Mobile Messaging Holds Opportunities, Challenges for Financial Firms

By Nathan Eddy, eWeek News

The vast majority (88 percent) percent of these businesses believe SMS has a considerable or major impact on customer service, the IDC report found.

The greatest benefits of mobile messaging for the financial services industry are its abilities to enhance the customer experience and improve employee relations, according to an IDC study sponsored by OpenMarket. The vast majority (88 percent) percent of these businesses believe SMS has a considerable or major impact on customer service and nearly three-quarters (73 percent) consider it to be very effective for employee-focused emergency alerts. The IDC study also reveals that more than 50 percent of financial services organizations use mobile messaging to differentiate or improve the customer experience, and more than one-third (35 percent) utilize the technology to attract and retain new customers. More than 25 percent use it to improve business risk mitigation, and more than 20 percent of these businesses use it to ensure business continuity and to enhance multi-channel delivery capacity. Surprisingly, just 15 percent of respondents said they use mobile messaging to improve their organization’s security.

According to the research, the top customer-facing use cases for SMS include timely offers and notifications regarding high-risk, high-dollar transactions. Thirty percent of these businesses utilize secure SMS messaging to gain deeper customer insights and to meet industry compliance requirements.

In addition, nearly half (48 percent) said they consider SMS to be an effective way to conduct customer surveys. The top issues financial services firms have with their current mobile messaging vendor include a lack of professional or managed services offerings and lack of flexibility. Managed services, encrypted mobile messaging capability and better support were all items for which these firms would be willing to pay a premium. “A company-wide mobile messaging strategy will give organizations a path to enhance the customer experience, gain additional customer insights, improve employee relations, and drive operational efficiencies,” the report concluded. The study recommended taking a long term, purpose-led approach to mobile investment, and advised businesses to look for vendors that can support platforms, not just individual technology or use case requirements. The research reflects findings around the financial services industry’s customer preferences for engaging via text-enabled customer service phone numbers that OpenMarket announced earlier this year. That study also found that the financial services industry has the greatest customer demand for adding SMS capabilities to their existing customer service lines – equating to more than 50 percent of all SMS-based requests from consumers across all major industries, including retail, travel and hospitality.