In response to today’s volatile economy, many financial services firms are changing their marketing campaigns to fear-inducing marketing messages to attract and retain clients. According to a new
Technographics Report from Forrester Research, Inc., these efforts miss the mark with the affluent — those consumers with investable assets of at least $1 million.
Forrester recently surveyed 2,500
North American affluent households on the state of the economy, the market, and technology, and found them to be confident about the economy and the market, secure in their wealth, and optimistic
about technology.
As a result, Forrester recommends two approaches above all to help firms gain market share: breeding loyalty and promoting a cohesive, relevant brand experience.
“The bottom
line is that retaining customers costs less than acquisition, and loyal customers buy more frequently and spend more,” said Ekaterina O. Walsh, Ph.D., senior analyst at Forrester. “Moreover, loyal
customers are a firm’s best acquisition vehicle. One of the top three ways affluent investors learned about their most recently chosen financial provider was through some sort of referral.”
Forrester says that to increase loyalty, companies must get back to basics by understanding their customers. Consumers do not separate their perception of a firm into individual channels or
interactions. Instead, all their experiences, ranging from online statements to branch visits, mesh into an overall impression of the financial institution. Consumers do, however, have expectations
for each interaction. Understanding these expectations will enable financial providers to promote the unique benefit of each type of customer experience—from the convenience of online statements to
the privacy offered in branches—through a unified message.
According to Forrester, financial firms will succeed by focusing on the unique benefits of their services and integrating their delivery
based on their target market’s expectations. To better understand what the affluent expect, Forrester analyzed four areas in which these consumers interact with financial institutions: advice,
branches, websites, and customer service. Timely, relevant, and customized advice, which includes everything from picking stocks to tax planning, plays a key role in retention. The affluent also
expect this advice to be offered via multiple channels, with 84% of millionaires expecting online and offline advice to complement each other.
The greatest benefits to branch visits for the
affluent are high-touch service and privacy. Clients who report that their firm offers a private setting are more likely to recommend that firm and less likely to move to another company, for anything
from lower fees and cheaper credit.
Affluent consumers’ affinity for technology is evident in how they use the Net to manage their finances: 44% of the wired affluent visit financial providers’
Web sites, compared with just 25% of their non-affluent peers. They are looking for accessible information and self-service when going online. Customer service is the fourth component to a firm’s
total experience. With today’s tight budgets, financial firms should offer cross-channel service and rapid responses to client email.
“Affluent clients whose primary financial providers
successfully integrate two or more desired services are 25% more likely to recommend the firm and 24% less likely to leave,” Walsh added. “And since the affluent are seven times more likely to list
credit referrals than ads as the way they heard about their current provider, firms can’t ignore the power of loyalty.”
For the Report “Winning The Affluent In A Downturn” Forrester surveyed 2,505
US and Canadian members of NFO’s and Canadian Facts’ panel of households with investable assets of $1 million or more.