Bank of America

Free Checking in the Internet Age

By Jim Bruene Posted on
Categories: Advertising & Promotion, Bank of America, Chase Bank, Deposits, Checking, Savings, CDs

Bank of America and Chase, two of the three largest U.S. banks, are putting an online spin on free checking offers using online banking, security, and other benefits to encourage applications. On the surface, Bank of America's approach appears much more effective. And with no direct-deposit requirement, it surely generates more new accounts. However, without knowing how the free accounts convert to profitable relationships, it's impossible for an outsider to recommend one approach over another.    

Bank of America
Bank of America's free checking offer (see note 1) is difficult to overlook (screenshot below).  The top-of-the-page banner has animations that showcase the major benefits:

  • online banking
  • bill payment
  • "Keep the Change" debit card savings program
  • SiteKey security

The teaser "We're redefining Free Checking" creates interest while the bright blue "open an account" and "special online-only offer" further entice prospect to click through the banner.

BofA home page with free checking offer

The landing page (screenshot below) reiterates the online benefits and features a large laptop to reinforce the high-tech nature of the account. Two additional benefits are added to the list:

  • Free debit card with security protections
  • Free ATM access at 17,000 BofA machines 

BofA free checking landing page

Notes:

1. The free checking banner appeared in a visit to the homepage from a Seattle IP address at 10 AM Pacific time today. It did not appear on afternoon searches from several computers.

2. The bank uses a live chat popup after lingering on the application for a short time (click on image right for closeup).


Chase Bank
Chase's homepage banner uses the "kitchen sink" approach with an image of an ATM machine, debit card, paper checkbook, laptop, and PDA along the top. The mobile phone is a good addition, but the ATM machine and laptop are so small, they aren't easily recognizable in a quick scan (see screenshot below).

Another problem: the paper checkbook, which is centered and slightly larger than the others, seems to get an inordinate amount of attention. I'm not sure that the checkbook or the debit card add much value. U.S. consumers pretty much realize those are included in a checking account.

Chase's landing page leaves a lot to be desired. The benefits are listed in small, gray type that is relatively hard to read. And the only call to action, if you can describe it as one, is the last line in small blue type, with an underlined "apply online." No buttons + no color + no large font + no offer = no interest.  

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Bank of America Integrates Small Business Financial Services into Microsoft’s Startup Center

By Jim Bruene Posted on
Categories: Bank of America, MasterCard, Microsoft, Small Business

It's extremely difficult to win the transaction accounts of small businesses. By the time you know of their existence, they already have their bank accounts in place. And most small businesses are too busy to bother switching accounts to save a few bucks a month, or even to get better products or services.  

One way to grab market share is to find businesses when they are in the pre-startup phase, before they've set up banking accounts. In pre-startup, the prospective business owner is in pure research mode, spending little or no cash. To find these businesses, you need to offer online information that startups value and can find at your site, such as new-business planning advice. Then entice the owner to establish bank accounts with a package of services that appeal to a new business owner.

Bank of America is on the right track with its sponsorship of Microsoft's new Startup Center <startupcenter.com>. It's more like a product placement than a "banner ad" sponsorship. The BofA logo is never even seen in the main content area.

However, the bank's content is tightly integrated throughout, especially in the Finances area. For instance, if a business owner wants to "set up a checking account," the links to detailed information such as "compare now," "get a recommendation," and "get a business check card" all link directly to content housed on Bank of America's website (see screenshot below).

MasterCard is also a primary sponsor, but its content is less integrated. The third core sponsor is Startup Nation.

Microsoft Startup Center Finance section

Analysis
It makes sense for Bank of America to be involved in Microsoft's Startup Center, a  beautifully designed tool all decked out in "Web 2.0" colors and graphics. The content seems appropriate and useful for a startup. However, it will be a challenge for the area to gain traction with actual startups, who are unlikely to be looking to Microsoft for assistance, unless they are software developers.

But you don't have to be a mega-bank or mega-software company to provide valuable services to startups. Financial institutions can partner with local professional service firms such as accountants, consultants, and attorneys, to create content for startups such as Webinars, and in-person seminars. A well-priced package of banking services, positioned and priced for startups, will help you grab new business in the startup sector.

Examples of startup products and services at financial institutions:

For more information, see our Online Banking Report on Small and Microbusiness Online Banking (here). Thanks to Payments News for the link.

