4 Ways Financial Marketers Can Take Their Strategic Plan To The Next Level

You’ve defined your target market. You’ve got great products and services. Your call center, website, and branches are all humming along nicely. But consumers aren’t engaged. Prospects are tepid. In fact, it’s growing harder to hold onto the business you already had. What’s going on? Here's how financial marketers can hurdle the array of mental barriers erected by consumers, and make sure they aren't wasting money on messages delivered to the wrong people at the wrong time.

1. Emphasize Core Context

Personal finance is deeply abstract for most consumers. Some of the biggest barriers include:

  • Choice overload. There are hundreds, if not thousands, of options available. Where does a consumer even begin?
  • Inertia and procrastination. Even when companies make personal finance easy — like buying insurance with a few clicks — there are just too many other priorities and interests competing for attention.
  • Lack of financial knowledge. The typical consumer lacks the basic financial knowledge needed to make qualified financial choices.
  • Discounting the future. People prefer instant gratification. Saving for retirement requires a sacrifice today, for a payoff far in the future.
  • Loss aversion. People fear making the wrong choice. Their money, their future, and their security are all at stake. Fear of loss is even more powerful than desire for gain.

Given these barriers, it’s no wonder consumers find it difficult to take action in their financial lives. From a purely rational standpoint, it’s in their best interest, but most don’t have the skillset or the mindset to do so.

Marketers can get their arms around this psychological gap by subdividing consumers into these groups, to better understand them:

  • Basic Needs/Getting Started (about 50% of the population). Consumers that are neither confident about managing their financial life nor do they possess relevant skills or knowledge.
  • Guidance-Seekers (about 25% of the population). Consumers who have the means and the desire to gain control over their financial life, but they lack the skill; they’re looking for help.
  • Validation-Seekers (about 15% of the population). Somewhat skilled financially, but they’re not sure they’re making the right choices. They also want help that confirms or validates their goals and approaches.
  • Experts (about 10% of the population). Financially skilled and confident, these consumers largely make their own decisions. They are heavy users of financial products and services. They want access to the best at the lowest prices, and seek an edge.

Understanding these four categories makes your messaging more discriminating, rather than trying to communicate the same message to everyone. You can’t. You run the risk of scaring off prospects by being too specific and assuming too much knowledge, or too general, not being specific enough. Or, you might risk sending a message that’s too dumbed-down, alienating the message for more sophisticated consumers.

Overlaying this matrix on a customer or prospect database can be tricky because it requires having data from which to infer consumer psychology, as opposed to basic demographics such as age and income. Obtaining the necessary data requires tapping multiple sources, and potentially using cluster analysis and modeling. Sources include first-party consumer data; qualitative research such as focus groups; quantitative sources such as consumer surveys; data regarding interests, drawn from subscriptions and event attendance; and third-party research relating to preferences and attitudes.

2. Align With Demographic Life Stages

Personal finance topics like investing, saving, spending, and earning are important at almost any age or income level. But where they rank in importance differs drastically among generations. What matters to a 27-year-old single woman will be much different than what matters to a 71-year-old retired grandfather. Not only will products and services used be different, but also their priorities and perspective about personal finance.

Younger consumers will be most interested in content surrounding their most immediate concerns: earning and spending. If you’re a wealth management marketer, your focus is on investing, so it might feel a bit counter-intuitive — even wasteful — to focus messaging around earning and spending. But quite often the most successful content and marketing messages for younger audiences has to do with precisely these two topics. It might be content about how to balance the need to earn a living with doing what you love. It might be stories about their peers who have embarked on novel or non-traditional career paths. It could be life-hacks about how to be smarter about your spending. That kind of content can capture attention and sow the seeds for a potential relationship.

Retirees, on the other hand, are likely to care about maximizing their fixed-income investments, or how to save money by managing their taxes and distributions. There’s less need for content about earning. (However, topics about part-time work or “second adventure” can be very relevant to this group.)

These are just two possible — and simplified — age cohorts. You can construct others on your own with research.

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3. Leverage Channel Preferences

Who hasn’t heard a marketing “strategy” in the financial industry that sounded like this?

“We want to do a direct mail campaign to promote our new checking account product. So let’s build a list to target people who we think are good prospects.”

But more sophisticated marketing strategies flip this around:

“We know who our audience is. We know their why (attitudes and disposition), and their what (appropriate products and services, given their life stage). So now, let’s understand how they’d prefer to engage with us.”

A detailed media usage/preference profile of the audience might indicate direct mail as a strong channel. Yet it’s just one channel among many — offline and online, addressable and non-addressable.

Good profiles should also include optimal frequency ranges for each channel for the audience. At first, an audience-level channel/media analysis may seem more relevant for a media mix strategy rather than messaging strategy. And that’s absolutely true — you’d want to use this to inform your media planning.

But also think of it from the perspective of the desired experience you’d like to enable for prospects or customers. Each channel has messaging opportunities and limitations; consider how each of the following might impact your message:

  • Ease and accessibility of response, i.e., responding to an ad on TV, versus a direct mail piece vs. an email.
  • Frequency/cadence at which the message may be seen — once per season? twice a month? daily? How might that affect the messaging and mix of creative executions?
  • Physical advertising/messaging unit itself; both how they differ (an ad on Facebook vs. an ad in Country Living Magazine) as well as how they’re similar (a 15-second traditional TV spot vs. a 15-second online video).
  • The context, i.e., to what degree does the message relate to the context in which it’s appearing? For example, a contextual ad for auto insurance appearing in a Google search for “best auto insurance” (strong context; highly relevant); vs. a branding message on a billboard for auto insurance (weak context; less relevant).
  • Media consumption, that is, its context of how, where, and when.

The data inputs to help build these kinds of media-based audience profiles (ideally, in conjunction with a data management platform) can include:

  • First-party site analytics
  • Search data
  • Display advertising data
  • First-party CRM/campaign data (offline)
  • Third-party behavioral data

4. Focus Messages Along The Buyer’s Journey

The strategic thinking and analysis that goes into the why, what, and how are all in service to the marketing and business goals. Generally speaking, those goals are about motivating consumers through the purchase funnel, driving conversion. But the purchase funnel itself is actually a useful lens through which to view messaging strategies — it helps articulate the role of each message.

You begin with marketing objectives: the conditions or “stages” the consumer moves through:

Messaging and content must be organized strategically, aligned to each appropriate stage. For example, campaigns and content could be lined up with Awareness, which might be about increasing brand favorability, or simply building trust. Other content could be geared more toward driving engagement, perhaps with online tools, calculators, or educational content. The Purchase stage includes very specific offers, triggers and remarketing messages to highly-targeted, qualified audiences.

The next step is producing Key Performance Indicators (KPIs) as part of your “feedback loop” – these are the outcomes that can be compared against each of the campaigns/messages. This helps ensure that each campaign is delivering on its goal, and helping to move consumers through the funnel.

The concept here is that there are no “silver bullets” that achieve the ultimate business goal: the sale. It’s about having a broad mix of communications, each with a specific job to do in the purchase funnel. With this approach, you’re in a better position to holistically refine and optimize your messaging over time.

This article was originally published on December 5, 2018. All content © 2018 by The Financial Brand and may not be reproduced by any means without permission.

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