financial services tracking - dma services... · financial services tracking study 2012 copyright:...

Financial ServiceS Tracking STUDY 2012

cOPYrigHT: THe DirecT MarkeTing aSSOciaTiOn (Uk) lTD 20121

Financial ServicesTrackingStudy2012

Insight partner

E�ective Marketing Research






Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

Key findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

1. Financial Services and consumer trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51.2 How Far Consumers Trust Industry Sectors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51.3 Trust in Financial Services Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61.4 Key Factors in Trust in Brands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61.5 Key Factors to Trust or Use Brands 2009 - 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71.6 Trust in Marketing Information Provided . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81.7 Trust in Investment and Insurance Providers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9

2. Financial Services and the consumer conversation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102.2 How Consumers Find Out About Financial Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102.3 Consumer Knowledge of Financial Products 2008 – 2011. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112.4 Consumer Contact Preference v Experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112.5 Consumer Contact Preferences 2009 – 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .122.6 Consumer Contact Received 2009 – 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

3. Financial services and consumer brand preferences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .143.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .143.2 Which Credit Card Consumers Would Choose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .143.3 Which Insurance Provider Consumers Would Choose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .153.4 Reasons for Choosing Insurance Provider . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16

Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

About the DMA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18

About fast.MAP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

Copyright and disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20



IntroductionAt the DMA Financial Services Council, we recognise the value to our members in tracking consumer sentiments towards financial services providers, their products and the subsequent impact on usage of marketing communications and channels. We have been tracking perceptions since 2008. This report presents the findings from the Consumer Trust in Financial Services Study conducted in Q4 2011.

The Financial Services industry led a very high profile life in 2011. With many media moments created less confidence for consumers in the industry than more. From stock market volatility and big-bank backlash to PPi claims and anaemic savings rates – the bad news seemed bountiful and the good news in scarce supply. With this and the arrival of social media centre stage, we have seen the emergence of a new voice; the confident consumer is also ‘advertising’ opinion which is starting to impact consumer’s trust and decision making.

So to state all is rosy in the garden of consumer perception would be an exaggeration. in fact it would be plain wrong. But as you read through this report, spot the stats and consider the commentary – there are encouraging learning here. and as you will find from the data, 2011 looks potentially to be a ‘turning the proverbial corner’ year for most sections of the industry.

above all, we hope the findings are both useful and useable. From providing evidence to strengthen budget bids for media to adding teeth to the argument that traditional direct media has a new role.

as ever we welcome all feedback.

regards

Christopher Brooks FIDM, Director, Lexden Ltd. [email protected], Financial Services Council, Direct Marketing Association

3



Key findings• Consumersarecautiouslyreturningtothemarketandlookingforfinancialproducts.Attitudeshavechangedsince theconsumerboomthatendedinacrash,however,with some implications for how marketers respond to

these green shoots.

• Leadingthisshiftistherisinginfluenceofsocialnetworkscomparedtobrandmarketing.“Know,nottell”bestsums uphowconsumerssay theyfindoutaboutproductsandservices-theopinionsofusersisclaimed to betrusted

aheadofwhatprovidersthemselvessay.This emphasises the importance of word of mouth, although care is necessary about the influence individuals can have in these channels.

• Atthesametime,thereisareturntosometraditionalvalues-consumershavemoretrustinbrandswithaHigh Streetpresencethaninpurelyvirtualbrands,suchascomparisonwebsites.Theyalsoprefertobewrittentothan togetproductinformationviadigitalchannels.Atthesametime,aneasy-to-usewebsiteisessential.Truemulti- channelconsumerbehaviourisnowapermanentfeature.

• Consumerresearchofwhatproductsareonofferisstillstartingwithpricecomparisonandreadingreviews-these aretrustedaheadofthebrands’ownmarketingmaterials.Thegoodnewsisthatsometrustisfinallyreturningto thefinancialmarketplace.Whereasthreeyearsagoconsumerswouldnotchooseanyofthebrandsonofferin creditcardsorinsurance,nowtheyarebeginningtoexpresspreferencesagain.

• There has been less change in the profile of contact channels used by the financial services industry as a whole than might be assumed. The marketing mix used by the industry is not so different now as it was two years ago – banks and building societies have even been sending more email than in 2009. Only outbound telemarketing has seen its role in the mix fall significantly.

