New TowerGroup Research Shows 92% of American Consumers Continue to Use Bank Branches

Primary Market Research Service Finds Consumers

Still Slow to Adopt 'E' Channels



Financial Institutions Must Continue to Emphasize Multichannel Delivery



Apr 18, 2001, 01:00 ET from TowerGroup

    BOSTON, April 18 /PRNewswire/ -- Despite growing comfort with technology
 and Internet use among American consumers, bank branches and other
 "traditional" channels are here to stay.  This is the word to attendees of
 TowerGroup's Annual Financial Services Business and Technology Conference
 (being held this week in Boston), who will get a first look at new research
 into consumer attitudes about and behaviors toward financial services delivery
 channels.
     The new study conducted by TowerGroup's Primary Market Research service
 captures consumer attitudes about such areas as "traditional" financial
 services channels, online banking and online account aggregation.  Highlights
 of this research include:
 
     * PC access and the Internet are now undeniably "mainstream."  More than
       three-fourths (76%) of U.S. households now use a PC for personal
       activities.  More than half of the adults in U.S. households (59%) use
       the Internet.
 
     * Yet despite the Internet reaching a "critical mass" of use among U.S.
       consumers, the bank branch remains the core of financial services
       delivery.  Ninety-two percent of all U.S. households have used a bank
       branch for financial services transactions within the past month (this
       includes lobby windows/tellers, driver-thru tellers, in-store branches
       and other branch employees).
 
     * While 39% of U.S. households say that their primary financial services
       institution offers online banking, only 18% have used it.  That number
       drops to 13% when respondents were asked to indicate whether they have
       used online banking within the past month.  Among online banking users,
       85% said that they have used a brick and mortar branch within the past
       month.
 
     * The majority of U.S. households use either two (26%), three (24%) or
       four (20%) different delivery channels to conduct their financial
       services business.
 
     * Awareness of online account aggregation continues to be low.  Sixty-one
       percent of total U.S. households agreed strongly or somewhat that they
       would "prefer to have all my accounts appear on one consolidated
       statement."  Yet 67% of respondents from online households were not
       aware of the existence of online account aggregation services like
       Yodlee.
 
     "Irrespective of the fact that the majority of U.S. consumers are now
 ready for online banking in technological terms, behaviorally they continue to
 be slow to migrate away from traditional channels like the local bank branch
 or call centers," said Michael Weil, TowerGroup's managing director of Primary
 Market Research.  "Rather than dropping existing channels, consumers use what
 they know while slowly adding new delivery channels into the mix.  The move to
 online banking-and ultimately to wireless as a delivery channel for financial
 services-will continue to evolve."
     Mark Sievewright, TowerGroup president and CEO, noted that even consumers
 who have embraced the most advanced delivery channels continue to view
 traditional channels as core to their financial services interactions.  "A
 multichannel approach to delivery is critical to serving today's retail
 customer.  The opportunity-and the challenge-is not only to provide the
 customer with these multiple access points, but to also ensure world class
 customer service across all available channels.  This is just one of the
 messages that our Primary Market Research service will be delivering to the
 financial services institutions attending our conference this week," he said.
     TowerGroup research regarding consumer financial services delivery
 channels was based on a sample of 3,033 U.S. households, representing the
 total U.S. population.  TowerGroup's Primary Market Research service
 encompasses three key areas-Consumer, Commercial and the Wealth
 Market-examining such subsets as Affluent Financial Services, Retail Delivery
 Channels, Retail Financial Products and Services, Small Business, and Small
 Office/Home Office (SOHO).  Primary Market Research reports are available for
 review by qualified members of the press.
 
     About TowerGroup:  TowerGroup, a Reuters company, is the leading provider
 of information technology research, advisory and consulting services
 specializing in topics critical to the global financial services industry.
 TowerGroup conducts research addressing banking, securities, investments, and
 insurance information technology, products, vendors, markets, investment
 trends and issues.  Headquartered near Boston, Massachusetts, and with offices
 serving Europe and Latin America, TowerGroup serves a global client base,
 which includes some of the world's largest financial services, technology and
 consulting firms.  For additional information, visit TowerGroup online
 (http://www.towergroup.com).
 
