Scotiabank closes online gap

The Bank of Nova Scotia, the last of the big banks to enter the online banking fray and by far the furthest behind in the number of online customers, has been busy trying to close the gap with a recent promotion...

The Bank of Nova Scotia, the last of the big banks to enter the online banking fray and by far the furthest behind in the number of online customers, has been busy trying to close the gap with a recent promotion for its Scotia OnLine banking service.

The promotion, which offered Scotiabank customers who signed up for the service the chance to have their bills paid for the next year, took the form of a direct mail piece in the shape of a laptop computer.

Customers were invited to log onto www.mydemo.scotiabank.com, enter a supplied personal identification number and see for themselves how Scotia OnLine could make it easier to pay bills, transfer funds between accounts and buy GICs and mutual funds.

Those who then paid at least three separate bills of $15 or more via the online service had their account fees waived for the next three months and became qualified to win up to $10,000 in bill payments over the course of a year.

According to Bob Grant, Scotiabank’s vice-president of electronic banking, the promotion and online demo was originally intended to run to the end of December, but was extended to this month when it proved successful at generating trial. The bank actually launched its online service in the summer of 1997.

‘So far, it’s exceeded all our expectations,’ he says of the latest program. ‘We thought using the combined approach was how we needed to do it. While I don’t want to give hard numbers, I can tell you that of all the people who tried out the demo, half have signed on, and we thought 20% would be doing well.’

While determining the offer was relatively painless, it was more difficult to come up with a list of prospects. As Grant suggests, it wasn’t easy to divine from bank customer lists who was wired at home, and who wasn’t.

‘We couldn’t actually tell if they had Net access,’ he says. ‘But we could predict the likelihood of whether they had access, based on information from Compusearch [Micromarketing Data and Systems], Statistics Canada and our own files. We had a good idea who had Net access but wasn’t necessarily using it to do online banking.’

He figures there were two reasons why there was some reluctance on the part of bank customers to go online: they were either unaware of the wide range of services available, or couldn’t be bothered to give it a try.

‘The safety and security part of it wasn’t an issue,’ he insists.

According to figures provided by Scotiabank, the financial institution has about 175,000 online banking clients, bringing up the rear among Canada’s major chartered banks. It was the last bank to wade into the online banking waters when it launched Scotiabank OnLine in 1997, trailing its competitors by one to two years.

Despite its perceived image as the financial institution of choice for the 50-plus crowd, Scotiabank has a much broader customer base, says Grant, one that is well-suited to online banking.

‘That may have been true of Scotiabank at one time,’ says Grant of the bank’s perceived customer base. ‘But today, the population of the bank reflects the population of Canada.

Not only was the Scotiabank OnLine promotion intended to open up an additional channel of communication with customers, says Grant, but to showcase the bank’s new service capabilities. Customers can now buy and sell registered and non-registered securities online, for example.

It doesn’t hurt, either, that by encouraging customers to use an online channel of delivery, the bank can cut further costs from the system.

Mississauga, Ont.-based direct marketing agency Rapp Collins Communicaide handled the creative and project management for the direct mail piece. Toronto-based Modem Media·Poppe Tyson, meanwhile, designed the Web site.

‘A great thing about the demo site,’ adds Grant, ‘is that we could almost literally watch (collective) customer behaviour – where they went, and where they didn’t go to. That means we could modify the site during the campaign.

‘That’s marketing at Internet speed.’

Bank on it!

Banking customers are heading online

Bank of Montreal 1,000,000*

Royal Bank 630,000**

CIBC 500,000

TD Bank 300,000

Scotia Bank 175,000

* Includes mbanx, PC banking and Investorline customers

** Includes online and PC banking

customers

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