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Followup Friday: More on the Bank of America & Verizon Online Billing Co-promotion

By Jim Bruene Posted on
Categories: Advertising & Promotion, Bank of America, Bill payment

Little did I know when I wrote about Verizon Wireless promoting Bank of America billpay on its site (here), that the company that brokered the deal, CheckFree, along with representatives from both consumer giants, would be presenting the results of the effort at Nacha's Payments conference last week (see note 1). I wasn't there, but I was filled in on the details by CheckFree's PR director Sheryl Roehl.

First, my assumption was wrong. It was NOT a paid placement by BofA. No money changed hands. It was classic joint marketing with each company promoting the other on their websites. The exposure to each others' massive customer bases trumps any concern over who benefits most by converting Verizon customers into ebilling users (see note 2).

In the prior post, I showed you BofA's ad on Verizon's site, here's what the Verizon placement looked like on the bank's site (note 3):

Verizon banner in BofA's main online banking area

Verizon placement in BofA's online banking area

Landing page for the Verizon promo

Verizon landing page from BofA promo

Email me if you'd like the presentation slides, which also include more figures about ebilling adoption (note 4).

Notes:

Penetration of U.S. online household per Harris Interactive, Feb. 2007

1. The joint presentation was by: Angeline DePauw, director electronic remittance Processing, Verizon Communications; Laurie Profilio Sass, eCommerce marketing, Bank of America; and Lori Stepp, managing executive E-bill Adoption Services, CheckFree

2. It's hard to say which company gains the most in an ebill conversion. Verizon saves money by eliminating the paper and BofA potentially converts a customer into ebilling, an important retention benefit.

3. The screenshot is from the NACHA Payments presentation; it is a mockup, note the 2004 date, but presumably is an accurate representation of what the promo looked like.

4. CheckFree presented the latest penetration numbers at the conference, as determined in their Feb. 2007 research conducted by Harris Interactive. Three-quarters of ONLINE households, or about half of all households, now pay a bill or bills online with biller direct (55%) leading pay-anyone (38%) by a measurable margin (19% do both). See inset.

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Bank of America’s "Paid Placement" at Verizon Wireless Bill Payment

By Jim Bruene Posted on
Categories: Advertising & Promotion, Bank of America, Bill payment

Update: It turns out that this was NOT a paid placement, but a joint marketing program. See April 27 post here.  

Here's an interesting twist on marketing bill payment services, Bank of America's  presence  on the Verizon Wireless post-login account page (see note 1). Here's how it works, according to a long-time reader and Verizon customer:

When Verizon wireless customers log in to their Verizon account online, the main page has a banner encouraging them to pay their bills at Bank of America's online billpay site (see below). Verizon also hosts a page on the benefits of paying through Bank of America and a link to the bank's login screen (see below).

I haven't seen this before, but since it all takes place behind Verizon's login, it's not visible to the outside world. I checked out the Verizon website this morning and Bank of America is not mentioned in the public areas. Has anyone seen this at other merchant sites? Leave a comment or email jim@netbanker.com.

Analysis
Everyone assumes that merchants want the bills paid directly on their site to maintain full control of the customer relationship. But evidently, even large merchants can be convinced to share the payment relationship if given proper incentives. 
 

Bank of America Banner on Verizon Main Account Page

Verizon Wireless account page with BofA billpay


More-info Page Hosted by Verizon Wireless

Verizon Wireless pitch for BofA bill pay  

Note:

1. I am assuming Bank of America is paying for the linkage; but it could be a joint marketing relationship where the bank pitches Verizon Wireless services in return for the exposure. The screenshots were submitted in early April.

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Banks and Credit Unions Go Green with Paperless Promotions

By Jim Bruene Posted on
Categories: Bank of America, Sovereign Bank

While many ideas discussed here require significant investment, here's something that any financial institution can do: Go green by supporting the environment through online banking via paper reduction, reduced trips to the bank, and so on.  

