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Best-in-Class for the Online DC Plan Participant Experience - A Competitive Analysis

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The presentation discussed industry best practices and trends from our recently completed 2013 DC Plan Participant Website Audit and also contained findings from the 2013 DC Plan Participant Survey. …

The presentation discussed industry best practices and trends from our recently completed 2013 DC Plan Participant Website Audit and also contained findings from the 2013 DC Plan Participant Survey. The survey polled approximately 1000 plan participants, asking questions about the digital experience they have with their retirement plan provider(s). CI also took a look at what’s next for the industry, focusing on the evolution of financial advice and guidance and mobile innovation.

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  • 1. BEST-IN-CLASS FOR THE ONLINE DC PLAN PARTICIPANT EXPERIENCE A COMPETITIVE ANALYSIS NOVEMBER 2013 Copyright 2013 Corporate Insight, inc.
  • 2. ABOUT CORPORATE INSIGHT Corporate Insight provides competitive intelligence and user experience research to the nation’s leading financial institutions. For over 20 years, the firm has tracked technological developments in the financial services industry, identifying best practices in online banking and investing, online insurance, mobile finance, active trading platforms, social media and other emerging areas. There are no assumptions in Corporate Insight’s work – we use live accounts at all of the firms we research, providing our clients with unparalleled, unbiased intelligence on the competition. Media Inquiries Corporate Insight welcomes the opportunity to speak with the media. If you are interested in citing our research or would like to schedule an interview with one of our analysts, please contact Intermarket Communications at 212888-6115 or corporateinsight@intermarket.com. Connect With Us JAMES MCGOVERN Vice President Consulting Services 646-454-2667 jmcgovern@corporateinsight.com 2
  • 3. TABLE OF CONTENTS • Introduction • Building a Best-In-Class Online Experience o Know your users  Findings from our 2013 DC Plan Participant Survey o Understand your competitors  Findings from our 2013 DC Plan Participant Website Audit • What is Next? • Corporate Insight Thought Leadership • Contact The Author 3
  • 4. INTRODUCTION 4
  • 5. CORPORATE INSIGHT’S RETIREMENT RESEARCH • Began research on DC participant Web experience in 2006 o Custom DC Plan Participant Website Audit 2006 and 2010 o Plan Sponsor Website Audit 2007 and 2010 • Launched Retirement Plan Monitor research service in 2012 5
  • 6. ABOUT THE DC PLAN PARTICIPANT WEBSITE AUDIT For over 20 years, Corporate Insight has closely monitored and analyzed the online customer experience offered by financial services firms. The DC Plan Participant Audit helps our clients understand the strengths and weaknesses of their DC plan participant website versus key competitors. The Audit also offers actionable recommendations to close competitive gaps and improve the client firm’s plan participant site. AUDIT METHODOLOGY The DC Plan Participant Website Audit framework consists of five categories, 23 sub-categories and over 125 attributes covering all facets of the online plan participant experience. The five categories assessed are: • Account Information • Account Servicing • Planning, Advice & Education • Quotes & Research • Transactions 6
  • 7. AUDIT INCORPORATES FEEDBACK FROM DC PLAN SITE USERS • CI surveyed 1,000 DC plan site users to understand what they want from their plan site • Survey data powers weighted scores used to determine the importance of Audit categories, sub-categories and attributes • Weights can be tailored based on preferred demographic • Survey data used to create DC Plan Participant Survey Report 7
