How Investors Search For Retirement, Brokerage Accounts Online: Google Data

Google’s new Think Insights, announced last week as a project designed to “help marketers make smarter decisions,” includes two 2010 research presentations that shed light on investors’ search for information online:

• “The Role of Search in Brokerage Account Shopping,” citing Google/Compete 2010 data
• “Inside Look Into The Financially-Minded Digitally-Connected Baby Boomer” with Google/Nielsen Online/Sterling data

Both are embedded below and here are a few notes from my review. By the way, Google doesn't number its title slides so the slide numbers I refer to below are to enable you to enter the number to go to the slide. It will be one off the number that appears on the slide.

Searchers Likelier To Apply, Bring Larger Account Balances 

Google's The Role of Search in Brokerage Account Shopping

“The Role of Search in Brokerage Account Shopping” covers retirement accounts, what Google calls “managed” brokerage accounts and self-directed brokerage accounts. The set-up of the presentation acknowledges the challenge in quantifying the role of the online channel (search, display or non-advertising content) in driving account applications.

The work looks at the behavior of those researching brokerage accounts online, which included searchers and non-searchers. Searchers—Google’s focus, given the company’s reliance on search-related advertising revenues—were more likely to apply online and more likely to maintain a $20,000-plus account balance.

Ouch—2/3 Of Shoppers Didn't Recall Online Ads

A line on Slide 8 says “Marketers have an opportunity to differentiate increase/brand recall by exposing shoppers to online ads.” That’s Google’s gentle way of breaking the news that 67% of shoppers did not recall any online ads. Ouch. But is it the creative, which is what Google’s suggesting, or the medium itself?

Shoppers referred by Search were more likely to apply than shoppers referred by other sources, according to Slide 11. But the percentage—22% of applicants that were search-referred—seems low to me. As shown on Slide 12, Google referred more than three-quarters of those who came in from search, which is no surprise. This report calls this online information-gathering “research,” but applicants considered just 1.13 brands on average (Slide 13).

Retirement accounts are easily the most (75% of respondents) researched type of account, followed by self-directed brokerage accounts (66%). Just 35% of respondents seek managed brokerage accounts (Slide 15).

Would you have guessed that online resources would be the only resource used by people researching brokerage accounts? That’s true of 37% of online shoppers (Slide 16), leading Google to make this recommendation: “Marketers should ensure brands are prominently represented online, otherwise a significant share of shoppers may not be exposed to their brand.”

Financial Institution Websites Still Relevant—To 58%

OK, see Slide 17 for evidence that financial institution Websites still matter as they top the list of online resources used by online shoppers researching brokerage accounts. They are used by 58% of respondents. We’d predict that this number will slip as others on the list gain in influence.

The headlines on Slides 18 and 19 are Search-centric but the graphs provide a point-in-time snapshot of how investors value financial institution Websites, social networking sites, finance-specific sites, financial institution review sites, online publications and other online discussion forums.

Slide 19 shows that shoppers for retirement accounts and managed brokerage accounts tend to value online resources in the same way. But see the differences in how self-directed brokerage account shoppers use online resources.

What effect does online and offline brokerage-related advertising have on online shoppers? No effect whatsoever for four out of 10 shoppers in aggregate, as shown on Slide 21. Almost half (48%) of managed brokerage and retirement account shoppers recalled no ads. Given a range of possibilities, the largest group (34%) recalled a television ad, followed by 21% recalling an online Website ad and 21% recalling an offline magazine ad. And the recall on other types of advertising falls off from there.

Shoppers with larger balances took more time to research their options (Slide 28). Almost two-thirds (63%) of those with $20,000 or less took less than two weeks versus 38% of those with more than $20,000. More than half of the group with larger balances (55%) took at least three weeks, 45% at least four weeks.

Boomers Search More, Watch More YouTube Videos

Google's The Inside Look At the Financially Minded Boomer

"The Inside Look Into The Financially-Minded Digitally-Connected Baby Boomer" presentation is a bit self-serving. In particular, Slide 9 and 10 show the relevance and usefulness of sponsored links (available from Google) to boomers, Gen X and Gen Y. Then again, who but Google is going to survey users about sponsored links?

Boomers are more financially search savvy than Gen X—a conclusion evidently based on the number of searches each group conducted for retirement savings, medical insurance, mortgage or home equity loan, stocks, bonds and mutual funds. Note that Gen X investors do the most searches for stocks, bonds and mutual funds.

Moving right along to another Google property, Google reports that boomers are twice as likely to watch finance-related videos (insurance and investing) on YouTube (Slide 11). Maybe this data will help push YouTube to refine its search capability as “investing” searches today produce results from a motley collection of experts with questionable credentials. YouTube's search deficiencies likely suppress views of videos produced by asset managers.

Check out Think Insights to download these and to see more financial services presentations.