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Hitwise Intelligence - Sandra Hanchard - Asia Pacific

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Financial Services and Information Asymmetry

October 04, 2005

One of the central themes in the Hitwise Online Australian Financial Services Report is comparison shopping. Having recently read Freakonomics by Levitt & Dubner, I've been interested in their concept of 'information asymmetry' and how it applies to the online finance industry.

Levitt & Dubner point out that the "Internet is brilliantly efficient at shifting information from the hands of those who have it into the hands of those who do not." Hitwise data supports the fact that Australian Internet users are combing through competing websites when they assess health funds, insurance, super and banking products. So providers who offer transparent fee structures, a clear outline of product features and benefits and user-friendly web application forms are going to be the winners in the online information exchange.

Seems pretty obvious, but the online financial services market has been left wide open to new entrants such as Virgin, Aussie Home Loans, and Wizard who have savvy online marketing programs that get the message across to consumers: they can simply offer better rates.

Posted by Sandra Hanchard at 01:42 AM | (1) | (0)