4P for Facebook Banking

After online banking, we got mobile banking. And now, Citibank is hinting it may start a Facebook app for banking. Lots of discussions have been going on, around the technical issues such as security, AML, privacy. What has not been asked is a fundamental question: why does a customer want to bank within Facebook?

At this moment when I start writing this post, I don't have a pre-set answer in my mind. What I'm going to do is to take a textbook approach and do a marketing 4P analysis, trying to understand WIIFM (what's in it for me) from a customer's perspective. Let's assume all the technical problems are resolved and the cost to build the app is not a concern.

Product

• Is Facebook banking a cool product? Definitely. Maybe. Yeah, but... The answer depends on who you ask the question to.
• Besides feeling cool or pretending to be cool, what are some functions and features of Facebook banking? I have a Facebook friend whom I have never met and I owe him money because of a reason only he and I know. I can't do an money email transfer because I don't want to bother asking for his email. Great there is Facebook Money Transfer or FMT. Sounds too wierd a need? Any ways, there is one need for it.
• What else am I going to use Facebook banking for? Check account balance? Who cares about account balance? I'm on Facebook to hang out with my buddies. Appreciate the pretty pie chart my dear bank draws for me in the Personal Finance Management section just to remind me how much I have overspent again? The only good it does is to get me off Facebook to use my time smarter so that I could balance my budget next month.

Pricing

• Is my bank giving me a discount on my credit card annual fee, a better mortgage rate or a bonus reward on the investment in my registered retirement plan just because I use Facebook banking app? Taking transactional behaviors to lower cost channels makes sense for banks, but is Facebook banking engaging a lower cost than is online or mobile banking? Or banks give incentive to attract Facebook bankers because they are higher value clients to banks?
• Banks watch my behavior on Facebook with their social media listening software and then feed what I post on my Facebook walls into a mathematical model that I will never understand just to guess what kind of person I am. And then they tailor a banking offer to me based on their guess. Pretend that I don't care my Facebook posts being watched and analyzed. Pretend that I behave the same way on Facebook as I would in the real world. Even though, why would the bank have to send that offer to me through Facebook banking app but not through one of their multiple channels that already exist? 

Promotion

• They said Facebook is where people give and seek information? Oh yeah you got it. But what social media means is that I now do not have to listen to what my bank tells me about its products and services. I am looking for information on Facebook from my buddies and from the folks who look like me. I don't even want to go to a bank's official Facebook page to hear they tell me how great they are. What makes them think I want to log into a Facebook banking app to get the message they push to me?

Place

• ATM was a great innovation because it added convenience to banking. Telephone banking was a great innovation because it added convenience to banking. Online banking was a great innovation because convenience became no longer complete unless I can get it online. Mobile banking was a great innovation because convenience was brought into a new time and space dimension. Every single channel innovation in the banking history added a new piece of convenience to the banking experience. What is that piece in Facebook banking? What is the new level of convenience that online banking or mobile banking does not have but Facebook banking is going to bring to customers?