Some ideas:

  • Plant a tree: We've seen several financial institutions use this one: A tree is planted whenever a customer signs up for estatements or electronic billpay. The latest to use it, Sovereign Bank and CheckFree today announced a program that donates funds to the National Arbor Day Foundation for setting up new electronic bills (excerpt below, see note 1). Their joint press release (here) contains good background info on the environmental impact of electronic delivery. Bank of America ran a similar promotion last year at this time (news release here, screenshot in note 2, webpage here). 
    • As part of the Go Paperless campaign, developed to educate consumers
    about the green-friendly benefits of paperless bills, Sovereign Bank and
    CheckFree will donate $1 to The National Arbor Day Foundation for each new
    electronic bill (e-bill) that customers activate at Sovereign Bank from
    April 1 through May 31, 2007. Each donation will help cover the cost of
    planting one new tree

Bendigo Bank Green program banner

  • Green products: Australia's Bendigo Bank (banner above) and Canada's VanCity CU have entire product lines that encourage environmentally sensitive investment and consumption. Here's the lineup at VanCity:
  • Go carbon neutral: Several banks including HSBC and Bendigo have announced corporate initiatives to reduce carbon emissions or go totally carbon neutral by purchasing carbon offsets. Bendigo even allows customers to buy carbon offsets in its branches or through the mail via a downloadable form (here).
  • Shredding days: This is the perfect springtime event. Invite anyone in the community to drop by the branch to shred sensitive documents, a great post-April 15 event as well. While shredding doesn't help the environment, other than recycling the results, one of the focuses of the event can be eliminating the paper in the first place through electronic statements and bills. During April, dozens of credit unions have shredding days planned, often in conjunction with other April 22 Earth Day activities. For example, Spokane Teachers Credit Union promotes "shred day" at its North Branch with this heading, "STCU helps 'shred' identity theft" (link here).


Note:

1. The CheckFree/Sovereign program is for e-bills, e.g., bill presentment, NOT bill payment. We missed that the first time through the release.

2. Bank of America's webpage discussing EarthDay 2006 promotion:

Bank of America Earth Day promotion for online statements

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Back Story: Wall Street Journal’s Article on Online Financial Planning Tools from Banks

By Jim Bruene Posted on
Categories: Bank of America, Online Banking Report, Personal Financial Management, Wells Fargo, Yodlee

The Wall Street Journal published an extra section yesterday on personal finance entitled, Your Money Matters. Online financial tools were highlighted in Jane Kim's, "Check it Out: New online tools from financial institutions can help consumers manage their money." 

Here's the back story on several of the items mentioned in the article:

  • Our sister publication, Online Banking Report, was cited as the source of the following statistic: "About 16% of U.S. households used some personal-finance feature at least once in 2006. That percentage is expected to climb to an estimated 33% by 2016, with nearly three-quarters of those households using personal-finance tools offered by their financial institution online."

    The information cited in the WSJ story was contained in the report we published last fall in Personal Finance Features for Online Banking (OBR 131/132; see Table 3, p. 3, lines 4 and 10). Current usage estimates were based in part from data provided by Javelin Strategy as shown in Table 2 on the same page. 

  • Wells Fargo My Spending Report CLICK TO ENLARGE In the article, Bank of America's My Portfolio was the first of two existing personal finance tools mentioned. The service, powered by Yodlee, was quietly launched in December and was covered in NetBanker at the time (link here) and received an OBR Best of the Web award in our final report of 2006 (OBR 137) where it was rated the third most important development of 2006.   
  • The second example cited was Wells Fargo's MySpendingReport (see inset and previous coverage here). The service, which is basically just a consolidated view statement data across the bank's transaction accounts, is a great example of positioning online banking features in a way that resonates with users. It was awarded an OBR Best of the Web in 2005, finishing the year as the tenth most important new development of the year (report here).

The story finished with hints of new services planned for later this year at Everbank, Bremer Financial (powered by Corillian), and a Digital Insight tool that allows users to hand enter additional bill payments in order to their entire payments picture in one place.

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In 2006, 86% of credit card direct mail included online options

By Jim Bruene Posted on
Categories: American Express, Bank of America, Capital One Financial Corp., Chase Bank, Citibank, Credit/Debit Cards, Metrics & Market Research

Advertising-monitoring firm, Mintel Comperemedia reported last week that nearly 9 out of 10 credit card solicitations in 2006 directed recipients to the Web, up sharply from 56% in 2003 (see note 1, 2). Several big mailers, namely American Express, still seem reluctant to use website response as an option, at least in the mailers we see at our house.

American Express tests must show a drop in response by offering too many choices. But if you don't have the budget of American Express, which can afford to drop a mail piece in every credit-worthy household every two or three weeks, you should add website options to your direct mail creative. That way, you can at least capture a lead at your website, even if they don't ultimately accept your credit offer. 

