Mapping The Vast Indoors

A few years ago, my old friend Brad McCallum (who is now at APOS integrating BI and GIS) and I were doing a trade show for ESRI when Brad had a thought.  All of this trade show should be in a GIS, not just in a paper map.  And you should be able to use it to find what you want and navigate the show.

To which I said, all space can be mapped, including indoor spaces - and not just malls and airports and bus and train terminals, but casinos and libraries and you name it.  Including the space between your ears.  This is where GIS and CAD show their common parentage. 

Another good friend and colleague and GIS developer extraordinaire Kurt Gunther did just this - with hospital beds, in his great eBeds software that manages hospital beds, and the folks in them and serving them, just like they were GIS features.


Today, Google made it real for the average person.  "Google Maps 6.0 for Android brings the freestanding map directory to the palm of your hands," announced today on the Google blogs. These detailed floor plans automatically appear when you’re viewing a map and zoom in on a building where indoor map data is available.

For now, the data is limited - Ikea, a few Macy's, the Mall of America, a few major airports.  But we all know where we're going.  Where Brad said we would, more than ten years ago.  And the possibilities, for those of us in GIS land in general, and in ESRI and APOS land in particular, are infinite.

Bank of America Backs Down On $5 Monthly Debit Card Fee

Graphic: Joe Lackow

As it turns out, it was a short wait before Bank of America decided to cancel the $5 monthly debit card fee, wherein the customer is explicitly charged for accessing their own money with a card instead of a paper check.  Wasn't the whole idea to use the cheaper, greener card payment?  Nuh uh.  I guess.

Anyway, the bank announced today that they are backing down.    And the statement came directly from the COO, who is probably livid with his PR people right about now.  The official statement, from David Darnell, the Bank's Co-COO, which is probably just how Dave feels today.

"In response to customer concerns and the changing competitive marketplace, Bank of America no longer intends to implement a debit usage fee.  We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee,  Our customers’ voices are most important to us. As a result, we are not currently charging the fee and will not be moving forward with any additional plans to do so."

In other words, we invited regulatory, governmental and public scrutiny, we misinterpreted our original customer research, we were cynical about the stickiness of electronic banking and its weight on customer inertia, we failed to gauge the social climate about as badly as we misjudged the competitive climate - and our major competitors became so upset that we upset consumers so much, they cut and ran and left us twisting in the wind, alone.


I know that Pete Hart, who I worked for at First Interstate and who later became President of MasterCard and Cirrus and knows as much about how people like to use payment cards as anyone ever has, is bemused right now.  The industry got a black eye, and the COO had to step in, because they just don't have solid marketing people and strategic planners like Pete Hart and Dick Rosenberg at the helms of these big banks anymore.


Leading a balanced life with Richard M. Rosenberg, former CEO of Bank of America from Jewish Community Federation on Vimeo
Pete has retired, but Dick - who once ran Bank of America, and when he did, said that the assets of the bank walk out the door and go home every night - will still tell you how to live a balanced life.

Wells, Chase, Others Back Down on Debit Card Fees

Hey baby, there ain't no easy way out.

Wells Fargo announced on Friday that the 5 state test of debit card fees started on October 14 will be canceled.  TD Bank, the Canadian bank that acquired Commerce Bank last year, followed suit.

And, word is leaking out of Chase, accoding to the AP, that they will stop charging their $3-per-month fees when the current Wisconsin and Georgia pilots end next month.

Bank of America had news on Friday, too.  As with Chase, an unidentified source told the AP that B of A will offer ways for its customers to avoid debit card fees through using direct deposit, maintaining minimum balances and/or using their Bank of America credit cards.

Citibank, where debit card fees are already implicitly reflected in fees as high as $20 a month for the underlying checking account, is going to town talking about their never did, never will policy towards debit card fees.

Countering that, at least one credit union - Bethpage FCU in New York - is offering Free Checking for Life for new members of the Credit Union.  With commercial banks (like Chase) offering bounties of $100 or more to acquire a new customer, that might be pretty sharp marketing - communicating peace of mind and value, and spreading the bounty out over a longer period of time.

One thing is for sure.





The Waiting is the hardest part.  Tom Petty and the Heartbreakers, THANK YOU for supporting KCSN and playing our beautiful little Plaza del Sol theater at Cal State Northridge on Saturday night.  We will never forget you.

Relative Strengths of Banks v. Credit Unions

Copyright California CU League, graphic Joe Lackow 2011

In the past couple of weeks, we've seen a lot of anti-bank sentiment in response to the announcement of debit card fees, in the wake of reduced interchange income for the banks.  It has been salt in the wound of a huge bailout and  the role of banks in the foreclosure crisis, followed directly by bonuses and record profit.

This has extended to at least one representative in Congress who stood before us and told Americans to dump Bank of America to send a message about the $5 debit card fee.  I don't know about you, but as much as we may find banks culpable, I don't think that is very fair, nor is it the place of government to do.

As if consumers needed to be told, anyway.  They know how to vote with their feet really, really well.

And the Nightly Business Report video in the upper right of this page is but one example in a torrent of media coverage about Americans leaving B of A and other big banks in droves, and heading to their latest credit union.  In fact, one of our major CU clients hung signs in their branches with a big $5, in a big red circle, with a big red slash through it.  Other reports, from credit union leagues to the bar on the corner, are that there is a significant uptick in CU membership happening right now.

But whether you are a bank or a credit union or a consumer, there is something solid to be sold and to be bought, and tradeoffs to be made.  As the NBR report suggests, those who value convenience and security and the latest technology might do well to stay put with their big bank, because they do those things well and provide value for those fees.  And those who are value-oriented, prefer a bit more old-fashioned service, and care about credit union values like co-ownership would do well to investigate their credit union options.

