The Parable of Online Bill Pay

Do You Pay Bills Electronically? ... At a recent strategy consulting project, I asked the 30 assembled senior executives at a large financial institution how many of them used online bill pay. Three hands were raised. Next I inquired as to how many in the group were aware that such services were available. Surprisingly, all 30 said they were. How many of the group believed that online bill paying would significantly reduce the time spent paying bills? Once again, 30 raised hands.

Now intrigued, I continued. If someone came to your house on a Saturday afternoon and offered to take all of your bills and set you up on an online bill pay, would you then use it? All but one of the non-adopters raised their hands. (The one who did not was concerned about security.) Finally, If vendor B subsequently offered a 50% discount on your new online bill pay, how many would move to the new provider? No raised hands.

To summarize: 100% of these financial professionals were aware that e-bill pay was both available and would significantly improve that activity yet only 10% actually had gone to the trouble of signing up. Non adopters (96%) would use it if someone else set it up for them. And no one would leave the vendor who went to the trouble of setting them up.

Lessons from the Parable of Online Bill Pay:
1. Internet adoption is much slower than Cisco's "Are you ready?" commercials might have you believe.
2. We are in the "chasm" between the "early adopters" and the "early majority" as predicted by Geoffrey A. Moore in Crossing the Chasm.
3. Internet companies won't make money fighting for the same 10% of "early adopters."
4. If an Internet company invests in the next 90% of users who are now non-adopters (Moore's "early majority"), customer acquisition costs may skyrocket. But the loyalty created can withstand significant price competition.

Who are your "early majority" clients? How will you get them across the "chasm"?

--Bob Potter