FinovateStartup Launches Tomorrow

By Jim Bruene Posted on
Categories: Finovate

finovatestartup_logoOur first annual FinovateStartup debuts tomorrow in San Francisco. The 40 presenters will demo new and improved versions of their products. There will also be a number of new product launches, company rebrandings, and even several company debuts.

Christophe Langlois, from Visible Banking, will be live blogging here at NetBanker, so tune in tomorrow for his impressions. Also, expect even more opinions from the dozen other bloggers in the room, along with a number of other press representatives.

We'll be naming the Best of Show winners here on Wednesday and posting full-length videos of each demo soon. Sign up for our Finovate announcement list here (lower-left corner) if you want to be notified when the videos become available.

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Quicken Loans is *Really* Using Twitter

By Jim Bruene Posted on
Categories: Alerts & Messaging, Quicken Loans, Twitter

imageLast week, I may have jumped the gun when I thought I'd found a bank using Twitter (post here). It's pretty apparent that E*Trade is not officially involved with that Twitter account.

But the ever diligent Ann-Marie Murphy was quick to add to the comments that her company, Quicken Loans, is *really* using Twitter to support its Quizzle personal finance site (see Quizzle coverage here). Beginning Feb. 22, the mortgage lender has posted 52 updates through last week (those would be called "tweets" if you are a real geek). That's about one per day, a good steady flow, without inundating the follower. 

Here's Murphy's rationale for using Twitter:

We've found it to be a great way to chat with our site visitors, get honest and helpful feedback to make the site better and give interesting home-related tips to followers. I especially like the instantaneous feedback. Ask a question, get a bunch of answers from folks who enjoy helping others.

Now this is what a real Twitter update stream looks like, complete with custom design. Nice.

Twitter page for Quicken Loans

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WaMu Posts Best Banking Facebook Page So Far

By Jim Bruene Posted on
Categories: Advertising & Promotion, Bank 2.0, Facebook, Washington Mutual

image As a marketer you have to love WaMu. They are bold, quirky, and not afraid to poke fun at conventional wisdom. I haven't liked all their advertising campaigns, but that doesn't matter as long as the bank is reaching its target markets and delivering results.

While the bank has its challenges cleaning up the mortgage mess, its marketing department and ad agency are still producing good work. Case in point: WaMu's new Facebook page (below).

I realize that all banking pages in Facebook will appear lame to just about every 20-something that happens to stumble across them (see previous coverage here). But 20-somethings do still need checking accounts, debit/credit cards, vehicle loans, and so forth. So they will buy banking services. And what brand will they choose? The one that is at least making an effort to meet them on their turf with Facebook pages, text messaging, and humorous advertising, such as the talking banner campaign shown below.  

WaMu's Facebook page, which looks like it was posted April 17, contains videos, a crossword game, a branch finder, a checking account application form, a fan area and a communications app (note 1) that can be added to your Facebook profile. Take a look yourself here.

Excellent work: A

WaMu Facebook Page (23 April 2008) (note 2)

WaMu Facebook page

Notes:
1. Even though I added it to my profile, I'm not sure what the WaMu Facebook application does. It appears to be a way to communicate with friends on Facebook and has 49 daily users.

2. The bar across the middle of the page is unrelated to the WaMu page; it's the new Facebook chat feature, that appears along the bottom of all screens, and messes up my screenshot. It does show you where the "fold" exists on a 13.3 high resolution laptop screen.

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One Week Away: FinovateStartup Adds Invesra, Sparkroom, and Zopa to Demo Lineup

By Jim Bruene Posted on
Categories: Finovate

finovatestartup_logo One week from now, we will be halfway through an amazing day at FinovateStartup, where 40 financial services startups strut their stuff at the UCSF Mission Bay conference center in San Francisco. There are still a few tickets remaining, so come steep yourself in financial innovation at this unique, one-day event. 

