The Bankwatch

Tracking the consumer evolution of financial services

How to web 2.0 your bank

Thinking about the CMO problem at ANA, when about 5% knew about web 2.0.  This begs the question of what are the implications for Banks.  What specifically should a bank think about, if it wants to join the web 2.0 cool club?

My belief is that there are simple staged elements that can be adopted that will engender internal confidence while producing satisfaction for customers.

The definition of web 2.0 and why it matters

There is only one definition, here, because O’Reilly invented it.  You can agree, disagree, debate, but that’s the definition.

It matters, because, wordsmithing aside, it loosely defines the resurgence of the web, following the 2000 dot com crash, and the following 3 or 4 years when business decided online was a fad.  It was all about business value, and Internet was an empty promise.  Well, meantime Amazon, eBay, Google proceeded to successfully build.  In parallel many smart people worked quietly in apartments, and basements, building web applications.  This is the first real shift in my view – the use of web as an application.  Examples are writely (now Google) and zoho.  Forrester called it the Xweb in 2000 before it was built.  I remember this article well, and frankly didn’t get it, but I knew there was something there.  Kudos to George Colony, because he was predicting web 2.0, 5 years previous to O’Reilly.

The second parallel shift, was the use of interaction.  There had long been talk of community, but with scale of many users, as Internet grew in the early 2000’s, grew online forums, based on common interest.  This could be people complaining about Bell Canada, the Post Office, or dare I say it Banks.  There were forums on stocks, and investing, restaurants, hotels, travel.  Sites sprang up to support these common interests, such as chowhound, and tripadvisor.  Finally blogs have become core to the web over the last 2 years.  Everyone reads blogs now, whether by accident or design.  If you search you end up in a blog at some point.  But the power of interaction, the the natural formation of communities of interest through blogs is fascinating and deceptive.  I know many people around the world now as a result of blogging.  I go to conferences, and feel I am amongst friends … yet I have not ever had dinner, or drinks with most.  We just have a common thread of interest, through posts, counter posts, and comments.

The third shift was the adoption of open source standards that reached critical mass, and the developer community behind it. Key here, were web services, and xml, that supported concepts such as tagging, ajax, microformats, openid, opml, rss, blogs, wiki’s, and in financial services, ofx, and ifx.

The convergence of these elements, web applications, interaction, and standards supported by critical mass of people online is where we are today.  We can debate my categorisation, and add/ modify/ but the essence is directionally right.  There is enormous promise, real promise for the web to become central to all our lives.  Its central to my life, and many who read this and other blogs, but we have to remember we are still the minority.  There is the demographic thing happening, that will take care of a fair chunk of the final shift but we also need much greater utility, integration and friendly tools.  The good news is that all those things are happening, at a frenetic pace.  The future of web 2.0 is assured.

Elements of web 2.0

Again, I will pull from the O’Reilly definition.  From a brainstorming session 2005 they developed a list, and this was a shortened version, suggesting the differences between 1.0 and 2.0.

Web 1.0   Web 2.0
DoubleClick –> Google AdSense
Ofoto –> Flickr
Akamai –> BitTorrent –> Napster
Britannica Online –> Wikipedia
personal websites –> blogging
evite –> and EVDB
domain name speculation –> search engine optimization
page views –> cost per click
screen scraping –> web services
publishing –> participation
content management systems –> wikis
directories (taxonomy) –> tagging (“folksonomy”)
stickiness –> syndication


In Colony’s 2000 piece he made a prescient point.

Many people think the Internet and the Web are the same thing. They’re not. The Internet is a piece of wire that goes from me to you and from me to 300 million other people in the world. The Web is software that I put on my end of the wire, and you put on your end — allowing us to exchange information.

In simple terms, the browser becomes the pre-eminent PC application, and whatever you need to do just happens inside it. 

O’Reilly came up with a meme map.


Finally, the essential elements of web 2.0 are contained in The Cluetrain Manifesto.  Its a terribly organised, but full of gems book.  There are 95 hypotheses, with some degree of overlap, so here is a relevant sample, which become principles. 

The Internet is enabling conversations among human beings that were simply not possible in the era of mass media.

Hyperlinks subvert hierarchy.

In both internetworked markets and among intranetworked employees, people are speaking to each other in a powerful new way.

There are no secrets. The networked market knows more than companies do about their own products. And whether the news is good or bad, they tell everyone.

What’s happening to markets is also happening among employees. A metaphysical construct called “The Company” is the only thing standing between the two.