  • 8. DC PLAN PARTICIPANT WEBSITE AUDIT – WHAT YOU RECEIVE AUDIT REPORT – Customized report that identifies your plan participant website’s strengths and weaknesses against key competitors. The report includes weighted scores for your site and all competitor sites that reflect importance ratings from our DC Plan Participant Survey. We also provide dozens of gap analysis charts and hundreds of specific, tailored recommendations to help you improve your plan participant website. DC PLAN PARTICIPANT SURVEY REPORT – As part of the Audit, we surveyed nearly 1,000 participant website users in June 2013 to understand how they utilize their provider’s website and mobile platforms and what features they value most. This report summarizes the results of this research and how attitudes and behavior differ by such demographic factors as age, gender and plan assets. DC PLAN PARTICIPANT SURVEY DATA – Audit purchasers also receive the raw plan participant survey data we compiled focusing on website and mobile usage, customer satisfaction and more. To learn more about our DC Plan Participant Website Audit, please contact James McGovern, Vice President, Consulting Services, at 646-454-8667 or jmcgovern@corporateinsight.com. 8
  • 9. BUILDING A BEST-IN-CLASS ONLINE EXPERIENCE • Know Your Users • Understand Your Competitors 9
  • 10. Know Your Users Findings From Our 2013 DC Plan Participant Survey 10
  • 11. THE WEBSITE MATTERS TO USERS… When you think of where to go to monitor your retirement plan balance and activity, you think of? 2% 1% Logging onto the plan provider’s website and reviewing real-time data 9% Opening your mailed statement and reviewing periodic data Logging onto the plan provider’s mobile app and reviewing real-time data Calling customer service to speak with a representative 88% 11
  • 12. AND IT MATTERS TO YOUR BUSINESS TOO! Likelihood to Roll Over by Satisfaction Level with Provider Website • Compared to our total survey sample, participants who are extremely satisfied with their provider’s website are 18% more likely to roll over their plan assets to an IRA with that firm 12
  • 13. TOP WEBSITE ATTRIBUTES ACCOUNT INFORMATION DOMINATES Eight of the Top Fifteen Most Important Website Attributes Relate to Account Information See your account balance 4 Importance 1 Access latest quarterly statement 5 View account positions 8 Transaction confirmations 9 Access quarterly statements for last year 12 Access account history for past 180 days 14 Account history available since enrollment 15 Positions are updated daily 13
  • 14. MEN AND WOMEN USE SITE SOMEWHAT DIFFERENTLY Main Difference in Website Utilization Per Gender • Men are more likely to research investments and exchange plan dollars between funds Female Male 17% Performed research on available funds 32% 23% Exchange between investment funds 41% 0% 10% 20% 30% 40% 50% 14
  • 15. OLDER USERS TEND TO LOG IN MORE OFTEN Frequency of Logging Into a Plan Website by Age Group Age 60+ 40 - 59 <40 00 1+/Month 69% 64% 59% 15
  • 16. OLDER USERS TRACK THEIR ACCOUNTS MORE CLOSELY Percentage of Respondents Who Performed Activity on Participant Site in Past 12 Months Age Group 60+ < 40 88% Checked plan balance 81% 74% Reviewed account / fund performance 65% 65% 58% Viewed / downloaded statement 0% 20% 40% 60% 80% 100% 15
  • 17. OLDER USERS ARE MORE LIKELY TO BE MOVING MONEY AROUND Percentage of Respondents Who Performed Activity on Participant Site in Past 12 Months Age Group 60+ < 40 36% Exchange between Funds 22% 33% Change Allocation 31% 20% Withdraw Money from Plan 3% 0% 10% 20% 30% 40% 16
  • 18. YOUNGER USERS ARE MORE LIKELY TO USE PLANNING, EDUCATION & MOBILE Percentage of Respondents Who Performed Activity on Participant Site in Past 12 Months Age Group 60+ < 40 23% Use Site Tools & Calculators 27% 10% Refer to Educational Content 15% 3% Use Mobile App to Access Account 8% 0% 10% 20% 30% 17
