Investment Products Are Top Online Purchases in Financial Service Marketplace
12 October 2000
Investment Products Are Top Online Purchases in Financial Service Marketplace
ROCHESTER, N.Y.--Oct. 12, 2000--Brokerage and mutual fund customers are more likely than customers in other financial service markets to use the online channel for product purchases/applications.
According to a recent Harris Interactive Financial Landscape(sm) survey, at least 63% of brokerage customers and 36% of mutual fund customers surveyed have purchased products online. For many investment products, online purchases are more common than telephone and in-person purchases.
These are some of the results of a recent nationwide survey conducted online among over 30,000 adults in various financial service markets, including retail banking, retail brokerage, mutual fund, mortgage, auto loan/lease, auto insurance, life insurance and property insurance customers.
Top products purchased online by brokerage customers include margin accounts (63%), stocks (40%), stock options (40%) and money market accounts (39%), with a larger proportion of brokerage customers using the online channel for product purchases than in-person or telephone methods. Telephone is the preferred method for purchasing/obtaining initial public offerings (56%), U.S. treasury or municipal bonds (53%), corporate bonds (51%) and mutual funds (40%). The only products that the largest proportion of brokerage customers are purchasing in-person are CDs (51%) and, to a lesser extent, Roth or traditional IRAs (34%).
In most financial service markets outside of the investment arena, product purchases/applications are the least common activities conducted online, with one to eight percent of customers applying for products online (banking loan or credit line -- 8%, mortgage -- 7%, auto insurance -- 5%, life insurance -- 2%, property insurance -- 1%). An exception is credit cards, a product for which about one third of retail banking consumers have applied.
In most of the financial service markets, the online channel is being used to meet informational or product servicing needs. Property and life insurance markets are exceptions, with customers being least likely to have conducted related activities online.
Across most markets, the top online activities conducted are information searches. Auto loan/lease and mutual fund customers are most likely to have conducted information searches about relevant products (auto loan/lease -- 79%, mutual funds -- 70%). Shopping for rates and comparing pricing or purchase options is another activity conducted by about one-fifth to one-third of online consumers across markets (auto loan/lease -- 36%, auto insurance -- 32%, mortgages -- 29%, banking loans -- 19%).
Among banking and mutual fund customers, checking balances, holdings or transactions is a top ranked online activity conducted (mutual fund -- 61%, banking -- 41%) and, to a lesser extent, transferring money across accounts (mutual funds -- 33%, banking -- 25%).
The following tables detail online activities conducted across financial service markets, as well as methods of purchasing products at brokerage companies:
Percent who are conducting financial activities online
Banking Module Total Mkt. (%) ---------------------------------------------------------------------- Base: 11,696 Retail Banking Customers ---------------------------------------------------------------------- Check acct info and balances 41 ---------------------------------------------------------------------- Apply for credit card 34 ---------------------------------------------------------------------- Transfer money across accts. 25 ---------------------------------------------------------------------- Search for info about banks 19 ---------------------------------------------------------------------- Shop for loans/compare loan rates 19 ---------------------------------------------------------------------- Pay Bills 18 ---------------------------------------------------------------------- Search for info about opening checking/sav acct. 15 ---------------------------------------------------------------------- Compare rates of return on investment products 12 ---------------------------------------------------------------------- Apply for loan, mortgage or home equity loan 8 ---------------------------------------------------------------------- Open banking investment acct (bank, brokerage, money mkt.) 3 ----------------------------------------------------------------------
Auto Loans-Leasing Module Total Mkt. (%) ---------------------------------------------------------------------- 2,371 Auto-Loan Lease Holders ---------------------------------------------------------------------- Look up information about autos 79 ---------------------------------------------------------------------- Compare lease/purchase options for autos 36 ---------------------------------------------------------------------- Check outstanding balance on loan or lease 8 ----------------------------------------------------------------------
Auto Insurance Module Total Mkt. (%) ---------------------------------------------------------------------- Base: 2,645 Auto Insurance Holders ---------------------------------------------------------------------- Check on aspects of insurance 77 ---------------------------------------------------------------------- Search for info about insurance 32 ---------------------------------------------------------------------- Shop for insurance rates or quotes 32 ---------------------------------------------------------------------- Apply for auto insurance 5 ---------------------------------------------------------------------- Make changes to policy 1 ----------------------------------------------------------------------
