This article appeared in the ATM & Financial Self-Service Executive Summary, Summer 2006.

Though ATMs have been around more than 35 years, financial institutions today are hesitant to use the technology to its full potential. Consumers have more banking options than ever, and banks face intense competition. To meet consumer needs and truly compete, more banks are now operating in real-time as a way to enhance customer relationships. When a customer makes a withdrawal, shouldn�t he be able to go online when he gets home and see the effect on his balance?

Additionally, banks can generate additional fee-based revenue, improve customer relationships and increase retention by delivering personalized, location-based content. The ability to integrate customer activity across all of the bank�s channels creates an intimate profile that results in greater opportunities to sell targeted financial services. ATMs hold the key to the evolution, and the technologies, products and services are here to enable the transformation.

In their book �The One to One Future,� Don Peppers and Martha Rogers point out that the key to growing any consumer business is to offer and deliver products and services specifically designed for the individual customer.

Engage Customers with Strategic ATM Marketing
So, you’ve taken the plunge and launched one or more targeted offers at the ATM.  But, are you getting those 20% take-up rates you were hoping for?  Phoenix customers are. Find out five ways to drive more revenue with ATM marketing.

Those products and services must be based on an increasingly precise understanding of the customer�s relationships and interactions with a firm, Peppers and Rogers say. Banks and financial services firms are in a particularly powerful position to take advantage of that learning process because of the financial account information they hold and the transactions and services that can be derived from such knowledge.

The experience of the Web in general and online banking specifically has raised the expectations of consumers. Today�s consumers expect actual personalization like they experience when shopping at Amazon.com or accessing aggregated banking records online.

But the services an ATM delivers today are usually the same, regardless of who is standing in front of the machine.

That sterile, non-contextual interaction leads customers to the conclusion that they are neither valued nor understood by their bank. The customer thinks that since the ATM does not remember the routine transactions that she uses often, every other function also must be generic. The result is lower customer acceptance of customer-specific, value-added transactions, even when they are offered.

Traditional ATM functions automate teller activities and have a value in speed and convenience for customers. ATMs continue to increase their transaction capabilities. To truly unlock the value of an ATM, however, we must look closer at the user experience and the type of services that could be delivered.

Strategies to consider include: improving customer interaction, integrating ATMs with the bank�s other customer channels, expanding the ATM transaction set, and maximizing location-based services. Options are increasingly available for automating the handling of more complex transactions, such as check cashing, bill presentment, money order issuance, ticket printing and bulk-cash recycling.

Those capabilities expand the suite of services that ATMs can deliver. ATM technology has reached a maturity level that can transform the ATM into a customer-focused channel with middleware for value-added services, greater customer retention and improved bank profits.

With a customer-focused approach, the simple ATM morphs into a wealth of useful services, some chargeable, some free, that are determined by the customer�s identity and relationship with the bank, the ATM�s capabilities and location, and the bank�s strategies and other relationships. The various characteristics are encompassed into profiles that in combination determine the content that the customer sees when interacting with such an ATM.

The approach can be broadened to other channels, allowing true integration of content delivery across the entire bank. The customer-focused bank � and the customer-focused ATM that is a component of it � is a concept ready for first-mover adoption today.

Robert Usner is director of marketing and product management and quality assurance for Nexus Software Inc., a standards-based, open retail banking middleware provider. He may be contacted at rusner@nexussoft.com.