ICICI Bank Offers Better Mobile Banking Services Than Its Peers

Arnav Gupta

Ever-increasing smartphone adoption has fueled the use of digital banking services by Indian customers. Forrester data shows that, in 2017, more than half of online banking customers in metro India predominantly use mobile devices to quickly complete simple banking tasks such as checking an account balance and viewing recent transactions. But more interestingly, online banking customers now also use mobile devices for serious and time-consuming banking tasks such as searching for and buying financial products and services. The need for enhanced digital banking services is not just restricted to metropolitan India, but is also emerging in smaller cities.

We recently concluded our 2017 India Mobile Banking Benchmark, which assesses the mobile banking offerings of seven large Indian banks: Axis Bank, HDFC Bank, ICICI Bank, IndusInd Bank, Kotak Mahindra Bank, State Bank of India, and Yes Bank. Of the seven, ICICI Bank received the highest overall score by delivering services that are both useful and usable. The bank has substantially improved its mobile app over the past two years, in the process overtaking the other Indian banks. Some highlights from our report:

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The State Of Retail eCommerce In Brazil

Lily Varon

The economic decline in Brazil has hit the retail sector hard , but eCommerce is still growing. To understand the state of affairs in retail eCommerce in Brazil, in 2016 Forrester surveyed online retailers in Brazil together with industry partner e-Commerce Brasil. Here are a few findings from the research:

  • Retailers are feeling the pain of operating in the midst of Brazil's economic recession. Nearly 60% of online retailers say slowing consumer spending with be a significant barrier to their eCommerce growth over the next 12 months. Furthermore, more than half cite the operational constraints of keeping up with constant regulatory change.
  • Online retailers are increasing their eCommerce technology budgets. Despite the pressure to reduce costs during turbulent economic times, 64% of Brazilian retailers we surveyed are increasing eCommerce investments to help them weather the storm.
  • Investment priorities include marketing, mobile – and uniquely! - marketplaces. Retailers this year are focusing on marketing and mobile, much the same as in the US and other global markets. Unlike many other markets, however, Brazilian digital commerce pros are also prioritizing marketplaces. Why? Third party marketplaces are a relatively simple way to sell direct to consumer online. And retailers like Magazine Luiza and Walmart Brasil are prioritizing launching marketplaces on their own retail sites as a source of new revenues.
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Amazon Prime Wardrobe Won’t Will Kill Subscription Boxes: Bad Strategies Will

Lily Varon

Retail subscription boxes have a churn problem – that’s the bottom line. For non-essential categories, once the novelty wears off, consumers leave. We're seeing subscription box companies burn through their addressable markets. If there's a death knell for today’s subscription box companies, it's not Amazon’s new Prime Wardrobe offering, it's that many of them have been short-sighted. They have no game plan to maintain their value proposition after the novelty of their initial product or service wears off. 

Here’s what subscription box retailers, or retailers considering a subscription box model, should take away from Amazon’s Prime Wardrobe announcement:

  • Amazon continues to build out the value they give to Prime members. Amazon isn’t letting Prime members become desensitized to the value of their subscription.This service isn’t innovation per se  rather, it’s a value-add for existing subscribers for no additional cost. Amazon is a building out the value of a Prime membership for its members. 
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Amazon Buys Whole Foods To Expand Its Digital Prowess In Retail

Brendan Miller

Written by Principal Analyst Brendan Miller and Principal Analyst Brendan Witcher.

Whole Foods’ brick-and-mortar expertise combined with Amazon’s digital prowess is a one-two punch that will give retail executives more sleepless nights. Our initial take on what Amazon’s $13.7 billion acquisition of Whole Foods means for the broader retail market:

  • To thrive in grocery, Amazon needs a keystone: the local store. Grocery is a high-frequency shopping experience. Whole Foods’ stores give Amazon a new store platform for deeper engagement across all its selling categories. Amazon can lock in its national distribution and logistics mastery with a local “place” in a way that other retailers will struggle to replicate. Now Amazon can tie into those weekly (or multi-weekly) grocery runs with add-on products and services further deepening their reach into customers’ wallets.
  • Amazon knows that to win at brick and mortar, retail theater is paramount. Whole Foods locations are destinations where the idea of “Retail Theater” still thrives. Consumers go to Whole Foods to shop but also to discover new foods, attend wine tastings, pick up prepared foods, and enjoy a cup of organic coffee. Whole Foods can be credited with turning Americans on to arugula, almond milk, and probiotics. The idea of retail theater and discovery is badly missing in most brick-and-mortar retail shopping experiences. Amazon is now getting private lessons from the master.
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Busting The Big Myths Of Retail: The Real Reasons Retailers Are Missing The Mark

Brendan Witcher

If you believe what you've heard in this year’s earnings calls, retailers are losing every dollar of business to Amazon. Are they? No. They’re losing some, but the estimates on Amazon’s pure, non-marketplace growth don’t even come close to every other retailer’s declines. Amazon's growth is a symptom of - not the reason for – retailers’ problems. Retailers in decline are also losing sales to the many multi-channel retailers that are growing and actually - *GASP* - opening stores, as well as new market entrants, including brands selling direct.

The other big industry myth: online sales are adding to total retail sales growth more than in-store sales. The facts: last year, retail sales grew $128B excluding items like fuel and autos. Online sales added a healthy $53B, but in-store sales added an even healthier $75B. The result of these myths: some retailers believe they should close stores and compete more online to resolve issues. But this strategy actually makes their problems worse, and closing stores is likely the first step to ultimately closing the doors.