 

SOURCE TowerGroup
    BOSTON, April 18 /PRNewswire/ -- Despite growing comfort with technology
 and Internet use among American consumers, bank branches and other
 "traditional" channels are here to stay.  This is the word to attendees of
 TowerGroup's Annual Financial Services Business and Technology Conference
 (being held this week in Boston), who will get a first look at new research
 into consumer attitudes about and behaviors toward financial services delivery
 channels.
     The new study conducted by TowerGroup's Primary Market Research service
 captures consumer attitudes about such areas as "traditional" financial
 services channels, online banking and online account aggregation.  Highlights
 of this research include:
 
     * PC access and the Internet are now undeniably "mainstream."  More than
       three-fourths (76%) of U.S. households now use a PC for personal
       activities.  More than half of the adults in U.S. households (59%) use
       the Internet.
 
     * Yet despite the Internet reaching a "critical mass" of use among U.S.
       consumers, the bank branch remains the core of financial services
       delivery.  Ninety-two percent of all U.S. households have used a bank
       branch for financial services transactions within the past month (this
       includes lobby windows/tellers, driver-thru tellers, in-store branches
       and other branch employees).
 
     * While 39% of U.S. households say that their primary financial services
       institution offers online banking, only 18% have used it.  That number
       drops to 13% when respondents were asked to indicate whether they have
       used online banking within the past month.  Among online banking users,
       85% said that they have used a brick and mortar branch within the past
       month.
 
     * The majority of U.S. households use either two (26%), three (24%) or
       four (20%) different delivery channels to conduct their financial
       services business.
 
     * Awareness of online account aggregation continues to be low.  Sixty-one
       percent of total U.S. households agreed strongly or somewhat that they
       would "prefer to have all my accounts appear on one consolidated
       statement."  Yet 67% of respondents from online households were not
       aware of the existence of online account aggregation services like
       Yodlee.
 
     "Irrespective of the fact that the majority of U.S. consumers are now
 ready for online banking in technological terms, behaviorally they continue to
 be slow to migrate away from traditional channels like the local bank branch
 or call centers," said Michael Weil, TowerGroup's managing director of Primary
 Market Research.  "Rather than dropping existing channels, consumers use what
 they know while slowly adding new delivery channels into the mix.  The move to
 online banking-and ultimately to wireless as a delivery channel for financial
 services-will continue to evolve."
     Mark Sievewright, TowerGroup president and CEO, noted that even consumers
 who have embraced the most advanced delivery channels continue to view
 traditional channels as core to their financial services interactions.  "A
 multichannel approach to delivery is critical to serving today's retail
 customer.  The opportunity-and the challenge-is not only to provide the
 customer with these multiple access points, but to also ensure world class
 customer service across all available channels.  This is just one of the
 messages that our Primary Market Research service will be delivering to the
 financial services institutions attending our conference this week," he said.
     TowerGroup research regarding consumer financial services delivery
 channels was based on a sample of 3,033 U.S. households, representing the
 total U.S. population.  TowerGroup's Primary Market Research service
 encompasses three key areas-Consumer, Commercial and the Wealth
 Market-examining such subsets as Affluent Financial Services, Retail Delivery
 Channels, Retail Financial Products and Services, Small Business, and Small
 Office/Home Office (SOHO).  Primary Market Research reports are available for
 review by qualified members of the press.
 
     About TowerGroup:  TowerGroup, a Reuters company, is the leading provider
 of information technology research, advisory and consulting services
 specializing in topics critical to the global financial services industry.
 TowerGroup conducts research addressing banking, securities, investments, and
 insurance information technology, products, vendors, markets, investment
 trends and issues.  Headquartered near Boston, Massachusetts, and with offices
 serving Europe and Latin America, TowerGroup serves a global client base,
 which includes some of the world's largest financial services, technology and
 consulting firms.  For additional information, visit TowerGroup online
 (http://www.towergroup.com).
 
 SOURCE  TowerGroup