Companies that assume online markets are the same markets that used to watch their ads on television are kidding themselves.

Companies that don’t realize their markets are now networked person-to-person, getting smarter as a result and deeply joined in conversation are missing their best opportunity

Getting a sense of humor does not mean putting some jokes on the corporate web site. Rather, it requires big values, a little humility, straight talk, and a genuine point of view.

Companies attempting to “position” themselves need to take a position. Optimally, it should relate to something their market actually cares about.

Bombastic boasts—”We are positioned to become the preeminent provider of XYZ”—do not constitute a position.

Networked markets can change suppliers overnight. Networked knowledge workers can change employers over lunch. Your own “downsizing initiatives” taught us to ask the question: “Loyalty? What’s that?”

Companies typically install intranets top-down to distribute HR policies and other corporate information that workers are doing their best to ignore.

Intranets naturally tend to route around boredom. The best are built bottom-up by engaged individuals cooperating to construct something far more valuable: an intranetworked corporate conversation.

Paranoia kills conversation. That’s its point. But lack of open conversation kills companies

You want us to pay? We want you to pay attention

Our allegiance is to ourselves—our friends, our new allies and acquaintances, even our sparring partners. Companies that have no part in this world, also have no future.

We are waking up and linking to each other. We are watching. But we are not waiting.

There are elements here that we call extract, that are re-usable for Banks, some being simple and can be done right away, and others requiring policy changes, and CEO approval.  Lets develop a list here.  I am starting with the web 1.0/2.0 table and moving through the meme, translating into relevant uses as I go:

  • AdSense
  • flickr & youtube
  • bittorrent/ itunes/ podcasts
  • SEO (Search Engine Optimisation)
  • web services
  • tagging
  • syndication (RSS, podcasts)
  • wikipedia
  • blogging
  • ajax:  rich user experience
  • perpetual beta
  • conversations
CEO approval
  • wiki
  • participation
  • reputation: customers as contributors
  • radical trust
  • participation, not publication
  • networked customers
  • networked employees
  • humble corporate values, and straight talk
  • engaged intranets
  • paranoia or openness
  • listen to customers
  • corporate irrelevance
  • speed

Observation:  the elements of web 2.0 skew towards CEO approval.  Without having the CEO onside, and driving change, banks’ success will be limited.

Now that we have a few elements of web 2.0, we need to go through the exercise of developing implications, and examples for each.  How can these elements be implemented for your bank?

web 2.0 implications

I will go through each of the above elements, and try to develop examples of how we can implement those.  I won’t get in too deep on pacing, cost, or other things that frankly could get proprietary, and I might just want to do these myself!

Simple – your channel, or marketing group can just do it


Go to, and sign up.  Check your budget, and if necessary get a consultant to help.  Lots of advice, but bottom line is just do it.  To see how others do it, go to google, type in mortgage, and view the results in the right sidebar.

flickr & youtube

Talk to your corporate real estate group.  Get photo’s of all your branches, and stick them on flickr.  Decide on the tagging strategy before you start, so that its simple.  Place all TV ads on youtube, and link from your web site.

bittorrent/ itunes/ podcasts

Have your marketing group team up with external journalists/ pundits/ experts, and do podcasts.  Go video.  Audio is the easy way out, and not very sexy.  Make sure your site has an RSS/ podcast area, and link all to there.  Have all product groups link to that area.

SEO (Search Engine Optimisation)

Get a consultant, or a student.  Get help, to raise the visibility of your bank in Google, MSN, and Yahoo.

web services

 Technology implementations should use re-usable elements, that you can build once, and share across channels, and systems.


Tagging takes bookmarking out of each customers browser, and makes it network centric.  By storing tags, or memorable key words online you can access from any computer, and others can share in your tagging.

This begins to get at the essence of community.

syndication (RSS, podcasts)

The basics.  You must have this on your site – this is entry level, web 2.0 101.

Policy -you will need to talk to legal, corporate communications, information security etc.


Forget corporate blogs – I despise them.  And to aspire to be a Scoble at Microsoft is a bit lofty.  Look for someone who gets it, and can be your blogger, talking to customers, non customers, commenting on other blogs with a link to your blog.  Let him talk about what is good about your bank and what needs to be fixed.  Let it take its own course, trust it.

ajax:  rich user experience

If you are not planning to run online banking with significant ajax by 2010 expect to be left behind.

perpetual beta

Don’t start a project for Google maps linked to your ATM locator.  Get a student and do it.  Put it on your site as a beta alongside your current ATM locator until you are satisfied.  Same for branch locator, mortgage tools, investment calculators, bank account selector, etc etc.

