Embed Size (px)
Citation preview
Bank Of Montreal
CASE STUDY
Bank of Montreal
CASE STUDY
Copyright ©2015 by Strands
All rights reserved. No part of this publication text may be uploaded or posted
online without the prior written permission of the publisher.
For permission requests, write to the publisher, addressed “Attention:
Permissions Request,” to [email protected].
Bank of Montreal | CASE STUDY
In 2011, Canada’s Bank of Montreal (BMO) embarked on a
quest to “Make Money Make Sense” for its customers.
To help realize this mission, the bank enlisted Strands to
design and deliver MoneyLogic, a widget-based personal
financial management (PFM) tool that gives BMO customers
a clear and holistic picture of their financial situation.
Read on and discover how Strands-powered MoneyLogic
helped BMO become a 3-time Model Bank Award winner…
INTRODUCTION
Bank of Montreal | CASE STUDY
Meet BMO 5
The BMO Challenge 6
Solution: Strands PFM 7
Benefits: Proven Performance Results 9
Taking it Further: MoneyLogic Upgrade 12
Recognition & Awards 13
Index
4
5
Bank of Montreal | CASE STUDY
Meet BMO
Bank of Montreal (BMO), founded in 1817, is Canada’s first bank. It provided
Canada's first circulated currency, and has played a major and continuing role in
the development of the country. Today, BMO is Canada's 4th largest bank and
has a significant presence in North American and world markets. The bank
serves more than 12 million personal, commercial, corporate, and institutional
customers, 2.5 million of which are online banking users.
Introducing MoneyLogic
MoneyLogic is a widget-based personal financial management (PFM) tool that
helps BMO customers gain immediate insights into their day-to-day spending
and finances. With functionalities ranging from automatic expense categorization
to net worth, savings goals and peer comparison, MoneyLogic became an
award-winning success by helping BMO meet their business objectives of
providing a superior customer experience while increasing retention and
sustaining growth.
Country: Canada / Sector: Retail banking / Product name: Strands PFM Branded name: MoneyLogic / Number of users: 2.5 millionChannels: Web, tablet / Technology: Java, Oracle
Bank of Montreal | CASE STUDY
The BMO Challenge
BMO customers were expecting a more interactive online presentation of their
finances and wanted more value from their banking relationships. BMO’s top
business priorities therefore became to drive quality earnings growth across
North America by delivering an industry-leading customer experience within its
personal banking offering, and to enhance productivity within operations and
sales. With this in mind, BMO set up 2 key strategies:
1. Compete on value by creating lasting relationships with customers
2. “Make Money Make Sense”: empower customers by helping them
control spending, grow their savings, borrow smarter, and invest more
wisely.
BMO concluded that they needed to offer digital services that included personal
financial management tools and features. Head of Online & Mobile Banking Dan
Dickinson explains:
“One alternative to achieve this goal was to invest in additional branch personnel
and train them to provide the same PFM services to bank customers directly.
BMO operates over 1,500 personal and commercial branches in North America,
so this option was deemed to be too expensive to deliver. In addition, branch-
delivered PFM services would not have provided an effective vehicle to collect,
analyze, and take advantage of the extensive customer data that the PFM
solution provides.”
6
Bank of Montreal | CASE STUDY
Solution: Strands PFM
Why Strands?
Upon deciding that they needed a white-label solution provider, BMO started
searching for a market-leading PFM vendor. According to Dan Dickinson, the
ability to meet the specific needs and requirements outlined above, combined
with proven experience in PFM implementation were the main reasons for
choosing to partner with Strands.
By all accounts, the MoneyLogic project reached an “on-time, on-budget”
outcome. During implementation, Strands’ flexibility and solid teamwork stood
out, especially with teams working closely together to solve both technical and
business-related challenges.
Taking Action: From white-label PFM to MoneyLogic
BMO took Strands’white-label PFM solution and made it their own by taking
advantage of the full set of customization options, such as choosing the widgets
that would best meet their customer needs and obtain maximum brand value.
But before the front-end could function perfectly, the back end had to be
seamlessly integrated, a process that never unfolds without a few technical
hurdles. For instance, BMO faced challenges in correctly sizing the IT
infrastructure for MoneyLogic on its IBM servers. Strands resolved this issue by
engaging with the IBM innovation centre to conduct stress and load tests that
Strands ability to meet the PFM needs and
requirements of BMO, and its proven experience in
PFM implementation were the main reasons in
deciding to partner with them. - BMO
“
7
Bank of Montreal | CASE STUDY
identified the limits for a given IBM IT configuration. This enabled BMO to
determine the optimal hardware requirements for MoneyLogic.