• Theslatehasnotbeenwipedcompletelycleanandconsumerbehaviourwillbehighlyfluiddependingonlevelsof confidence.Whatisclearisthatthereislessappetiteforsophisticatedmarketingactivityandmoredesirefor

simple,clearandtrustworthymessages.All brands are required to be transparent and fair in the way they deal with consumers – the challenge for marketing is to be engaging as well as truthful.

4



1. Financial Services and consumer trust

1.1 Overview

• Financialservicesareinthebottomthreesectorsforconsumertrustalongsidegovernmentandthemedia. Consumersdistrusttheindustrytolookoutfortheminthecurrenteconomicclimate.

• Customerexperienceonlineistheprimarygroundwheremarketerscaninfluencetheconsumer.Surprisingly, theviewsofothercustomerswithexperienceofabrandaretwiceasimportantincreatingtrustashavingdirect personalexperience.Nurturingwordofmouthislikelytopaydividendsbothforrecruitmentandprospectingasa result.

• Trustintheinformationprovidedbyfinancialservicesprovidersisbarelypositive.Aworryingaspectisthatmany consumerssaycorefinancialproducts,suchasmortgages,arenotrelevanttothem.

• Thistrustdeficitisbasedonabeliefthatcompaniessellproductstomeettheirownsalesgoals,ratherthantomeet theconsumer’spersonalneeds.

1.2 How Far Consumers Trust Industry Sectors

Consumer Trust by Sector 2008 - 2011

0

1

2

3

4

5

6

7

8

Charities Home mediaproviders

Media (eg,newspapers)

Government Utilities Mobile phonecompanies

Carcompanies

Financialindustry

Dec-11Mar-11Jun-10Dec-09Jul-09Dec-08

Charitiesleadonconsumertrust–perhapsbecauseoftheemotionalupliftassociatedwithgivingtogoodcauses-as

dokeycontentandserviceproviders(satellite/cableTV,mobilephones).Carsandenergycompaniesalsoattracta positiveranking.Butwhenitcomestogettingconsumertrust,themedia,governmentandfinancialservicesneed notapply.

Therelativetrustworthinessofeachsectorhaschangedlittleoverthelastthreeyears(withacoupleofexceptions). Charitiesarethemosttrustedsectornowastheyhavebeensince2008andthisstandinghasshownlittlechange.

Homemediaprovidersandmobilephonecompaniesarethenextmosttrustedsectors,undoubtedlyreflectingtheir dailyroleinconsumers’lives.Ratingsforthesebrandshavesufferedlittleharmduringtherecessionandcurrently standingslightlyhigherthanthreeyearsago,withthreeoutoftenconsumersrankingthesesectorsfirstorsecond fortrust.

5

1.3 Trust in Financial Services Industry

Trust in Financial Services Industry

-0.9

-0.8

-0.7

-0.6

-0.5

-0.4

-0.3

-0.2

-0.1

0Dec-11Mar-11Jun-10Dec-09Jul-09Dec-08

eer

ga

siD

ylg

nort

S =

2- ;e

erg

A yl

gn

ortS

= 2 :

ela

cS

Trust Financial Services Industry to LookOut for Me

1.4 Key Factors in Trust in Brands

Consumersstillhavelittlefaiththatthefinancialservicesindustrywilllookoutfortheminthecurrenteconomicclimate,butareperhapsbecomingmoreopenminded.ThislackoftrustregisteredclearlyinDecember2008,whenthemajorityofconsumers(57percent)hadanegativeviewwithonly9percentbeingpositive.ByDecember2011,thenumberholdinganegativeviewhadfallenby10pointsto47percent,whilethosewithapositiveattitudehadrisenslightlyto11percent.

ThisisarealimprovementcomparedtoJuly2009when60percentexpresseddistrustcomparedto7percenthavingconfidencethattheyarebeinglookedafter.Sincethen,attitudeshavestabilisedandaretrendingveryslightlyupwardswithadrifttowardsneutrality–sinceDecember2008,8percentofconsumershavestoppedbeingnegativeandnowhavenovieweitherway.

