SAN MATEO, Calif., — June 13, 2005 — New competitive intelligence from Keynote Systems (Nasdaq: KEYN), The Internet Performance Authority®, reveals that brokerage Web sites generally maintain the Internet’s highest service levels, increasing competitive pressures in what is already a highly competitive market. Two companion studies (the Keynote Customer Experience Rankings for Brokerage Web Sites and the Keynote Service Level Rankings for Brokerage Web Sites) examined the online customer experience and service levels at leading brokerage Web sites and offer new insights into the intensely competitive nature of this market.
For the studies, Keynote evaluated the Web sites of the following brokerage companies: Ameritrade, E*TRADE, Fidelity, HARRISdirect, Merrill Lynch Direct, Schwab, Scottrade, ShareBuilder, SiebertNet and TD Waterhouse. In addition to these sites, the Keynote Service Level Rankings study also examined the BrownCo, Firstrade, T. Rowe Price and Wells Fargo sites.
“Investors have very high expectations of online brokerage Web sites both in terms of the customer experience and in terms of service levels,” said Dr. Bonny Brown, director of research and public services for Keynote. “Given the very competitive state of the brokerage industry, performance problems and customer experience frustrations can translate into problems in attracting new investors.”
The Keynote study found that Web site service levels in the brokerage industry far exceed other industries, with industry average reliability of 99.5%, the highest reliability rating of any industry measured by the company. According to the study, pages that download in more than one and a half seconds, a download time that is considered excellent in other industries, are outside best of class in the brokerage industry.
“Leading brokerage companies are pushing the bar much higher not only for competitors, but across the Web as well,” said Chris Loosley, general manager, service level business for Keynote. “Driven by the brokerage industry, the eight second rule, which had become the four second rule, is quickly becoming the one and a half second rule.”
The Keynote Service Level Rankings examined service levels on public portions of leading brokerage sites, testing speed and reliability by running 6500 simulated interactions with each site. Ameritrade, Schwab and Scottrade were judged to provide the industry’s best overall service levels, maintaining excellent performance across ten key factors measured in the study. In the critical area of site reliability, Schwab and Scottrade were reported as the most reliable sites. In fact, Scottrade did not report a single error for the entire month during which the study was conducted.
Despite excellent performance by the industry as a whole, some major brokerage companies performed surprisingly poorly in terms of service levels. One site in the study reported more than 20 hours of downtime in the examined month, and had average page download times more than twice the industry average, a performance that is unacceptably poor in the demanding brokerage environment.
The studies found that site speed and reliability were key considerations for prospective online investors when evaluating brokerage sites. In fact, the speed and reliability of trade execution on a company’s Web site is almost as important to prospects as the commissions and fees charged for trades. In the study, 83% of prospective online investors reported commissions and fees as an important consideration and 82% reported speed and reliability of trade execution as a key consideration. In comparison, the selection of available products and services was a consideration for 60% and investment advice and planning tools were considered by 56%.
In the competition for customers, E*TRADE, Fidelity and Ameritrade had the most success in converting prospective online investors into customers, according to the study. To determine the leaders in customer experience, and other key business success metrics such as customer acquisition, Keynote examined 1500 prospective online investors as they interacted with leading brokerage sites, and captured more than 250 behavioral and attitudinal data points for each prospect.
E*TRADE rated highly, in part, because of its persistent display of security icons and easy access to its privacy policy. Fidelity’s intuitive navigation, product categorization, and account descriptions earned it high marks from prospective investors. The top frustration for prospective investors evaluating brokerage sites was when poor online demos were presented, or no demo was available at all. Almost a third (29%) of all prospective investors in the study complained about this issue.
The Keynote Customer Experience Rankings for Brokerage Web Sites and the Keynote Service Level Rankings for Brokerage Web Sites, which may be purchased together or separately, provide in-depth competitive analysis of the online brokerage industry and contain hundreds of additional data points and a detailed analysis of study findings. For more information about the full reports or to purchase the reports, visit:
Keynote Systems provides a full range of measurement and monitoring, service level and customer experience management services. Keynote’s competitive intelligence studies provide insights into Web trends, as well as service level and customer experience competitive benchmarks of leading brokerage Web sites.
About Keynote Customer Experience Research
Keynote is the leading provider of customer experience research services, offering both competitive intelligence and custom research examining consumer attitudes and behavior on the Web. Keynote’s research provides critical business insight into online customer experiences, industry trends and competitive Web strategies for a variety of vertical industries. In addition to traditional opinion data, Keynote’s proprietary research technology and access to a pool of 160,000+ panelists allows for the collection of detailed qualitative and behavioral data that inform its reports.
Keynote CE (CE) Rankings are available for a number of industries including the retail, banking and credit card industries, as well as several travel verticals, including the airline, cruise and rental car industries.
To learn more about Keynote’s competitive intelligence offerings and for a list of the various vertical industry reports that are available, visit: http://www.keynote.com/solutions/competitive_intelligence.html.
About Keynote Service Level Management and Competitive Intelligence
Keynote Service Level Management (SLM) solutions provide enterprises with the tools to align IT and e-business goals. Keynote’s SLM solution suites offer a comprehensive approach to the problem of managing e-business service levels effectively for IT, for application deployment and support personnel, and for e-business executives.
To learn more about Keynote’s SLM solutions visit: http://www.keynote.com/solutions/service_level_management.html.
About Keynote
Founded in 1995, Keynote Systems (Nasdaq “KEYN”), The Internet Performance Authority®, is the worldwide leader in e-business performance management services. Over 2,100 corporate IT departments and 16,000 individual subscribers rely on Keynote’s growing range of measurement and monitoring, service level and customer experience management services to improve e-business performance by reducing costs, improving customer satisfaction and increasing profitability.
Keynote is viewed as The Internet Performance Authority due to the company’s global infrastructure of over 1,600 measurement computers in more than 50 cities worldwide that capture and store on a daily basis over 60 million Internet performance measurements, frequent media citations quoting Keynote's Web performance data and analysis, the company’s market-leading Web performance indices for vertical markets and leading customer research that provides critical business insight into online customer experiences, industry trends and competitive Web strategies.
Keynote Systems, Inc. is headquartered in San Mateo, California and can be reached at www.keynote.com or by phone in the U.S. at (650) 403-2400.
Keynote, The Internet Performance Authority and Perspective are registered trademarks of Keynote Systems, Inc. Other trademarks are the property of their respective owners. © 2005 Keynote Systems, Inc.
Editorial Contacts:
Della Lowe, Keynote, (650) 403-3233, dlowe@keynote.com
Dan Cahill, Roaring Communications, (415) 552-3999, dcahill@roaringcommunications.com
Michael Hopkins, Lippert Heilshorn & Associates, (212) 838-3777, mhopkins@lhai.com