By Paul McGrath, Vice President, EMEA Sales at Bazaarvoice
The UK financial industry has, it’s safe to say, seen better days. Aside from the banking crisis of 2008, recent stories of banker bonuses, distorted interest rates, money laundering and miss-selling scandals have all contributed to an increasing lack of faith and trust in financial services.
This is particularly true in the consumer market, where trust is central to a competitive and properly functioning financial system. However, the fragility and complexity of the sector means it can take time to restore once dented. The recent events outlined above have had a negative impact on many UK consumers, who now write off financial service providers as ‘all the same’ without checking their offerings.
Faced with this situation, there is a clear need for financial service providers to reconnect with their customers and the general public. Yet traditional means of advertising and marketing are not strong or smart enough to cut through the negativity; in the eyes of consumers, firms have lost the right to drive the conversation. It is therefore imperative they find alternative means of re-establishing this connection and one of the best ways is using the latest social and technology tools to transfer that right to their audiences and capture the voice of the consumer to speak on their behalves. In other words, they must focus on user generated content and online reviews to do the advocacy for them.
Financial service companies can use consumer content to build trust through the perception that they do what’s best for their customers, not just the company’s bottom line. This type of customer advocacy builds customer loyalty and, for financial service providers, loyal customers provide the highest revenue growth opportunity. Businesses that proactively collect reviews from customers generally have an average rating of 4.3 stars or above; readily available user content promotes transparency and accountability, whilst also inspiring conversation and experiences based on shared interest. Opening up to customer feedback also shows current customers that a financial institution cares about their experience – and will work to keep their business.
This is hardly surprising. After all, despite the advances made by the internet and aggregator sites, the vast majority of people still ask friends, family or colleagues for their recommendations. Research shows that consumers tend to trust people like them – real customers who’ve used a product or service – nearly 12 times more than information from the brand or service provide. In addition, thirty percent of consumers would choose a financial institution based on the recommendation of a trusted acquaintance; consumers’ trust in each other’s opinions makes customer reviews the ultimate selling tool for financial service providers.
In addition, to influence decisions these comments and opinions need not be from people consumers know. Strangers’ reviews help consumers find the right financial products and provider for their needs, and buy confidently. Among all financial service buyers in one study, 38% read product reviews online while making their decision – and all of them reported being influenced by those reviews. And 29 per cent of them would never buy insurance or sign up for a credit card without first reading opinions from current or past customers of the institution.
So how do you go about implementing this in an industry like financial services? This will vary depending on the size and nature of the organisation, but here is check-list of the main things to consider:
- Creating the right structure
One of the most important considerations here is to make sure that all content displayed on your site is authentic – free from fraud, moderation and with complete disclosure of incentivising or affiliation of the reviewer with the product / service they are reviewing e.g. employees.
On the other hand, monitoring conversations and managing engagement with customers is not as time intensive as you might think. Bazaarvoice clients typically receive an average of 1.4 reviews per week that require a public response from the company. It is therefore important to understand where resources should be allocated to maximise efficiency.
- Facilitating relevant content
Social channels of financial services providers are often bursting with content from customers that can be leveraged on their own websites. Aggregating content from these sources not only helps existing and potential customers looking for new products, it also encourages conversation to take place on your doorstep which is ultimately easier to manage.
Research by Bazaarvoice in November 2013 found that 70 per cent of consumers have questioned the trustworthiness of reviews across the web and that half thought companies removed negative reviews. It is therefore important that any content being aggregated from social channels is filtered through authenticity channels and that negative comments are not omitted.
- Scenario planning / crisis comms
Whether as simple as a negative review, or a series of comments following a negative news story, there is always the possibility of something going wrong. It is important to set out what these might be and have provisions in place before enabling UGC on your site.
For ratings and reviews in particular, being responsive can not only make customers feel good about a brand, it can also increase conversion rates. A Bazaarvoice study with Wakefield Research found that intent to purchase more than doubles if consumers see a brand respond to a review. Furthermore, responses from companies that correct ‘misuse’ of a product or service can triple intent to purchase. For financial services, a negative review might be the result of a customer purchasing an unsuitable product. By suggesting an alternative, you might well retain that customer and bolster confidence in your commitment to customer service with all audiences.
In today’s digital age, where information is readily available and the democratisation of traditional institutions is ongoing , digital services and initiatives will become increasingly important for financial services, especially as more Millennial – those aged 18 to 34 – become financially independent. It is this group that have arguably suffered the most from the fallout of the economic crisis and whose faith in financial services has been most affected. With 70 per cent of this group saying social opinions are the most trusted form of advertising, it is clear that user generated content is both the present and future.