Word-of-mouth campaigns help online banking adoption.

• Position: Marketing News - Brief article

Banks can increase adoption of online banking by using word-of-mouth campaigns to spread knowledge of the product, according to a study from the Marketing Science Institute, Cambridge, Mass.

The study, which used data for 30,000 customers from a large U.S. bank, found that "network effects" played an important role in consumer adoption of online banking.

The study found that customers who had a greater transaction demand as well as a higher ability" to use self-service options were faster to adopt online banking.

After adopting online banking, customers significantly increase their transaction demand and open more accounts, says the study, entitled, "The Determinants and...