We are pleased to announce three more companies to the demo lineup: Invesra, Sparkroom, and Zopa. See you next week.

imageimage  image

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Bank of America Reports 2.5 Million Users of My Portfolio, its Online Personal Finance Tool

By Jim Bruene Posted on
Categories: Bank of America, BillMonk, Expensr, Geezeo, Market Research & Metrics, Mint, Personal Financial Management, Wesabe, Yodlee

image Two months ago we published a table (here) showing active users at the leading online personal finance startups. Below is the table, updated with March traffic and the addition of one more player: Bank of America.

The bank, which offers a full-featured online personal finance management solution called My Portfolio, powered by Yodlee, has 2.5 million active users, according to BofA exec Marina Moore (note 3). That's an impressive 10% of the bank's online user base, and about 6x the total user base of all the online startups combined (note 4). 

Company Users (1) % of Total March Traffic(2) Jan Traffic(2) Chg
Bank of America 2.5 million 86% — — —
Mint 180,000 6% 160,000 150,000 7%
Wesabe 100,000 3% 28,000 41,000 (32%)
Buxfer 80,000 3% 8,400 9,200 (9%)
Geezeo 20,000+ 0.7% 8,400 14,000 (40%)
NetWorthIQ 13,000 0.5% 10,000 11,000 (10%)
BillMonk 10,000+ 0.3% 1,700 1,000 +70%
Expensr Five figs 0.3%+ 2,000 1,700 +18%
Total 2.9 million 100%      

For more information:

Notes/Sources:

1. Users: per BusinessWeek Online, Feb 2008, figures are reported by the companies and may include inactive users; Mint has been updated to 180,000 from 130,00 based on new figures reported in the Bank Technology News article published in April 2008

2. Traffic: per Compete estimates of website traffic for March 2008, retrieved April 21, 2008. Compete estimates traffic from its online data and can be off by a factor of two or three-fold for smaller websites.

3. As reported in a Bank Technology News article published in April 2008.

4. This table does not reflect all the players, such as Intuit's new Quicken Online, just the ones highlighted in the BusinessWeek article.

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New Online Direct Bank: OnBank from M&T

By Jim Bruene Posted on
Categories: Deposits, Checking, Savings, CDs, Direct Banking, M and T Bank, Metavante

image It's been six months since the last direct bank launch, Provident Direct (coverage here). The latest entry is OnBank from M&T Bank, a $66 billion bank based in Buffalo, NY. 

OnBank passes our strict 25-word homepage standard, joining ING Direct, EmigrantDirect on the short list of financial institutions with Google-like clarity on their home page. It takes just a few seconds to know that this is a place to get a high rate of interest on your money, but you should look elsewhere for a commercial loan.

The user has just two main choices of what to do next (screenshots below):

  1. Apply…encased in a trendy lime green button
  2. More details…which leads to an equally succinct page that answers the important questions (see last screenshot below):
    – fee free
    – minimum balance of $1
    – FDIC insured
    – quick online opening process

The only thing missing is a comparison to other banks. Given that it's one of the highest savings rates available right now, OnBank should be aggressively showing how it compares to key online rivals, including ING Direct's 3%.

Not only is the bank direct and to the point in its copywriting, it also uses simple, effective graphics, including a gimmick sure to gain attention. To reinforce its 24/7 "always on" branding, OnBank takes a page from the iPhone weather forecast interface, showing the current time in reverse lettering in front of a background image that changes to match the time of day. As you can see in the three screenshots below: daylight (4:42 PM), sun setting (8:58 PM), and nighttime (9:02 PM). Presumably they also have a sunrise background. The bank displays the time according to the user's machine, PDT in my case.

We didn't test the Metavante-powered online application all the way through, but it looked relatively straightforward, although graphically not as appealing as the other OnBank pages.

Thanks to Bank Deals for the find.

OnBank homepage during daytime (17 April 2008)

M&T's OnBank homepage

Evening (16 April 2008)

image

Night (16 April 2008)

image

"More details page" (17 April 2008)

OnBank more details page

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Deja Vu: The First* Canadian Person-to-Person Lending Service Readies for Launch — CommunityLend

By Jim Bruene Posted on
Categories: CommunityLend, Loans & Credit, P2P Lending

imageCommunity Lend reached out to bloggers last week to get the launch buzz started (note 1). The site appears ready to go, all it needs is a loan/borrow signup form in place the email notification box in the center of the homepage (below).

