By Prelini Udayan-Chiechi, VP Marketing EMEA at Bazaarvoice
There is no doubt that today’s consumers are far more informed, connected and empowered, and far more likely to hold businesses accountable for anything that diminishes trust.Such is the case with Financial Institutions (FIs), which are by nature a business more likely to generate sensitive conversations. While FIs have recovered from the financial crisis of 2008, consumers’ trust has not. In fact, 38 per cent of financial product selections start with self-directed consumer education as opposed to getting advice in person from relevant agents, according to CEB TowerGroup’s ‘’Learning Driven’’ research.
Most financial institutions have been fighting battles on several fronts: acquisition, retention, and compliance. The FIs that have thrived in this new environment have successfully adapted to evolving customers’ needs; it’s crucial for the rest to be keenly aware of key macro-trends shaping the new consumer mandate and make them part of their strategy.
As aﬄuent segments age, there is a steady wealth transfer from older to younger generations.With $6 trillion expected to transition from the baby boomers to generation X and Y over the next decade, the tools necessary to approach and acquire new customers are changing.
Furthermore, the digital disruption has gradually led to 64 percent of consumers acquiring new financial products online, according to the CEB TowerGroup’s “Digital Banking: The Real Customer Impact” research.With fewer in-person interactions, FIs have lost the ability to build personal relationships and directly inﬂuence their customers’selection of the right financial products to fulfil their needs.In addition to this, if you consider that 52 per cent of consumers still do not trust financial institutions, it’s easy to see that the industry is now at a critical crossroad.
Consumers trust peers’ opinions three times more than brand content. Consequently, they no longer rely on branch staﬀ or agents, but use trusted resources, such as consumer-generated content (CGC), like for example online ratings and reviews, to bring clarity to complex problems.This reliance on CGC presents an opportunity for FIs to take control of the conversation and leverage it on owned digital properties to inform, influence, and convert more visitors of all varieties. As CGC holds enormous influence, businesses also need to take the responsibility to safeguard the content that so many consumers access before making a purchase decision.
The truth is, if FIs are not taking a proactive approach to CGC, they’re putting their institution at a major disadvantage. In fact, 73 per cent of consumers say that getting useful information is the most important attribute when selecting a provider, making CGC a critical asset in helping to identify and fulfil financial needs.So what should FIs do to leverage CGC?
To foster a much more representative conversation, FIs need a controlled social environment with the ability to solicit feedback from customer advocates. In fact, based on Bazaarvoice Financial Services Benchmark Data 2016, when institutions actively solicited feedback, customers rated their financial products 4.53 out of 5 stars, and 93 percent indicated they would recommend that product to a friend.
With a tailor-made CGC programme on an institution’s dotcom, FI marketers have the ability to leverage the fresh, keyword-rich consumer content to fuel long-tail search and track measurable impact, such as increase in conversion, site traﬃc, and engagement. As an example of this, when visitors engage with Bazaarvoice CGCon an institution’s dotcom, we’ve seen a 12 per cent lift in conversion.
In addition, CGC can also help eliminate compliance concerns. In the first instance, it’s essential to work with an experienced partner to appropriately address the compliance requirements of each of the major regulatory bodies such as FINRA, CFPB, FTC, NIC, Federal Reserve. When compliance is effectively managed, marketing teams can focus on what really matters: winning more customers. By housing CGC on their owned digital assets, FIs have complete control of all content moderation and therefore can ensure its compliance.
With many more options for banking and less influence on the in-branch experience, financial products are more commoditised than ever. In order to win in this changing and highly competitive environment, FIs must cater to the demands of an increasingly affluent younger audience, while still serving their core customers. By harnessing the power of CGC on their controlled channels, FIs can provide the most relevant, trusted content for each consumer’s unique financial needs, and seize the opportunity to harness the voice of the customer to drive sales.