Website Redesign Expected to Accelerate
March 8, 1999
It seems like almost every day some mutual fund company or another is re-designing its website.
In just the past couple of weeks, Conseco and American Century Investments have launched new websites. In January, Scudder Kemper Investments introduced a new site. Other companies have made revisions to their sites.
The rate of change is likely to increase as the Internet becomes a more widely-used distribution and marketing channel and as competition between companies becomes more intense.
"It's going to be more (redesign) rather than less. People will be looking for a new look," said Steven Miyao of McGladrey & Pullen, a consulting and accounting firm based in New York that rates mutual fund sites every year.
Miyao says that on average, medium-sized mutual fund companies are re-designing their websites once a year. Larger companies are redesigning even more frequently.
"Most of it is involved with technological changes," Miyao said.
But the frequent redesigns are not just done to to take advantage of new technology. Companies are also redesigning their sites to support branding efforts. Some companies are coordinating their website revisions with advertising campaigns. For example, when Fidelity started its Peter Lynch television and print advertising campaign last September, it re-designed its site to include Lynch's image. Conseco, which is based in Carmel, Ind. and sells mutual funds, insurance and lending services, launched its redesigned site in late February - at the same time it started new television and print advertising using its "Step Up" motto. That motto is displayed prominently on the site, as are promotions of the new advertisements.
"Companies now are starting to align (their websites) with their advertising strategies," Miyao said.
Stewart Stockdale, executive vice president of marketing and strategic planning for Conseco, said connecting the website and the brand and advertising campaign is essential.
"They feed off of one another," Stockdale said.
This is the first "major renovation" to the site and it was done to increase the usefulness of the site for both consumers and distributors, he said. Before, the site only listed products but gave no further information about them. Now, if an investor wants more information about one of Conseco's financial products, he can click on a button labeled "Have a Conseco Representative Contact Me!" On the screen, a box opens up in which the investor can type in contact information and a salesperson in that individual's geographic area will get in touch with him to discuss the product. The investor's contact information is conveyed to the company by e-mail. It is just one of the new functions of the site, which in the past had been more aimed at providing information for Conseco's shareholders, Stockdale said.
American Century's recent redesign is the third for its site, said Gwinn Appleby, website manager for that company.
The new site allows investors to create personal home pages and to gain access to all their online account information with just one personal identification number. In the past, investors had to have separate personal identification numbers, for example, for an individual retirement account and a regular mutual fund account.
The company is still working on tying the company's website to its advertising and branding themes, said Appleby.
"Our goal is to be consistent," she said. "Online branding as a discipline is evolving."
The major impetus for the changes was to convey the impression that the company-via the Internet- was treating visitors as individuals, she said. For instance, by customizing their personal home-pages, investors get the feeling their fund company "knows" them better.
"We want the information that we give people to be relevant to their needs," Appleby said.
Incremental change is better than radical change when revising a site because people can be resistant to change once they get comfortable with something, Appleby said. American Century sent out mailings to its 80,000 investors who have on-line account access to inform them of the new website.
All changes can be costly but the most costly are those involving the most sophisticated technology, according to Miyao of McGladrey & Pullen.
Sites like Fidelity's and Vanguard's - which include online brokerages - cost millions of dollars to create, said Miyao. But those introduced by smaller companies without trading and account access are not as expensive to build. McGladrey & Pullen's "Outstanding Web Sites - Mutual Funds 1998" survey said that 40 percent of the top 20 sites spent over $90,000 on initial development of their websites.
Site maintenance is expensive too. There are an average of 11 people working on the top-rated mutual fund company websites, according to McGladrey & Pullen. But, many companies hire outside consultants to do the work. Costs vary depending on the training, experience and responsibilities of those hired.