  • 19. AREAS OF INTEREST FOR THOSE UNDER 40 YEARS OLD 1. Estimate of retirement funds needed Planning Tools 2. Recommend asset allocation changes 3. Financial tools covering basic decisions 4. Plan for multiple goals in retirement 5. Actionable guidance on savings rate Educational Content 1. Retirement savings as well as investing strategies 2. Understand non-retirement resources from the provider 3. Basic tools / materials available pre-login 19
  • 20. Understand Your Competitors Findings From Our 2013 DC Plan Participant Website Audit 20
  • 21. WHAT IS THE WEBSITE AUDIT? IT IS a benchmarking analysis against your key competitors It is NOT like the government version • Identify strengths and weaknesses • Weighted rankings of attributes • Identifies high value enhancements • Helps prioritize platform development 21
  • 22. A MORE DETAILED VIEW OF OUR AUDIT FRAMEWORK 22
  • 23. COMPETITOR SET OF THE CURRENT WEBSITE AUDIT Graded Ten Leading DC Plan Participant Sites Using Live Accounts 23
  • 24. KEY AREAS OF INTEREST TO PARTICIPANTS Plan Overview 1. View account balance Statements 2. Rate of return 1. Most recent quarterly statement 3. Performance chart for account 2. Quarterly Statements for past year 4. Current contribution & match 3. Statements since enrollment into plan Account History 1. Transaction confirms 2. Minimum of transaction history for last 180 days 3. All history since enrollment into plan 5. Retirement income forecast 6. Allocation pie chart 24
  • 25. CORE ACCOUNT INFO SCORES FALL WELL SHORT OF EXCELLENT History, Statements & Plan Overview Account History Vanguard (3.57) Great West (3.55) Fidelity (3.23) Total Score Account Statements Great West (3.55) Great West (3.75) Vanguard (3.42) JP Morgan (3.66) Merrill Lynch (3.22) Mercer (3.22) Plan Overview 1 = Poor 2 = Fair 3 = Good 4 = Excellent Merrill Lynch (3.54) Vanguard (3.54) AON Hewitt (3.47) 25
  • 26. ACCOUNT HISTORY KEY FINDINGS Account History Vanguard (3.57) Great West (3.55) Fidelity (3.23) Industry Average = 3.05 / 4.0 • Half offer less than two years of searchable account history • History search, sort and filter functionality limited • Data display tends to be simplistic 1 = Poor 2 = Fair 3 = Good 4 = Excellent Source: 2013 Corporate Insight Plan Participant Website Audit 26
  • 27. VANGUARD IS ABOVE AVERAGE IN NEARLY ALL ACCOUNT HISTORY ATTRIBUTES Competitors are Better Vanguard is Better Data Display Transaction Descr. Data Download/Export Printability Navigation / Integration Depth of Archive No print link Transaction Types Avail. Search, Filter, Sort Account History Gap Analysis – Vanguard vs. Competitors 27
  • 28. GREAT WEST ALSO CONSISTENTLY OUTPERFORMS Competitors are Better Great West is Better Data Display Transaction Descr. Data Download/Export Printability Navigation / Integration Three year archive Depth of Archive Transaction Types Avail. Search, Filter, Sort Account History Gap Analysis – Great West vs. Competitors 28
  • 29. ACCOUNT HISTORY BEST PRACTICES – GREAT WEST A Summary overview offers combined figures for each transaction type within a given time period 29
  • 30. ACCOUNT HISTORY BEST PRACTICES – GREAT WEST Clicking on a particular transaction reveals additional level of detail 30
  • 31. ACCOUNT HISTORY BEST PRACTICES – VANGUARD Users can access seven years of transaction history 31
  • 32. ACCOUNT HISTORY BEST PRACTICES – VANGUARD Users can view transactions by fund, source or both… …and sort transactions by date, description or fund name 32
  • 33. ACCOUNT HISTORY BEST PRACTICES – VANGUARD Fly-out menu gives users one-click access to other key site functions Easy access to related features 33
  • 34. TO DELIVER A BEST-IN-CLASS ACCOUNT HISTORY… 1. Offer a deep archive, preferably for full life of the account 2. Allow users to filter history by fund, source and custom time period 3. Provide dynamic data sorting 4. Let users click on a transaction to reveal additional details 34
