- Offer a customized debit cards for kids. Kids love cards. Why not allow them to customize the color or add a picture of their choice?
- Ask them to sign something. Even though the parent signs the official documents, I believe it’s important for kids to feel that they have some skin in the game. A bank account is a responsibility. A fictitious kids contract will make the child feel important and also teach a sense of responsibility.
- Give out a kid friendly short story. My kids know how to read, why not get them to read a short story that teaches lessons about money? Some banks invest pretty heavily in children’s literacy, though this doesn’t have anything to do with the branch experience.
- Develop or showcase an app that teaches kids about money. Some banks offer this already (e.g. RBC), though it’s unclear to me if the app is used in the branch. Even if your bank doesn’t have an app like this, there are 3rd party apps that can serve the same purpose. This would be a good use for iPads in the branch, as kids can play with an app while the parent does the paperwork.
- Explain how the bank works. There is so much that takes place in the bank branch. It would be great to walk the kids around the branch, and explain to them what is going on and what the various employees do.
January 29, 2015 by 3 Comments
My wife and I decided that it was time. Time to introduce our 2 daughters to a bank and open their own accounts. Our girls are old enough (ages 8 and 6) to understand what a bank is, plus they hear their daddy talk way too much about banks. So far, their birthday money has been stored in their collection of wallets, piggy banks or ziploc bags. They are no strangers to financial education as we have talked before about the different uses for money and the importance of saving. They were ecstatic when I told them we would be going on a little field trip to open bank accounts, even if it meant handing over some money to the bank to safeguard. It was all downhill from there. I went online to try to make an appointment to visit the local branch. Unfortunately my bank offers no such tool. So, I picked up the phone, called the branch and left a message. My call was never returned. I’m a pretty persistent guy, so I actually walked into the branch (a foreign concept for me) and had no trouble making an appointment. We arrived a few minutes early on the day of our appointment as the girls were super excited to go to the bank and open their own accounts. Alas, the banker assigned to us was running late. After a 15 minute delay we were given the privilege of sitting down in his office. The process was mundane and no different than if an adult were opening an account. The girls were bored out of their minds. Thankfully, they sat nicely through the entire hour long process and were extremely patient. The only info the banker asked them for was their birth date. I wasn’t expecting this to be a kids activity, though it would have been cool if they could have opened the account while bouncing on a trampoline. In all seriousness, I was expecting there to be SOMETHING that was kid friendly. Although my kids are very digitally inclined, I was also hoping they could get a traditional bank passbook. I think it’s a little more tangible and easier to teach them about debits and credits using the book. However, the bank doesn’t issue passbooks anymore and that frankly isn’t a big deal as I can teach them online. Daddy signed all the paperwork, they were issued debit cards, and we went off on our merry way. The girls were confused, they wanted more. They couldn’t believe that they had to sit for an hour just so I could sign some papers on their behalf. I felt bad, because it was my mistake. I shouldn’t have dragged them along for the account opening process without checking it out first. However, I was really disappointed that there was simply nothing in the process that was fun and educational for kids. We had some “fun” at the ATM though as I showed them how it works and they got to press all the buttons and deposit their funds. So much went wrong, yet it was such an opportunity for so much to go right. The account opening process should have some elements tailored to kids (other than the trampoline of course). Here are some suggestions:
November 15, 2013 by Leave a Comment
So, whilst Robert was doing things in Vegas that have largely stayed in Vegas, I was spending time with my family during the UK school holidays. However, I may not win any awards for best dad! How did I entertain my two daughters? Cinema? Amusement park? Swimming? No. Let’s go open you both bank accounts! OK, it wasn’t quite like that, thankfully, but the net result was interesting. Some observations that struck me: #1 Choosing an account isn’t that straight forward. If you think marketing of current accounts is poor, try looking at it through the eyes of a 15 year old girl. Or, more accurately, their glazed eyes. Considering that most consumers don’t ever change banks, in terms of “bang for your buck”, surely getting this age group right (because they’re likely to be a customer for life) should be high on a banks priority? Not so, based on my observations. #2. Daughter #2, aged 13 – “Have I ever been in a bank before?” Which in turn led to a whole conversation about a bank is, and why she would need one. Again, educating young people about finance is both, in the current climate, probably a good way to head off some future challenges, but equally get time with their customers of the future who are currently spending hours every day with organisations mooted as potential competitors of the future (Google, Facebook, Apple, etc) Now these two points are worthy of entire blogs each (and indeed, may well get them in the future). But the last point is really what I want to focus on in this blog. #3. Clients will know that I’m less than impressed with the UK switching service that has been recently launched. Not that I am anti-switching, but that it isn’t addressing the problem, just the symptom. There has a slightly less sexy version of the switching service for