aba webcast: next generation financial sites

ABA Webcast:Next Generation Financial Sites

Cathy GraeberSenior AnalystOnline Financial ServicesForrester Research

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© 2001 Forrester Research, Inc.

Agenda

What do consumers think of today’s financial sites?

Why do financial sites fall short?

Why is this a problem?

What will next generation financial sites look like?

What are the specialized roles for financial firms?

How will successful banks partner to fill in the gaps?

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The voice of the customer

Survey of 5,500 consumers with online access to their banking or brokerage accounts

Ranked 20 banks and 15 brokerages

Measures degree to which sites meet consumer expectations on 12 -14 attributes in 3 categories: 1) Tools and advice 2) Transactions 3) Customer support

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Support and tools barely meet expectations

3.18

3.05

3.03

3.03

Range of products available

Depth of product info

Usefulness of financial tools

Relevance of recommendations

Helpfulness of phone reps

Responsiveness of phone reps

Responsiveness to email

Helpfulness of email responses

3.40

3.19

3.15

3.08

Transaction accuracy

Timeliness of account info

Ease of applying

Synchronization of info

3.46

3.33

3.25

3.15

Tools ……….

Tools …………..…..

Tools ……….

Tools …...

Support………..

Support ...

Support ……….

Support ...

Transactions ……...

Transaction ….

Transactions ……………..

Transactions …...

Average score of top 20 banks

1Much worsethan expected

5Much better

than expected

2 3 4Meets

expectationsBased on responses from 5,500 consumers surveyed

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Why sites fall short: The user experience is broken 1. Sites don't help users choose 1. Sites don't help users choose

tools tools and contentand content

XYZBank.comXYZBank.comHome-buyingHome-buying

centercenterWhoa! 50 articlesWhoa! 50 articles

about buying aabout buying afirst home, and 3first home, and 3

different mortgagedifferent mortgagecalculators!calculators!

Mortgage Mortgage calculatorcalculator

Enter estimatedEnter estimateddown paymentdown paymentHmm…howHmm…how

much much dodo I Ihave in myhave in mysavings?savings?

2. Tools don’t integrate customer 2. Tools don’t integrate customer datadata

BalanceBalanceinformationinformation

$43,000$43,000

OK, I found howOK, I found howmuch I have -- howmuch I have -- howdo I get back to thedo I get back to the

calculatorcalculator

3. Account access interfaces are 3. Account access interfaces are isolated from the rest of the isolated from the rest of the sitesite

XYZBank.comXYZBank.comMortgageMortgage

Pre-approvalPre-approval

What's the What's the difference difference

between a fixed between a fixed and variable rate? and variable rate?

I need to call I need to call customer servicecustomer service

4. Online service is weak, driving 4. Online service is weak, driving users to more expensive users to more expensive channelschannels

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How did sites get in this predicament?

Misguided priorities

Mismatched goals and metrics

Misaligned organizations

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Priorities are misguidedWhat are your top priorities for your site?

Customer service

Usability

Personalization

Channel integration

Site redesign

Content

Measurement

Account aggregation

Interactive tools

37%

33%

27%

17%

17%

13%

10%

7%

7%

Online advice 3%

Percentage of 30 financial firms responding

……..…… 3.5

………….…... 3.8

……………….….... 2.5

…………………….…………... 3.5

……...………………...……………... 3.1

………………………….………………... 2.4

How well does your site meet customer expectations?

1 = Much worse than expected, 5 = Much better

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Goals and metrics are mismatched

Enrich existing customers

Acquire new customers

Offer wide variety of products

Retain customers

Improve customer satisfaction

Offer an easy to use site

Integrate multiple channels

Cut costs

Generate traffic

53%

40%

30%

30%

23%

23%

20%

13%

10%

What are the business goals for your site?


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Goals and metrics are mismatchedHow do you measure the success of your site?


Site traffic

Usability testing

Focus groups

Third party feedback

Customer surveys

Customer feedback

Acquisition rate

Revenue generated

Retention rate

67%

60%

60%

57%

50%

33%

33%

20%

10%

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Organizations are misalignedWhat are the greatest challenges for your site?

Channel integration

Lack of resources

Understanding customer needs

Setting the right priorities

Making the site easy to use

Keeping up with business change

Acquiring customers

Keeping up with new technology

Balancing growth with profitability

33%

27%

23%

20%

17%

13%

13%

10%

10%

Being innovative 10%


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A formula for customer dissatisfaction

Misguided priorities +

Mismatched goals & metrics +

Misaligned organizations =

A broken user experience

Why is this a problem?

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The pain of serving new online consumers

The early adopters were much more forgiving

The mainstream need easy to use sites and synchronized channels

The affluent require objective advice online

Young consumers want a seamless processWhat will next generation sites have to accomplish?