From the look of it, the startup has a good design team. It's direct and to the point in the main section while staying fresh with blog posts, selected news stories, and press releases displayed in widget-like boxes along the bottom of the screen (below the fold on my laptop). But I'll reserve judgement until I see the actual lending and borrowing screens when they become available.

The most interesting part of the pre-release info was the list of official advisors to the startup which included Virgin Money (US) CEO Asheesh Advani as well as the Phil Hopper, CEO of Australian P2P lender, iGrin. It will be interesting to see if those relationships turn into future Canadian partnerships.

For more information on P2P lending, see our recent Online Banking Report (#148/149) and catch Prosper and Loanio on stage at our FinovateStartup April 29 in San Francisco.

__________________________________________________

*Technically, IOU Central was first in the Canadian market. However, a few weeks after launch it was forced to shut down as it works to satisfy regulators (coverage here). Therefore, the honor looks like it will go to CommunityLend.

 

CommunityLend pre-launch homepage (17 April 2008)
CommunityLend home page pre-launch

 
Note:

1. Blogger outreach is the modern day equivalent to the press conference. Dave Colman's emails to bloggers resulted in five blog posts that same day, and that's without any news other than its UNOPENED site had been remodeled. Think back to the last time you revamped your website, did you get five press mentions?  

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E*Trade Bank Posts Savings Rates on Twitter

By Jim Bruene Posted on
Categories: Alerts & Messaging, E*Trade, Twitter

imageI was searching Twitter today to see if any major brokerages were using it to reach out to customers. The only hit was E*Trade which is using Twitter to update its Complete Savings Account rates. It seems to be coming from the bank, but it's possible someone else, perhaps an employee or fan, is responsible for the two entries: the first on March 12 announcing a 3.45% yield and then on April 1 when the rate dropped to 3.01% (note 1).

Regardless of who's responsible, it makes sense to use the new channel for outbound communications. If nothing else, the 90 seconds spent creating those two entries have already generated a favorable mention in this blog. 

For those of you not familiar with Twitter, it's a communications tool that allows users to post short (140 characters max) updates about what they are doing, what they are thinking, or anything else. Unless the user chooses to make their updates private, anyone can read them, just like a blog post. That's why Twittering is sometimes called micro-blogging. But it's more like "broadcast instant messaging" for most people who's musing will be seen by just a handful of friends, family and/or colleagues.

For more info from an actual Twitter user, read Ron Shevlin's recent post.

image

Note:

1. I suspect it's an "unofficial" Twitter page because they didn't put APY behind the percentage, although that is spelled out in the short bio section in the upper right, and they are not using the company logo.

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Two Weeks Until FinovateStartup, "Demo" for Financial Services & Technology Innovators

By Jim Bruene Posted on
Categories: Conference Calendar, Finovate

image If you’ve been reading NetBanker for the past few months, you’ve heard about our upcoming conference, FinovateStartup: Demo’ing the Future of Finance.

Reminder: It’s Tuesday, April 29, at the UCSF Mission Bay campus just south of downtown San Francisco (previous coverage here). It’s an offshoot of our first Finovate conference (videos here) held last fall in New York City (note 1).

Forty startups will demo their latest and greatest (note 2) on the big screen. There will be several industry debuts, a handful of a new product launches, and hundreds of new twists unveiled that day. 

While coverage by more than two dozen press, analysts, and bloggers at the event should provide a good overview of what’s going on, there is nothing like being there (note 3). Imagine talking to 10, 20, or 30 founders and senior execs in a single day. It will make your head spin, but by the time you get back to the office, you will have been exposed to a year’s worth of new ideas. The value = priceless. 

image

Notes:
1. We return to New York on Oct 14 for the second annual Finovate conference. It’s the Tuesday after Columbus Day, so if you want to make a long weekend out of it, you might want to book hotel space now. It’s a lot more than San Francisco (see #3), but it will only get worse. And you can lock in super-early-bird prices by registering for the conference today. Because it’s NYC, seating is limited, so don’t put it off too long. We sold out in about six weeks last year.

