The Egg Index: 54% Of Britons Now Using Interactive Technologies

11 December 2001

Egg/MORI report registers 37.5% increase in online banking in 6 months - now at 5.5 million users

"Britain's appetite continues to grow for new and exciting innovations that are either already on the market or on the technological horizon. Consumers have developed a liking for the value and flexibility that digital technology affords them, and are becoming increasingly confident in the possibilities of transacting online. We are now also seeing a significant level of interest and anticipation for technologies such as digital payment and aggregation services, which are currently not widely available in Britain."

Key Highlights

• The Egg Index: 54% of the British adult population - or around 25 million people - now use interactive technologies (internet, digital TV or WAP mobile phone) for personal use (April 2001: 48%).
• We are becoming a nation of digital bankers: approximately 5.5 million Britons now bank online, a 6-month increase of 37.5% (April 2001: approx 4 million).
• Click happy: Internet use continues to rise fast with 42% of the British public - or around 19 million - now using the internet for personal use (April 2001: 33%). A further 1 in 7 adults (14%) envisage accessing it within the next two years, suggesting clear growth potential for online financial services.
• Buying habits: Nearly a half of all internet users (46%) say they have either bought or serviced a financial product over the internet (August 2001: 34%). Motor insurance is the top online financial services product with around 2 million British customers to date.
• Britons keen to beat the battle of the bulge: Over a quarter of Britons (27%) would swop their wallets for digital payment solutions which would involve iris or fingerprint recognition.
• Account Aggregation: Indications of an appetite for account aggregation services in Britain with around 1 in 3 adults (36%) claiming they would be interested in such services.
• From Silicon Valley to Sutton Coldfield: The Midlands has emerged as the region with the highest proportion of people with access to interactive technologies. Scotland is predicted to be the next internet growth hotspot with some 17% of Scots saying they would be likely to start using the internet within two years.

1. Embracing Technology - 'Innocence Vs Experience'

• The Egg Index: '54% of British adults now use interactive technologies' Between April 2001 and October 2001 the Egg Index has recorded a rise of six percentage points in the number of adults using interactive technologies (internet, digital TV or WAP mobile phone) for personal use. The total number of people now using these interactive technologies is around 25 million, or 54% of the British adult population (April 2001: 48%).
• Trust comes with time online According to the Egg/MORI report there appears to be a strong link between experience and the more comfortable people feel about using the internet for more sophisticated and transactional purposes. For instance, 56% of internet users that have been online for over 5 years bank online, but among those who have been online for between 1 and 3 years, the figure dips to 20%. Only 11% of those who have been internet users for up to a year bank online. Clearly the market for online financial services has growth potential. Propensity to bank online is likely to naturally increase as these new adopters mature and become more comfortable with using the technology.
• Internet use goes from strength to strength The use of the internet is still on the increase - 42% of the British adult population, or approximately 19 million people, now use the internet for personal use, a rise of 9 percentage points on six months ago. Positive news is that a further 14% of adults envisage doing so in the next two years, indicating a continuing hunger to explore the possibilities of the virtual world.
• Sofa so good for Digital TV: now accessed by 15 million British adults Our last report suggested the increase in the use of Digital TV may encourage people who may not otherwise have considered PC-based internet access to go online. Today 34% of the British adult population has access to Digital TV - around 15 million consumers. This equates to an increase of around one million (April 2001: approximately 14 million).

2. Embracing Technology - 'A nation of digital bankers'

• Online banking has grown by approximately 1.5 million in the last six months The number of people banking online continues to rise as internet users appear to become more comfortable with the technology as a medium for financial transactions and are realising the benefits and convenience of conducting financial matters online. The British online banking market now totals around 5.5 million people - an increase of 37.5% since April 2001. Egg currently has 1.8 million customers in the UK. ^*1
• Uptake of online financial products The findings show that 46% of internet users have now either bought or serviced a financial product over the internet, compared to 34% in August this year. The three most popular financial products to be arranged over the internet in order are Insurance, Credit Cards and Savings accounts. Motor tops the insurance stakes with approximately two million having taken out an online car insurance policy to date. Since launching the first ever online credit card in 1999 Egg has led the market and now has a card base in excess of 1.2 million customers. Looking forward, 53% of internet users say they would consider arranging some sort of financial product over the internet in the next two years.
• Account aggregation: On British consumers' Christmas wish list The report has also identified a high level of interest and anticipation in new technologies not yet widely available on the market. In all, 36% of British adults view with interest the possibility of being able to access and view all their financial products, regardless of being with different providers, on a single internet site, (otherwise known as 'account aggregation'). 37% of adults say they would be interested in using a single internet site which enables them to choose and compare between financial products from a range of suppliers.
• The Midlands rules the technological map of Britain The highest proportion of people with access to interactive technologies (internet, digital TV or WAP mobile phone) is still to be found in the Midlands, as our last report highlighted, while Wales has the lowest proportion in Britain. In terms of usage of different technologies, the Midlands and the South of England lead the way in internet and email use, whereas people in Scotland and the North use WAP mobile phones in greater numbers. The Midlands are the biggest users of non-WAP mobiles and SMS. Future demand for internet access is expected to be high in Scotland - 17% of Scots say they are likely to start using the internet within the next two years.

Professor Sir Robert Worcester, Chairman of MORI comments:

"The extent to which many people are receptive to potential new technologies of the future is extremely interesting. One-quarter of the general public - and four in ten under 35 year olds - say they would like to see technology which establishes who people are and how much money they have with iris or fingerprint recognition, meaning that one would never have to carry a wallet again"

The 'Embracing Technology Report' also found that:

• The number using the desktop PC for personal use is at the same level as internet usage - 42% of adults, which represents an increase of six percentage points on six months ago
• Personal use of email has increased by six points, and is now used by 39% of the British adult population
• SMS text messaging is now used by around 1.2 million over 55s
• 53% of internet users say they would consider arranging a financial product over the internet in the next 2 years
• 40% of internet users now use the internet for buying products.
• Men, the under 45s and the affluent social classes are more likely to be users of interactive technology (internet, digital TV or WAP mobile phones).
• There has been a 10 point increase in the proportion of women using the internet, from 26% to 36%, which equates to approximately an additional 2 million female users in the last 6 months.
• Male internet users are twice as likely as female internet users to have been online for over 5 years.

Technical details

Egg recognises that six months in the new economy is equal to a decade in the old economy, and will be publishing its "Embracing Technology" report regularly. The next edition is likely to be available in February 2002.

Technical details

MORI conducted a total of 1,959 interviews with a nationally representative sample of adults aged 16+ across Great Britain. All interviews were conducted face-to-face, in-home between 18 and 24 October 2001. The data were weighted to reflect the national profile. Where figures do not sum to 100 per cent this may be due to computer rounding, multiple codes or exclusion of 'Don't Know'.

Throughout this report, comparisons are made with the last Egg report - Embracing Technology [pdf format 176K] . A total of 2,008 interviews were conducted face-to-face, in home between 19 and 24 April 2001.

** PLEASE NOTE: question phrasings have changed slightly between the April and October surveys. In this October survey, usage of technologies refers to personal usage in the last six months, while the April survey referred to whether technologies had been used at all for personal use.

*1 Figures from Egg's third quarter reporting period ended 30 September 2001. Egg has seen 453,000 new customers over its nine-month reporting period to 30 September 2001 bringing the total to over 1.8 million.