CEO approval – stuff that’s just too outside what Banks do, and you feel personal risk by trying (PS .. if you are in a dot com company, you do these things first – at Banks we are opposite)


Develop a wiki, that lets customers design bank products.  You will be surprised.  As much as you will have extremists want everything for free, you will get sensible, creative, thoughtful ideas, based on willingness to pay.  I know this from experience, during the early direct banking days, when I personally chatted with new customers via email, about what we ought to to next.

reputation: customers as contributors
radical trust
participation, not publication

These four concepts are similar, and almost are principles to govern how the other elements are implemented.

Relevance to Bankwatch:

This post ended up much broader than I expected, so I will link this is the sidebar near the top, and update periodically.


Written by Colin Henderson

October 14, 2006 at 11:46

25 Responses

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  1. Colin, nice post – and pretty lengthy for you too 😉

    There are some interesting thoughts in here. In my view web 2.0 for any highly interactive online service (online banking as you have chosen being the prime example) really requires better use of technology behind the scenes to really work well. Otherwise the feedback from customers in the newly opened community forums on the web 2.0 site will be more negative than you would hope. I wrote a little about my thoughts here:

    I look forward to seeing this are evolve over time.


    Phil Ayres

    October 14, 2006 at 17:49

  2. Interesting. I posted about “the bank of the future” on my blog at and on new ways for banks to operate at
    Lots of complimentary thoughts, it seems to me.
    Adding your blog to bloglines as we speak…

    James Taylor

    October 14, 2006 at 19:41

  3. Thanks for the comments:
    Phil .. that issue about the comments being negative is certainly real, and we all remember the amti Microsoft newgroups in the late 90’s where the comments were really negative.
    But I think we (Banks) have to learn to live with that. Any negativism about Banks is real, and happening anyway in other media/ forums/ coffee shops.

    In term of technology use, I know our gaps, but what did you have in mind there? I am certain we won’t solve those issues overnight.


    October 14, 2006 at 20:39

  4. […] I took a different tack, with my small attempt to encapsulate Web 2.0 concepts as design principles for the future bank. […]

  5. Very comprehensive Colin. I think the industry is still struggling with the transparancy web 2.0 brings to business. While some companies are getting the space and getting engaged, others seem to be putting their backs to the wall and hoping it will go away.

    One thing to consider including would be reputational monitoring in line with these efforts. Tools like Technocrati, Sutori, Sphere, Google Blog Search, BlogPulse help ensure that you are aware of the reaction to your efforts and how and where they are being discussed off of your own sites.


    October 16, 2006 at 14:30

  6. Benry … Transparency is a great word to descirbe this stuff. And yes, the tools you mention are one way to monitor the results, and impacts of the efforts.


    October 16, 2006 at 15:01

  7. this is exactly what we are working on. The issues being: the banks have their rules, legalities, compliances, etc which they need to take care from the business end. and yet deliver the web2.0 experience of transparency, participative and the gamut. how can one seamlessly deliver this experience. are there any banks who have a web2.0’d website which delivers the experience and yet takes care of business issues…
    before i sign off – fantastic content Colin…


    November 10, 2006 at 10:13

  8. Let’s assume that all businesses work in a socio-political force field in which they need to comply to rules and legalities. I think that in a web 2.0 mindset these are not regarded as boundaries but as enablers.

    If for example we are, by law, not allowed to directly compare our product with that of a competitor in a TV commercial, we can still get the same result from a blog in which customer peers do the comparisons.

    If there are copyright constraints around existing content, we see that this functioned as an enabler for Wikipedia to mobilize the masses to simply recreate content.

    When it comes to bank or Financial Institution sites I don’t think we can create a web 2.o site – because what exactly is that?

    A FI that is working along the lines of web 2.0 might as well have ‘satellites’ in place that help enable what the physical branch does: create a feel good attitude towards the FI. The web 2.0 experience does not necessarily need to be created on the corporate FI websites as these might still have a web 1.0 function.

    I believe that web 2.0 adds to and not replaces web 1.0. and that FIs have many chances to mobilize web 2.0 forces (transparency, collaboration, peer reviews and such) to improve the customer experience on their we 1.0 site.

    Yet, there are examples of web 2.0-only webistes. I find a good example to be, a Singapore based fund shop that allows their customers to compare their peers’ portfolios, share opinions about markets, rate investment decisions – and all the market research is for free.

