UK Report: How Word Of Mouth Can Increase mBanking

Think back to when you first decided to invest in a smartphone. Chances are it took more than a flashy magazine ad or a commercial’s smooth rhetoric to convince you.

Smartphones have quickly become ubiquitous, and a new study from VocaLink reported that word-of-mouth (WOM) plays an integral role in technology adoption. In fact, most consumers were persuaded by early adopters in their social network or family. The report also gives insight to the adoption of mobile banking, and how people are using their mobile phones to replace traditional methods.

We take a look at how mBanking is adopted in this PYMNTS Deep Dive.

Mobile Banking: Tell All Your Friends

According to the report, WOM is an inherent part of human life since we are naturally social beings. WOM represents one of the earliest forms of marketing, and many would argue it is also the most effective.

Walking down Oxford Street in London, almost everyone carries a smartphone in hand. People are conducting everyday activities on their mobile phone: banking included.

VocaLink’s report indicated that mobile banking engagement is strongly connected to smartphone ownership. In the UK, 27 percent of consumers confirmed to have used mobile banking applications.

Forty-three percent of smartphone users said they use their mobile phone to complete banking activities. Interestingly, the number of tablet users who use online banking apps is even higher, with a reported 50 percent. Consumers who use both the tablet and smartphone for mobile banking purposes comprise about 57 percent.

While the report suggested many UK consumers are engaging in mobile banking services, there is still much room for growth.

Similar to smartphone adoption, the majority of consumers who use online banking are initially persuaded by friends. Early adopters, also called influencers, have the power of influence in the mobile banking market.

For companies in the mobile banking industry, this is good news. This means there is wide opportunity to convince current non-users to adopt new channels for banking.

If the industry can make sure current mobile bankers are having a positive online experience, it can be expected that they will pass positive WOM to friends and family.

Thorough research has proven that satisfied customers are highly likely to discuss positive experiences with products and services with others.

Who Are The So-Called “Influencers?”

VocaLink reported that most UK mobile bankers are mature in both profile, and in regards to their knowledge of technology and use. Eighty-two percent of mobile bankers are under the age of 45, and 55 percent of those users are between the ages of 25 and 45.

The number of men who use smartphones exceeds the number of women, but only slightly. Fifty-five percent of men own a smartphone, and a similar percentage of men also use their phones to make mobile payments.

What Do You Mean By “Mobile Banking?”

A small majority of consumers conducting online banking are taking advantage of multiple features on banking sites.

Most consumers, roughly 60 percent, use services to check account balances. About half revealed they use the application to obtain account details, pay for services such as utility bills, see transaction history or transfer money.

However, mobile bankers have yet to catch up to such an array of activity. Consumers using mobile phones to bank are also mostly checking their account balances, but only 20 percent from a smartphone and just 6 percent from a tablet.

Opportunities And Obstacles

Consumers revealed the top three reasons why they enjoy mobile banking: it’s quick, it saves time, and it is accessible from anywhere at anytime.

UK consumers are also showing a keen interest in adopting mobile payments. VocaLink reported that more than half of the British adult population is already using mobile payments (20 percent), or wanting to try it out (30 percent).

Fifty-two percent of people said they wanted to use mobile payments because it was convenient. Quick transactions, not having to queue up, and going cashless were also popular reasons for wanting to adopt mobile payments.

On the other hand, consumers also expressed certain concerns. Many stated they worried about the level of security of such transactions. Four-in-10 non-users said they did not feel comfortable putting card details in their smartphone. They worry what would happen if they were to lose their phone.

What Does This All Mean?

In conclusion, this VocaLink report leaves with us both good news and not-so-good news. The good news is that customers are aware of new technology and payment solutions, and some even seem eager to try new avenues.

The not-so-good news isn’t bad, but suggests that those in the industry need to strongly convince non-users to dive in.

It seems consumers are still weary, and are just waiting for the right mobile payment solution to come along. If early adopters continue to have a good mobile banking experience, then chances are good for future growth.

To read the full VocaLink report click here