While use of electronic delivery can replace billions of dollars spent on paper, printing and postage, the promise of these savings has been pursued with disappointing results, according to Toronto, Ont.-based DALBAR Inc. Over the last five years, the enormous cost savings promised through e-delivery has remained elusive and expensive to implement. DALBAR found that with significant promotion, financial services firms can expect only 4% to 5% of customers to adopt e-delivery of the majority of customer communications. The majority of firms have realized some cost savings from e-delivery to date. The average annual savings per each converted customer have been: $9 for hard copy mutual fund quarterly statements replaced by e-delivery; $6.76 for hard copy variable annuity shareholder report replaced by e-delivery; $2.38 for hard copy mutual fund shareholder reports replaced by e-delivery. The most effective promotional strategies for increasing the adoption of e-delivery tie it to a financial incentive, DALBAR found.
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