My dream of mobile banking has turned into a nightmare

I was an earlier adopter of mobile banking, which is no surprise as I was the head of product at Monitise when we launched the UK’s first mobile banking apps in 2006.

Back then I used to tell sceptics how I often found myself checking my bank balance on my Nokia even when I was sitting in front of a perfectly good computer. Why? Because it was so much faster to click an app, enter my 5 digit passcode and get my balance. At Monitise I set a user experience goal of being able to complete any transaction within 30 seconds from start to finish. And that meant from the moment a customer identified a need to getting the result, no starting from a logged in app here – convenience was the heart of mobile banking, and it needed to feel instant or as close as possible. And on that little old Nokia, with an old school GPRS network I would regularly hit the target for balances and statements.

7 years later and we have super-fast mobile networks and smartphones with hi-res touch screens, gyroscopes and probably more raw computing power than the Space Shuttle, and yet I’m a lapsed mobile banking customer. My first reaction today when sitting in front of a computer is to log on to internet banking, and with my new smartphone I never just quickly check my balance as I used to do regularly on my old Nokia. For me mobile banking is now only used in emergencies when I need to take action that cannot wait. My bank hasn’t changed but their mobile banking has (and I no longer work for Monitise so this isn’t a pitch!). The new mobile banking has more functionality and a simply terrible user experience that’s confusing, unreliable and frustratingly slow. To be fair they constantly try to improve by tweaking the design and issuing regular updates – unfortunately as an occasional user that means I’ve had to wait for the app to update every time I’ve tried to use the service in the last 6 months. The result of 7 years progress in software and hardware is a 45 second benchmark for an account balance on WiFi, and closer to a minute on a mobile network connection. It takes me 14 taps to get to a balance, when it used to take 7 (5 of which were the passcode!). The end result is that today it’s faster for me to log on to internet banking, and it’s also a much nicer experience.

I’m sure there are better banking apps out there, for a start many Monitise apps still use a 5 digit passcode which is so much easier than a complex password on a mobile device, and secure enough when combined with 2 factor authentication (the app on the phone being a soft token). But this story isn’t really about mobile banking. Rather it’s about maintaining a clarity of vision for you product, making sure that you really understand what’s important, and never, ever, comprising on your core benefit because changing customer behaviour is hard work, but doing it twice is nigh-on impossible.

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We need to talk about ‘mobile first’

Every time I hear the words ‘mobile first’ it makes me shudder just a little – when we should be thinking about how connecting people will transform future business, ‘mobile first’ feels technology centric and rather short-term. Today ‘mobile’ still makes people think of phones, tablets, and other devices, and if mobile is first then what comes second? Are we drawing a line between different channels when we should be building a consistent, seamless user experience? There’s a risk that thinking ‘mobile first’ produces tactical solutions, focusing on today’s technology and yesterday’s way of working. We can all celebrate our shiny new mobile app, but the jobs not done, in fact we’ve only just started.

Now, think long-term and user centric – people are increasingly connected across multiple channels, we are becoming ‘always connected’. In the connected world mobile is a user context not a technology, it’s about interacting with users anytime, anywhere on their choice of channel. Today that means smartphones, rugged PDAs, tablets, laptops, and desktops as well as voice and face to face; but tomorrow that means wearables, smart TV, embedded tablets, combinables, the internet of things, and who knows what else. The future of mobile technology is not predictable. The only constant is that people will become more connected and their ability to interact will become infinite and all encompassing. That’s a revolution in communication that will require a whole new way of doing business. Thinking ‘people first’ with an always connected experience means completely forgetting about how business works today and imagining how business could work if everyone can interact when-ever and wherever with whomever they want. Of course in reality we’re a long long way from the omnipresent omnipotent mobile network, but what we have today is already capable of disrupting entire industries and in 10 years’ time today’s mobile technology will look like a Ford Model-T compared to a F1 car with self-drive technology.

