Okay, I could have inserted just about any burdensome topic into the parentheses above because when it comes down to it, Americans prefer freedom. Sometimes we want the noble freedom, like our forefathers, of choosing our own destiny and sometimes, like 3 year olds, we just want freedom from any and every imposed restriction.

The credit card study we just finished provided yet another example (or two) of how we want and seek freedom in every aspect of our lives. Compete analyzed consumer credit card shopping behavior at Bankrate.com and Creditcards.com from January through April 2007.

• The majority of consumers viewing card-specific content are looking at low interest/balance transfer products
• However, these cards make up a large proportion of all the cards offered on these sites, so it is difficult to determine cause and effect

Continue reading “Let freedom (from credit card interest) ring!” »

Do you know what universal default means? It is the practice of a credit card company raising your interest rates based on your failure to pay one of your other creditors. Example: you are late on making your car loan payment, and the following month the interest rate on your credit card goes up… substantially.

A recent Consumer Affairs article does a good job of outlining the specific credit card industry practices that are enraging consumers and (once again) attracting the attention of politicians, including universal default, trailing interest, and penalty fees.

Compete recently surveyed consumers (March 2007, n=300) about their use of credit cards and their understanding of some of these less-than-desirable tactics that drive industry profit.

Continue reading “Extra Credit: What’s universal default?” »

While it’s said that the only two certainties in life are death and taxes, the internet has at least given consumers a multitude of options for filing, and, unfortunately, the uncertainty of knowing if they will make the filing due date.

The most interesting aspect of the season from our perspective was a campaign by TurboTax**. Which sponsored a consumer generated media contest this year that was judged by Vanilla Ice (whoa, flashback) and offered a $25,000 cash prize to the winner, who appeared to have mad game. With its own Microsite and YouTube channel generating significant traffic, this campaign finally brought humor to one of the least pleasurable financial activities ever.

What else did we see?

The year over year change at these three major Tax information and electronic filing sites was varied.

• While irs.gov remains the definitive of information for tax filers, there was little change in the number of unique visitors from the 2006 tax season to the 2007.
• The volume of visitors to HRBlock.com (H & R’s e-filing and informational site) declined slightly year over year.
• Intuit.com, where TurboTax users e-file, saw growth of over 33%.

Continue reading “Death and Refunds: The 2007 Tax Season” »

Okay, we ended the last post with a question. Now we are going to give you a short look back to January to see where other people’s money might have been going. Take a look at our fantastic brand new free Attention Velocity chart below:

This Attention Velocity chart shows the daily change in attention (a.k.a. total time spent) compared to January 1st for the HSBC Direct and ING Direct sites. So what happened at the end of January you may ask? HSBC Direct announced a promotion offering 6.00% on new deposits through April 30th. Wow!

One of the ways banks make bread is on the spread – the difference between what they pay you for your cash deposits and the interest they collect on the loans they make. My national bank pays 0.20% APY (yes that is 1/5th of one percent, not a typo) on cash in a regular savings account while charging over 6.00% on home loans. Not bad bread.

Other banks thought so too and decided to compete by paying a little more for your cash in return for only providing online account access. The real competition started back in 2000 with ING Direct and the introduction of Orange Savings. But things have continued to heat up in the online high-yield savings account (HYSA) market, even since Compete issued its last public study in March 2006.

Competitors entering the market in 2006 included Citibank Direct and E-Loan, and returns being offered today provide 20 – 30 times the return of a regular savings account. So how do HYSA account openings compare to traditional deposit account openings online?

• Within the competitive set analyzed*, 37% of all online deposit accounts opened over the six month period were for high-yield savings accounts
• Over two-thirds of HYSA accounts were opened with either ING Direct or HSBC Direct, the two largest “direct” players battling to boost our meager yields

Continue reading “Direct to the cash: Where’s your money at?” »

MySpace and YouTube are the two top sites where people participating in the web 2.0 revolution have chosen to hang out (literally and figuratively). The amazing growth of these social-networking phenoms was initially driven by consumer-generated content and the communities built up around that content.

The question we wanted to answer: Which site engages people more?

One useful engagement measure we looked at was time spent per session. MySpace has a clear advantage here. In August-October, MySpace visitors averaged 28 minutes per session, while YouTube visitors averaged 12 minutes.

Another measure we looked at was the number and percentage of people actively participating and contributing content (profiles, posts, ratings, video, etc.). This reveals how compelling (or easy) it is to become a member and contribute to the community vs. remaining a more passive and less engaged observer.

Below is a view of both measures averaged over August-October. The bars represent the volume of active members and the diamonds indicate active members as a percentage of total visitors to the respective sites (right axis):

You’ll notice that a whopping 82% of all MySpace visitors conduct member related activities on the site vs. 25% on YouTube.

Bottom-line:
The clear winner, in terms of user engagement is MySpace. MySpace has more visitors, more active members, those people spend more time per session on the site, and a much higher percentage of visitors are “active members”.

Get SnapShot’s of sites mentioned in this post:

• YouTube.com
• MySpacecom