2021 Marketing Trends: Financial Services.
It almost goes without saying that 2020 has placed a lot of economic pressure on businesses of all kinds. Customer acquisition and retention strategies have been revisited with long term plans being substituted for short term tactical initiatives.
In this blog post, we’ll focus on the key trends affecting marketing strategies for Financial Services companies as they look towards a different kind of landscape in 2021.
Personalisation and privacy.
According to an article published in the Drum in 2020, personalisation is a key battleground in financial sector marketing. Building better, more personalised relationships with customers is key to the industry’s success but remains one of its biggest challenges.
Customers want personalised, helpful guidance and content yet they have trust issues with financial institutions as a whole. The 2019 Edelman Trust Barometer: Financial Services report revealed that trust in the sector is at its highest level since 2012, yet at 57% of the general population, it remains the least-trusted sector measured.
When looking at personalisation, Gartner found that more than half of consumers would unsubscribe from the company’s communications and 38% would stop doing business with a company if they found personalisation “creepy”.
Further, personalised content needs to be dynamically generated to fulfil the promise of hitting the needs of individuals and this presents a real privacy challenge. To provide individually tailored landing pages, customers and prospects need to accept third party cookies and share personal data with the likes of Google.
Changes on the horizon with third party cookie usage add to the challenge as opt-in is likely to require an extra stage at least to remain compliant.
However, firms can update their cookie control to use the new Google Consent Mode. Find out more in this article.
So the key here is to get the balance right. You need to provide enough personalisation that the content remains relevant but not so much that you fall foul of breaching personal privacy.
A refocus on user experience on your site or app to ensure that you are meeting different user types needs efficiently will also be a prudent move.
Marketing to Millennials, through to Generation Z.
Research group Gartner points out that Millennials through to Generation Zs are a challenge for financial institutions to market to. They distrust financial institutions, are relatively low adopters of various banking, investing and insurance products and have very specific values – like equality, adventure and belonging – that need to be aligned with.
It’s about creating emotional appeal, developing trust, and making the right services available in the right way.
Peer influence is key to gaining trust so traditional outbound marketing methods like publication ads or direct mail campaigns are relatively irrelevant to this notoriously hard to reach group.
The value of careful personalisation, segmentation and positioning are critical when setting any marketing strategy in 2021 and particularly for reaching these audiences. Gathering demographic and geographic data has always been key to digital marketing success but now psychographic profiling (segmenting by culture, lifestyle, typified buying behaviours etc) will be all the more important.
This gives rise to even more granular segmentation. Whilst this can be aided by having well-researched buyer personas, greater emphasis should be placed on reaching out to younger consumers in a genuinely helpful way.
Great examples of this include Natwest’s Money Sense campaign that takes an educational slant and Barclays’ LifeSkills initiative with tips on getting a job, going to university or staying safe online. They even offer virtual work experience.
The end of the office? Digital transformation.
With customers and clients increasingly moving towards online interactions with Financial Services, the temptation is to move to a purely digital experience. COVID has accelerated this trend.
While meeting with clients virtually and offering services online has its great advantages, there is still much debate about the value of the high street presence. FS giants like Capital One have branches that more closely resemble coffee shops while others actively channel customers towards online interactions.
Millions have been invested in call deflection strategies as banks seek to move customers away from costly call centres and push them towards “self-solve” automated routes.
Whatever the view, there’s no doubt that customers and service providers need to fully embrace the much-discussed “new normal” of people working from home and with it higher expectations on the digital service offering.
FS providers that invest in bridging the gap between an “in-person” service and personalised online services (taking account of the privacy battleground) will be ahead of the curve.
Marketing automation solutions like HubSpot, Marketo and Intercom should be at the forefront of any tech spend. Artificial intelligence-based solutions that learn from user behaviour and enhance Customer Experience (CX) will reap the greatest rewards.
Inbound Marketing over Outbound.
The value of a good inbound marketing strategy – producing user-centric marketing campaigns – has proven itself many times over in terms of ROI. It is also much easier to measure. The use of tried and tested attribution models can prove more accurately which touchpoints in a buyer’s journey have resulted in a conversion.
