Deutsche Bank is to begin sending SMS messages to communicate with investors in DWS, its European mutual fund management unit.
DWS is one of Europe's largest mutual fund managers with more than 120 billion euros in assets and 3 million customers. The company plans to begin sending transaction confirmations by SMS, which is about three times less expensive than sending confirmations by regular mail.
The average age of DWS customers is well over 50, outside that of the typical SMS user, but DWS director of e-commerce Torsten Barkitzke said 20 per cent of customers they surveyed said they were interested in receiving transaction confirmations by phone.
The transaction notification service is the first of two wireless services being implemented for DWS by Flytxt, a London-based wireless marketing firm. The second will be to send investors information on new funds and services. Ultimately, an SMS version of DWS's e-mail newsletter is being contemplated.
Barkitzke said: "You get hundreds of e-mails every day so maybe you would overlook an email, but people my age  don't get so many SMS messages at the moment."
All of this, they hope, will solidify the investor's relationship with their phone, and in turn with DWS. It's a technique that has worked well with teenagers: pop music sites such as Worldpop.com and Emap's Smash Hits magazine have text messaging clubs that send teens gossip on their favourite pop stars and even allow them to send fan mail back via their mobile phones.
It remains to be seen if the medium will catch on in the investment community, but the reaction could be unfavourable if customers feel they are getting spammed on their mobiles. Flytxt said that all its current campaigns are opt-in, and the first message always contains information on how to be removed from the database.