Key Factors in Brand Trust

30

12

12

11

9

4

37

37

31

28

18

13

27

41

42

45

48

43

4

6

9

11

20

20

1

3

4

3

4

19

1

1

1

2

1

1

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Easy to use website isimportant

Get views of other peoplewho have used them

High street visibility isimportant

Don’t have to know them,but rates have to be best

Need previous experience toconsider them

Regular TV advertising isimportant

Strongly agreeAgreeNeitherDisagreeStrongly DisagreeDon’t know

ThebiggestdipintrusthasbeenintheGovernment.Aslightrecoveryseenearlyin2011hasbeenreversed,although itsratinghasnotslumpedtothetroughexperiencedinJuly2009.Themediahavealsoseenafallingawayoftrustfor thefirsttime,whilethefinancialindustryisunabletoimproveitsstandingtoanysignificantdegree.



Themostsurprisingdimensionsinwinningtrustisthatknowingpeoplewhohaveusedaproductorservice andgettingtheirviewsistwiceaspowerfulaspreviousdirectexperienceofthecompany.Thatisverytellinginterms oftheemphasisfinancialservicesprovidersneedtoplaceonsocialmedia,evenwithintheirretentionmarketing.This newmarketingmixisfurtherunderlinedbythefactthatwordofmouth(andbyimplicationsocialmedia)ismore importantthananyclassicadvertisingordistributionmethodsusedbybrands.

Despitetheimportanceofthesevirtualandpersonalfactorsindrivingtrustandusage,havingaHighStreetpresence stillmatterstofouroutoftenconsumers,despitenearlyoneinfivesayingitdoesnotmatter.

Marketerscaninfluenceconsiderationthroughpricing-fourintenconsumersclaimtheywilltrustoruseabrand iftheyhavebest-in-marketrates.Thesedeal-hungrycustomershavelongbeenacoredriverofmarketshareand appeartoremainso.Bycontrast,TVadvertisingisviewednegativelyby39percentofconsumers,withonly17per centsayingitisimportant.

Existingcustomershavealwaysbeenviewedasthekeyassetforfinancialservicesproviders,yetthisresearch suggeststhismayhavebeenoverstated.Thenumberofconsumerssayingpreviousexperienceisnecessaryinorder toconsiderabrandisonly3percentmorethanthelevelforwhomthisisunimportant(27percent against24percent).Fromthisitcanbeinferredthatasignificantproportionofconsumersareperpetualprospects, readytolookatanyproviderinthemarket,notjustthosetheyalreadydealwith.

1.5 Key Factors to Trust or Use Brands 2009 - 2011

Factors in Brand Trust 2009-2011

0.91

0.49

0.38

0.33

0.26

-0.37

1.06

0.64

0.38

0.35

0.01

-0.36

0.97

0.59

0.28

0.32

-0.05

-0.48

1.04

0.68

0.4

0.36

-0.08

-0.34

-0.6 -0.4 -0.2 0 0.2 0.4 0.6 0.8 1 1.2

Easy to use website is important

Get views of other people whohave used them

High street visibility is important

Don’t have to know them, butrates have to be best

Need previous experience toconsider them

Regular TV advertising isimportant

Dec-11 Mar-11 Jun-10 Jul-09 (Scale:2=Stronglyagree;-2=Stronglydisagree)

Theimportanceofthewebsiteingainingusageandtrustcontinuestobeaheadofallotherinfluencesontheconsumerdespiteasofteningcomparedtoprevioussurveys.Infact,allareasofinfluencehavefalleninimportance,withthehighlysignificantexceptionoftheneedforpreviousexperience.Despitebeinglessimportantthanwhatotherswhohaveusedthecompanymightthink,therehasbeenasizeableresurgenceintheimportanceofanexistingrelationship.

ItisnotablethathavingapresenceoftheHighStreethasreturnedstronglyasaninfluence,perhapsasconsumersstarttolookaroundforpotentialproviders.VisibilityintherealworldisratedtwiceashighlyasawarenessbuiltthroughTVadvertising,withconsumersstillnegativeaboutseeingfinancialservicesprovidersusingcommercials.

Bycomparison,priceisholdingsteadyintermsofitsimportanceinwinningtrust.Consumersprobablyhaverelativelylittlepriceelasticityandwanttoknowthatprovidersaregivingthemthebestdeal.