Life Insurance Module Total Mkt (%) ---------------------------------------------------------------------- Base: 2,715 Life Insurance Holders ---------------------------------------------------------------------- Search for info about insurance 15 ---------------------------------------------------------------------- Shop for insurance rates or quotes 12 ---------------------------------------------------------------------- Check on aspects of insurance 3 ---------------------------------------------------------------------- Apply for life insurance 2 ---------------------------------------------------------------------- Make changes to policy 1 ----------------------------------------------------------------------
Mutual Fund Module Total Mkt (%) ---------------------------------------------------------------------- Base: 2,713 Mutual Fund Customers ---------------------------------------------------------------------- Search for info on mutual funds 70 ---------------------------------------------------------------------- Check balances, holdings or transactions 61 ---------------------------------------------------------------------- Check tax records 41 ---------------------------------------------------------------------- Buy or sell shares in mutual fund 36 ---------------------------------------------------------------------- Transfer money across mutual funds 33 ----------------------------------------------------------------------
Mortgage Banking Module Total Mkt (%) ---------------------------------------------------------------------- Base: 2,781 Mortgage Holders ---------------------------------------------------------------------- Search for information on mortgages 36 ---------------------------------------------------------------------- Search for new home 29 ---------------------------------------------------------------------- Compare mortgage rates or costs 29 ---------------------------------------------------------------------- Apply for credit card 29 ---------------------------------------------------------------------- Apply for any type of loan other than mortgage 10 ---------------------------------------------------------------------- Apply for mortgage 7 ----------------------------------------------------------------------
Property Insurance Module Total Mkt (%) ---------------------------------------------------------------------- Base: 2,667 Property Insurance Holders ---------------------------------------------------------------------- Search for info about home/renter's insurance 13 ---------------------------------------------------------------------- Shop for home/renter's insurance rates or quotes 11 ---------------------------------------------------------------------- Check on aspects of home/renter's insurance 2 ---------------------------------------------------------------------- Apply for home/renter's insurance 1 ---------------------------------------------------------------------- Make changes to policy 1 ----------------------------------------------------------------------
Most Common Methods Used to Purchase Investment Products (%)
Brokerage Module ---------------------------------------------------------------------- Base: Consumers Who Have Purchased Each Product Online Telephone In person Other ---------------------------------------------------------------------- Margin accounts 63 32 3 3 ---------------------------------------------------------------------- Stocks 40 34 10 16 ---------------------------------------------------------------------- Stock options 40 24 15 21 ---------------------------------------------------------------------- Money market accounts 39 32 23 7 ---------------------------------------------------------------------- IPOs 30 56 4 9 ---------------------------------------------------------------------- Mutual funds 21 40 20 19 ---------------------------------------------------------------------- Roth/traditional IRAs 21 34 34 11 ---------------------------------------------------------------------- CDs 7 38 51 4 ---------------------------------------------------------------------- Corporate bonds 6 51 19 23 ---------------------------------------------------------------------- U.S. treasury/municipal bonds 3 53 33 11 ----------------------------------------------------------------------
About Harris Interactive
Harris Interactive , the global leader in market research, uses Internet-based and traditional methodologies to provide its clients with information about the views, experiences, behaviors and attitudes of people worldwide. Known for its Harris Poll, Harris Interactive has over 40 years experience in providing its clients with market research and polling services including custom, multi-client and service bureau research, as well as customer relationship management services. Through its U.S. and Global Network offices, Harris Interactive conducts research in over 80 different countries in more than 30 different languages. Harris Interactive uses its proprietary technology to survey its database of more than 7 million online panelists. For more information about Harris Interactive, please visit our Web site at http://www.harrisinteractive.com. EOE M/F/D/V
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