Harvard Case: Bank of America

How should McDonald and Brown respond to the LOB managers’ request to include more functions to the banks’ mobile app?

Introduction: what’s the problem?

After a remarkable launch in mobile banking in 2007, Bank of America is wondering itself about the app’s future. Indeed it has created a simple app which provides a very specific and efficient service to the customers. In three years they have enrolled four million mobile banking customers.

Regarding the market and the tremendous competition, especially with CitiGroup, Bank of America has to decide rather or not to add more functions on its mobile application. It seems that for the company’s goodness it should be developed. Let’s have an explanation about the advantages and disadvantages of the app extension and then decide what should do Mrs. McDonald and Brown on the application:

| Pros | Cons |

To BofA | * Differentiation:Others have different apps for different people but this may cause inconvenience. * Easier to engage customers:More function in the app can serves more type of customers and then brings customer satisfaction and loyalty and increase company’s income | * The promising of mobile-banking market is not guaranteed:The market is still relatively smaller than other channel. About banking people could be more conservative than for e-commerce for instance. * Self-cannibalization: It is risky to repriorize the costly resources from other channels (ex.ATM): it may result in lower profit in other channels. |

To Customers | * Differentiation:Almost all main banks already have a mobile app: customers want new features and diversity. The quality of the app may be a factor in the choice between different banks. * Easier to engage customers:Customers will be attracted by more functions and wide range of possibilities. | * Complicated functionalities:Can slow down the apps, result in more failure and security could be affected. As a result the satisfaction and willing of...