Spain’s BBVA has rolled out a Facebook-only savings account as well as a comprehensive online personal account management system – examples, says the bank, of the sort of Intelligent Web 3.0 services that will increasingly define the future of consumer banking. William Cain reports.
Through its online subsidiary, uno-e, BBVA has become the first bank to offer a product exclusively on Facebook, the global social networking website. Spain’s second-largest bank has also launched a powerful online money management tool for its 4.1 million online Spanish retail banking customers in a further sign of its heavyweight push into state-of-the-art marketing and distribution technologies.
Some 1.3 billion transactions were carried out online by BBVA customers over the past 12 months, and the bank says that, as more and more people conduct their personal and financial lives online, the banking industry should promote the development of not just ‘The Social Web’ (Web 2.0) but, more significantly, ‘The Intelligent Web’ (Web 3.0)
The deal with Facebook adds momentum to the growing number of banks – including HSBC, Chase, Toronto-Dominion, ING – dabbling in social networking, person-to-person (P2P) technologies and other forms of modern web marketing (see RBI 593, 592).
BBVA’s particular Facebook product, called Depósito 16, is a nine-month savings product with a headline-grabbing rate of 16 percent in the first month. For the remaining eight months it pays out Euribor minus 0.15 percent, giving an overall return of 5.51 percent.
The bank is offering the product until the end of September; users who sign up receive a €100 bonus.
A personal financial management system
Depósito 16 was launched alongside BBVA tú cuentas, a personal financial management solution aimed at helping the bank’s online customers manage their finances through a range of interactive tools. The service, co-designed by the bank and Strands, a US technology/marketing specialist, will be up and running from the autumn.
BBVA tú cuentas will provide an aggregated snapshot of a customer’s financial and non-financial information, including non-BBVA accounts, utilities and telephone bills. It is an example, states BBVA, of the sort of Intelligent Web 3.0 services that will increasingly define the future of banking.
Gabriel Aldamiz-echevarria, a spokesperson for Strands, told RBI there were three things which made the product different to others on the market.
Firstly, expenses can be automatically catalogued by the system using debit and credit card data – though not with cash – meaning finances can be analysed through graphs, charts, budgets and savings targets (BBVA hopes the tool will increase card spending as a result, and added a 2 percent growth in cards would make €100 million in profit).
The second difference is the service is accessible through mobiles as well as the internet, available through iPhone, Nokia and Blackberry handsets. And thirdly, it is based on ‘widget’ software which means users can personalise layouts and add or remove items.
The concept is similar to products run in the US by Bank of America (My Portfolio) and Wachovia (Wachovia Online Banking) and in the UK through HSBC’s first direct (Internet Banking Plus) and Egg (Egg Money Manager), all of which offer account aggregation services. Figures from Egg, the UK internet-only bank owned by Citi, have shown customers who use its Money Manager service have lower card dormancy rates, higher cross-product holdings and visit the website five times more often than those who do not use the service.
Word of mouth recommendation
The popularity of the Depósito 16 Facebook product will provide an interesting insight into Web 2.0 marketing as it will be communicated primarily by word of mouth and recommendations between friends on the site.
Uno-e CEO Cristina de Parias said: “Uno-e, a bank without branches, has for some time been on the lookout for the best way to achieve a much closer presence and a much more direct relationship with its target market and customers. In this regard, social networking sites offer the platform and the tools, and are a transit point where uno-e had to have a presence.”
The move towards marketing on Web 2.0 platforms – internet sites predominantly featuring user-generated content – remains a small one so far among banks, according to a recent report from VRL KnowledgeBank called Web 2.0 in Retail Banking – Building Customer Engagement. There are around 50 banks and credit unions using Facebook, one of the most popular user-generated sites.
But it looks set to become an increasingly important way of communicating with customers as the marketing effectiveness of traditional media declines and word-of-mouth marketing becomes more important.
De Parias added: “If you offer products with excellent conditions and provide good service that improves day after day, the best way to communicate is to get the word out to as many people as possible. Facebook and other social networks are useful for that.”
Surveys suggest banking applications on Web 2.0 platforms like Facebook are in demand, but usage of those currently available has not taken off. A survey by internet security provider WorkLight found 25 percent of Facebook users would consider leaving their bank to obtain online banking through Web 2.0 gadgets.
A survey of 1,000 Facebook users found 48 percent of respondents would take advantage if their banks offered such a service.