This is the second post in a series of four about best practices in mobile banking. You can read the first part, Economic and Legal Conditions Favourable for Mobile Banking, here, and the third (best practices in supply chain management in mobile banking) and fourth (addressing Risks in Mobile Banking) articles will be posted soon! This post is concerned with 9 best practices in the marketing of mobile banking services.

1. Service Characteristics of Mobile Banking

Convenient, flexible, affordable and proximity to the poor are four characteristics crucial for the success of mobile banking services. Additionally, marketing efforts must communicate all costs to customers so they are comparable to the cost of traditional financial services – this makes the customer’s decision easier.

2. The Right Positioning of Mobile Banking

Mobile banking competes with other financial services in it’s own right by being affordable, convenient and safe, which is more than what can be said for banks (safe, yet inconvenient), and informal money transfer services (possibly convenient yet expensive and unreliable). By marketing the comparatively positive side of mobile banking services, customers have a better idea of the benefits they will receive.

3. Offering the Perfect Product in Mobile Banking

Considering the masses of migrant workers in countries offering mobile banking (Pakistan, Kenya, Uganda, Philippines, various statistics of these countries have been posted in the first part of this series), there is a big market for money transfers on account of remittances. As a result, this is major source of revenue for MNOs offering mobile banking services.

4. Giving Customers The Mobile Banking Service They Need

Even though customers may not be aware of their needs, mobile banking operators must anticipate and satisfy their preferences. There is an entire array of services beyond remittances, such as the payment of utility bills (water, electricity, gas and TV), handling of microsavings and microloans,  and the ability to send donations to NGOs or government organizations. Additionally, several non-financial mobile money services can be marketed.

5. Keeping The Mobile Banking Promotion Simple

A straight-forward message, such as, ‘send money home’, or ‘pay your bills’, along with an explanation of the service that suits the financial literacy of consumers, will appeal to potential mobile banking clients more than complicated slogans and detailed descriptions and flashy marketing campaigns. Such adverts may actually intimidate rural residents, hence it’s important to speak to customers in their own culture and style to enhance their comfort level.

6. The Right Sales Strategy in Mobile Banking

Below the line promotions are better, compare to above the line because they subtly target individual customers to create a positive influence on their mind. Such marketing tools include ‘educational campaigns about the specific uses of mobile banking, sponsorships, endorsements, mobile messages, exhibitions, trade discounts, public relations, redemption coupons, road shows, shop-front activities, etc’.

7. Pricing Strategy in Mobile Banking

Flat fees have two advantages over variable fees: they are less costly for large transactions, and appealing to customers in their simplicity. A recent trend of promoting discounts on airtime purchased with mobile banking services is emerging, because it offers convenience and may over-compensate the fee associated with money transfers. The benefit to MNOs is the increase in revenue from “non-voice sources”, as well as a rise in margins owing to the removal of layers of franchises in the distribution network.

8. Customer Care in Mobile Banking

There is a risk of confusion on the part of customers in mobile banking. The novelty of this technology, combined with low literacy rates of its users, means customer support must be accessible and prompt to improve the comfort and satisfaction of users. Educational campaigns to enhance the financial literacy of clients may be fruitful in improving penetration rates since a lack of knowledge about microfinance services is one of many problems faced by micro-entrepreneurs.

9. Reach Out to Potential Mobile Banking Customers

Proximity to the customer is vital, and sales teams must proactively visit potential clients at their homes or workplaces, offering convenience and free credit upon purchasing mobile banking services. This strategy can be supported by a vast distribution network (read best practices for supply chain management in mobile banking) is expensive, but rewarding in the long run owing to volume-based competition in mobile banking sector.

This concludes the second post in a series of four. You may wish to read other articles about  mobile banking, or other areas in microfinance, or even visit the original sources of this information, which are the CGAP Blog and GSMA.