Compete recently held a webinar in which we analyzed the role that search plays in consumers’ online research for auto insurance. The study revealed some interesting findings about just how prevalent search is within the consumer buying cycle. Some of the key findings from this webinar include:

• Online auto insurance shopper volume has increased and price is the key driver of consumer choice
  
  • 90% of those looking to replace an existing policy cite price as the reason
  
• Most consumers apply online and search is the second most used resource in the shopping process trailing only issuer websites
  • 56% of online auto insurance shoppers, who ultimately apply, do so online
  
• Shoppers use search frequently with application rates increasing with number of queries
  • 57% of shoppers perform multiple search queries
  
• Shoppers utilize both brand and non-brand search terms with non-brand driving better conversion
  • Non-brand terms convert at ~2x the rate of brand terms
  
• Search is used throughout the consumer shopping cycle
  • 50% of search referrals occur outside of the conversion session, thus indicating that consumers leverage search at the very early stages of their shopping process when they might not yet be ready to transact
  

In sum, despite the current economic recession we have actually seen online auto insurance shopper volume increase with price being the key driver leading consumers to look for new insurance. We also found that consumers not only use the online channel for auto insurance shopping, but are also most likely to choose this channel to ultimately apply. Finally, our data indicates that search plays a significant role in consumers’ online research for auto insurance. Auto insurance shoppers use search frequently and at multiple stages of their research process.

Please note that a replay of this webinar can be viewed at the following link: http://compete.na3.acrobat.com/autoinsurreplay/

Compete recently held a webinar in which we analyzed the role that search plays in consumers’ online research for credit cards. Using the credit card market as an example, we are able to see how search has become a significant aspect of many consumers’ path to purchase across a variety of products and services. Some of the key findings from this study include:

• Search activity is frequent
  • 35% of shoppers that go on to submit an online credit card application do 5 or more search queries while they are shopping

• Search frequency and online credit card conversion are positively correlated
  • Consumers who search 5 or more times are significantly more likely to convert

• Most consumers stick with one type of search path: branded or non-branded
  • Consumers who ultimately submit an online credit card application are split approximately 50/50 in their use of branded vs. non-branded keywords and tend to utilize that same path throughout their entire shopping process

• Non-branded search terms convert at nearly twice the rate as branded terms
  • Non-branded paid terms had the highest overall conversion

• Search is used throughout the consumer shopping cycle
  • 60% of search referrals occur outside of the conversion session, thus indicating that consumers leverage search at the very early stages of their shopping process when they might not yet be ready to transact

In sum, it is clear that search plays a very significant role in consumers’ online research for credit cards. Credit card shoppers use search frequently and at multiple stages of their research process. Additionally, there apparently is a cumulative effect to the value of search, as conversion trends upward with the more one searches.

As we continue to spend more time online and leverage the web for a greater number of reasons, search is likely to play an increasingly important role in our everyday lives. It will be interesting to monitor both the growth and impact of search over time.

Please note that a replay of this webinar can be viewed here.

It is undeniable that social media is an increasingly pervasive medium for interacting with friends and family; evidenced by the fact that Facebook and MySpace are the eighth and tenth most visited sites on the entire web. What is less clear, however, is how effective social media is as a marketing channel. Can brands successfully drive business value from these sites or will they be viewed as artificially entering into conversations in which they don’t belong? In my view it is still too early to definitively conclude whether social media should be used as a marketing platform for most companies; however, there are success stories emerging.

American Express Open Forum is an online community in which business owners can interact with one another and access a variety of helpful resources. The site is increasing in popularity, as unique visitors grew from <20K in January 2008 to ~160K in December 2008.

American Express clearly wants users to find value in Open Forum and ultimately develop an affinity for the AMEX brand. One way that Open Forum provides value is by having a blog written by Guy Kawasaki – a well known entrepreneur and author. What I found most interesting here is that Guy appears to be leveraging Twitter, the social media site that enables one to post short status messages, to drive consumers directly to Open Forum. In January 2009, Twitter drove more traffic to Open Forum than any other site except Google. Through Twitter American Express is able to reach the >60,000 people who currently follow Guy on that platform. The chart below illustrates the percentage of Open Forum’s total referral volume that comes from Twitter for each of the past five months.

As I mentioned earlier, marketing within social media is clearly still in its infancy. This example, however, illustrates the power of the networking effect of social media and how it can drive measurable business value for marketers. It certainly will be interesting to see how more marketers choose to leverage social media in the future.

On a side note, if any of you are going to be at the Net.Finance conference on April 20th in Las Vegas come by and check out the panel moderated by Compete about trends in online consumer behavior. It should be an interesting session.

It is undeniable that consumers are increasingly living their lives online. From buying a book, to viewing a photo, to posting a tweet through the use of Twitter, individuals are turning to the internet for a myriad of reasons. Financial services is certainly not immune to this digital migration. While it is clear that online banking usage and adoption is growing, it is less obvious how consumers view their current experience. Are consumers really satisfied with online banking functionality? We surveyed existing online bankers to find out.