  • 35. ACCOUNT STATEMENTS KEY FINDINGS Account Statements Great West (3.75) JP Morgan (3.66) Mercer (3.22) Industry Average = 3.1 / 4.0 1 = Poor 2 = Fair 3 = Good 4 = Excellent Source: 2013 Corporate Insight Plan Participant Website Audit • Most firms only offer two-year archive o Sixty-seven percent of respondents said that access to ALL statements online was “very” or “extremely important” o Young participants prefer digital over paper • A few sites lack statements in PDF 35
  • 36. ACCOUNT STATEMENTS BEST PRACTICES – GREAT WEST Users have access to five-year statement archive, plus online access to mailing inserts 36
  • 37. ACCOUNT STATEMENTS BEST PRACTICES – GREAT WEST “On Demand” statements can be generated and accessed in PDF format for easy downloading 37
  • 38. ACCOUNT STATEMENTS BEST PRACTICES – JP MORGAN 38
  • 39. ACCOUNT STATEMENTS BEST PRACTICES – JP MORGAN 39
  • 40. TO DELIVER A BEST-IN-CLASS ACCOUNT STATEMENTS FEATURE… 1. Offer a deep archive, preferably for full life of the account 2. Organize statements by year 3. Allow users to create custom statement for desired period 4. Present statements in PDF 5. Provide easy access to statement inserts 40
  • 41. PLAN OVERVIEW KEY FINDINGS Plan Overview Merrill Lynch (3.54) Vanguard (3.54) Aon Hewitt (3.47) Industry Average = 3.22 / 4.0 • Audit’s most important sub-category • Homepage & related features/info o Plan balance/fund balance o Asset allocation o Performance 1 = Poor 2 = Fair 3 = Good 4 = Excellent Source: 2013 Corporate Insight Plan Participant Website Audit o Current contribution o Retirement Income projection 41
  • 42. PLAN OVERVIEW BEST PRACTICES – MERRILL LYNCH Account Summary page offers useful account overview data with click-toreveal access to more in-depth info 42
  • 43. PLAN OVERVIEW BEST PRACTICES – MERRILL LYNCH Balances are available by investment, source or asset class, with the option to display a combined view 43
  • 44. PLAN OVERVIEW BEST PRACTICES – VANGUARD Intra-page tabs provide quick access to overview information and key site features Combined balance information offered for multiple plans and aggregated external accounts 44
  • 45. PLAN OVERVIEW BEST PRACTICES – VANGUARD Access to personalized rate of return for plan as well as individual funds Month-by-month detailed performance data 45
  • 46. PLAN OVERVIEW BEST PRACTICES – AON HEWITT Interactive graph allows users to compare up to three individual funds against personalized rate of return 46
  • 47. PLAN OVERVIEW BEST PRACTICES – AON HEWITT Compare current asset mix to model mix and view the impact on projected balance Links are offered to apply new investment mix 47
  • 48. TO DELIVER A BEST-IN-CLASS PLAN OVERVIEW FEATURE… • Put key metrics up front, like plan value and YTD performance • Allow users to drill down into the details • Use graphics to communicate performance • Offer links to key features like recent statements 48
  • 49. WHAT IS NEXT? 49
  • 50. WHAT IS NEXT? Advice & Guidance Next-Gen Advice Mobile 50
  • 51. ADVICE AND GUIDANCE 2013 Financial Advice Survey • Americans need financial guidance, but many participants opt to retrieve it from places other than their DC plan sites, especially those that are between the ages of 18 and 34 and 55 and 64, respectively. 51
  • 52. MANY FIRMS LACK EDUCATION AND PLANNING RESOURCES Planning, Advice & Education Category Scores Multi-Goal Planning Tools Sub-Category Scores Fidelity Fidelity T. Rowe Price Great West Vanguard T. Rowe Price 0 1 2 3 4 Planning, Advice & Education Industry Average = 2.5 / 4.0 1 2 3 4 Multi-Goal Planning Tools Industry Average = 2.13 / 4.0 1 = Poor 3 = Good Source: 2013 Corporate Insight Plan Participant Website Audit 0 2 = Fair 4 = Excellent 52
  • 53. FIDELITY’S PORTFOLIO REVIEW IS THE BEST IN CLASS Portfolio Review tool creates investment strategies to help users meet specific goals The tool incorporates Fidelity accounts as well as accounts held outside the firm 53
  • 54. PLANNING, ADVICE AND EDUCATION BEST PRACTICES – FIDELITY Portfolio Review offers actual fund recommendations to help achieve desired goal Users can select all available funds or Fidelity funds only 54
