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New Tech to Influence Future of Banking

The swiss army knife that is online banking is getting the equal of that tiny pair of tweezers that has so many uses. Customers will be able to deposit checks through the automated clearing house (ACH) system into their bank accounts. Checkfree.com looks to be pairing with other institutions to enable this feature in the coming future.

Clearing checks will get easier because it can be done by email. Heavy and moderate users will have their entire account activity archived through their email provider. Look for ISPs and banks to start offering encryption as an additional service for email and mobile technologies.

Attention Economy's Affects on Banking Relationships

Forms of entertainment and other distractions are going to keep increasing. Radio isn't going anywhere, TV is staying, email will continue to grow, and the internet is going to invade every nook and cranny there is. Because of this, your attention is constantly engaged. There is only a finite amount of your attention, so the things you choose to spend your time on with either captive or voluntary attention become more valuable.

Your attention gains value, currency you can spend.

This is an opportunity for banks. For example, look at the web 2.0 world. The path to profitability looks something like this:

1. Create a service people want and need to visit often
2. Reach a critical mass of users and gather info about them
3. Advertise in an unobtrusive way, leveraging the intense community and info gathered to sell more expensive targeted ad space

When it comes to banks, steps 1 & 2 are already done; the user base is there and they visit their accounts often on-line. But how do you change the banking paradigm to the point where consumers will not be put off by getting ads tailored to their income level and checking account history?

The untapped resource that is the consumer checking account warrants investigation. That level of access will have advertisers salivating. Ads would be improved because they would be more relevant and targeted, reducing the potential agitation on the customer's part. A few ideas to package the selling of the customers own info are:

1. Third party offering: Someone else is offering the service in exchange for a benefit. Sites like clearcheckbook.com and mint.com already exist with this premise. Closer integration would be beneficial and widely accepted.
2. Partnership: Bank inks deal with telecom to sell advertising over cell phones, offering greater access. Text messaged balances and mobile banking already exist but do not offer any real upgrade to the banking expeirence. More advanced cell phones (GPS, WIde Screens, increased bandwidth) will be able to offer more advanced and relevant ads.
3. Freebies: Offering reduced fees or small credit lines will entice many to join up. Will be offset by ad revenue.

Targeting Customers can Help Improve Advertising

I hate seeing boner pill commercials. First of all, its not relevant to me so it's money wasted on the end of the erection distributor. Secondly, on a subconscious level, I do not want to be reminded that some day... well you get the point.

On top of that, half the population can't even use the product directly; women aren't interested either. But a company needs to get their message out regardless.

Advertisers need to use microdemographics. Think of your 20 gallon jug of collected change from over the years.

The change as a whole has collective needs. The coins want a good place to stay, away from the path of falling sticky substances that could bind them together for ever.

But they also have needs within their specific denominations that can be targeted. The copper industry might want to target pennies. The quarters may want to know about the latest arcade craze.

Throwing money at a 30 second spot for (insert TwentySomethingProduct here) during a show that has a large share of twenty-somethings watching just seems wasteful. If the smarter route is taken through web advertising, you're still limited to adwords or already established sites with better, but still limited information about their users.

If the banks could reach an agreement with their customers about the sharing of their personal checking account information, it could go a long way towards filling the current information gap; adding another revenue stream for banks and better services for their customers. Specific targeted ads aimed at microdemographics stay effective because they are relevant and personal.