1.6 Trust in Marketing Information Provided

(Scale:4=highleveloftrust;1=none)

Despitelowlevelsoftrustinthefinancialservicesindustryasawhole,notallprovidersaremistrustedtothesamedegreewhenitcomestotheinformationtheyprovidethroughmarketing.Buildingsocietiesandpensionprovidershavethemosttrustedmarketing,withscoresof2.64and2.61respectively(basedonascaleof1to4,where4meanstheinformationisimplicitlytrustedand1meansitisnottrustedatall).

Distrustintheinformationprovidedbybankshasrisento13percent(from11percentinMarch2011),althoughabaremajorityof51percentimplicitlyorsomewhattrustwhatbankshavetosay.Creditcardshavelesscredibility,with12percentexpressingnotrustintheirinformation,although44percentdohaveapositiveview.Investmentcompaniessuffermost,withoneintentakingthemostnegativeviewagainst35percentbeingpositive.

Itshouldbenotedthatmanyconsumerssaythatfinancialservicesmarketingisnotapplicabletothem,rangingfromjust9percentforbanksupto38percentformortgagelenders.Theseself-exclusionslimitthedegreeoftrustwhichcanbegainedbyinstitutions–themeanleveloftrustshownabovehasbeenweightedtoreflectonlyconsumerssayingthequestionisrelevanttothem.Thisisalsoaconcernforproductsforwhichconsumershavealowlevelofuptake,suchaspensions,lifeinsuranceandinvestments.

Trust in Marketing Information

2.64

2.61

2.54

2.45

2.41

2.4

2.39

1 1.5 2 2.5 3 3.5 4

Building society

Pension provider

Insurance company

Bank

Credit card

Mortgage lender

Investment company

Mean level of trust



Trustisabalancingactbetweenthebestinterestsofacompanyandthoseofitscustomers.Consumersunderstandthecommercialprerogativethatdrivesfinancialservicesproviders,buttheyalsoneedtofeelthattheyarenotbeingexploited.Inthecurrentclimate(orbasedonexperienceinthelastdecade),consumersarenotconvincedthatthisbalanceisright.

Sellingproductsinordertomeetsalestargetsisidentifiedasthebiggestissuewithbothinvestmentandinsuranceproviders.UntilDecember2011,around45percentofconsumersbelievedinsurerswerejustchasingtheirownsalesgoals,withthreeoutoftenbelievingthesameaboutinvestmentcompanies.Mostrecently,bothoftheseissueshavesoftenedby12percent,notleastbecausemanyofthemorepushytacticsorone-sideddeals(suchasPPI)havebeenpulled.

Atthesametime,however,fewerconsumersareconvincedthattheinformationandproductsonofferaretotheirpersonalbenefit,withjust12percentsayingthisaboutinvestmentand16percentaboutinsurance.Earlierin2011,bothofthesestatementsreceivedmuchhigherlevelsofagreement.Thereisalsolimitedconvictionthattheadviceonofferisimpartial.Demonstratingtoconsumersthatthisreallyisthecaseisaclearpathtowardsrestoringtrustinthefuture.

1.7 Trust in Investment and Insurance Providers

Trust in Investment and Insurance Providers

0

5

10

15

20

25

30

35

40

45

50


Gives information/sells products that benefit me personally (investment)Gives information/sells products that benefit me personally (insurance)Gives information/sells products to meet their sales targets (investment)Gives information/sells products to meet their sales targets (insurance)Gives me impartial advice to suit my personal needs (investment)Gives me impartial advice to suit my personal needs (insurance)





Sources of Consumer Information on Financial Services

0

5

10

15

20

25

30

35

40

45

50

Dec 11(%)Mar 11 (%)Jun 10 (%)Dec 09 (%)Jul 09 (%)Dec 08 (%)

Comparison websitesBrands’ websitesIndependent websitesFriends/relativesNewspaper articlesLiterature from bank/building societyDirect mailEmail marketingOther

2. Financial Services and the consumer conversation

2.1 Overview

• Arecentshiftawayfrombrands’ownmarketingandtowardsintermediarieshasended,withallsourcesof informationonfinancialproductssufferingfallsinimportance.Thisreflectslessactivityinthemarketandtherefore lessinterestinallsources.Despitethis,thereisagrowingnumberofconsumerswhowanttoknowmore,butdon’t knowwheretoturn.