    I believe this company will soon reach out to other markets. Good to follow them.

    david garceran nieuwenburg

    November 11, 2006 at 11:00

  9. Hey Colin: just revisiting this post and realized how quickly this is moving. Consider the new social-media app Wesabe. I tried it yesterday and while today it has a long way to go, it has the elements to be great. Being able to compare my spending on say, Cable, vs others in my area is a bit of “Wisdom of Crowds” in action. This is one financial Web 2.0 service I’m going to watch.

    Ed Terpening

    December 13, 2006 at 11:04

  10. Ed,

    Don’t watch us, call 800.511.8544 and let’s talk what works for you and what doesn’t.

    Jason Knight

    December 13, 2006 at 18:56

  11. Ed … I am a fan of Wesabe … they are part of a new social space for banking, and different again, from Prosper, and Zopa. I see them as complementing each other, and in aggregate helping to define social financial services.

    I posted here:


    December 13, 2006 at 20:31

  12. […] How to web 2.0 your bank277 […]

  13. With all the ecitement about Web 2.0 capabilities you should not forget that a great part of your banks target audience is web agnostic. US is probably way ahead with adoption of Web 2.0 techniques by customers. In other parts of the world but also in US you have to provide smooth entries in the world of free interaction between banking organisation’s employees and their customers.


    February 2, 2007 at 11:02

  14. Interesting observation. My sense is that web use is pervasive everywhere, but the usage of social aspects of the web might be more prevalent in North America. Yet, I still don’t quite get the differences yet. This quote from Semel/ Yahoo is about new advertising, yet it might argue against your point:

    “Still, some believe that online advertising in Britain provides somewhat of a roadmap for where online ads in the United States and elsewhere may be heading. “The U.S. is so behind,” said Terry S. Semel, the chief executive of Yahoo, in a recent speech in London. “It’s certainly lagging the U.K. by at least a year or two.”


    February 2, 2007 at 13:58

  15. […] How to web 2.0 your bank « The Bankwatch I’ve had this post bookmarked in my reader for a while, thought that it was time to share it. (tags: web2.0 enterprise2.0) […]

    Off Topic :: 2007 :: March

    March 11, 2007 at 18:38

  16. […] How to web 2.0 your bank « The Bankwatch (tags: web2.0) […]

  17. I’m working on a story regarding how banks with under $1B in assets are using Web 2.0 and social networking. Deadline is August 20, 2007. Anyone willing to give me assistance–either as background or on the record?

    Liz Wheeler

    August 7, 2007 at 17:27

  18. Liz Wheeler

    August 7, 2007 at 18:53

  19. I think that Banks that embrace a fast implementation of WEB 2.0 technologies can expect a quick return-on-investments in the following area:

    – customer interactions
    – online banking
    – mergers, acquisitions and split-ups
    – eCompliance
    – reducing costs of their own internal IT
    – delayering the organisation and
    – virtualisation of their internal and external relationships and value chains.

    Web 2.0 technology could be the next step in quickly reducing internal and external interaction costs. So a big leap forward in comparison with traditional “BPM” and workflow based process automation.

    So “process destruction” instead of the slow “process improvement/process management” approach.

    Kind regards,
    Tony de Bree

    Tony de Bree

    July 7, 2008 at 05:06

  20. […] y retrouve les mêmes éléments que dans le Web 2.0. Certains d’entre eux nécessitent l’approbation de la direction, […]

  21. I was hoping someone may have the contact details of “Colin” whom posted the blog

    I am hoping to email him an invitation to speak at Australia’s largest banking and finance conference, the Tech & Innovation – the Future of Banking & Finance at Sydney’s Four Seasons Hotel on October 14, 15?

    Can someone point me in the right direction please?
    Angela Horvat
    Editorial Director
    FST Media

    Angela Horvat

    August 10, 2008 at 04:56

  22. Contact made.


    August 11, 2008 at 10:42

  23. […] is interesting here is that web 2.0 however one cares to define it is being written off by marketing before they try it.  This is not […]

  24. […] aussi à suivre l’évolution Web 2.0 de ce secteur sur The Bankwatch (je vous invite à y lire How to Web 2.0 your bank) ou encore sur […]

  25. Transparancy, customer participation, straight talk… from the banks : ) That’s we’re headed for sure and the best way to leverage the power of the Internet.

    A. Pekich

    April 30, 2009 at 06:20

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