The Young and the Mobile

May 1, 2010
from US Banker
By Bonnie McGeer

On some New Jersey trains this spring, the guys looking out the window included George Washington and Abe Lincoln. Sun National Bank says the unusual image succeeded in getting attention.

As part of a major campaign to tout mobile banking-which it began offering in February-it wrapped trains and buses in advertising that depicts the presidents as commuters.

“The message is, your money is moving wherever you go,” says Ed Malandro, the executive vice president of consumer banking for the $3.6 billion-asset Sun in Vineland. “The presidents are symbolic of money, that’s why we used them.”

The campaign represents a strategic shift for Sun, whose customers are mostly Baby Boomers, Malandro says. It is aggressively pursuing younger customers with this new service and looking to position itself as a technology leader.

Doug Miller, a senior analyst for Corporate Insight, says the strategy is smart. Mobile banking is still new enough to be distinctive, particularly since Sun’s largest local competitor, the $146 billion-asset TD Bank in Cherry Hill, doesn’t offer it.

Red Gillen, a senior analyst for Celent, says mobile banking also should help Sun appeal to younger customers, as it hopes.

“Gen X and Gen Y are very tech savvy and have mobile-centered lifestyles,” Gillen says. “Banks are viewed as being stodgy, and smaller banks are perceived as behind the times. So rolling out a mobile campaign, it gives you a hip, new, young image.”

Sun lets customers use its mobile service for free. Or, they can sign up for what the bank is calling “Sun on Hand,” which bundles mobile banking with some extra benefits for a $5 monthly fee.

But the fee can be reduced. One of the benefits is a 15-cent bonus every time a customer uses a debit card, up to a $10 limit. So a heavy debit card user could offset the fee and even make money, Malandro says. “The Gen Ys who use their card for everything, that’s who we were going after with that product.”

Other benefits with Sun on Hand include free bill pay and two refunds a month of automated teller machine charges from other banks.

Gen Y, which generally refers to those born from the late 70’s through the late 90’s, does not have as much to deposit as Sun’s typical older customers, so might seem less attractive, Malandro says. But Sun sees potential because these younger customers use debit cards more often and visit branches less frequently. They also grow up eventually.

“Our thought is if we can get them and give them a decent product, we’re going to have them for a long time,” Malandro says. “You don’t make a lot off their accounts right now, but they’re going to be the affluent customer of the future.”

The Brownstein Group created the campaign, and Joe Weinlick, the chief brand strategist there, says the ads are meant to convey a sense of fun and give a quick visual message of money on the move. He says other mobile banking ads he has seen focus on product features like the ability to get account balances by text message, but Sun wanted to be more creative.

“This is taking a mobile campaign and elevating it to branding status,” Weinlick says. “‘It’s your money and it’s mobile’ is more of a connection with the brand attitude. We’re not trying to show the details of what mobile banking is with screen shots.”

Besides wrapping trains and buses, Sun pursued its younger target with ads in some nontraditional media, including 15-second spots on Hulu, an Internet television service, and Pandora, an Internet radio service.

Malandro says he knows the bank is reaching its target, because Sid Brown, the vice chairman, recently mentioned that his teenage son got excited about seeing a Sun ad on Hulu.

James Van Dyke, the president and founder of Javelin Strategy and Research, says consumer surveys indicate that many people are not even aware of whether their bank offers mobile service. So he agrees that having mobile, and advertising it, can give Sun a competitive advantage.

A recent Javelin survey asked 3,548 people who had switched banks why they did so. Participants could select one reason from a list of about 15 options, and a surprising 3% said they switched to get access to mobile banking, Van Dyke says. It was the first year the annual survey included that reason on the list.

Sun developed its mobile service with mFoundry. It offers all three types: a Web site formatted for a mobile phone, an application that can be downloaded onto a smart phone, and simple text messages.

Gillen says 696 banks and credit unions nationwide have some form of mobile banking, but few do much to promote it besides putting a note on their Web sites. He expects Sun’s campaign to help it stand out.

“Mobile levels the playing field between small and large banks,” he says. “For a small bank, it can raise its stature from a tech perspective, and that helps with image. You can be just as cutting-edge as a big bank.”