Bank of America Essay Example for Free

blaspheme of the States EssayThe app arent problem in the lodge of the States compositors case study is that Jen McDonald (head of the Bank of America digital marting group), and Douglas Brown (senior vice electric chair of quick product development) received requests to create mobile apps much specific for individual businesses as a way to gain leverage (Supta Herman, 2012). Brown, specifically, was hesitant to add additional mobile app lineaments as he feared it would sour the occupation far too complex.Not only would it prove to be difficult for some users to understand, more(prenominal) features very much make applications run more slowly, which could complicate the idea of mobile bank buildinging. In addition this could perhaps give the client a more negative experience. To cite the problem specifically, Brown stated App complexity has led to some naughty-profile failures in the market place. This carries a huge risk (Supta Herman, 2012). Furthermore, Ba nk of America was provided $20 billion in capital from the United States government during the financial crisis under leadership of CEO Kenneth Lewis (Supta Herman, 2012).Lewis had concerns that certain investors and customers would start to correlate Bank of America with Citigroup, who had previously given up 36% of its ownership to the federal government (Supta Herman, 2012). This resulted in Brian Moynihan (head of consumer and small business banking) taking over as CEO on January 1, 2010 (Supta Herman, 2012). Constraints and obtainable options One of Bank of Americas options was to create different apps to target different groups and market segments, which prove to be somewhat of a risk.Not only was the organization concerned for the customers reaction, Bank of America was excessively hesitant because mobile apps are costly and in doing so, technology resources would be proposen from other substantial areas of banking such as online banking and atm machines. At this t ime customers were not completely pulling in working with their banks, as financial struggles were becoming more and more apparent. In order to give theBank of America the bank name and customer loyalty it had previously held for so long, executives decided Mobile banking was the right path to take in order to save the company.Analysis and Evaluation The bank of America officially pitched their mobile banking application in May of 2007. This included the ability to bank on the customers phones either by application or by accessing the mobile web through their phones browser. Douglas Brown confirmed that the success of the mobile application was amazing as the company gained four million mobile banking customers over the time span of less than 3 years (Supta Herman, 2012).Because of the high level of success, business managers were eager to update the applications, in an effort to raise the level of functionality even higher. This proved to be a decision that had to be careful ly considered by the Bank of America corporate team. Strengths The Bank of America already holds the title of being one of the most prestigious banks and a leading company in the U. S. Because of their household name, marketing new products prove to be fairly on the loose(p) however identifying a product that customers go out adopt and figuring come in the target market are essential to Bank of Americas success.An additional strength of the mobile banking application was the timing in correlation to the launch of the application and the launch of the iPhone, making Bank of America the first bank to be able to tour a banking application on the iPhone. The most used features of mobile banking came from viewing draw balances and viewing transaction details, making debit card holders the most popular users. After the mobile banking launch more customers opened checking accounts in the months of the introduction of mobile banking and did in fact use the application during that time. WeaknessesA flunk shown by Bank of America proved to be within technology adoption and which hopeful phones the mobile applications could be used by. The Bank of America was slow to adopt SMS technology and access to mobile banking was limited. It was only available to those who used online banking with Bank of America, therefore leaving a huge portion of customers out and feeling negatively about the new product. Another weakness in the new mobile application was that it had to be created with more features than competing mobile applications, which added the risk of making the mobile app more complex.Complexity is a weakness when striving to offer a simple and functional upgraded product to customers. Furthermore, the bank was recovering from the financial crisis, which caused a great loss for a company as big as themselves, as customers had to put a curb to their spending. They similarly feared they damaged their name in asking for $20 billion in federal backing which proved to be a huge mistake. Bank of America did not want to be associated with other banks that had borrowed capital, but in turn were forced to give up a percentage of their company.Opportunities In analyzing the Kotler Keller text, marketing opportunity is described as a buyer taking interest in something that has the prospect to make a profit (Kotler Keller, 2009). The introduction of mobile banking was a huge opportunity that the Bank of America capitalized on. When mobile banking was introduced costs per transaction started at 10 cents and were expected to drop to 3 to 4 cents. cash machine costs were already 1. 34 per transaction which provided an advantage to debit card holders with low account balances.They in like manner benefited in that they could easily check their account balance through their phones before making a purchase. The Bank of America capitalized on the opportunity to offer this feature to customers for absolutely no cost. This was a huge positivist in gaining additional customers and fans of mobile banking, as other banks had already begun to waive ATM fees during the times of the market dropping. Mobile banking was a way for Bank of America to bounce back after financial crisis and offer users an experience they had never before been exposed to.The novelty of the design and idea would bring trust and note value back to the company. Threats A strength threat of mobile banking was that expanding on apps and adding new features can turn potential customers off because it tends to make banking more complicated throughout the introduction process. Surveys and research overly showed that 44% of customers did not see a need or any type of value within mobile banking. When introducing a new product, buyer behavior tends to be very guarded as customers are reluctant to trust a pone application to keep their banking statements and accounts secure at all times.Major competitors are also a threat that the Bank of America faced. Major Banks such as Wellsfargo, Citigroup and PNC, to name a few, also offer mobile banking with virtually the same functions and applications. Mobile banking was also seen as a threat because of the high initial costs, however, from a marketing perspective, if the Bank of America were to pay bare(a) costs to set their mobile applications apart from competing banks, the additional features would be worth the price in customer popularity and satisfaction. RecommendationsBecause mobile banking has been introduced by so many other banks, the best tribute would be to create a form of mobile banking that is more secure and user friendly than competing applications. These are the two issues that customers seemed to have the most doubts about, so putting extra emphasis on these areas leave behind surely set the Bank of America apart from others. Another recommendation is to target one particular sense of hearing and market to them specifically, therefore making age and stage in the life cycle of great importance.It is likely that the younger generation exit be much more open to yet another phone application, as it is the norm for them, and will provide huge relieve to another aspect of their lives. This may result in the younger generation taking more gap when it comes to banking and gaining more responsibility in this aspect of their lives. Phone applications makes it easy to transfer money and to check balances, providing an sentiency of your funds 24/7, opposed to only during banking hours.Kotler Keller advices marketers to take the following three steps when marketing a product 1. Compare it with a product that consumers already know about, making it more comfortable for them to animal the purchase off of a past decision (Kotler Keller, 2012). 2. The lure of free is almost irresistible (Kotler Keller, 2012). 3. Consumers often experience the optimism bias or positivity illusion. They tend to overestimate their chances of experiencing a positive outcome and decry the ir chances of experiencing a negative outcome (Kotler Keller, 2012).These steps are recommended to the Bank of Americas target audience in order to raise popularity and awareness of the mobile banking application. In other words, it is essential to understand the means of consumer behavior. Kotler Keller define consumer behavior as how individuals come up with ideas and experiences that work to satisfy the customers wants and needs. The customers desires will be met in that the mobile banking app will be free to current customers, which will already account for a huge part of the appeal.Compared with online banking, which customers are likely to be more old(prenominal) with, the target audience will see the mobile app as an easier, faster version of a feature they already value. Furthermore, because of the optimism bias and positivity illusion, customers using this product are more likely to feel it will improve their financial security and well-being. Lessons Learned In the rev iew of the entire Bank of America case study, it is apparent that control was an issue that was brought up as the main concern of the customer in evaluate the new application.Customers were weary at first, as they had concerns for the security of their finances and feared they were giving up control of their bank accounts to a mobile application. In retrospect, the customer actually gained more control over their finances as they were able to access them from nearly anywhere in the world. This goes to show how identifying with the customers emotions and providing them with a product that gains their trust and eases their concerns, will make the innovation and the company that much more successful.