This should lead to much lower cost per acquisition figures than some traditional outbound marketing methods. For more discussion on this check out my earlier post.
Value adds in Financial Services.
With an increasingly competitive online market, Financial Services firms will need to look for other ways of adding value to their customers and clients. Price comparison site MoneySuperMarket does this by offering free expert advice in the form of MoneySavingsExpert, capitalising on the celebrity status of Martin Lewis.
Whilst the site claims editorial independence, there is no doubt that MoneySuperMarket gains some brand equity from the association. This works much like above the line sponsorship but has a more subtle approach. It positions the price comparison site as an expert in its field and doubtless helps with search rankings.
Even small steps forward like keeping a well maintained Frequently Asked Questions section on your website, helpful newsletters or content bulletins, a blog, explainer videos or other useful content will go a long way to adding value to your customer’s experience.
Getting back to basics.
As already mentioned, those firms that invest more heavily in customer-centric marketing are likely to do best.
There are a number of ways this can be achieved but understanding your users wants and needs and how you are meeting them is now more important than ever.
2020 has given industries of all kinds pause for thought about how to better meet customer needs and provide a better service. Margins are being squeezed as the economic slowdown has meant that consumers have become less brand loyal and expect more for less.
This applies to Financial Services too. Not only will firms need to look at more cost-efficient practices but they should look towards a better customer journey.
A key to the success of any change is a more thorough understanding of user or buyer journeys. Ask questions like, how did the buyer find us? What services did they use? What part of our product or service did they enjoy using? What were the key touchpoints in their buying or repeat business decision? Did they refer us on to someone else?
The result for FS providers that make this investment should be shorter-term gains, greater stabilisation and long-term growth.
Campaign and service evaluation.
Firms should audit their current metrics and survey their customers on what is working well for them, Useful and easily accessible data to look at could include:
- Number of site visitors (increased traffic is always a good start)
- Site visitor bounce rates- which pages are people leaving on and why
- Conversion rate statistics (Google Analytics, Hotjar)
- Results of tracked campaigns against referrals
- Results of customer surveys (particularly Net Promoter Score stats and feedback. Remember – the most useful part of the NPS survey is the qualitative question rather than the quantitative one and avoid using incentives as these typically skew results
- Number of meetings arranged
- Number of meetings against new business wins
- Number of touches with a prospective customer before they convert
- Cancellation feedback – understanding why your customers stopped using you – often this will be about price or perceived value but are there other factors that have become trends? Maybe a human interaction
All of this information should be housed in a centralised database where possible – again tools like Hubspot or Salesforce are a fantastic place to note and track what’s working and what needs attention.
Core competencies vs diversification.
Services that have diversified their product offer may do better to refocus on core competencies in the marketing message. Going back to the roots about why you exist and what your service is “bought to do” will likely mean some important decisions about what you actively market and what you leave behind.
Messaging needs to be crystal clear at the moment so in 2021 it will be crucial to ensure all channels are aligned and all customer touchpoints genuinely move them towards their desired goals.
Having said that, if your product or service is in decline, now might be a good time to consider some strategic partnerships or mutual marketing agreements.
Higher reporting cadence and marketing agility.
Financial Services marketers and sales teams typically report in monthly and quarterly periods. With the volatility of the marketplace, it will make sense to have shorter reporting periods. Marketing efforts will need to be more closely monitored and a strategic approach may have to be broken down into a greater number of tactical “sprints”.
Agile marketing will need to be backed up by fast responding tech development partnerships.
It almost goes without saying that 2020 has been a crazy year for industries of all types. It has placed increased pressure on Financial Services providers to prove their worth, Key to the success of next year will be:
- Greater personalisation
- Proof of data privacy
- Genuine outreach and help for younger generations of service users
- Investment in new service delivery methods
- Greater emphasis on inbound marketing investment
- Genuine added value initiatives
- Revisiting and evaluating service design
- Refocus on core competencies
- Greater agility in marketing tactics and strategies