• by Steve Smith , Staff Writer @popeyesm, February 7, 2014

Branded apps in most consumer categories have been nice-to-have items for marketers. They give the brand a “presence” where people are. They can be a showpiece for press and at events. And for the most part, consumers probably could go about their day as well without them as with them. Sorry, brand managers -- but in most segments, consumers really don’t care how cool you and your agency think your app is.

In banking, however, where an institution is the middleman between you and your money, the game is different. Apps matter. And mobility is coming into the market at just that point in banking history when other dynamics -- especially online banking and debit/credit cards replacing cash -- are having a profound impact on how people make their bank brand choices.

“For years people chose on proximity and convenience,” says Melissa Stevens, managing director, Citi Internet & Mobile. This is changing, and the implications for bank marketing are enormous. “We have seen data showing that proximity is not the number one reason some groups are picking banks. Mobile is part of that choice. It is more likely in the 18- to 34-year-old category.”

Apps matter when convenience and the most important of personal information -- your finances -- are in play.

The online banking that helped demote branch proximity as a chief deciding factor in brand choice is also the key driver to mobile adoption. Stevens tells me that it is the “digitally active” group that is migrating to mobile at an astonishing rate. In roughly an 18-month period, Citi saw the share of digitally active bankers on mobile grow from 22% to 66%. She believes that education and a rapidly increasing comfort level with mobility explains that quick and massive shift. There is also a group of people who actually are leapfrogging online banking altogether and moving from offline banking straight to mobile-only.

And so for this category mobile performance suddenly is a high-stakes game. What is interesting here, however, is that the winner in the mobile banking space may not be the bank that piles on the features into their apps. For this highly intimate but extremely important everyday activity, it may be more about seamless simplicity and fluid execution of some core functions.

“It comes down to a sophisticated understanding of the fact that simplicity and getting things done [is most important]” she says. It is the basics -- checking balances and transactions, seeing what transactions are pending and being able to pay a bill or transfer across accounts. “It is important to deliver flawlessly on those first,” she says.

Citi just released a new version of its app, among the most used banking apps in the world, and it is significant that it does not lead with dazzling new bells and whistles. A lot of this is about streamlining what is already in the app. The tablet version has moved for a sequential navigation design to a flatter single-screen dashboard. Payments and transfers now have simplified menus for faster operation. Push notifications now allow opted-in users to get account-specific status reports for things like check clearing and falling beneath balance thresholds. Not all of these are necessarily new to banking apps, but they are part of this natural path of evolution in these apps to try to surface more at-a-glance data with minimal app launching and screen tapping.

To that end, Citi is experimenting in select markets with a Citi Mobile Snapshot model that gives an app user even quicker access to the basics of balances and the last 15 transactions without logging in. Stevens says a number of consumers have been asking for quicker access to the most basic information, so they are testing how users respond to surfacing a little more information outside the log-in wall. The feature is entirely opt-in, and any operation involving transactions requires a secure log in.

Stevens feels that the rapid shift of existing online bankers to mobile has a lot to do with the educational piece. Citi is devoting a lot of its TV and other advertising to quickly demonstrating the app feature set and impress consumers with the simplicity of doing operations on phones that they are already comfortable performing online. Although advanced features like photographing checks to make mobile deposits are being done by a very small slice of customers, she says its use has doubled in the last year. They think that the human Citi teller is a key part of the education process too. They have been working with tellers. “Our hope is that if you come to a teller to deposit a check, we want someone there who can educate you that you could do that without coming to the bank. Banks really need to work on education for employees.”

As comfort levels with mobility banking grow, a bank can begin moving people into next levels of convenience. Stevens sees person-to-perosn money transfers growing in popularity as people see their utility in everyday life. Splitting a lunch check, for instance, becomes easier if one person picks up the check and the other just transfers her friend her piece of the bill. People splitting rent and utility bills also see the utility of the feature. “This is a service with a lot of legs to it,” she expects.    

And to get an inkling of just how important Citi and the banking industry regard mobility as a piece in the battle of the brands, you just need to look at where the big media spend is going. Citi has three Olympics-themed TV ads in advance of the games running, two of which are focused specifically on mobile banking.