• Consumersstillstateastrongpreferencefordirectmailoveremailanddocontinuetoreceivemailingsfrom alltypesofprovider.Althoughthefinancialservicesindustrysendsoutfeweritemsofpost,consumersarenot receivingsignificantlymoremessagesthroughnewer,digitalchannels.

• Themobileconsumerhasnotyetarrivedinthefinancialservicesmarketplacewithlittleappetiteforcallsortexts andlowlevelsofusageofthischannelbybrands.

• Comparisonwebsiteshaveseenanear50percentfallintheirstatusasasourceofinformation,althoughthey remainthemostcommonlyusedresource.InDecember2009,43percentofconsumerscheckedthesesitesfor information–byDecember2011,thishadfallento31percent.

2.2 How Consumers Find Out About Financial Products

Withthesqueezeonhouseholdincomes,consumersarelessinterestedinfinancialproductsnowthantheywerethreeyearsago.Asaresult,theyarecarryingoutlessresearchintowhatisavailablethantheyusedto.

Evenoverthecourseof2011thisawarenessofthemarkethasdeclined.LastMarch,consumerspredominantlyturnedtothirdpartywebsitesortheirfriendsandfamilyforinformationaboutproducts,underlingthepowerofintermediariesandwordofmouth.

Comparisonwebsiteshaveseenanear50percentfallintheirstatusasasourceofinformation,althoughtheyremainthemostcommonlyusedresource.InDecember2009,43percentofconsumerscheckedthesesitesforinformation–byDecember2011,thishadfallento31percent.

10

2.3 Consumer Knowledge of Financial Products 2008 – 2011

Despiteweakerlevelsoftrustinthefinancialservicesindustry,therehasbeenafallinthenumberofconsumerswhosayitisdifficulttofindunbiasedadvice,from28percentinDecember2008to19percentin2011.Thisisthereverseofwhatmighthavebeenexpectedofamarketplacethathasseenmultiplestoriesaboutproductmis-sellingandthelike,butcouldbetheresultoftheriseinintermediaries,suchaspricecomparisonwebsites,thatappeartobeindependent.

Certainlymoreconsumersfeelwellinformednowthanatanyothertimeandthereisevenarisingtrendofthosewhowanttoknowmore,butdonotknowwhototurnto.Themarketingpotentialtheseconsumersrepresentissignificant,providedfinancialservicesprovidersareabletohittherighttoneandbalanceintheinformationtheyprovide.

Consumer Knowledge of Financial Products

31

28

30

282827

2627

25

28

3029

19

2322

2525

28

13

10

8

10

66

1211

16

910

9

0

5

10

15

20

25

30

35


Feel well informedNeed to know more, but find it dullDifficult to find unbiased adviceWant to know, don't know where to turnLeave it to someone else

-

2.4 Consumer Contact Preference v Experience

Consumer Contact Preferred v Received (By Channel)

52

61

26

32

8

12

3

7

1

6

48

56

32

24

4

9

1

3

0

2

37

40

19

7

2

3

2

2

0

1

39

48

26

26

3

7

4

4

1

6

33

33

18

14

2

4

2

5

0

1

31

27

19

9

2

5

1

2

0

1

28

25

12

5

2

3

0

2

1

1

0 10 20 30 40 50 60 70

Letter - Prefer (%)

Letter - Received (%)

Email - Prefer (%)

Email - Received (%)

Landline call - Prefer (%)

Landline call - Received (%)

Mobile call - Prefer (%)

Mobile call - Received (%)

Text - Prefer (%)

Text - Received (%)

Bank Insurance Pension Provider Credit Card Building Society Investment Mortgage Lender

Consumer Contact Preferred v Received (By Provider)

52

48

37

39

33

31

28

61

56

40

48

33

27

25

26

32

19

26

18

19

12

32

24

7

26

14

9

5

8

4

2

3

2

2

2

12

9

3

7

4

5

3

3

1

2

4

2

1

0

7

3

2

4

5

2

2

1

0

0

1

0

0

1

6

2

1

6

1

1

1

0 10 20 30 40 50 60 70

Bank

Insurance

Pension Provider

Credit Card

Building Society

Investment

Mortgage Lender

Letter - Prefer (%) Letter - Received (%) Email - Prefer (%) Email - Received (%)Landline call - Prefer (%) Landline call - Received (%) Mobile call - Prefer (%) Mobile call - Received (%)Text - Prefer (%) Text - Received (%)

