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Why Bank Alerts Must Become More Meaningful

JJ HornblassbyJJ Hornblass
August 1, 2012
in Banking
Reading Time: 2 mins read
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US Bank recently updated the marketing of its mobile alerts service, and the bank’s approach appears to move it more to the ideal paradigm of consumer interaction.

Let’s first realize that robust alerts are not in a bank’s best interest. An effective alert can cost banks fee income, and that’s a precious commodity to banks to say the least.

But alerts are fair. Consumers — both retail and commercial — deserve the type of alerts that don’t just tell them when a check clears. It is practically a moral imperative to offer what I would call meaningful alerts, alerts that get to the heart of the banking relationship.

Consider retail account balance alerts. Like many banks, US Bank can ping their consumers via text message or email with the following information:

  • When a consumer’s balance is low
  • When a payment’s due
  • Online statements are ready
  • A deposit has been received

Is it valuable to know when a balance is low? Yes. Is that all a customer needs to know when it comes to low balances? Of course not. A meaningful alert would be one that cross references balances with payments. Let me explain. Say I have $10,000 in my checking account. Certainly, that is not a “low balance” — and US Bank would not send me an alert as a result. But what if I have a future payment planned for the following week in the amount of $11,000? The fact is that $10,000 immediately becomes “low.” And what if I get paid $6,000 every Monday? Well, then that $10,000 is not “low” anymore.

These are the types of calculations that banks can easily provide. Alerts centered on such calculations become something more than “alerts.” They become meaningful, enlightened interactions between consumer and bank. US Bank is moving more toward this ideal, but it must integrate low-balance alerts with pay-due alerts. Will this cut into fee income? I believe it will — but that loss in fee income will be recouped in a more meaningful and sticky long-term business relationship between bank and customer. And who doesn’t want that?

Tags: alertscheckingdepositsemailfee incomeSales & MarketingUS Bank
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