Total mailing volume for 2006 was 9.2 billion pieces (see note 1), or about 3 per week per credit-worthy household. Two of those were from the five largest mailers listed below which accounted for more than 60% of the volume, according to Comperemedia. JPMorgan Chase accounted for 18% on its own. 

In another data slice from Comperemedia, cited by Capital One in a Feb. 2006 investor presentation (PDF here), response rates have fallen from 1.4% in 1995 to 0.3% in 2004 (see note 3).

Here's a breakdown of the billion-piece club, and their percent change compared to 2005:  

1. Chase >>> 1.7 billion (down 4%)

2. Capital One >>> 1.2 billion (up 13%)

3. American Express >>> 1 billion

4. Citibank >>> 980 million (down 2%)

5. Bank of America/MBNA >>> 920 million (down 17%)

Other top-10 mailers: HSBC (up 25%); Discover (up 29%); Barclays Bank (190 million, up 70%)

Note:

1. Comperemedia tracks mailing volume for more than 150 large financial institutions. So the figures here do not include mailings from thousands of smaller banks and credit unions. In total, those probably account for less than 5% of the total from the top-150. 

2. Comperemedia press release is here. Interview of Comperemedia director Jenny Roock by MediaPost is here.

3. Credit card response rate slide from Capital One's investor presentation (PDF) at the Debt & Equity Conference, Feb. 2006; data from Comperemedia.

Credit card industry response rates

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Bank of America Opens One New Checking Account per Branch per Day

By Jim Bruene Posted on
Categories: Bank of America, Channel Integration, Deposits, Checking, Savings, CDs, Metrics & Market Research, Washington Mutual

The folks at BAI, using research by Raddon Financial, ran the numbers on new checking account sales per branch and found that Bank of America is opening 31 new checking accounts per branch per month, or just about one per day (article here). WaMu did better with 39 per month or 1.3/day. The article said community banks typically get only about one-fifth that,  just 2 new checking accounts per week per branch.

I'm not sure exactly what those numbers mean, but someday in a meeting when you are trying to make a case for new investment in your website, you can counter the, "but customers love the branches" with, "sure they do, but even BofA, who spends more than $200 million/year advertising, only manages to sell one checking account per day per branch" (see top 2005 advertisers here). It still might not mean anything, but it makes it sound like you've done your homework.

The problem with comparing branch-account openings to online-account openings is they are not separate ecosystems. Would the account have been opened online without a nearby branch? Or did that account, opened at the branch, come as a result of research conducted online by the customer? In the U.S., you need both channels for the foreseeable future, unless you sell a financial product that doesn't need physical support, like a savings account (see note 1).

Another wild card: How do you gauge the impact of increasingly prominent website offers like this one currently running on the checking account page at <bankofamerica.com> (see note 2)? Naturally, to get the $50 you have to open the account online.

Bank of America landing page for $50 checking account offer

Notes:

1. For more information on the future of the online channel vs. branch, see our report, The Demise of the Branch, published spring 2006 in Online Banking Report (OBR 128).

2. The offer was presented to a non-customer browsing the main Bank of America site from a Seattle IP address and indicating their state of residence was Nevada.

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Bank of America Posting Content at its .mobi Address

By Jim Bruene Posted on
Categories: Bank of America, Mobile Banking

Bank of America is gearing up to launch nationwide mobile access this year. The region-by-region rollout begins in Tennessee next month (see note 1 below). Few details are available, but it sounds like WAP banking, similar to Wachovia's approach announced in December. We'll analyze BofA's approach in great detail as more information becomes available. With 21 million online banking accounts, just about anything they do has the distinct possibility of becoming the de facto standard.

Bank of America's .mobi home page As you think about your future mobile offerings, one detail to be wrapped up immediately is registering your .mobi address. While it's too soon to tell if that address ever becomes popular, Bank of America, for one, has staked a claim at that site putting bank info and a zipcode-based ATM/branch locater at its .mobi address, <bofa.mobi> (see screenshot right).

We did a quick search this morning and found no other top-30 retail bank with a functioning .mobi address, at least none using the standard version of the bank's name as the address, e.g., keybank.mobi. Worse, a number of the .mobi addresses appear to be registered to domain-name squatters (see note 2), so it will take time and money to wrest those names away from the original registrants.

So if you haven't already, at least spend $20 and register your bank's .mobi address. For more details on how to launch mobile services, see our upcoming report due out later this week at OnlineBankingReport.com.

