Preparing For The Rise Of The Biller-Direct Generation - Forrester Research
This is the first document in the "2009 US Online Banking And Bill Payment Forecast" series.
by Edward Kountz
with Vikram Sehgal, Benjamin Ensor, Courtney Tincher
Executive Summary (This is a document excerpt)
Between 2009 and 2014, the total number of US online bill payment households will increase from 48 million to 63 million. Despite the early gains of direct billers, Forrester believes that bill consolidators like banks have a slight advantage in a maturing market. Nevertheless, bank eBusiness executives must secure this edge through cultivation of solid bill payment relationships with young affluents and other young adults, who are significantly more likely than the average online user to pay via billers' sites. eBusiness executives must also invest in tools supporting the shift from a focus on adoption alone to one that encourages activation and repeat usage. By 2012, consolidators’ share of the online bill payment market willsurpass direct billing by merchants for the first time, according toForrester.
Here's their press release:
Jun 16, 2009, 8:00 a.m. EST
Forrester Forecast: 63 Million US Households To Pay Bills Online By 2014
Banks Must Cultivate Relationships With Young, Affluent Consumers To Retain Market Lead
CAMBRIDGE, Mass., Jun 16, 2009 (BUSINESS WIRE) -- The number of US households paying bills online will grow from 48 million this year to 63 million by 2014, according to a new forecast by Forrester Research Inc. /quotes/comstock/15*!forr/quotes/nls/forr (FORR 25.07, +0.26, +1.05%) . The 5.4 percent compound annual growth rate reflects a maturing market where growth rates will shrink in the years ahead, but it also reflects a market that is not yet saturated. The top-line, five-year forecast is available to Forrester RoleView(TM) clients; subscribers to Forrester's ForecastView receive more detailed forecast data.
Forrester sees a shift in the online bill payment market as more consumers turn to banks and bill payment consolidators like Yodlee and Corillian because of several factors, including: the convenience of having multiple bills aggregated at a single Web site, the elimination of bill payment fees, and innovative marketing efforts to drive adoption. By 2012, consolidators' share of the online bill payment market will surpass direct billing by merchants for the first time.
Young consumers -- especially young affluent consumers -- will be a key battleground among financial services firms as the market matures. To date, this generation has shown less of an interest than older consumers to use aggregators such as banks for their online bill payment.
"eBusiness executives at banks need to work to establish earlier and stronger bill payment relationships with young affluents and other young adults," said Forrester Senior Analyst Edward Kountz. "To strengthen their position and better support these customers, banks need to add more payment options, deploy online and mobile alerts with greater visibility, and continue to hammer home the message that online bill payment is free."
The Forrester report "US Electronic Bill Payment And Presentment Forecast, 2009 To 2014" is currently available to Forrester clients and can be purchased directly at http://www.forrester.com/go?docid=54120.
About ForecastView
ForecastView is a syndicated subscription service that provides access to up to 40 forecasts across North America and Western Europe. Clients receive detailed forecast data and important market metrics that they will not get through research reports alone. In addition, they also have unlimited Inquiries with a forecast analyst. Forrester analysts employ a unique methodology that includes deep, consumer demand-side data along with supply-side metrics from proprietary company and industry sources. ForecastView forecasts provide insights into the development of online, mobile, and emerging technology markets. More information about ForecastView is available at http://www.forrester.com/consumerdata/forecastview.
About Forrester Research
Forrester Research, Inc. /quotes/comstock/15*!forr/quotes/nls/forr (FORR 25.07, +0.26, +1.05%) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, consumer insight, consulting, events, and peer-to-peer executive programs. For more than 25 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visit www.forrester.com.
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