the last 10 years, and switching rates have never fallen below 2% but have never exceeded 3% during that time. Over £750m has been spent on improving the service, and heavy advertising across all mediums, including TV, have been used to promote the use of it. The result? Switching peaked at just over 4%. Based on the unlikely assumption that this level of switching is maintained for a whole year, the service will have cost around £1,300 per additional account switched, plus the cost of switching, plus the cost of acquisition. Hardly a bargain. It would have been cheaper and simpler just to use money as an incentive. So, having said the lack of switching is only the symptom, what is the problem? Well, partly #1 & #2. Consumers, particularly younger ones, don’t perceive a bank as adding value, nor that they are different from each other. In a market where the headline price to most consumers is free, and many products are commoditised (as they are sold via comparison sites based on the price), it’s difficult for consumers to see value. But other reason, and the trigger for writing this blog, is the actual experience. On entering the bank, a newly revamped Lloyds, we were confronted by three different desks, with no clear signage as to how they differed. Four members of staff continued to do what they were doing, and not one looking to help us – fail #1. We then asked at desk #1 for help, and were sent to desk #2. Only 10 feet away but apparently soundproof because we had to start the request again. Fail #2 And the result? Could we come back next Tuesday, at 2pm? Apart from the obvious problem – school children will obviously be back at school – it really surprised me that something so fundamental as getting new customers couldn’t be handled by anyone in the branch – not just the staff under-occupied in the public area, but the other staff in the backroom. Specialist, complicated products do require specialists. But a bank account, in a bank who has just contributed to that switching programme? The moral? The issue around banking is much more fundamental. The banks need to realise that they are in the service industry as much as they are in banking or even products. Those banks that get this surely must be the ones that succeed. Oh – and the result? The Bank of Ice Watch continues, and funnily enough, in paying no interest, is only a few fractions of a % behind the majority of banks. Anyone else like to open an account?
January 17, 2013 by 3 Comments
On January 15th, Green Dot, a US-based company best known for its prepaid cards, announced the launch of GoBank, a full FDIC-insured bank account designed for and available via mobile phone. Promoting itself as “a bank with tomorrow’s technology”, it does indeed come with a host of attractive features, such as a mobile-only account opening, checking the balance in 2 seconds without logging in, multiple ways to deposit money (from direct deposit to check RDC to deposits via any Green Dot retailer, such as Wal-Mart), and a network of over 40,000 ATMs to withdraw cash for free. It also includes alerts and other tools meant to help customers manage their money, such as, for example, “Ask the Fortune Teller”, which if a person tries to spend too much, might say: “Remember that time you won the lottery? I don’t either!” let the customers name their own monthly fee, up to $9 a month. That’s right – there is no fixed monthly fee, instead, the bank asks the customers how much they are willing to pay. Now, as far as I know, that is new in Banking; I’ve only seen it done in other industries. In the early days of the Internet revolution, I recall websites that would let the users name their price for a seat on the plane or a hotel room. More recently (in 2007), Radiohead, a popular UK band, made news when they started distributing their “In Rainbows” album themselves online and allowed listeners to name their price before downloading. Of course, many downloaded it for free, and subsequently the album was released as a CD available via regular channels. I am sure there will be many customers of GoBank that will also decide to pay nothing. However, perhaps this is not as crazy as it might seem at first glance. As a “purely mobile” offering with no branches, GoBank’s costs must be lower than that of most other banks. The bank probably expects that the fees they will be charging (e.g. out-of-network ATM use or personalised debit cards at $9 each and others) will more than cover those lower costs. And they might be in for a positive surprise – I also fully expect that some people will offer to pay monthly fees if they genuinely like the service. After all, I was one of those that did pay a voluntary fee to download “In Rainbows” and ended up buying the actual CD… It is too early to tell what kind of impact this migth have on the banking industry, but good luck to the team at GoBank! We will be watching their progress with interest.
November 1, 2011 by 1 Comment
Account opening is an interesting process at US Banks and it is insightful to see how much the process and style differs across banks. At one bank, I was given a needs assessment, asked about my mortgage and what kind of credit cards I carried. Another bank showed me a list of accounts and asked me to pick one. Finally a third asked me my income (I answered), and then did nothing with that information. I’m certain that there is a bit of variation within banks as well as lots of variation across banks, but it is insightful to see the philosophies underlying the questions. One bank clearly wants to be my financial service provider of choice. Another has products on a menu and invites me to pick. One bundled a savings account with the checking account in spite of the fact I had no need for savings. Another let me articulate my needs and move forward from that basis. As transactions continue to move away from the branch, American retail banks are going to need to be better at understanding customers and creating appealing offers to those customers. They haven’t quite arrived yet. Do you have any experiences you’d like to share?