Friendsandfamilyhavealsoseentheirinfluencefallby12pointsandindependentwebsitesby10points.Thesefallsarenotbeingoffsetbygrowthinotherchannels(withtheexceptionof“other”).Instead,itisevidentthatconsumersaresimplylookingaroundlessthantheyusedtoandasaresultneedlessinformationthanbefore.



Contactpreferencesamongconsumersremainsurprisinglytraditional,despitethestrongfocusplacedbymarketersonnewchannels.Askedfortheirpreferenceforhowdifferenttypesoffinancialservicesprovidershouldcontactthem,consumersoverwhelminglynamedtheletter.(Onlyonechoiceperproviderwasallowed,forcingconsumerstochooseasinglepreference.)

Postwasthedominantchannelforeverytypeoffinancialserviceandwaschosenbyatleast50percentmoreconsumersthananyotherchannelineveryscenario.Directmailalsoenjoystheclosestalignmentbetweenconsumerpreferenceandactualreceipt.Whilebanks,creditcardsandinsuranceprovidersmaybeslightlyover-mailing(by9percent,9percentand8percentrespectively),investmentprovidersandmortgagelendershavea4percentand3percentgapbetweenthelevelofpreferenceandactualreceipt,suggestinganopportunityforincreasedcontact.

Emailistheclearsecondfavouritechannel,indicatingthatcontactpreferencesarechanging,albeitstilltowardsachannelthatprovidesawrittenmessage.Withtheexceptionofbanksandcreditcards,actualreceiptofemailisbelowwhatconsumerswouldprefer.

Althoughasizeableproportionofconsumersnowpreferdigitalcontact,landlinenumbersstillwinoutovermobileswhenitcomestobeingcontactedbyaprovider.Themobileconsumermaybeemergingrapidlyforretailandothersectors,butinfinancialservices,thereisstillrelativelylittleappetiteforeithermobilecallsortexts.

2.5 Consumer Contact Preferences 2009 – 2011

Consumer Contact Preference 2009 - 2011

0

10

20

30

40

50

60

70

Bank Insurance PensionProvider

Credit Card BuildingSociety

Investment MortgageLender

Letter (Dec 11)Letter (Mar 11)Letter (June 10)Letter (Dec 09)Email (Dec 11)Email (Mar 11)Email (Jun 10)Email (Dec 09)

Consumer Contact Preferred v Received (By Channel)

52

61

26

32

8

12

3

7

1

6

48

56

32

24

4

9

1

3

0

2

37

40

19

7

2

3

2

2

0

1

39

48

26

26

3

7

4

4

1

6

33

33

18

14

2

4

2

5

0

1

31

27

19

9

2

5

1

2

0

1

28

25

12

5

2

3

0

2

1

1

0 10 20 30 40 50 60 70

Letter - Prefer (%)

Letter - Received (%)

Email - Prefer (%)

Email - Received (%)

Landline call - Prefer (%)

Landline call - Received (%)

Mobile call - Prefer (%)

Mobile call - Received (%)

Text - Prefer (%)

Text - Received (%)


Consumer Contact Preferred v Received (By Provider)

52

48

37

39

33

31

28

61

56

40

48

33

27

25

26

32

19

26

18

19

12

32

24

7

26

14

9

5

8

4

2

3

2

2

2

12

9

3

7

4

5

3

3

1

2

4

2

1

0

7

3

2

4

5

2

2

1

0

0

1

0

0

1

6

2

1

6

1

1

1

0 10 20 30 40 50 60 70

Bank

Insurance

Pension Provider

Credit Card

Building Society

Investment

Mortgage Lender

Letter - Prefer (%) Letter - Received (%) Email - Prefer (%) Email - Received (%)Landline call - Prefer (%) Landline call - Received (%) Mobile call - Prefer (%) Mobile call - Received (%)Text - Prefer (%) Text - Received (%)



2.6 Consumer Contact Received 2009 – 2011

Marketersareconstantlyflexingthemixofchannelstheydeployinordertomeettheirbusinessgoals.Theseshiftsarevisibletosomeextentinthecontactswhichconsumersrecallgettingfromdifferentprovidersacrossaperiodofyears.Thesurpriseisthatovertwoyearstherehasbeenlesschangeintheprofileofcontactchannelsusedbythefinancialservicesindustryasawholethanmightbeassumed.