2. Unfortunately, Lending Club will not be able to present at FinovateStartup due to the quiet period as they register to sell securities (see coverage here). We have several companies looking to take their place, so we still expect to have 40 demos.

3. It must be a relatively slow week in downtown San Francisco, as hotel rooms are as cheap as we’ve seen them in years. We have 5 rooms at the Parc55, averaging about $130 per night plus tax. The average daytime high is 65 that time of year, so come out for the weekend and enjoy the Bay Area in spring.

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Digital Federal Credit Union and Four Others Offer Consumer Remote Deposit Capture Through EasCorp

By Jim Bruene Posted on
Categories: Credit Unions, Deposits, Checking, Savings, CDs, Remote Deposit Capture

VIP Deposit from Sharon Credit Union USAA is no longer the only financial institution offering consumers the ability to deposit paper checks from the comfort of home using standard home scanning technology (see previous coverage here).

image Through DepoZip, a new offering from Massachusetts-based corporate credit union, EasCorp, five northeastern credit unions have recently begun offering remote deposit capture services for their members. In addition, Austin, TX-based Randolph-Brooks FCU is slated to launch it later this spring.

According to its published prices, the cost is $15,000 to implement the program ($5,000 for the license and $10,000 for training), then $100/mo plus $0.40 per active user plus $0.01 per its plus applicable image processing fees which range from $0.03 to $0.14 per item. Compared to manually handling deposits at the teller window, that’s a bargain. 

The service was piloted beginning in August last year and launched in November at Sharon Credit Union (see inset image) and Hanscom Federal Credit Union. The latest to roll it out is 300,000 member Digital Federal Credit Union. 

Company HQ Size Service Name Launch Date
Sharon CU Sharon, MA $590 mil assets VIP Deposit (Virtual Item Processing) Nov 2007
Hanscom FCU Bedford, MA $280 mil assets Easy Deposit Nov 2007 (pilot began Aug 2007)
Service CU Portsmouth, N.H. $1 billion assets   Dec 2007
Paragon FCU Montvale, NJ $390 mil assets
62,000 members		 eDeposit Jan 2008
Digital FCU Marlborough, MA 320,000 members; 150,000 banking online PC Deposit Feb 2008
(2000 members enrolled in first 3 weeks; pilot began Aug 2007)
Randolph-Brooks FCU San Antonio, TX $3 billion assets
250,000 members		   coming in late spring

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Tax Prep 2.0: Does H&R Block’s Tango Provide a New Model for Pricing Online Financial Services?

By Jim Bruene Posted on
Categories: HR Block, Premium-level Products, Pricing, Tax Prep

imageFive days from the U.S. income tax deadline, tax prep ads are everywhere. I don't usually notice them because I still file the old-fashioned way, via CPA (note 1) and paper check. However, yesterday I noticed H&R Block's banner strung across the top of TechCrunch (screenshot below).

It caught my eye for a several reasons:

  • 24/7 access to live tax help, a real benefit to the legions of last-minute filers.
  • The "Tango" branding really intrigued me. How could a tax service be interesting enough to have its own brand, especially one as off-beat as Tango (note 2)?

The Tango product, complete with YouTube videos, <wannatango.com> URL, and more, deserves a post of its own, but here I want to focus on Block's pricing/segmentation.

The tax-prep giant divided its online services into two distinct categories, both catering to the computer savvy do-it-yourself crowd. Block calls the segments: "Do it Myself" and "Do it With Me" (screenshot below) with pricing as follows:

Do it myself:

  • $14.95 for 1040EZ
  • $29.95 for 1040 with itemized deductions
  • $59.95 for 1040 with state return

Do it with me:

  • $70 Tango option — complete online and submit yourself with unlimited 24/7 support (includes state return)
  • $99.95 (+$34.95 for state) complete yourself and then route to an H&R Block agent to review and e-file
  • $99.95 (+$34.95 for state) and above (note 3) to fill out an online questionaire and submit your data to have someone at H&R Block complete the return for you

image

NetBanker strategic action item
Banks, take notice. Block's pricing strategy is brilliant and if applied to online banking, could revive the difficult business case. Online banking, like electronic tax prep, is a mature business, and has long ago proven itself as valuable and convenient.