The music industry is a good test case, it’s already been disrupted and is slowly maturing towards a connected experience, but the disruption is far from over, in fact it’s probably only just begun. People often think that the CD or digital download is the product that they’re buying, but in reality that’s just the packaging, a CD or download is just the box for the content. What you actually buy is the rights to play that content as much as you want for as long as you live (and possibly beyond). Even Steve Jobs couldn’t let go of the idea that you had to own something when you purchased a song, he dismissed the idea of subscription music and believed that customers would always want to have something physical, even if it was a download on a device. Strip everything back though, and why do you need to own anything? If you own the rights to play a song, and you can stream that song from a server somewhere then you don’t actually need to own a copy of the content. A downloaded song is no different to vinyl, tape, or a CD – it’s just another box for some content – and in the end we always throw away the box. Spotify, Netflix, Google Play, Amazon – in the long term they will sell us a licence to some content and provide a connection to access that content from wherever we are using whatever channel we choose. This is the ultimate development of lean thinking – focus on the value and get rid of everything else.

Everyone thinks their industry is different, special, it can’t happen to them but barriers to entry are falling down and power is shifting. As everything becomes digital and access to knowledge becomes democratised, the always connected world is super-charging the power shift from organisations to individuals. This is an unstoppable force which creates unprecedented opportunities for disruption and re-invention. If banking and payments, possibly the most regulated and protected industries in the world, can be disrupted, then every industry will be. If you’re not innovating and disrupting your industry then someone else will be.

There’s nothing wrong with thinking mobile first of course, but it only helps with today’s needs – it’s not the path to long-term success. We must think ‘people first’ and ‘always connected’ to create a vision of a connected experience for our consumers, customers, employees, partners, and suppliers. The connected experience will drive unprecedented business model and process innovation – reinventing business for the connected world and the mobile enterprise.

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Don’t ignore a ‘faster horse’

Henry Ford is often quoted* as saying “If I’d asked my customers what they wanted they’d have said a faster horse”. in product management this is often used as an example of customers not knowing what they want, when actually it’s a customer telling us what they need expressed in a way they understand – the current solution. Don’t be too quick to dismiss a ‘faster horse’ because it’s a gold mine of latent needs and acceptable constraints.

Customer needs We know how quick a horse is, so we can establish a baseline. We also know that when it comes to faster or better we need to make a step change to win customers and change behaviour. A little bit faster just won’t cut it, 10% is marginal, so let’s go with 50% faster – so that’s an average speed of about 25mph and top speed of around 45mph.

Next, what is a horse for? At the time it was a mode of transport, and possibly, occasional entertainment. As a means of transport the horse has a number of characteristics, it can easily carry one person, maybe two for shorter distances. It can also carry some luggage or goods. It is pretty adaptable when it comes to terrain but for speed it needs a relatively flat and smooth surface.

Constraints and Limitations ‘Faster horse’ also helps us to define some acceptable constraints and limitations. A horse can travel a certain distance before needing food and water, they need a space to be stabled at either end of the journey, they need regular maintenance, you need to learn how to ride, and they cost a certain amount to buy and have a limited lifespan.

For a new product to be successful in replacing the horse as a means of transport it must do the key things a horse can do, have similar constraints, and be significantly better in some aspects. And, of course, the first Ford Model T fits the bill – it could carry one person with luggage faster and further than a horse, or upto 4 over a long distance, and it was affordable and manageable by the average person.

OK, so this is a retrospective exercise and we can make it fit the Ford Model T quite nicely thank you, but the point is that customers may not know what the solution is but they definitely know what they need. Don’t take customer feedback at face value, you need to look beyond what customers say they want in order understand what customers actually need. There are hidden gems in everything customers tell us.

*There appears to be little evidence that Henry Ford every said this, but we shouldn’t let that get in the way of a good quote.

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Don’t misunderstand Minimum Viable Product

I’m starting to think that Minimum Viable Product is the most misunderstood term in product management today. To be fair the name is rather misleading because it’s not really a ‘shippable’ product at all. Rather MVP is a strategy for rapidly testing assumptions and ideas in the real-world. Think minimum effort for maximum learning, and not just any old learning, this is learning validated by your potential customers.

Actually, it’s much harder than just launching a product with minimal functionality, because you need to invest time in understanding what to test, how to test and analysing the results. There are many different ways of doing this, but here are 2 common approaches that help to explain the concept: prototype launch or deploy now code later. You might want to read that last one again, because at first it doesn’t seem to make any sense!

Deploy now, code later: You have an idea for a new product, let’s say selling mini-houses for squirrels, but there’s no data to justify the investment or even create a vision. You could design a basic product with the minimum functionality, build your first batch and launch, but that’s a high risk strategy prone to failure. Alternatively you could use an MVP strategy – what’s the least you can do to get the maximum learning – so you create a web site that explains the proposition, but only has a ‘tell me more’ button where the customer can provide details. You then market the website and see how many people click the button. With minimum effort you can test your assumption that people want to house squirrels and get some data on potential market size. This isn’t traditional market research, it’s real-world validated learning – in the customers mind your product exists. You can then move to the next assumption, and use MVP again until you have enough data to commit to building your first real product.

