Context

The Keep Me Posted campaign is a partnership of over 70 organisations campaigning for the rights of consumers to choose how they receive financial information without penalty.

Companies and organisations are increasingly sending “transactional mail”.

The study

The Keep Me Posted campaign commissioned London Economics to conduct the study to determine how far the medium of communication affects consumer understanding, choices and actions. The study involved:

• Literature review – to identify the main issues identified in transactional mail; to develop an analytical framework to structure the study; and to assess how they could apply relevant behavioural economic fieldwork techniques to the study.
• Online behaviour experiment and survey – 3,600 people from across the UK were invited to participate in the study, 2,399 people took part. The participants were randomly divided into two groups: one received a mock bank statement (either financially “healthy” or “unhealthy”) and a notice of changes to overdraft fees by post, while the other received the same information by e-mail (either as an attachment or a link). Both groups were asked in an online survey to recall and assess information and to identify the correct course of action to take. A further 310 people who did not or rarely used the internet, had a long-term health condition and/or were on low incomes took part in a face-to-face version of the survey. An offer of a cash prize helped to ensure that this was an “incentivised experiment”.

Key findings

Participants in the online survey believed that electronic communication was better at helping them to manage their finances, but the behavioural study suggested that mail by post was better.

Those who received information by post rather than electronically were better able to: recall their balance (82% v 32%), identify the biggest deposit into the account (71% v 30%), assess the financial health of the account (75% v 48%), recall a specific payment (96% v 77%), and determine whether there would be enough money to cover a payment (60% v 44%). They were also better at recalling the topic of the notice about changes to overdraft fees (82% v 42%) and when this would take place (81% v 54%).

Among those who received an “unhealthy” bank statement, 90% of those in the postal group identified suitable responses (such as reducing spending), compared with 77% in the electronic group. 90%, as opposed to 85%, identified the possibility of switching to a better deal.

The response rate in the study from the postal group was 80% compared with 54% from those who received the electronic statement. 98% of the postal group reviewed their mock statement, compared with 86% of the online group.

The survey found that 25% of participants considered information received on paper to be more genuine and accurate, while 16% thought that electronic information was. 22% considered postal information to be more secure, against 15% for electronic.

The study concludes that postal information may help people to manage their finances better and be more likely to encourage desired behavioural change.

Points to consider

The full report includes a very detailed and useful breakdown of individual survey questions and responses to the behavioural experiment across a number of variables.

The electronic group was divided into those who received an attachment or text with the relevant information, and those who received an electronic link, but higher-level findings combine these two sub-groups.

While the initial survey of attitudes distinguished those who preferred postal or electronic information, there is little discussion of how this reflected the results of the behavioural experiment.

The full report includes a useful literature review and wider information about effective communication.

While the results were weighted to reflect characteristics of the UK population as a whole, the experimental nature of the study limits how far the findings can be generalised.

Full report

Managing money online – working as well as we think? - full report