Another technical challenge was to load data from BMO’s database into
MoneyLogic in near real-time. This approach was necessary to ensure that each
user’s data would be updated on MoneyLogic every time he or she logged into
online banking, in addition to daily batch updates. To meet this requirement,
Strands created a specific abstract code to load transaction data from the
application logic layer. As a result, MoneyLogic now supports dual-level data
updates.
8
Bank of Montreal | CASE STUDY
Benefits: Proven Performance Results
Added Value by Business Area
After conducting several interviews with BMO, Forrester Research constructed a
Total Economic Impact (TEI) framework to determine the qualitative &
quantitative benefits delivered by Strands PFM. These benefits have had a
tangible impact on 4 key areas across BMO retail banking operations: marketing,
customer service, sales, and channels.
MARKETING
Investing in Strands PFM boosted BMO's reputation as a leader in banking innovation
MoneyLogic differentiates BMO from the competition
MoneyLogic helps BMO target millennials
Data-driven analytics of user behavior helps BMO create personalized & contextual marketing campaigns
CUSTOMER SERVICE
99% retention rate of MoneyLogic users
Within 1 year of launch, 25% of BMO online banking users registered for PFM & more than 50% created a budget
MoneyLogic helps strengthen trust-based relationships
Fresh, intuitive & interactive UI impressed & engaged users for longer (more "stickiness")
CHANNELS
MoneyLogic users doubled time using online banking
MoneyLogic users visited BMO website 2x as often
Increased number of touch-pointsacross devices translated to higher & longer engagement
SALESMoneyLogic users set up >15x as many pre-authorized payments vs. non-users
4x more BMO products opened by MoneyLogic users
Revenue from MoneyLogic users grew 5.5x faster than retail customers
Cross & up-sell opportunities expanded due to unprecedented availability of customer data
PFMCH
CS
SA
MK
The customer retention rate for MoneyLogic users was
significantly higher: 99%. MoneyLogic users are younger,
newer to BMO, and less likely to leave the bank.
Revenue from the average MoneyLogic user grew 5.5
times faster than typical retail customers.
- Forrester Research
“
“
9
Bank of Montreal | CASE STUDY
Return on Investment (ROI)
In 4 years, Strands PFM delivered $16,828,000 of benefits to BMO, resulting in a
ROI of 22% and a payback period of only 24 months.
Forrester Research identified the ROI of MoneyLogic by scrutinizing 3 areas:
savings from customer retention, profit associated with customer retention, and
value generated by reaching the market faster.
Further, BMO was able to avoid significant internal costs by developing its PFM
solution together with a third-party FinTech provider.
Dan Dickinson adds: “the Strands PFM solution is significantly more cost
effective than having our branch personnel provide customers with the same
services. There would also be too much labor and change management involved
to collect all the customer data now provided by Strands PFM. These ongoing
costs would have been more than
we spent on the Strands PFM
solution, and we would not have
been able to impact the same
volume of customers as quickly as
we did.”
MONEYLOGIC: ROI OVER 4 YEARS $
Savings from higher customer retention $10,202,000
Profits associated with retained customers $2,914,000
Savings from faster time-to-market $3,712,000
TOTAL BENEFITS $16,828,000
Project ROI 22%
Payback period 24 months
The Strands PFM solution
is significantly more cost
effective than having our
branch personnel provide
customers with the same
services. - BMO
“
10
Bank of Montreal | CASE STUDY
Customer Response
BMO’s customers responded very positively to MoneyLogic. In the words of Dan
Dickinson:
“We are excited about the response from our customers who have been looking
for a better way to get a clear picture of where their money is going. With almost
half of our personal banking customers doing their banking online, BMO
MoneyLogic provides them with immediate insights into their spending and
savings habits and helps them take better control of their household finances.
And the fresh, innovative, interactive user interface and functionality of the
Strands PFM solution impresses the BMO customers who use it.”
Lynne Kilpatrick, Senior Vice President, added: “BMO MoneyLogic has proven
wildly successful with our customers, who set almost 300,000 budgets within
just two months after the launch.”
The fresh, innovative, interactive user interface and
functionality of the Strands PFM solution impresses
the BMO customers who use it. Our customers set
almost 300,000 budgets within just two months
after the MoneyLogic launch. -BMO
“
Within 1 year of launching MoneyLogic, 25% of BMO
online banking users registered to use PFM with
over 50% having created a budget.- Forrester Research
“
11
Bank of Montreal | CASE STUDY
Taking it Further: MoneyLogic Upgrade
An important factor in MoneyLogic’s ongoing success is the continuous
improvements and upgrades of the tool both on the frontend and backend. A
steady influx of new technologies combined with the constant emergence of
new UX standards necessitates a proactive and iterative approach in evolving
MoneyLogic to exceed consumer expectations. By partnering with a PFM expert
that keeps itself on the leading edge of
FinTech, BMO gains immediate access to
the latest industry innovations.
