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.

The Future of Banking

In this blog I hope to start a discussion covering the current and emerging trends shaping the banking industry. A major influence will be Tom Davenport and John Beck's book Attention Management, which dictates that service providers will gain a more prevalent role in the evolving economy. Other trends on watch here are ever increasing fees for overdrafts, the decaying housing market, increased spending on web advertising, web banking, a wider acceptance of social-media and its uses.

So many things are coming to affect the banking industry that in a decade, I do not believe the customer facing side will look anything like it does today. Please stop by and check in regularly.