Prototype launch: Sometimes an MVP approach will mean building some functionality, but again, it’s just enough to test an assumption – remember, minimum effort for maximum learning. Sometime in the late 1990’s a UK supermarket chain thought online grocery shopping might be a good idea, but there wasn’t any data in the UK or anywhere in the world really. They didn’t know how or if customers would use the service, would it replace the weekly shop, be used for a few essentials, or something completely different? That meant they didn’t know what deliver infrastructure would be required and making a mistake there could be very expensive. They used an MVP strategy, which was clever because it hadn’t been invented yet. To understand online shopping behaviour they needed to have real customers using the service. So they built a website that allowed customers to order their shopping online but that’s all they built. Online orders were manual entered into another system, printed off in Glasgow, faxed to the local store, where a shopping assistant would walk-around and fill the trolley, before it was loaded into a van and delivered. Of course they lost money on every online order, but for a minimum investment they learnt how customers used online shopping. Armed with that data they understood where online shopping fitted into their overall strategy, built a business case and designed the distribution and delivery infrastructure required to create a successful business.

These approaches are quite different, but they’re both about getting maximum learning for the minimum effort, and not about creating shippable products – validated learning, that’s what minimum viable product strategies are all about.

And if you don’t believe me then here’s the masters voice http://www.startuplessonslearned.com/2009/08/minimum-viable-product-guide.html

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Are you looking at features when you should be thinking benefits?

Whether a product is digital, physical or even a service the features are the ‘buttons’ and ‘knobs’ that do stuff, while benefits are the advantages or rewards we get for pushing and twirling.  Like a rat in a laboratory experiment, if button A gives a treat then we’ll keep pushing it. It’s the same for a complex piece of enterprise software, just with more buttons and bigger treats. Now if our rat thinks that buttons=treats, and he has a choice between a box with one button or a box with 5, then which do you think he’ll choose? Of course he only needs the one button to get a reward but 5, well it’s better isn’t it?

In the perfect product every feature delivers a benefit to the customer, but to be valued those advantages and rewards must map to a real customer need. Features are just how you get from one to the other.

Some products appear to prioritise features over benefits, and who hasn’t been guilty of buying X because it had more bullet points in the brochure than Y? The interesting thing is that, no matter why we buy something, it is the benefits that keep us using it. And sometimes it’s all those features that make us stop – complexity sneaking in to mess things up and make us wish we’d bought the simpler, cheaper model.

There really is nothing for free in this world, and there’s always a cost for any benefit. And when I say costs, I don’t just mean money. Every product has some form of inconvenience, learning how to use it, installation, registration, payment, keeping it charged, cleaning it, servicing, the list is endless. For the customer utility only comes when the benefits outweigh that inconvenience.

I never ‘got’ the iPad. Yes it’s a nice object and clever (and I don’t mean technically but rather because it was based on the iPhone ecosystem, that was genius). I just didn’t get the point of such a big and heavy mobile device. I don’t have the evidence but I’m guessing that most are used on the sofa in front of the TV and never travel further than a few feet from the power socket. A great list of features but for me not enough obvious benefits to overcome the cost, literally in this case. Now Steve Jobs believed that a small tablet was pointless, but when the Nexus 7 appeared on the scene, it was smaller which made it more portable and cheaper. That was enough to make the risk worthwhile and for a long-time it became my constant companion. Small enough to go everywhere, powerful enough for my needs and just cheap enough not to matter. 7-inch tablets now dominate the market, including the iPad mini of course.

There is an unhappy epilogue to this story though, because although the Nexus 7 is still a regular companion, it’s no longer a good friend. It’s a problem unique to computing, as the software develops the hardware cannot cope. So nowadays my companion is rather slow and quite grumpy most of the time – and it’s all becoming a little too inconvenient.

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It’s not PFM, it’s just me and my money

IMG_3173It is with great joy that I read Chris Skinners’ PFM is already out-of-date … we need PFM squared which talks about the value created when Personal Financial Management meets payments. This is the beginning of the connected experience for banking, joining the dots in the value chain to create a simple service by making the network disappear, leaving only the value. The original iPod is the classic connected experience example, connecting the music publishers with the act of listening any place any time. Orchestrating many stakeholders to deliver such simplicity is hard work, but the resulting experience can be revolutionary.