  • 55. TO DELIVER BEST-IN-CLASS PLANNING AND EDUCATION • Offer a good mix of plan-specific calculators and in-depth planning tools • Organize your resources effectively • Don’t just address retirement – healthcare expenses too! 55
  • 56. NEXT-GEN INVESTING ADVICE 56
  • 57. STEVE JOBS LIVES ON 57
  • 58. MOBILE IS REACHING A TIPPING POINT 58
  • 59. GOOD NEWS: PROVIDERS OFFER MOBILE Mobile Platform Support Among Retirement Plan Monitor Firms As of October 2013 Mobile Optimized Site iPhone App iPad App Android Phone App Android Tablet App 59% 47% 41% 12% 0% 59
  • 60. BAD NEWS: PARTICIPANTS ARE UNAWARE Does your provider allow access to your account via a mobile device? If yes, have you accessed your plan via this device in the past 12 months? I don't know, 64% Yes, 35% Yes, 23% No, 65% No, 13% 60
  • 61. AND MOBILE ACTIVITIES REFLECT LIMITS OF TODAY’S OFFERINGS Retirement Plan Activities Using Mobile Conducted research on a plan investment 10% Made a transaction (e.g., rebalanced my account, changed my contribution rate, etc.) 9% Scheduled a guidance consultation 2% Completed an investment risk tolerance profile 2% Viewed educational content like a planning tool or video about saving for retirement 2% Enrolled in my plan 2% Sent or received a text message to/from customer service 1% 0% 20% 40% 60% 80% 61
  • 62. MOBILE CLOSING THOUGHTS • Mobile must be part of your strategy • Participant knowledge is very poor – you must change this • You can improve overall participant engagement using mobile, especially with young people • Do not neglect the tablet 62
  • 63. FINAL THOUGHTS • Industry gets the basics of account information right… • But it could do much more to drive engagement… • Particularly with younger participants… • Better planning and education is one part of the solution… • Longer term, mobile will be as well 63
  • 64. CORPORATE INSIGHT THOUGHT LEADERSHIP Next-Generation Investing: Financial Startups and the Future of Financial Advice CI tracks over 100 startups that covers a wide range of new ideas across financial advice and investing. This study will focus on each idea, analyze compares them to what established financial institutions offer and examine the potential impact on the industry. Download the study preview! Social Media Trends: Annuity and Life Insurance This presentation analyzes the current social media initiatives and promotions undertaken by leading insurers, highlights key social media findings and trends across the insurance industry, and offer tips for insurers looking to bolster their social presence. Tablet-Friendly Web Design: Best Practices for Financial Services The study examines the tablet-friendly website features provided by four leading firms across financial services and provides recommendations for financial services firms building tablet-optimized websites. Facebook Marketing Campaigns - Social Media Initiatives in the Insurance Industry This slide deck highlights some of the engaging Facebook marketing campaigns initiated by P&C Insurance Monitor firms this year and offers a few Facebook marketing tips for insurers. 2013 Mobile Finance Trends and Innovations This slide deck includes commentary on mobile developments, key takeaways for financial services firms and thoughts on what’s next for mobile finance. 64
  • 65. CONTACT THE AUTHOR James McGovern Vice President Consulting Services James McGovern is head of CI’s Consulting Services. He leads a team of analysts that provides highly customized research and competitive intelligence to the nation’s leading financial institutions. Recent consulting engagements have included website and mobile capabilities benchmarking projects, Website Audits, industry trend analysis, business strategy projects, mystery shop work, pricing analysis, and user testing and heuristic reviews, among others. Check out our consulting case studies to learn more about our latest projects and strategic engagements. CONTACT JAMES: 646-454-2667 jmcgovern@CorporateInsight.com | LinkedIn 65