Now it's time to cash in on that convenience. While levying fees across the board would create customer ill-will, it's possible to segment your online banking base into customers who want plain vanilla services for free and those that want the best, and are willing to pay for it. Block's Tango is a good example of how to price for those who want to go it alone for the lowest cost and those that want high-tech online services AND high-touch tech support.

A bank or credit union could mimic the Block program:

  • Do it myself (FREE): Download data, set up my bills, create triggered alerts, monitor my own security settings, read my own credit report, store my own statements on my hard drive, and so on
  • Do it with me ($5/mo): 24/7 access to an online specialist who will provide advice, assistance, and help doing any of the above. Added bonus: lifetime storage of all transactions, statements, and check images!!!

Call it VIP Banking and start turning online banking into a profit center. With dedicated fee income you will have fewer problems during the looming crisis in online banking measurement. 

For more on online banking pricing and how to develop a premium-priced online banking service, see our Online Banking Report: Pricing – The "Fee" vs. "Free" Controversy (#109).
 

H&R Block Banner on TechCrunch (9 April 2008, 1 PM Pacific)

H&R Block Tango advertised on TechCrunch

Landing page from TechCrunch banner (9 April 2008)

H&R Block landing page from TechCrunch banner

Tango homepage (9 April 2008)

H&R Block Tango home

Notes:

1. In testing Turbotax and TaxCut, I have found both to be intuitive and surprisingly easy to use, even for relatively complicated returns with business deductions. This year, I did my teen's return on the free TurboTax online site, which was very slick. My son's already deposited his $2 refund into his online bank account.

2. H&R Block's Tango actually has a Wikipedia listing (within the H&R Block entry). That's something you don't see too often. According to Wikipedia, the Tango service first appeared last year for 2006 returns, but was plagued by computer glitches that forced the company to issue refunds. But it received good reviews this year, scoring an 82 here, just two points less than leader TurboTax Online. Tango finished ahead of the other four sites reviewed (here).

3. My federal returns would cost $199.80 through this most expensive option, about $500 less than my CPA.

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Online Financial Services Scorecard: February 2008

By Jim Bruene Posted on
Categories: Compete, Market Research & Metrics

image

Summary
According to data from Compete's consumer panel, both applicants and shoppers in all segments dropped in February. Recession fears appear to be negatively impacting sales activity. However, conversion rates stayed relatively constant except for credit cards, indicating that those still shopping are serious buyers. 

Commentary

  • The credit card industry saw a slight decline in both shoppers and applicants (note 1). This has been the case for the past few months following the large holiday push by the credit card companies. Conversion dropped significantly to 23%, down 6% from January and down 9% from December. However, it's back to where it was in second quarter 2007, so it may be more of a seasonal drop than a falloff in demand. 
  • Deposits saw losses across all three segments, especially high-yield savings which was down 25% in applications, as the Fed's rate cuts trickled through the banking industry. In checking, all but two competitors tracked saw decreased application volumes. 
  • Refinance mortgages had the biggest drop in February, posting a 30% decline in shoppers and 19% in applications. Purchase mortgages saw a similar decline in applications (down 18%), but only an 18% drop in shoppers. 
  • The home equity segment fared the best in the home loan category with 10% fewer applications and an 8% drop in shoppers.

About the Financial Services Scorecard
In April, we introduced the Financial Services Monthly Performance scorecard produced by Compete. It summarizes the overall performance of 23 large U.S. financial institutions and lead-generation sites. Refer here for the detailed methodology as well as companies tracked.

Note:
1. There was a change in Compete's methodology for measuring credit card shopping activity, so February's count January's cannot be compared. However, the 4% decline shown in the chart is correct, reflecting the change from what January would have been under the new methodology. 

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