Some predict that NFC mobile payments will wither and die because it creates little if any value for the consumer. Of course they’re right, replacing a swipe with a tap has no real value – if it did then we’d all be using contactless cards by now. Then again that tap is just a feature of NFC, the real value is in the fact that I’m tapping my smartphone and that means that I could be connected to my money every time I pay. Like a card payment, NFC gives the consumer a simple way to pay using the phone – keeping the act of paying as easy as today while opening a door to new value. The question then is not about how I pay but what value can be delivered when I pay?

Many believe that loyalty and vouchers will be the ‘killer’ app for mobile payments but I’ve  seen little evidence of this and remain unconvinced. After all is the consumer really crying out for a better voucher experience? Like contactless cards, I don’t believe it’s enough on its own to change how we pay. What we really need is a new way of managing our money – the digital equivalent of cash and a wallet.

Today’s Personal Finance Management is getting smarter but it needs to be part of every day life, it needs to help me manage my spending at every payment. Just making PFM mobile isn’t enough because money management needs to be connected to spending. It needs to be there, in the background, all the time.  The real magic comes when smarter PFM is embedded into every day life through mobile payments. Then every payment will keep me informed about how much I’ve spent and how much I’ve got left to spend. I won’t have to check if I’m spending too much, I’ll already know. Then I truly become connected to my money and in control of my spending. Then it’s just me and my money.

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Peak Apple

The iPhone and the iPad are great products sitting on top of Apple’s supremely successful app/content ecosystem. Even though iOS is looking rather dated nowadays and iTunes has never really been that good, they are still more than good enough for most peoples’ needs and the whole is definitely greater than the sum of the parts. Overall there can be little doubt that Apple’s mobile offering is the best in the market.

Aiguille de Chardonnet

So why does it appear that we’ve reached peak Apple and from now on it’ll be all downhill? Of course many advocates will challenge that statement, but stand back and look at how different Apple is today from this time last year. This year’s product launches have felt a little desperate with the usual great fanfare for an iPhone with a slightly taller screen and an iPad with a slightly smaller one. It’s probably best not to mention the iMap fiasco or the launch of the new iPad, followed shortly afterwards by the launch of the even newer iPad. It all seems rather reactive and defensive, where has the innovation and that fabled product release cycle gone? This isn’t the Apple of old and the changes have nothing to do with Tim Cook’s leadership, rather this is the result of a longer journey and a destination that was almost inevitable.

The iPad’s much heralded grip on the tablet market is slipping; with IDC reporting that in Q3 2012 iPad has 50% of the market, a steep decline from 66% in Q2. Still, half the market is a fantastic achievement, but with recent launches of very good lower cost Android tablets from Google and Amazon there is every sign that this is only the start of the iPad’s decline. Possibly more significant is the recently reported loss of faith in the Apple followers, with Strategy Analytics finding that ‘only’ 75% of current iPhone owners in Western Europe were likely to buy another Apple smartphone. Again 75% is a fantastic achievement but a year ago it was a mildly stunning 88%.

From a personal perspective, the iPhone 4S is possibly the perfect device, so why have I recently purchased an Android tablet and phone? For a tablet the 7inch format is just about perfect for anyone who wants to use it on the move and until the iPad mini, Apple thought a small tablet was a stupid idea but that’s not the whole story. For a smartphone the iPhone ticked all the functional boxes but still I couldn’t quite bring myself to buy one.

When I thought about it there were 3 main reasons:

  • Apple is just too expensive: the competition is almost as good, and in some places better
  • I don’t want Apple deciding what I can and can’t do: I love that it all works so seamlessly but I want the freedom to choose what’s best for me
  • I don’t like Apple: I like the products but not the company

That last point should be the most concerning for Apple, focusing on making great products is one thing but you also need to be a good ‘citizen’. I don’t think I am the only one who no longer feels Apple is something to aspire too. It’s starting to feel a little like BMW in the late 80’s – undoubtedly great products and engineering but all a little too smug and arrogant. BMW managed to turn that around, preserving the good stuff but getting rid of the attitude.

Somewhere along the way Apple started to believe its own hype and that arrogance was only ever going to end up here – peak Apple.

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