Note: 

1. Some Bank of America regions have already posted the features and benefits of mobile banking at the regular website. For example, make sure you have selected "Tennessee" as your state at BankofAmerica.com, then click here to see the mobile banking section (screenshot also shown below). 

Bank of America's mobile banking website info (STATE = TENNESSEE)

2. The following addresses appear to be registered to entities NOT affiliated with the bank: suntrust.mobi, usbank.mobi, nationalcity.mobi, pncbank.mobi, capitalone.mobi, unionbank.mobi, commercebank.mobi, and zionsbank.mobi 

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Email: Bank of America’s "Ring in the New Year" Credit Card Balance

By Jim Bruene Posted on
Categories: Bank of America, Credit/Debit Cards, Email Marketing, Email Samples

Here's a timely email from Bank of America, inviting its credit card customers to start the year off with a 3.99% balance-transfer offer. But the savings won't last long, since the rate resets after August 2007.

Here are the specs:

  • Subject: Use your Bank of America® credit card today.
  • From: Bank of America [BankofAmerica@loyaltyemail.bankofamerica.com]
  • To: jim@netbanker.com
  • Product type: Credit card balance transfer
  • Offer: 3.99% through August 2007 (cash advance fee NOT waived)
  • Customer type: Mailed to current credit card customers
  • Personalization: Full name and last 4 digits of account number

Screenshots:

Email body


Bank of America email with 3.99% credit card balance transfer CLICK TO ENLARGE

Landing page

Bank of America landing page from credit card email CLICK TO ENLARGE

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Holiday Bank Marketing Continued

By Jim Bruene Posted on
Categories: Advertising & Promotion, Bank of America, Citibank, PNC Bank

As mentioned last week (here), U.S. banks are starting to get more creative with their websites, with 12 of the 30 largest (note 1) injecting a bit of holiday spirit into their websites.

This year, three of the top-30 banks had major holiday themes running on their homepages; in 2004, none did. And today we viewed another nine with minor holiday sprinkles, making 12 in total. Two years ago, four banks had minor holiday-themed promotions.

We expected to see more banks marketing gift cards, one of the hottest holiday gifts, especially during the last few days before Christmas. Only four banks mentioned gift cards on their homepages on Dec. 24 (note 2):

  • National City
  • BB&T
  • North Fork Bank
  • Commerce Bank

Here is a rundown of those with major holiday themes:

  1. Citibank: Citi had the best overall holiday theme as  it continued pushing its 5% e-Savings Account, with a clever 5% "ornament" hung next to traditional Christmas decorations (see screenshot below).

    Citibank holiday homepage CLICK TO ENLARGE

  2. PNC Bank: Runner-up was PNC with its unique brand of holiday marketing, a tongue-in-cheek look at the cost of the items listed in the popular Christmas song, Twelve Days of Christmas. It's a holiday tradition at PNC which has been tracking the holiday index for 22 years (see screenshot below).

    PNC Bank holiday homepage CLICK TO ENLARGE

  3. Bank of America: The largest online bank used a holiday theme, and $100 off a Dell PC, to encourage users to join the other 20 million BofA customers using its online banking. Customers hitting the bank's homepage were greeted with an animated banner displaying a wrapped package, which after two seconds changed to the Dell deal (see before and after screenshots below).

    Showing before and after package animation:

    Bank of America holiday homepage before CLICK TO ENLARGE

Bank of America holiday homepage after CLICK TO ENLARGE

Other top-30 banks with holiday-oriented images on their homepages:

  • Chase Bank: snow globe with 0% credit card offer
  • Wells Fargo: packages
  • Washington Mutual: snowball with 30-second credit card application
  • Citizens Bank: packages with a debit card rewards promo
  • National City: snowflakes with gift card promo
  • BB&T: packages with a gift card promo
  • Countrywide Bank: snow and packages with a loan promo
  • North Fork Bank: Radio City promo with $15 off coupon and gift cards
  • Commerce Bank: packages with gift card promo

Notes:

  1. According to Online Banking Report's list of the 150 largest U.S. financial institutions as of 31 March 2006 (link here).
  2. Searches conducted during late morning (EST) on Dec. 24, 2006, from a southwest Florida IP address. Although gift cards were not mentioned on US Bank's homepage on Dec. 24, we had seen them advertised on previous visits, although not necessarily on ithe homepage.

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