Online account aggregation sites are now offering tools that let people compare their own spending habits to those of others, a contrast to the traditional aggregation model in which Web sites help users track only their own income and spending patterns.
Wesabe Inc. in San Francisco revamped its Tips page last week to begin tracking its users' spending at specific merchants. The page previously let people post recommendations for ways to save money, but this anecdotal approach meant that the advice could be hit-or-miss, depending on what the person needed to buy, where they lived, and whether anyone had made a relevant suggestion.
The updated service tries to show — by examining the account holder's purchases and displaying how much others have spent on comparable products at other merchants — how people could save money.
Mint Software Inc. in Mountain View, Calif., introduced in December its SpendSpace feature, which compares users' spending in specific categories to other users' habits. For example, people can see whether they are spending more at restaurants or coffee shops than other Mint users in their state, and they may use the information to adjust their own spending.
"Over half our users say they've actually changed their spending behavior because now they can see where it all goes," Aaron Patzer, Mint's founder and chief executive, said in an interview. The most common adjustment, he said, is deciding to eat at home more often in order to reduce restaurant spending.
Wesabe said its Tips feature is more focused on individual merchants than spending categories. For example, it can show the average amount its users spend on trips to two mechanics in the same city, and potentially show the one that is generally less expensive. The site also lets users review specific merchants, allowing them to submit specific reasons why others might want to avoid the cheaper mechanic.
(Mint also offers a tool that lets people compare the amounts they spent at many large merchants to the average amounts spent there by other Mint users, but it does not suggest other, similar merchants.)
Marc Hedlund, Wesabe's co-founder and chief product officer, said the revised Tips feature is meaningful because it shows people not only when they are spending more than they need to but also ways to reduce their costs.
"A lot of the people who are coming to our site are doing so because they're under financial stress," he said.
Mr. Hedlund suggested thinking of his site as "the opposite" of a credit bureau and instead a place where consumers can evaluate merchants before doing business with them. Just as lenders want to review an applicant's history before granting a loan, consumers can review a merchant's history before spending money there.
"We don't want people spending money at bad merchants," Mr. Hedlund said. "We want to show people where they have options, where they can do better with the money they're spending today."
Users' evaluations of merchants are backed up by their transaction history; Wesabe only lets users review merchants where they've spent money.
Banks, which have largely shunned aggregation, would not be able to provide this level of information to their customers, Mr. Hedlund said, since it could risk upsetting their merchant customers if they start guiding consumers to a rival. "For the banks, they have a sort of split position, which is, they want their credit cards and debit cards to be accepted by these merchants," he said.
Though Mint does not recommend specific merchants, it does offer tips about banking products that could save users money. For example, a frequent traveller might be advised to use a credit card that offers travel rewards.
It makes these recommendations on the products' merits, though banks can choose to sponsor listings on Mint's site. Sponsorship does not win a bank's products stronger recommendations, but it does let the bank fine-tune the way its products are presented when deemed relevant by Mint. For example, Mr. Patzer said, sponsoring banks can include their logos when their products are recommended.
Mint is expanding the types of financial accounts it lists on its site, Mr. Patzer said. In March, it added the ability to view balances on investment accounts, and on Wednesday it added charts that show how these investments change over time. It also plans to include student loan and mortgage balances and then let providers of such products sponsor recommendations in those sections.
George Tubin, a research director at TowerGroup Inc., an independent research firm in Needham, Mass., owned by MasterCard Inc., said that aggregation sites can use their data in ways that banks cannot.
A bank that tried to pool customer data and present it to customers in a way similar to Mint or Wesabe would "start to run into privacy questions," he said. And in guiding consumers to different merchants, "perhaps payment providers would get some backlash from their customer base."
By contrast, Wesabe and Mint "are in a position where they have nothing to lose," Mr. Tubin said. "Any kind of value-added information they can put out, why not?"
Though some consumers may express concern at the notion that their spending data is being shared, other kinds of user-feedback are becoming commonplace on the Web. "More and more consumers are adding their comments to ratings," he said.
This information could be just as useful to the merchants being rated by consumers, he noted, and some merchants might even be willing to pay to see their bad reviews, much as vendors who sell through Amazon.com Inc. keep selling even when their products get poor reviews from the site's users.
"They could actually sell information back to merchants to help them understand what it is customers do and don't like about them," he said.
