Up until the economic downturn, Web 2.0 and Rich Internet Applications (RIAs) seemed to be on everyone's lips. Banks across the US and Europe were experimenting with new RIA-based online banking features and social networking tools. Since the downturn, experimentation and innovation are dirty words replaced by a ‘back to basics' approach to business. Banks are focused on driving greater efficiency from existing processes, while research shows that IT spend is down and many are cancelling non-essential IT projects. So is Web 2.0 a non-starter in today's economic climate?

Innovation has largely been to blame for the current crisis, albeit the creation of complex financial instruments designed to keep the bubble from bursting, not innovation in service delivery. So innovation is a dirty word and in the world of IT, Web 2.0 and RIAs are innovative technologies. Well that's what I've heard from some of the financial services IT executives I talk to. But talk to the line of business executives and you find a different story. They have a different definition of innovation, one that's not technology-driven and grounded in process efficiency and quick and demonstrable return on investment. The penny dropped for me when one executive gave me an example of innovation where moving a box on an application form had led to a return of millions by reducing the number of abandoned applications and incorrect applications. 

Taken in this light, Web 2.0 and RIAs may yet have a major role to play in today's IT plans, not tomorrows.  

RIAs are a simple way of converting the ‘services' understood by internal IT systems into the relationships and information required by users. In effect they are a multimedia presentation layer dynamically combining data from existing systems into outcome-orientated information for the consumer.

The growing usage of interactive simulation calculators on banking websites shows that the financial services industry has already seen the value of rich web experiences in engaging customers with back-end systems. Recent qualitative research Adobe commissioned into the web presences of 75 major banks across UK, Germany and France showed that 88 per cent of banks had adopted calculators, up from 50 per cent in 2002*.

However, the research also showed that the supporting online application forms, that these calculators are designed to drive customers towards, are actually turning customers away through poor design and user interface.

I would argue that re-launching online application forms on RIAs, either as discrete applications or as part of a complete rebuild of online banking services, offers the financial services industry a very compelling business case for their implementation. One that very much ticks the process efficiency and return on investment boxes. 

The problems with existing online application processes will not surprise anyone. In most cases they're simply the paper form transferred to a series of html web pages with little consideration for the user experience. When written as web applications they become page driven, they must download information every time the user goes forward or backwards and they have limited functionality.

The research highlighted that online forms are too long, 30% are between 6 and 14 pages, some longer and they take an average of 12 minutes to complete. Something exacerbated by the fact that data entered into online forms can rarely be saved for completion later. In more than a quarter of cases, the initial entry point to the form was difficult to find. While 40% of online forms offered confusing data entry or re-entry options. Overall, the online application process for more than four out of ten banks was classified as dissatisfying.

Rebuilding online forms as RIAs can provide a much improved platform for designing engaging and easy-to-use product or service application processes. For a start, the form can be completed from a single page - either in or outside a web browser - with new information downloaded dynamically, and saved locally for completion later. When you consider that an average of 5% of customers abandon a form after every page, this is very powerful. Furthermore, research by Gallup Consulting recently revealed that "extremely satisfied website users" are seven times more likely to be engaged with their bank when compared to less satisfied website users.

Simulation calculators can be built directly into the form and used to populate parts of the form, while further interactive guidance can be offered via integrated online tutorials, videos or dynamic links to customer service representatives. With active links to back-end systems, the form can be automatically pre-populated with information already known about the customer and, of course, feed information back into back-end systems. If moving a box around a form can lead to a return of millions, it's exciting to think what this new class of online form could deliver in terms of reduced form abandonment and more accurate information collection. Returns that are very easy to measure from day one, using existing web analytics tools.

A further role for RIAs today may lie in their potential to enable new classes of internal. enterprise applications that can greatly improve access to and usability of data stored within an organisation.

RIAs in the enterprise come in two main flavours. Interactive and easily accessible dashboards, which promote better decision making across the organisation, and task oriented workflows, similar to the online forms example which simplify internal data entry processes.

A primary advantage of RIAs is that they are agnostic when it comes to back-end data sources. They employ a data service layer that enables them to be linked to back office and management systems. As such, business intelligence and customer relationship management vendors, including SAP, Salesforce.com and Oracle, are using RIAs to improve access to complex analytical environments. They are developing RIAs as a replacement for some web-based applications, and using them to extend their portals where they want to offer more interactive applications to their customers. They also demonstrate the kind of opportunities available to financial services providers to build custom RIAs that integrate with multiple back-end office systems or services within a service oriented architecture environment.

So where can we expect to see RIAs appearing? Well, a number of banks are already using them both in-house and with customers. Wachovia and HBOS are two early adopters in this respect, building internal and customer facing applications, respectively, using Adobe's Flash Player technology and Livecycle Data Services platform. During 2009 I expect to see many more banks look closely at the benefits that a RIA-driven interface can bring to both internal and external processes.

It is clear that the Rich Internet Application has significant potential in the banking sector. Even at a time of constrained budgets they can be created to maximise return on existing investments in IT, whilst also increasing engagement, retention and extension of customer relationships. While, internally, the so called Web 2.0 effect and the ‘Web Generation' are driving a demand for more interactive, intuitive and multimedia ways of working with core banking systems. A call that can, and is, being answered by RIAs.

Those who ignore these trends risk seeing customers and the best recruits move to those that are embracing these technologies. In the midst of recession the RIA could become a significant differentiator for the winners in the financial services sector and 2009 may just be the year they come into their own.

* Research carried out by ExpertON Group for Adobe in September 2008