MoneyLogic has been upgraded to the
latest version of Strands PFM. Since the
newest release, the following features
have been added to expand the tool’s
capabilities:
1. Community: enables users to anonymously compare spending and
saving habits with the BMO MoneyLogic community.
2. Safe-to-Spend with Spending Plan: helps users forecast monthly
spendable income and expenses, and predicts how they will evolve
over time.
3. Net Worth: analyzes users’ total assets and liabilities to find out how
much they own and owe. Users can also monitor their historical net
worth performance.
4. Financial Calendar: enables users to view and track financial events in
a much more intuitive way, with a color-coded heat-map showing
actual and forecasted inflows & outflows.
The initial success of MoneyLogic’s web version eventually led to a tablet
upgrade as well.
An important contributor to MoneyLogic’s ongoing success isthe continuous improvements and upgrades of the tool.
“ 12
Bank of Montreal | CASE STUDY
Recognition & Awards
With the launch of MoneyLogic, BMO became the first major bank in Canada to
provide an online financial management tool that enables customers to set and
track savings goals.
2014 saw customer adoption and engagement in
their mobile banking channel grow significantly,
with active mobile users increasing by 80%, and
monthly logins & transactions up by 80% & 107%,
respectively. In 2015, Bank of Montreal was
recognized by Celent with a Model Bank Award for
excellence in digital banking for the third
consecutive year.
Bob Meara, Senior Analyst at Celent Banking Group, said:
"We are delighted to present BMO with a Model Bank Award in digital banking.
BMO continues to demonstrate best practices in the digital space by offering
their customers a simple, yet value-driven experience.”
Other industry commentators had positive things to say about MoneyLogic as
well.
According to Laurie Campbell, CEO of Credit Canada Debt Solutions, “Programs
like Money Logic assist in strengthening financial literacy among the populace
big time […] Through it, individuals and families can manage their finances in
smart, easy ways. […] Indeed, Money Logic’s user-friendly, step-by-step online
guide can make just about anybody
master of their personal financial
universe.”
Noting the “thorough and detailed”
interface which “can be customized to
meet specific needs”, Campbell
added: “Most interesting to me are
the spending analysis and budgeting
tools. You can quickly identify your
spending patterns right down to
those daily Starbucks’ expenditures,
BMO continues to
demonstrate best
practices in the
digital space by
offering their
customers a simple,
yet value-driven
experience. -Celent Banking Group
“
13
Bank of Montreal | CASE STUDY
and you can set realistic budgets that keep you on track through notifications of
your spending on everything from bills, utilities and entertainment, to
transportation, food, dining and more. Color-coded progress bars and
percentage figures tell you at a glance where you are at with the budget and
savings goals you set.”
Campbell went on to point out that the introduction of MoneyLogic not only
“reflects BMO’s market savvy”, but also sparked measurable changes in their
customers’ financial behavior: “Just last week the bank reported through a
survey that more Canadians are embracing financial planning after the recent
recession caught so many unprepared. According to the BMO poll, more than
one-half (56 per cent) of 1,002 respondents had a financial plan in place at the
end of 2010, compared to 34 per cent one year earlier, and 25 per cent the year
before that.”
Colin Henderson from BankWatch writes: “BMO has surprised a few with
introduction of a very cool tool called BMO MoneyLogic, that is tightly integrated
into online banking. There are nice
graphs and a very pleasant and easy to
use interface. This is great to see and is
probably the best offering of its kind
amongst Canadian banks to my
knowledge. Well done BMO.”
Money Logic’s user-
friendly, step-by-step
online guide can
make just about
anybody master of
their personal
financial universe. -Credit Canada Debt
Solutions
“
14
WWW.STRANDS.COM
ABOUT STRANDS
Strands develops innovative software that enables banks to offer personalized digital
banking experiences. The Strands Finance Suite includes a comprehensive set of
white-label solutions such as PFM, BFM, CLO & REC. In 2008, Strands revolutionized
online banking by deploying the first PFM in Europe.
From our Barcelona HQ and offices in San Francisco, Miami & Buenos Aires, we serve
top-tier banks including Barclays, Deutsche Bank, BBVA, BNP Paribas, Bank of Montreal
(BMO), & PostFinance.
Bank of Montreal
CASE STUDY
