Beyond stock trading and bill payment, today’s adolescent mobile finance services offer limited value to customers and financial firms. According to a new Report from Forrester Research, Inc. (Nasdaq: FORR), to build customer retention and differentiation, leading financial firms will create value by offering continuous advisory services that deliver real-time analysis, action-oriented advice, and automatic execution of complex transactions.
“Financial firms are blowing their chances to create long-term value and stand out from the pack, because eventually everyone will offer bill payment and funds transfers, balances, news, and quotes via mobile devices,” said Maribel Lopez, senior analyst at Forrester. “Delivering continuous financial analysis and advice to help customers execute transactions anytime, anywhere will separate the winners from the losers.”
Continuous advisory services will offer smarter, more valuable interactions to wireless customers by delivering real-time analysis to mobile devices. By 2003, leading companies will offer relevant, timely, personalized financial data. Leading firms will add real-time financial analysis that lets customers know when to sell stock or transfer money to cover a margin call. Topnotch firms will also help users make purchase decisions by delivering immediate cash-flow and credit analysis.
To create differentiation and build long-term customer retention, financial firms will also be constant advisors to their clients by providing virtual advice geared to time-sensitive decisions. First-rate banks and brokerages will create services that anticipate financial problems and opportunities before providing alerts with action-oriented advice. Firms will also deliver instant financing to mobile phones and PDAs, enabling instant credit approval.
The final step in delivering continuous financial support requires the ability to transfer data and funds among financial institutions. Executing action-oriented advice will require financial institutions to embrace Open Finance because this mobile service requires the exchange of information among financial institutions in order to complete a transaction. Smart companies will give customers the ability to instantly execute advice such as portfolio changes, purchasing or selling stock, or securing mortgage rates, by hitting one button on a cell phone.
Creating continuous advisory services requires more than pushing data from the Web to mobile devices. To take advantage of mobility’s unique properties, build interfaces that work with constrained devices, and leverage partners to create robust scalable delivery, firms will focus on technology upgrades to support executable advice including voice-enabled content, synchronization of data across channels, analytical tools to unlock customer data, and automated advice applications.
“To stay ahead of the curve, banks and brokerages will also be forced to build relationships with mobile operators, Dot Coms, and technology outsourcers,” added Lopez.
For the Report “Mobile Finance Needs Advice,” Forrester interviewed 23 banks and brokerages with mobile strategies. Although financial firms are racing to market with mobile service, they don’t expect to make money. Forty-five percent of respondents do not believe that offering wireless access will result in incremental revenue, while 32% are expecting incremental revenue, and 18% are unsure.