DirectmailhasshownaseasonalitywhichmakesactivityhigherinJunethanDecember,butthedropinitsbaselinebetween2009and2011isonly4percentatmostduringtheoff-season.Emailhasmaintainedarelativelystablelevelofuse,withtheexceptionofbanks–9percentmoreconsumersreceivedemailsfromtheminDecember2011thaninDecember2009,with4percentmorefrombuildingsocietiesinthesameperiod.

Iftherehasbeenasignificantdropoff,thenitisinoutboundtelemarketingtolandlines.NearlyoneinfiveconsumerswerecalledbyabankinJuly2009,butthishadfallento12percentbyDecember2011.Callsfrominsuranceandcreditcardcompaniesfellby3percentinthesameperiod.Mobilephonecallshavenottakenupthisslack,withlittlerealchangeinthevolumesconsumersexperience.

Consumer Contact Received 2009 - 2011

0

10

20

30

40

50

60

70

80


Letter (Dec 11)Letter (June 10)Letter (Dec 09)Letter (Jul 09)Email (Dec 11)Email (Jun 10)Email (Dec 09)Email (Jul 09)Landline call (Dec 11)Landline call (June 10)Landline call (Dec 09)Landline call (Jul 09)Mobile call (Dec 11)Mobile call (June 10)Mobile call (Dec 09)Mobile call (Jul 09)

Whilemoreconsumersprefertoreceivefinancialdirectmailthanemail,theyalsohaveclearpreferencesaboutwhichchanneldifferenttypesofprovidershoulduse.Overthelasttwoyears,thesepreferenceshaveremainedconsistent,butalsoshowsomeimportantdynamics.

Banksarethemostpreferredusersofdirectmail,withnearlytwiceasmanyconsumerswantingtogetpostfromthemcomparedtomortgagelenders(52percentv28percent).InthetwoyearssinceDecember2009,however,therehasbeenadeclineofupto8percentinthenumberofconsumersstatingapreferenceforthischannel.

Emailhasasimilarspreadofpreferencesbetweentypesofcompanythatconsumerssayshoulduseit,withconsumersmostlikelytowelcomeemailfrominsurancecompanies(32percent)andleastlikelytowantamortgagelendertosendit(12percent).Thereisnosignofeitherincreasingpreferenceordecliningreceptivenesstoemailoverall,althoughinsurancemessagesinthischannelarenowwelcomedby32percentcomparedto25percenttwoyearsago–theonlymeaningfulgrowthforanysector.





3. Financial services and consumer brand preferences

3.1 Overview

• Brandpreferencesarebeingexpressedmorestronglynowthanatanytimeinthelastthreeyears.Whenpriceand termsareremovedfromtheequation,somebrandsareclearlyachievingahigherdegreeofbreakthroughwith

consumersthanothers.

• Inthecreditcardmarketplace,BarclaycardandLloydsTSBhavegainedtractionwithoneinfiveconsumers, significantlyupontheirpreviousstanding.Acrossallbrands,moreconsumersnowsaytheyhaveapreferencefor acreditcardprovider,withnonesayingtheywouldn’tchooseanyofthem-previously,nearlyoneinfourresisted makingachoice.

• Intheinsurancemarketplace,thereisapremierleagueofbrands,ledbytheAA,DirectLine,ChurchillandTesco Bank.Surprisingly,comparisonwebsiteshavenotractiononcepriceandtermsareexcludedfromthechoice.

• Althoughtrustisafactorwhenchoosingaprovider,itisoneofasetofthingsthatconsumersconsider.Forsome brands,reputationiscritical–forothers,TVadvertisingcanstillwinanewcustomer.

