Inhibitors to buying online: Financial Services

Inhibitors to buying online #2 – Financial Services

A colleague at Conchango has recently pointed out a revealing survey from Forrester as to why consumers do not buy products and services online. The post is set in the context of tangible goods – clothes, books, groceries etc. but it’s interesting how the research resounds in the world of intangibles such as Financial Services products and services.

Inhibitors cited (by rank) are:

1.       I want to be able to see things before I buy them

2.       I don’t want to give out my personal financial information on the Net

3.       I feel no need to buy products online

4.       I prefer to research products online then actually buy them in a store

5.       I don’t trust the products will be delivered in good condition

6.       I’ve heard about bad experiences that others have had buying online

7.       It’s too complicated

8.       Delivery costs are too high

9.       I don’t want to wait for products to be delivered

Of this list, half, (items 1, 5, 8, 9) relate purely to tangible products, suggesting that it should be much easier to sell intangibles online as half of the inhibitors are irrelevant. So why are FS institutions finding it so difficult to transact online? Unsurprisingly, very similar factors apply. Rizwan suggests focusing on better product display and improving the security messaging on the site.

The former is really about making products more understandable and accessible. In a world of broadband and rich media tools, a website is surely the easiest place to convey the complexities and subtleties of FS products. A well executed website will educate consumers of the benefits of a product category, use decision tools to guide them to suitable options, offer forums to discuss the alternatives and critically, simplify the acquisition process.

The matter of security has particular resonance for me as it was a subject I spent many a late night sweating over early in my career in technology. The epiphany for me watching a presentation by Bruce Schneier (who writes excellent monthly posts) where he explained that the key to security was education and communication. Educate a set of users effectively on potential threats and they will become part of the solution. Ignore them and they will be part of the threat.

Sadly, many finance houses still seem to adopt the “head in the sand” approach, relegating any security information to the depths of an FAQ section. More enlightened organisations are tackling the issue openly. On Bank of America’s online banking site, security is the first subject discussed. In the UK, The Co-op’s Smile bank currently even post a survey on it’s homepage to draw them to a section discussing how to ensure your online security.

I’d add a third item to the list of “must do’s” and that’s to ensure communication is joined up across the channels. If consumers still see your website as a tool to research products, provide them with options to move them forward through discussion and selection to close. This could be offering a call-back from the contact centre, book an advisor meeting in a branch, or even seek the advice of others through open discussions. Just make sure the customer’s next step is towards buying a product from you rather than your competitor.