The chart below illustrates consumers satisfaction with their current online banking experience across a variety of areas. The most apparent conclusion from this data is that consumers, in general, are very satisfied with most banking functionality offered online. For instance, fewer than one in ten consumers who currently use online bill pay are either indifferent towards or dissatisfied with the experience. The immediate inhibitor to continued growth in adoption of online banking functionality is thus not the usability of these site features, but rather convincing consumers to try them out in the first place.

The data below shows the percentage of existing online bankers that currently use particular types of online banking features. While in the above chart 92% of respondents that use bill pay are happy with the experience, only 54% of online bankers choose to utilize this feature in the first place. Banks need to do a better job of driving initial trial for online banking functionality, for once consumers engage with these offerings they typically are satisfied with their experience.

Traditional marketing efforts promoting features and functionality across multiple distribution channels are clearly one way to drive trial. However, perhaps an additional way in which banks can drive trial of online banking functionality is to more aggressively leverage the high satisfaction levels of existing consumers by letting individuals speak to each other in an online community. It is not unprecedented for banks to create an online community around a particular topic area. Bank of America, for instance, created a compelling online community for small business owners. Letting consumers learn from the experiences of others is likely to drive increased trust in the bank and thus impact trial. It will be interesting to monitor the adoption of specific online banking features over time and what banks specifically do to drive trial.

Financial institutions are investing heavily to build technological platforms and strategic partnerships to capitalize upon the growth of the mobile banking channel. We wanted to separate the hype from the reality by exploring one fundamental question: Is there really significant consumer demand for performing banking activities on a mobile device? The results of a recent survey targeted at online bankers illustrates that the mobile market, although still in its infancy, is poised for future growth.

One of the obvious drivers of mobile banking adoption is consumers having access to the internet from their mobile device. Our research indicates that 72% of online bankers never access the internet from their mobile device (see below). Mobile internet access will undoubtedly rise, as technology advances and “smart phone” adoption (Blackberry, iPhone, etc.) proliferates; however, if almost ¾ of online bankers never access the internet from a mobile device, how many people actually utilize mobile banking services? The answer is not many, as only 5% of online bankers currently use a mobile device to check a banking account.

It is clear that mobile banking is still in its infancy, but what about future growth prospects? Our research reveals that consumers are significantly more likely to view mobile banking as “very useful” (23%) than “not at all useful” (12%) (see below). It is interesting to note that 28% of respondents currently appear to be indifferent towards mobile banking, neither citing the functionality as useful or not useful.

Many of these indifferent consumers are likely to demand mobile banking functionality once the technology and partnerships make the usability of this banking channel easier for the average consumer. One good example is a current Bank of America promotion for free mobile banking to current online customers. The messaging promotes the accessibility, convenience, and security of mobile banking.

As consumers increasingly leverage mobile devices for shopping and account service needs it is highly likely that banking will be no different in its migration towards this emerging medium.

In June 2008 Chase launched an innovative marketing program called Chase Exclusive that provided preferred offers to its existing online checking account customers. The campaign promoted “better rates,” “more rewards,” and “bigger discounts” to this group of consumers. Undoubtedly the aim of this program was to increase customer retention and grow the bank’s overall share of wallet amongst its consumer base across multiple product lines.

Michael Cleary, head of product development and marketing for Chase’s consumer bank stated: “We created Chase Exclusives to deepen our relationship by delivering benefits that are real, quantifiable, and immediate.” (Source: Payment News) Cleary later goes on to say that its checking consumers could save $2,000 or more by choosing Chase, rather than a competing bank, for a financial product such as a mortgage, home equity loan, or a CD. The business case for this campaign is predicated on driving high adoption amongst Chase’s customer base for these preferred offers. The cost of providing preferred terms could in fact be less expensive for Chase than the marketing costs associated with driving new consumers towards the bank’s products.

At this point you are probably wondering: Is the Chase Exclusive campaign working? Compete analyzed this campaign from an online perspective. Despite a direct link from Chase’s home page to a dedicated “Chase Exclusives” page (see above), the bank has not yet driven meaningful online traffic to this page. The number of weekly online visitors to the Chase Exclusive page can be seen below.

The campaign is still in its early stages, so it is very likely that site traffic will increase in the future, however at this point the campaign is not driving significant online traffic. This actually might be by design, as visitors to the Chase Exclusives page cannot directly enter into an online application for these preferred product offerings, but rather get redirected to a branch location tool. It appears that shoppers need to go offline to receive the “Chase Exclusives” offers. It will be interesting to monitor whether traffic to this site grows in the future. One could conclude that some visitors to the Chase Exclusives site likely wanted to purchase a product online as opposed to being driven offline. Is Chase losing application volume by not readily enabling an online enrollment process from the “Chase Exclusives” page? Time will tell.