Regardless, it's time to face facts, America.  It costs quite a bit for a bank or credit union to do all it needs to do to provide you with a good, solid, safe checking account, and there is quite a bit of value there - despite the fact that this has been given away by so many and for so long.  As always, it is a matter of understanding what one's customers and members want and demand; how one's competitors react and what they offer and charge; and the overall environment in which services are offered and consumed.

And most of all, every financial institution and every American should understand that BANKS DON'T MAKE MONEY OFF A SINGLE SERVICE CHECKING RELATIONSHIP, AND NEVER REALLY COULD.  It is the broader customer relationship that is profitable, to all concerned.  And to those who point to customers who generate a lot of NSFs and overdrafts, let me tell you something.  Relying on the kind of marginal customer who generates enough of these fees to seem profitable in the short and medium term will jump up and bite you on the ass one day - when they go belly-up on you.

Almost everyone's financial needs extend well beyond a checking account, and it is crucial to seek out relationship, whether based on transactions, consumer credit, home oriented lending, saving, investing, insurance and most likely, a combination of these that is market segment-specific.  Banks and credit unions will be most successful as they become more consultative, and move towards fee-based offerings like financial planning, retirement planning, college savings and planning, and medical savings and planning.  Rather than trying to make money on a sure loser, and one that has never really been logically charged for before.

You know where I'm going with this.  Where we always go.  To the GIS, where all of this data is integrated in one place to support informed product, service and fee decisions.

Debit Card Fees - Betting On Inertia & Control

Ann Page, B of A's spokesperson, told the NY Times the other day that the Bank did do "extensive research on how (customers) would react to a new fee and whether it was fair."  And that what this is really all about is that "People like online bill pay, it's convenient and safe... the lower attrition rate that came with it was simply a result of offering a valuable service."  She also pointed out the value that fraud protection, overdraft protection and lots of ATMs add to the debit card and the checking account.

The suggestion is that, when you put this all together, the research showed it was worth the added five bucks a month to an awful lot of customers.

However, there is online bill paying scheduled through the bank; and then, there is online bill paying done directly with the folks who are billing you, in which you provide the merchant or service provider or other bank with your routing and account number.  It is the latter that is much more prevalent.  Banks don't control online bill paying, they offer the convenience of aggregating and scheduling the payments in one place.  Which is valuable.  But not prevalent, and not growing anywhere near as fast as online payments in total.

But, even more importantly, we have two old, old sayings in retail banking administration that are really important.  One is that a legislated solution thrust on banks is the worst possible thing that could happen to everybody.  And the other is that, when you do need to impose or raise fees, one does this QUIETLY.

Well, the horse is kind of out of the barn on the latter.  And, on the former, there is a bill in Congress that will reduce the inertia and friction of moving a checking account to another bank when one has linked many electronic payments to that checking account.  In essence, the "Freedom and Mobility in Consumer Banking Act" will make it as easy to change checking accounts online as it is today to transfer credit card balances.  One will simply provide the routing and account number for their new bank to their old one.

That is why debit card charges make sense, but are a bad bet on inertia.  Despite the research.  Despite the the fact that online and mobile payments are making checking "stickier" and the numbers show that fewer Americans indeed are changing banks.

Then, there are the issues of context and timing.  Corporate earnings are high, on the way to job creation and new investments.  But so is unemployment, and people are losing patience.  So much so, in fact, that the context of the debit card fee introduction is the Occupy Wall Street phenomenon. Worst, worst of all, is failing to calculate the loss of immeasurable goodwill for the Bank and the industry.  When your actions fuel a fire that brings heat down on your whole industry, and protesters start looking for you at home with their demands -  this, this is not good.

Research is there to be applied, not to pass judgement.  As an old boss of mine at a big research supplier used to tell our clients, senior marketing people at major corporations, "Well, if it did, we wouldn't very well need you, would we?"  I also recall my COO at Great Western Bank, who once told me as his strategic planner, "You are looking out the back window.  And I appreciate the view.  But don't try to drive the car."

So, B of A did do their homework.  They just did it wrong.

But the fact is, a good checking account costs and is worth a lot.  Consumers are going to get used to understanding all these costs first, and then the value.  And then, we are going to be able to have everyone pay their fair share according to how much Bank they consume. 

And we'll find a much better time and a better way to tell them about it.

And, of course, GIS will play a role in creating, and communicating, the value the customer receives and why this costs so much damn money.

Don't Charge Me for Using My Own Money!

Bank of America's proposed $5 debit card fee is offering a virtually unprecedented treasure trove of consumer feedback.  Nearly every major newspaper and financial website has content and user comments about the proposed fee.

One of the richest sources is certainly at Change.org, where nearly a quarter million citizens signed a petition to the Bank to rescind the fees.

One thing is becoming very clear.  At its root, the consumer marketing question for a bank remains the same - don't charge me to use my own money.  Consumers perceive that they should not be paying for accessing their checking accounts via card rather than via check at the point of sale.  What also remains is the fact that consumers don't understand the costs to the bank that are involved.

At the end of the day, consider that it is far better to sink these costs into the overall cost of monthly checking, than to charge explicitly for the debit card or use of the debit card that accesses it.  And there can be two kinds of Checking - one with debit, one without, priced accordingly, and perhaps differing somewhat across markets.

So, use all this consumer feedback as a departure point for engaging your own customers and prospects about this, by e-mail, on the web, in social media - and in surveys and focus groups.  And analyze how their concerns differ by segment and place in your GIS.  Then, you'll be in the best position to reprice and communicate.

BAI RDC Online

Want to act more like a retailer but can't make it to Chicago?  Check out BAI Global Connect, where re-imagining the branch, and the banking role at the point of sale, are dominating the buzz.