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Experts in Personalized Retirement Plan Design & Administration

Four Out of Five 401k Participants Receptive to Cross-Selling From Their Providers

CHICAGO, IL, May 16, 2005 — Four out of five 401k participants would be receptive to their plan providers marketing additional products to them, demonstrating the existence of a potentially large market for cross-selling. However, just 14% of plan participants polled earlier this year own additional products from their 401k providers, according to the Spectrem Perspective(TM) report “Cross-Selling to Plan Participants: Can it Work?” released today.

A full 80% of plan participants said they would be open to cross-selling initiatives. This group includes individuals who already own additional products as well as those who are either familiar with their providers’ additional product offerings or unfamiliar but willing to learn more. The plan participants who do not yet own additional products appear overwhelmingly satisfied with their 401k providers: 70% are satisfied with their provider’s service and 63% are satisfied with plan performance.

“Cross-selling represents a tremendous opportunity for the providers of 401k plans, yet it remains largely untapped by these firms. Plan participants tell us they are generally satisfied with their providers and overwhelmingly open to the marketing of new products by these organizations. At a time when scandal has tarnished so many areas of the financial services industry, positive relationships like these are worth their weight in gold. New sales seem to be there for the asking,” said George H. Walper, Jr., President of Spectrem Group.

Of those participants unfamiliar with additional product offerings by their providers but open to learning more, their top choices for being contacted are: mailings to their homes, enclosures with their account statements, and links on their plans’ Web sites.

The report, “Cross-Selling to Plan Participants: Can it Work?” was based on telephone interviews with 401 plan participants in January and February 2005. The margin of error for this data is plus or minus 4.9 percentage points. Those interested in purchasing Spectrem Perspective(TM) reports should contact Spectrem Group at 641 W. Lake Street, Suite 402, Chicago, IL 60661, (312) 382-8284 (http://www.spectrem.com).

About Spectrem Group

Spectrem Group is a strategic consulting firm specializing in the affluent and retirement markets. It integrates proprietary research with expertise in building business, marketing and M&A strategies. Spectrem professionals have held senior management positions at leading global companies. Through a collaborative process, they create and implement practical and profitable strategies that fit the cultures of client firms.

Information provided in partnership with 401khelpcenter.com, LLC. 401khelpcenter.com, LLC is not the author of the material unless specifically noted. We do not endorse and disclaims any and all responsibility or liability for the accuracy, content, completeness, legality, or reliability of the material. THIS ARTICLE IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT INTENDED AS LEGAL, TAX OR INVESTMENT ADVICE.

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