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How USAA Innovates Online Banking

Neff Hudson is in his office in San Antonio, but his mind is 7,000 miles away. "The first face-to-face video chat with a rep on our website was with a specialist in Kuwait who had gotten her re-up bonus" - payment for re-enlistment - "and wanted to put more money in her retirement account," says Hudson, assistant vice president of emerging channels for USAA. Video chat is just one example of technologies USAA has implemented ahead of many more traditional banks, to accommodate its highly mobile and often highly stressed member base of 9 million military service personnel.

Since its members tend to need remote access to financial products earlier and more often than civilians, USAA dives into new technology by necessity. Much the way World War II sped the development of things like plastic and radar, USAA tried innovations such as mobile check deposit and Web banking early on to bring financial management and transactions to soldiers in the field. The firm has a long-standing tradition of early adoption, and was a quick mover into older remote access modes such as phone banking.

USAA offers a mix of insurance, financial management, mortgage, auto loan and banking services, almost entirely through nonbranch channels such as the Web and mobile devices. It also has a small but expanding network of financial centers located mostly near military bases, and most of those centers rely on remote-access technology and new video capabilities as a means to expand the company's physical footprint at minimal cost.

The firm's pioneering forays into new delivery methods make USAA a good representation of what financial retail delivery will look like in a couple of years, since its services often get adopted by civilian-oriented banks with larger branch networks later. Right now USAA is working on projects involving one-to-one video, Web bandwidth agility, data analytics, contextual Web marketing and voice-automated response.

By taking on unproven technology like voice recognition, the company is attempting to forge a new role for the Web as smartphones and tablets start to become banking channels in their own right.

"The way we look at it is the online banking site is looking more like an app and the apps are creating more content for the website. It's an ecosystem where mobile feeds the dot.com and vice versa," Hudson says.

That cross-device relationship is driving a redesign of the private portion of the USAA.com member site that will make the Web site look and feel more like a mobile app to promote design and user experience consistency among devices.

For example, electronic bill payment for the iPad is being "reverse engineered" to make the Web browser experience mimic the iPad app.

"Bill pay on the iPad offers the top experience," says Rhonda Crawford, vice president of digital media and innovation at USAA. The personal financial management tools embedded in the online banking site, such as goal-based budgeting and debt reduction, are being incorporated to the iPad. Hudson says PFM is a good fit for the longer use sessions of tablets.

The iPad app includes an extensive amount of research materials and graphics, since USAA has found that users spend more time on tablets than on other mobile devices such as smartphones. Hudson says people often use tablets during leisure time, a trend also noticed by other early movers into financial services on tablets such as Bank of America and Citigroup.

While USAA's mission of serving the military lends to early tech adoption, having a large base of military users also brings unique website design challenges, as the firm works to deliver and sustain online banking to remote locations that most banks don't have to worry about.

"I was on the USS Nimitz over Father's Day weekend, and saw men and women using the low-bandwidth website," says Rhonda Crawford, vice president of digital media and innovation at USAA.

USAA offers Web banking in remote locales through lower bandwidth when a higher bandwidth isn't available. It uses device detection to track where the member is accessing the website. A low-speed connection results in the user being routed to a streamlined site.

"That has the basic transactions, money movement, stock trades, etc.," Hudson says. This version of the site is used in typically network inaccessible areas such as aircraft carriers. "They are surfing the Internet through a straw on those carriers, so we have to deliver the Web to them in a way that's as compact as possible so people can manage their finances from afar," Hudson says.



The low-bandwidth service demonstrates the importance of context in USAA's Web and digital marketing and development as it attempts to use data to tailor marketing and service using the Web and other channels. Much of the company's digital strategy is steered by the type of device the member is using, where, at what time and for what purpose - with the belief that these factors indicate what the consumer wants to accomplish later in a financial services session.




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