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Next generation financial sites

IntelligentIntelligenttransactionstransactions

Incorporate customer profiles, data, and preferences when transactions are initiated

Guide users through decisions with clear language and actionable recommendations

ContextualizedContextualizedguidanceguidance

Anticipate problems and service needs

before they arise

PreemptivePreemptivesupportsupport

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The next generation user experience

Welcome back! Last time you filled out a financial goal planner you indicated you were looking for a house. Would you like to try our novice or advanced calculator?

1. Contextual guidance

Examples

XYZBankHome BuyingCenter

Wells FargoResource Centers put content and tools together in groups that apply to specific customer segments.

PNCLearning Link groups articles and calculators by financial topic and consumer life stage, then lets user choose the view that works best for him.

Quicken.comOne-Click Scorecard lets users see how a stock measures up against four investment strategies.

TD WaterhousePortfolio Planner recommends specific funds based on the amount a consumer investor has on hand, as well as her goals and investing style.

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2. Intelligent transactions

You’re in good shape to buy a house -- would you like to start the pre-approval process?

Examples

Calculator

Results

WingspanBank.comPre-populated online account applications with the name, address, and phone number of existing customers who wanted to add new products.

BankOneAlerts customers to new bills as soon as they log on, then lets user pay up to three bills at a time.

Key BankLets customers pay multiple bills with one click from one screen and shows account balances on transfer and bill payment pages.

AmeritradePuts a Quote look-up box at the bottom of every screen, letting users trade any stock in two clicks.

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3. Preemptive support

Many customers ask about the difference between a fixed and variable rate …..

Citibank

Uses a “Learn More About …” window on MyCiti pages to alert users to new features and offers tips and tricks that can eliminate problems.

Datek Online

“Ask Datek” lets customers search for answers using natural language and displays questions asked by other users.

Juniper Bank

Alerts customers via email, pager, cell phone, or PDA when a balance runs low or a bill is due.

Examples

MortgagePre-

Approval

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Specialized Roles For Financial Firms

Who will do it

Banks, Schwab,

AmEx Advisors

Lending Tree, Financial Engines,

Fidelity Funds

AmEx Blue, Chase Mortgage,

Turbo Tax

Digital Insight, Checkfree,Metavante

What they do

Orchestrate the customer

experienceAttracter

MatchmakerAggregate suppliers

and objectively match buyers

Transformer Design and deliver financial products

EnablerDesign and deliver

technology products

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Specialists will partner freely

Citi

Travelers Salomon Smith Barney Citi Visa

Quicken Insurance Smart Money Credit Quotes

GEICO Datek NextCard

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Today’s Online Partnerships Don’t Work

Promise Reality

Access to new customers

Few transact finance online

Lower acquisition costsAcquisition costs

higher

Reduced processing costs No ROI in sight

Financial Service Providers

Overspend

Operate at arm’s length

Don’t differentiate themselves

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Plans For Partnering In Financial Services

Will you partner more in the future, and why?

38%

32%

22%

20%

16%

14%Access to new markets

Technology makes it easier

Speed-to-market

Partner has more expertise

Shared costs and risks

Access to new offerings

Less

6%

Don’t know14%

More80%

Percent of 50 FIs interviewed (multiple responses accepted)

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Percent of 50 FIs interviewed

(multiple responses accepted)

34%

32%

24%

14%

8%Product feedback and quality data

Customer demographic data

Data to complete the transaction

Aggregated product usage data

Don’t share data

What Data Do You Share With Your Partner?

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Improved close rates onpromotions and cross-sells

Improved customersatisfaction and loyalty

Improved internal commitment to the deal

Partners see a single viewof the customer

Customers see a singleview of the partnership

All parties work toward asingle set of objectives

Visibility Transparency Accountability

• Shared segmentationand promotions

• Combined modeling ofcustomer data

• Integrated salesprocesses

• Common workflowspanning partners

• Innovative productcombinations

• Single point ofcustomer contact

• Shared risk and reward

• Partner-friendly internalincentives

• Partnerships run asprofit centers

What is it?

What doesit require?

How doesit pay?

Three Keys For Successful Partnerships

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Evaluate your customers and capabilities

Are there specific customer segments you excel at attracting?

Attracter

Do you refer customers to competitors?Matchmaker

Which products have an operational competitive advantage?

Transformer

Could back-office or technology functions be profitable as stand-alone business

units?Enabler

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Create Successful Partnerships

Take a hands-on approach to partnerships

Collaborate to uncover the needs of distinct segments

Combine predictive models to improve results

Make partnerships transparent to the customer

Mutual accountability builds internal commitment

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Thank you

Cathy Graeber

415-848-1308

[email protected]

www.forrester.com

aba webcast: next generation financial sites

Documents

financial firms

todays financial sites

financial topic

generation sites

financial goal planner

customer support

business goals

customer profiles