“A half-done, hard-to-use solution with limited features certainly says something about you. It’s probably not what you want your customers to hear.”

Mobile Commerce is commerce. Mobile Banking is banking.

Too many organizations overlook this simple truth and instead treat mobile as a simple feature add-on to their web solution. They do so at their peril.

Done right, mobile is not a simple technology decision, but a business expansion. For example, a successful mobile banking rollout certainly includes Technology and Information Security teams, but it also touches Marketing, Retail Banking, Banking Operations, and in some cases, Commercial banking. Rolling out mobile banking is a great excuse to touch your customers through bank statements, courtesy calls, print and mass media advertising, signage in your branches, user education events, etc.

Your customers will see your mobile option as an extension of your brand and a statement about who you are. A half-done, hard-to-use solution with limited features certainly says something about you. It’s probably not what you want your customers to hear.

Look around the internet. There are few if any press releases on the success of mobile sites that simply refactored their web site into a mobile site.

How successful can your mobile commerce site be if you can’t buy anything?

Successful mobile initiatives start with the overall business goals, then they figure out how mobile can help achieve those goals. Technically, this usually involves figuring out how to translate your connection with your customer into the mobile context.

For example, Facebook announced today they have 65 million mobile users. Despite some early usability issues, the application is encouraging more engagement and more users to join, which drives revenue. Facebook focused on the key use cases of status updates and wall posts. These chunks of functionality fit well into the mobile context and made Facebook easier to use because members didn’t have to remember their witty comment until they got back to their computer – they just typed it when the thought about it and moved on.

Similarly, Bank of America has seen tremendous success in their mobile banking application by focusing on getting key functionality to the most users possible. In Bank of America’s case, this meant offering a variety of mobile banking products.

Similarly, USAA recently announced success with its mobile remote deposit feature. USAA announced that users deposited over $1.5 million in the first days after the service launched. Mobile deposits are important to USAA because the bank doesn’t operate a large retail branch network and their customers are spread around the world. Mobile deposits bring more deposits into the bank and encourage customers to choose their USAA account as their primary account rather than an account from another bank or credit union.

The mobile image you project is increasingly the image your customers see. Make a good impression.

Mobile-Financial.com recently interviewed Len Pienaar, CEO of First National Bank Mobile and Transact Solutions about their tremendous success with mobile. FNB has 25% adoption of mobile banking with 3,ooo to 5,000 new customers joining each month. Mobile Alerts are used by nearly 80% of their customers and account for 2-3 million SMS messages daily. Given that South Africa has a population of 50 million, the 1.5 million FNB mobile users is all the more significant. Many North American mobile implementations have fewer users than FNB adds in a month, but to be fair many U.S. banks and credit unions have fewer customers than FNB.

I find that North American bankers are generally aware of the success of mobile banking in Sub-Saharan Africa, but they perceive the African experience so different from the U.S. or Canada, that the applicable lessons get lost. I think the same is mostly true for Latin America as well, despite some similarities in the challenges of serving their customers.

While there are differences between the geographies, I think there there are a number of universal truths reflected in Pienaar’s comments that are critical to the success of any mobile implementation.

Approach mobile banking as banking

“[W]e had a very big focus on marketing, advertising, and education,” Pienaar said. “We spend the same amount of money on marketing and advertising that we spend on technology and I would subscribe more than fifty percent of our success around the way we market and educate our customers.”

Many organizations look at mobile banking as a technology project. I’ve found many marketing executives in banks not yet doing mobile, completely defer all conversations to the technology team. While technology is a critical, enabling factor, business teams should be out front providing business goals for the technologists. Organizations need to find the right solution for their overall goals, then absorb it as an overall part of the business by connecting it to all the other customer touch points.

“I think that’s where so many launches I’ve seen have fallen flat.” Pienaar says, “People think once they’ve launched it that it will take off by itself but with any product that a bank puts out, you have to put education behind it.”

Make it easy

“[W]e also made it easy to register” Pienaar said. Making it easy takes lots of hard work and many packaged solutions lack flexibility to adapt to specific workflows or technologies.

Pienaar indicates that FNB provides enrollment from multiple channels such as branch, ATM, and Call Centers. “What’s amazing is that ninety percent of our registrations today actually happen inside our branches. When we started this service we thought we could really do a virtual branchless banking model but our customers actually want to talk to someone. They want to see how the service works and they want that personal education part. What’s amazing is that once they are on the service, they leave the branch and we see transactions in that environment drop dramatically from those customers.”

Few North American banks let users enroll anywhere other than online banking despite the obvious benefits. In my experience, this is because of the amount of work required to interface into all the various systems. It can and should happen in North American implementations, but it takes more time, money, and resources which all have been in short supply particularly in U.S. institutions.

Furthermore, FNB decided to make their solution work on almost any phone regardless of carrier or technology. Many U.S. consumers have been been surprised and confused when told that their phone is not supported. While not mentioned in the interview, universal support almost always comes at the expense of usability and functionality. Organizations face a difficult challenge in deciding how best to balance accessibility and usability for their particular user base. For example, SMS provides near universal phone support but with serious security constraints and a command-line user experience that is often difficult for customers with the most money to use. Conversely native applications like iPhone applications can provide a stellar user experience but potentially only reach a small segment of the population.

Making it easy often means making tough decisions.

Make it profitable

FNB provides various payment capabilities which provide benefits to the bank and consumers. Pienaar calls out customer retention as a key benefit: “I think we’ve seen with customers that it’s such a powerful retention tool that people are preferring to use our cards to our competitors card because that SMS is there the moment you swipe your card.”

Bank of America recently announced they are reducing their reliance on branches partially due to the success of mobile banking and other electronic channels.  Banks profit whether they reduce branches and significant overhead costs or simply repurpose branches for more valuable services such as investment and business services.

Providing payment capabilities presumably provides additional revenue to FNB in addition to a deeper relationship to the customer and the merchant. “[W]e provide an interface to merchants that displays a unique dial string for a payment, customers dial it, put their mobile pin in, and the transaction is confirmed. It literally takes about three to four seconds and the beauty about it is that you don’t disclose anything personally to the merchant; not your card number, or your bank account details, or even your name.”

While a similar system in North America probably isn’t feasible, U.S. banks should consider the creative approach to find unique ways to create deeper ties with consumers and make each interaction more profitable.

Pienaar says, “Today we make sure when you leave our branches, you leave it with a piece of plastic in your hand that you can swipe; cell phone banking is quickly going in the same direction.”