What’s the end result of less cash, weaker spending, and devalued assets? Fewer and shorter visits to bank websites, according to a new study from comScore, Inc. Third-quarter data show a significant declines “in the average number of minutes spent per visitor” on a year-over-year basis, with Bank of America down 6 percent, Wells Fargo off 7 percent, JPMorgan Chase slipping 8 percent, and Wachovia sliding 12 percent. Washington Mutual’s website showed a 2 percent gain.
The fall-out of the financial market meltdown has further concentrated the online universe. During the third quarter “the top three online banks accounted to nearly 60 percent of all of the customers of the top 10 online banks,” according to comScore. With Wells Fargo/Wachovia and JPM Chase/WaMu pairings the share of the top three banks has widened to 80 percent.
And competition for customers has intensified, with some banks offering cash incentives up to $200 for new account business. The approach is “absolutely working—these banks have been relatively successful in growing new accounts,” observes Marc Trudeau, senior director of financial services at comScore. “But it’s challenging from a financial perspective. There’s a deep hole to dig out of, since most of the business is in free checking accounts, and balances are down.” Still, online banks should provide a “tremendous opportunity to build customers,” Trudeau says. “Branches simply cost more; online banking maximizes ROI. Clearly, more banks must move to online acquisition.”