A fledgling market research firm has launched a unusual on-line data base that tracks the performance of the investment product sales force in the nation's largest banks.
The company, San Francisco-based Prophet Market Research, has developed the data base system, called ProphetWatch, using mystery shoppers who visit selected bank branches and survey the effectiveness of investment products salespeople.
They rate investment salespeople on issues such as customer service, regulatory compliance, and sales skills, said Scott Galloway, the founder and principal of Prophet Market Research.
"ProphetWatch will enable banks to gain a greater understanding of the strengths and weaknesses of their own brokerage operations and see how they compare issue by issue with their competitors," Mr. Galloway said.
The data base, which can be accessed via modem-equipped personal computers, grew out of the firm's consulting work with individual banks, regulators, and trade associations since its founding in 1992, Mr. Galloway said.
"By delivering the information electronically and sharing it among a larger subscriber base, we can deliver this at a much lower cost," he explained.
ProphetWatch contains information on the investment sales operations of 15 large banks in the Northeast, including Citibank, Chase Manhattan, Chemical, Bank of Boston, Fleet, Keycorp, First Fidelity, Mellon, Midlantic, Marine Midland, PNC, Integra, Republic Bank, and Dime.
Mr. Galloway said ProphetWatch is being be expanded this summer to include the nation's top 50 banks. Later this year, data bases on the stock brokerage and insurance industries will be introduced, he added.
Over the next 12 months, Prophet will mystery-shop each financial institution 100 times. Results are updated weekly, and then compiled into easy-to-read charts that can be downloaded into a PC.
The firm has contracted with 230 people across the country to work as mystery shoppers. All of them possess either an advanced business degree or are licensed by the National Association of Securities Dealers, Mr. Galloway said.
The mystery shoppers rate bank salespeople on more than 70 topics, ranging from disclosure that a product lacks federal deposit insurance to closing skills.
Mr. Galloway said the data base can serve as vital benchmarking tool for bank executives looking to comply with regulations on investment product sales, as well as to glean competitive data.
He cited as an example a recent mystery-shopper study comparing investment sales at banks, brokers, and insurance companies that Prophet conducted for the American Banker's Association.
The research found that while salespeople working for banks did the best job of informing potential customers of the risks associated with uninsured investments, bank broker s did a less adequate job closing sales and were more difficult to contact with follow-up questions.
"This is not just a source of information regarding regulatory compliance, but competitive intelligence that can help a bank sell more effectively," Mr. Galloway said.
Subscribers pay a $15,000 quarterly fee to access ProphetWatch, he said. The software runs on PCs using Microsoft Windows or the Apple Macintosh.