Consumer Attitudes to Online savings

• Using global data from our FSCI survey this report identifies how consumer attitudes towards the online channel are changing.
• The report analyzes the causes of these shifts and identifies strategies that can be employed by S&I providers to attract & retain online customers
• The report discusses real world examples of what savings providers are doing online, and action points on developing an effective online strategy.

• Access the results of Datamonitor's Global FS Consumer Insight survey, enabling you to understand shifting online attitudes and behaviours.
• Identify why these changes are occurring, and understand the future implications of the online channel.
• Identify actionable proven strategies that can help encourage consumers to engage with the online channel.

Overview

Catalyst

Summary

Methodology

Table of Contents

Table of figures

Table of tables

Introduction

Financial Services Consumer Insight: dispelling the myths surrounding online behaviors

Understanding consumers' attitudes towards financial services is vital for providers

The Future Decoded

Trend: Online activity is growing globally

Falling technology prices and growing infrastructure are driving growth in all regions

Insight: Online savings are now held by 43.9% of consumers with internet access

Japan has the highest penetration of online savings

All age groups use online savings, but 35-49 year olds account for 37% of all online savers

Online banking will not replace traditional methods in the eyes of savers

Insight: Consumers registered to use online savings hold a greater number of financial service products

Online savers are more active in almost all savings product categories

Online savers also hold a greater variety of financial service products

Online savers tend to save more, with some notable exceptions

Online savers are also more likely to buy other financial service products online

Trend: Online savers break the mold

Online savers key differentiator is in their attitudes and confidence regarding financial services

Online savers are driven by a range of concerns

Insight: Online savers are intelligent and nuanced, and are driven by more than just budget concerns

Insight: Online savers are comfortable making their own financial decisions

Online savers show a preference for free, online financial information

Online availability is not a top priority for online savers when making financial decisions

Online savers are strongly driven by liquidity concerns

Trend: Mobile phone use has surpassed online penetration

Insight: Mobile savings activity is subject to regional variations

Insight: Mobile savings has the most potential in developing markets

Trend: Web 2.0 is being used to push savings

Insight: Web 2.0 draws consumers in deeper

Dynamic content can help enhance control and functionality

Social networks are already being used to drive savings

Social media can also prove harmful as disgruntled customers can now reach a wider audience

Trend: Security and stability is critical to online savings activity

Online savers in countries with high rates of online savings show lower rates of concern

Insight: The security and stability of saver institutions is increasingly important to online savers

Perceived versus real risks of collapse

Insight: Fear of fraud is detrimental to online savings and investment activity

Security must be visible without becoming inconvenient

Action points

Action Point: Integrate online savings and investment with other forms of online financial activity

Action Point: Move beyond price and functionality as your unique selling point

Action Point: Use mobile banking to reach developing markets

The remittance market has strong potential for mobile savings products

Action Point: Use Web 2.0 effectively and avoid technology for the sake of it

Action Point: Security and stability measures need to be seamless but nonetheless visible

Education against fraud and phishing scams will help ease consumer fears

Provide seamless, but nonetheless visible security protocols

APPENDIX

Methodology

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Internet penetration by region, 2000-2008

Table 2: Internet penetration by country, 2000-2008

Table 3: Number of internet users by region as of March 2009

Table 4: Share of internet users registered to use online savings

Table 5: Share of consumers by country registered to use online savings

Table 6: Age breakdown of online savers, 2009

Table 7: Consumer attitudes to online and branch banking

Table 8: Online registration rates for online saver and non-online savers

Table 9: Share of consumers with savings products

Table 10: Share of consumers with financial service products

Table 11: Average amount saved each month by country ($)

Table 12: Share of consumers buying products by type directly from financial service providers

Table 13: Share of consumers buying products by type from price comparison websites

Table 14: Online registration by consumer and product type

Table 15: Share of online savers by consumer type by country

Table 16: Online saver, and other consumer, level of education

Table 17: Online saver, and other consumer, attitudes to finance*

Table 18: Current levels of concern, and future action over savings and investment*

Table 19: Factors influencing online savers purchasing decisions*

Table 20: Reasons for savings product purchase by share of consumers

Table 21: Communication technology penetration by region (per 100 population)

Table 22: Arica, mobile cellular subsriptions (per 100 population)

Table 23: Level of concern over the security of online banking*, and online savings rates, by country

List of Figures

Figure 1: The number of internet users globally has more than doubled in eight years

Figure 2: Growth by individual countries shows the scope for growth in the BRIC region in particular

Figure 3: There were 1.59 billion internet users globally as of March 2009

Figure 4: Nearly 44% of consumers are registered to use some form of online savings

Figure 5: Japan has the highest rate of online savings at 72.4%

Figure 6: 35-49 year olds are the largest age group for online savings and investment activity

Figure 7: Online savers feel more strongly about face to face banking than non-online savers

Figure 8: Online savers are significantly more active than non-online savers in other online banking areas

Figure 9: Online savers have more savings and investment products altogether

Figure 10: Online savers are more active in almost all financial service product categories

Figure 11: In most but not all regions online savers save more each month

Figure 12: Online savers are likely to buy online direct from companies rather than from comparison sites

Figure 13: Online savers are much more likely to use price comparison websites

Figure 14: 59% of online savers have at least some university level education

Figure 15: Attitudes to finance show online savers are more concerned about their savings

Figure 16: Online savers are more likely to act on their concerns, reflecting their greater confidence

Figure 17: Conscientious consumers are the most active across all types of online savings

Figure 18: Due to their high volume in each market, budget consumers are the largest users of online savings

Figure 19: Online savers are comfortable independently researching their savings options

Figure 20: Financial stability has become the most critical factor for online savers

Figure 21: Nearly half of online savers place a strong emphasis on savings liquidity

Figure 22: Mobile coverage is 32 times more prevalent in Africa than fixed telephone lines

Figure 23: Since 2000 mobile phone subscriptions in Africa have had a CAGR of 43-44%

Figure 24: Real time and rich savings information can help to increase the user experience

Figure 25: Smartypig has successfully added social networking to help drive savings

Figure 26: Smartypig deposits are forecast to reach $500m by the end of 2009

Figure 27: Social networking allows negative images to be spread as easily as positive ones

Figure 28: The run on Northern Rock marked a downturn in UK saver confidence

Figure 29: All consumers show some concern over the security of online banking

Figure 30: Icesave explicitly showed its backing by Landsbanki in an attempt to look stable

Figure 31: The professional look of phishing scams fool many online savers

Figure 32: Using two-way engagement via Web 2.0 functionality can help personalize a brand image

Figure 33: USAA's advertising is explicit regarding the company's lack of a need for a government bailout

Figure 34: Messages targeted at the point of fraud are likely to have a stronger impact on consumers

Figure 35: High visibility airport security helps act as a deterrent while reassuring passengers