How Financial Services Companies Are Meeting Consumers’ Needs

A version of this post was initially published on The Financial Brand.

Edelman’s brandshare findings cast favorable light on the financial services industry that is reinventing itself after an unprecedented crisis that rocked world markets. The time since the crisis has been an opportunity for consumer financial services companies to rethink how they do their business, and brandshare respondents stated that the effort is noticed and appreciated.

The financial services industry outpaced other industries in the areas of responsiveness (ex. responds quickly to concerns/complaints) and conviction (ex. has a clear mission/purpose), however gaps in what consumers deem important and their perception of brands’ performance offer opportunity for improvement. In the area of involvement, the financial services industry lags behind technology and electronics. The question then becomes, how do we use these insights to close the gaps and keep the positive momentum going for financial services companies? The brandshare research looked through the lens of the following consumer needs:

  • Emotional: how brands make people feel
  • Rational: the transactional reason to believe
  • Societal: contributions to communities and the world at large

Here’s how financial services companies can improve:

  • EMOTIONAL – 87 percent of people want meaningful interactions with brands.

Connect Through Social Media: Consumers don’t connect with businesses through social media to just buy their products; they connect to share their vision and passions. Social media, therefore, is a medium for businesses to personally connect with consumers on an emotional level. This is more difficult than is sounds for financial services companies that are inherently risk averse, functioning within the most conservative frameworks to communicate.

The good news is that Financial Industry Regulatory Authority and Office of the Comptroller of the Currency provided clear and concise guidance on the use of social media six years ago, with minimal changes since. The guidance mirrors that of the offline world: maintain records, and follow the applicable company’s social media policy. The latter requires a sound policy that employees can understand and follow.

  • RATIONAL – 68 percent of people think brands should communicate openly and transparently about products, up from 54 percent the year before.

Communicate Proactively on Security Protections: For financial service consumers, the key concern is “how secure is my financial information,” with fears ranging from point-of-sale theft to hacking. Financial services companies have become leaders by collaborating with government bureaus and competitors to combat threats. Still, hacking is no longer a matter of “if,” but of “when.”

Consumers want and deserve to know about how their financial information is being protected and what their rights are. This is an opportunity for companies to advance the conversation with open communications that clarify their policies to protect consumers and the steps/outcomes that should be expected if personal financial data has been compromised. This communication can be easily placed on corporations’ websites and in retail locations, and will tap into not only rational needs, but societal as well by resonating with consumers’ personal/socio-economic interests.

  • SOCIETAL – 80 percent of consumers believe that brands must have a clear purpose.

Meeting Societal Needs Drive Business Value: Societal needs now extend beyond traditional definitions of corporate responsibility and sustainability. Using resources to drive change in the world and taking a stance on issues people care about will contribute to meeting consumers’ societal needs. Consumers want to know and understand the details in “fine print” policies. Why not invite people to be part of the development and refinement process for products and services? This will help eliminate the mystery of the industry’s “fine print” all together, tapping into what consumers really care about and providing the opportunity to engage on their media of choice.

The Buying Decision

Meeting consumers’ emotional and rational needs has a compound impact on a buying decision. Consumer needs that can be met through the following actions:

  • Quickly respond to stakeholders’ concerns and complaints
  • Act with a core mission and purpose at its core
  • Provide many ways to ask questions and give opinions

Meeting emotional, rational and societal needs will increase consumers’ likelihood to purchase from, recommend and defend a brand, as well as increasing likelihood that consumers will share their personal information and communicate about branded content online.

When consumers feel connected to the mission of a brand and trust them to be a good steward in society, they do – in fact – vote with their wallet.

Deidre H. Campbell is the global sector chair, Financial Services.