his article originally appeared in the Fall-Winter 2013 Edition of Consulting Insights.
For more information on the 2014 DC Plan Participant Website Audit or Survey Report, please contact James McGovern at firstname.lastname@example.org or646-454-2667.
Defined contribution (DC) plans play a critical role in helping Americans meet their long-term financial goals. This year, the Employee Benefits Research Institute (EBRI) estimates that the DC plan is the primary retirement plan for 78% of workers who participate in an employer-sponsored benefit plan. Considering DC plans’ importance to participants’ financial futures, provider firms need to make sure their clients can easily find key information and manage their accounts through their preferred channel. With that in mind, Corporate Insight designed a survey that examines the relationship between retirement plan participants and their provider website.
For our DC Plan Participant Survey, we interviewed 990 respondents, all required to be currently enrolled in their employer’s retirement plan or have funds in a past plan. In addition, we limited the sample to participants who had logged into their plan provider’s website at least once over the past six months.
The survey’s 32 questions covered key characteristics and behaviors important to understanding online DC participant activity, including login frequency and feature preference. We also asked about retirement plan provider and demographic attributes such as assets, income, age and level of education in order to tabulate the data into 20 contrasting segments.
Age and Assets Impact Satisfaction
As part of our analysis, we asked retirement plan participants how satisfied they were with their provider’s website in order to evaluate the industry’s success in meeting participant expectations. While the overall sample is generally content, with 63% indicating that they are “satisfied,” we found discrepancies among particular segments. Younger participants, who typically have greater expectations in terms of Web experience, are less satisfied than their older counterparts. We found that 15% of participants under 25 identify themselves as “extremely satisfied,” nine percentage points less than participants 60 or over.
A similar pattern emerges when looking at survey takers with different levels of liquid household assets. More affluent participants are less satisfied with their provider website experience. This may reflect the fact that they likely have investment accounts at multiple firms and may be accustomed to more robust online offerings. When we combined asset and age characteristics, we saw a sharp increase in dissatisfaction levels among younger, more affluent participants.
To better understand what factors might contribute to satisfaction, we asked which activities retirement plan participants performed on their provider website in the past 12 months. Consistent with our past surveys in the brokerage and banking space, we found that the three most popular activities all pertain to account information. Eighty-seven percent of users had checked their balance, 72% reviewed account performance and 61% viewed a statement. Assets, income and retirement plan account value also impact site usage. For example, affluent participants check their balance more frequently and track performance more closely than others do. They also make more exchanges between the funds they own in their plan account.
Mobile Has Yet to Catch On
Mobile account management is an increasingly important aspect of the relationship between financial institutions and clients. While not critical in the retirement plan space today, it will only rise in importance as mobile technology continues to improve and gain acceptance. With that in mind, we also surveyed participants regarding their use of mobile to manage their retirement plan account.
Interestingly, 64% of participants indicated that they did not know whether their plan provider offers mobile account access. This lack of awareness was even higher among participants age 60 or above (67%) and female participants (70%). This suggests that provider firms should be doing more to publicize their offerings and emphasize the convenience they provide.
Of respondents who knew their firm offered a mobile app or mobile-optimized website, only 35% accessed their plan in the past six months via one of these channels. And of the total survey sample, just 8% had accessed their plan via a mobile device in that period. It’s worth noting that 82% of the providers Corporate Insight tracks through our Retirement Plan Monitor service offer a mobile-optimized site and/or an app to plan participants. Our survey data suggest these platforms aren’t seeing much use yet.
Generating Engagement and Client Satisfaction
While most survey participants expressed satisfaction with their provider’s website, only 21% said they were “extremely satisfied,” indicating that there is still room for improvement. Different client segments also valued site features like education and planning tools to varying degrees. These findings highlight the need to understand your client base if you want to increase customer satisfaction with your site.