Google Glass Still 'Too New' to Interest Bankers: Survey
Bankers are intrigued by Google Glass, but are waiting for consumer adoption to pick up before building mobile banking apps for it, a recent survey says. They're more ready to adapt their mobile apps to work with wireless sensors in bank branches and retail stores.
The Mobile Banking Intensity Index is a monthly survey of 300 bankers that asks about the features they offer and their rate of adoption. The latest report, showing activity for the month of January, found that bank customers' overall use of the technology was high.
The index value for the month was 73.8, an uptick from December's reading of 71.9. [The MBI is a diffusion index. Readings above 50 in a diffusion index indicate expansion and readings below 50 point to contraction. The further from 50 a reading is, the stronger the indicated change.]
All types of mobile banking activity measured by the index increased in January. Mobile check deposit made the biggest jump. About 85% of bankers said the volume of retail customers depositing a check by mobile device increased in January as compared to December.
Bankers were also asked what they think of two emerging technologies Google Glass, the search giant's eyewear that doubles as a computer, and wireless beacons.
Only one-fifth of the bankers surveyed said they were interested in offering mobile banking apps that work with Google Glass. However, comments revealed that bankers are clearly intrigued by the technology's potential.
"Anything that might give us an edge is worth looking at," one wrote.
"Google Glass along with other wearable technology gadgets are the wave of the future, so our company wants to remain at the forefront of our industry," said another.
A third enthusiastic proponent said, "I want all the tellers and front end staff to be using Google Glass," while another predicted that in five years "Google Glass will be everywhere with our younger clients."
Others, though, seemed less inclined to develop apps for Google Glass, citing concerns about security, cost and even consumers' fickle tastes in fashion.
On the security front, one banker questioned whether customers would be comfortable using the voice command feature of Google Glass because others could overhear them. Another said that there is "too much risk and uncertainty and unknowns with Google Glass at this time to satisfy regulators, auditors, etc., or to ensure customers their transactions are safe."
Others raised concerns about the cost of developing an app for yet another device. "Current development of our mobile app is already a two-fold process keeping the app stable between Apple and Android devices. Inclusion of Google Glass at this point does not fit into our development schedule," said one respondent. "The cost to develop versus actual usage in our demographics would not make business sense."
Some bankers are simply uneasy about partnering with Google because they see the tech behemoth as a potential competitor. "Google is looking to capture all the transaction information and bypass us and the exchanges," one banker wrote.
One gave an honest assessment of the device from a fashion point of view. "It's a fad. People look ridiculous wearing the device."
Industry observers agree that it's probably too soon for bankers to start seriously thinking about building banking applications for Google Glass, which is still not publicly available.
"Google Glass is still proving itself," says Mike Goodson, a managing director and head of management consulting for Accenture's North America banking practice. "It will be interesting to see what the poll says next year."
Caution is appropriate, says Bradley Leimer, who leads digital strategy for Mechanics Bank in Richmond, Calif. "While it's great to get ahead of the coming wave of wearables glass, watches, rings, whatever you have to clearly define the use cases that your customers would have using these devices."
Leimer also points out that many banks are vendor dependent. "Do you want your primary technology vendors focused on wearables when they need to shore up their user experience and bring more engaging features to the mobile devices customers are actually using?"
The surveyed bankers took more readily to the emerging concept of using wireless location sensors like iBeacon with their mobile banking apps.
Wireless beacons can be used to communicate with customers' mobile devices in branches (most likely, with customers' permission). Westpac New Zealand, for example, is developing applications through which beacons recognize customers as they walk into a branch. The application sends the customer's photo and records to branch staffers, who can then greet customers by name and make relevant suggestions.
The bank also plans to use beacons to track the times of day customers use a branch, the parts of the branch they're going to, and what they are doing or looking for. This information will help inform staffing decisions and product and service offerings.
Wireless beacons can also be used to facilitate payments in restaurants and stores or send customers relevant offers while they're shopping.
Bankers say the technology could generate ad revenue and strengthen a bank's ties with both customers and local merchants.
"Another way to add stickiness to the customer's account," one banker wrote.
"Appears to be supported by a business case with clear pay-back from merchants," said another.
Goodson believes this response to beacons makes sense. "Banks can offer them to their small business customers as a more complete technology and financial solution, enabling these businesses to proactively push offers to customers in their stores," he says.
Still, a few were concerned that customers would perceive the new messages as advertising or intrusive. "Customers that have received such offers seem to be more annoyed by them," one respondent wrote. "Disturbs customers," said a second.
Several were worried about customer privacy. "Do not want to get tagged with the stigma that we are tracking our customers' locations," one banker said.