Retailers struggling today suffer from brand problems, not store problems. They have failed on five main fronts. Specifically, they:

  • Don’t focus on solving customer pain points. The ability win in today’s environment is just a matter removing customer pain points to improve experiences along the shopping journey. Unfortunately, many retail teams we speak to make the issue too complicated, and aren’t even aligned on what their customer pain points are.
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Who Are The Mobile Banking Leaders In Australia And New Zealand?

Zhi-Ying Ng

This blog post was co-written with senior research associate Erna Esa.

Over the past few months, we have diligently reviewed the mobile banking services of five retail banks in Australia and three retail banks in New Zealand. We used our mobile banking functionality and digital user experience methodologies to find out who the mobile banking leaders in Australia and New Zealand are. And the results are out: In Australia, CommBank takes the top spot thanks to its impressive usability and strong functionality features, with Westpac coming in a very close second. In our inaugural New Zealand mobile banking benchmark, KiwiBank has edged out BNZ with good usability.

Here are some key takeaways from this year’s benchmarks:

  • Leaders stand out with strong functionality features and great user experience . . . Many Australian banks offer mobile banking services with strong functionality and slightly above average usability. This is a result of digital teams having fostered strong relationships between their customer experience, digital business strategy, and technology management teams. The digital teams have also adopted an iterative test-and-learn process, with cross-functional teams taking an Agile approach of experimentation, measurement, and quick adjustment to drive success.
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Who Are The Mobile Banking Leaders To Follow In Europe?

Aurelie L'Hostis

We’ve spent the past few months diligently reviewing the mobile banking services of 11 retail banks in Europe and six retail banks in the UK, and the results are out. BBVA in Spain and Lloyds Bank in the UK earned the top spot in our 2017 European and UK mobile banking benchmark reviews, respectively. These two banks achieved impressive scores, even as we raised the bar in terms of our expected performance of mobile banking services. Not only do BBVA and Lloyds Bank offer best-in-class transactional functionality, a wide range of next-generation features, and outstanding marketing and sales functionality, they also lead by delivering good user experiences.

What were the key takeaways this year?

  • Banks in Spain, Poland, and Turkey continue to lead the way in Europe. Not a huge surprise. These mobile banking leaders — BBVA and CaixaBank in Spain, mBank and Bank Zachodni WBK in Poland, Garanti in Turkey, as well as Lloyds Bank in the UK — stay ahead of the curve by prioritizing mobile initiatives on their agenda. These banks have brought together cross-functional teams, building strong relationships among their customer experience, digital business strategy, and technology management teams. They have also adopted an iterative, rapid development process, fostering an agile approach of experimenting, measuring, and quickly adjusting. As a result, the gap between the leaders and the other banks is gradually widening. To learn about how Lloyds Bank Group established a new operating model to rapidly adapt and respond to future customer needs and deliver better digital services faster, I invite you to read our recent case study.
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PayTM Payments Bank Disruptive Effects To Be Felt Beyond Banking

Arnav Gupta

In 2016, India’s banking regulator opened up the banking sector to nonbank finance companies (NBFCs) and approved 11 of the 41 applications to set up payments banks in India as part of its ongoing initiatives to increase financial inclusion in the country. So far, PayTM, Airtel, and India Post have launched payments banks. They cater to different customer segments, have slight variations in their offerings, and offer significantly different interest rates.

Source: Airtel press release, November 23, 2016

Source: India Post Payments Bank corporate brochure, February 2, 2017

Source: PayTM website

All three firms have vast customer reach, owing to their existing customer networks, and the potential to amplify the financial inclusion agenda. Forrester believes that PayTM’s payments bank is most favorably positioned to leverage its adjacent financial services ecosystem of retail merchants, utility providers, eCommerce platforms, and mobile wallets.

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Time To Assess Your Omnichannel Maturity

Brendan Witcher

It's a fact: Every time customers are exposed to improved shopping experiences, their expectations are immediately reset to a new higher level. Today’s empowered customers expect seamless brand interactions across every touch point, forcing organizations to replace outdated thought-processes and legacy systems with new ways of doing business. That said, many digital strategy and commerce leaders are either not sure where to start, or simply failing to deliver excellence within customer journeys through existing omnichannel capabilities. Forrester’s Omnichannel Maturity Assessment tool, created by Claudia Tajima and myself, helps organizations discover their current maturity level, and understand what steps they need to take to reach omnichannel mastery. 

The assessment challenges organizations to evaluate their retail business across three dimensions:

  • Digital customer experience
  • Digital operational excellence
  • Omnichannel customer engagement

Organizations must score themselves across seven modern omnichannel capabilities that leading retailers are executing today:

  • Enterprise inventory visibility
  • Ship-from-store
  • Ship-to-store
  • Endless aisle
  • Omnichannel value adding services
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Open Banking Is Open For Business

Jacob Morgan

Open banking is rapidly heading to the top of the agenda for retail banks across the globe. BBVA today announced the launch of its open banking business, joining the likes of Nordea, which launched its open banking site in March. In the UK, the Competition and Markets Authority obliged the top nine banks to create an open banking standard; the first stage was reference data (e.g., branch opening hours and loan data), which was delivered in March. However, open banking isn’t limited to Europe. In Australia, the House of Representatives recommended the development of a binding frameworkto underpin data sharing for open banking; in April, the Monetary Authority of Singapore announced plans to make its own data available via an open application programming interface (API) and made no secret of its enthusiasm for open data. We’ve seen no formal moves in the US so far, but The US Bureau of Consumer Financial Protection put out a Request for Information Regarding Consumer Access to Financial Records in late 2016.

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