3.2 Which Credit Card Consumers Would Choose

Brandpreferencesareastronginfluenceoverconsumersiftheproductorserviceonofferhasparitywitheverythingelseinthemarket.Askedtopickacreditcardprovideronthebasisthatallratesandtermsareidentical,oneinfournamedBarclaycardastheirproviderofchoice,whilejustoveroneinfivewouldpickLloydsTSB.

BothofthesebrandshaveseentheirrankingleapsinceDecember2008,whenBarclaycardwaschosenby14percentandLloydsTSBby13percent.Whatisfuellingthisgrowthinpreferenceisawillingnessamongconsumerstoconsideraprovideratall-whensurveyedin2008andmid-2009,32and37percentofconsumerssaidtheywouldnotchooseanycreditcardcompany,regardlessofratesandtermsbeingthesameforall.Thatclearlyreflectsthedepthofmistrustandwarinessoftakingondebtthatexistedatthetime.

Credit Card Preference

0

5

10

15

20

25

30

35

40


)%(

NoneIFMBNACapital OneEggAmerican ExpressLloyds TSBNatWestVirginBarclaycard

14

NatWesthassimilarlybenefitedfromthisreturnoftrust,seeingitsrankingnearlydoublefrom9percentinDecember2008,whileVirginhasseenitsratingrisefrom10percentto14percent,althoughitpeakedat18percentin

June2010.

Otherbrandshaveseensmallincreasesintheirstanding.Significantly,thebiggestcreditcardissuers-MBNAandCapitalOne-getlowscoresoncethetermsandofferswhichdrovetheirmarketshareareremovedfromthe

equation.

3.3 Which Insurance Provider Consumers Would Choose

Brandpreferencesbetweencarinsuranceprovidersarehighlydynamic.Assumingparityofpriceandterms,theAA,DirectLine,ChurchillandTescoBankBankwouldbechosenbyone-fifthtoone-quarterofconsumers.Whilethesebrandsareinthepremierleagueofconsumerpreference,thereareadozenmorenamedbybetween10and16per

centofconsumers,indicatingachampionshiplevelofbrands.Bycontrast,inJuly2009,nobrandcommandedmore than9percentofconsumerpreferences.

Thisrapidupshiftinbrandstatusseemslikelytoreflectamore“businessasusual”viewamongconsumersoffinancialservicesproviders.Carinsuranceisamust-buyfordrivers,yetinJuly2009,9percentofconsumerssaidtheywouldnotchooseanyofthebrandsproposed-now,notasingleindividualopted-outinthisway.Consumershavebecomemorewillingtobuyagainandarerebuildingtheirviewofthemarketplace.Atthesametime,brandshavebeenusingmoreintensivedirectsellingtocounterthepowerofcomparisonwebsites.

Anotableaspectofthisreturntomarketisthelowlevelofbrandpreferenceexpressedtowardsintermediariesandcomparisonservices.Thenumberofconsumerswhobuythroughabrokerhasnearlytrebledto11percentfrom4percentinJuly2009.YetComparethemarket.comandMoneysupermarket.comwerenotmentionedbyasingleconsumerinDecember2011.

Oncepricehasbeenremovedfromtheequation,thissuggestsonlinecomparisonsitesarenotbuildingbrandvalues,whereasawiderangeofotherprovidershavecreatedaperceptionthattheyoffermorethanjustthelowestdeal.Long-establishedprovidersmakeupthesecondtierofpreferredproviders,includingbanks(LloydsTSB,Barclays,NatWest,Halifax)andinsurancespecialists(Aviva/NorwichUnion,Zurich,AXA,LV=).

Insurance Provider Preferences

0

5

10

15

20

25

30


AAAdmiralAllianzASDA AXABarclaysBudgetChurchillCompare the market.com Dial DirectDirect Lineesure Fortis Green bee (John Lewis)Halifax insureandgo Liverpool and Victoria Lloyds TSB Money SupermarketMore Th>nMotor insurance warehouseNatWest Aviva / Norwich Union PrivilegeRAC directRoyal and Sun AllianceSaga SainsburysSheila’s WheelsSwinton Tesco ZurichNone of the above as I use a BrokerNone of the above as I do not driveNone of the above



Morerecently-launchedbrandswhichhavemanagedtoembedthemselvesintheconsumer’sconsiderationsetincludeMoreTh>n(launchedbyRoyalSunAllianceInsurancein2001),GreenBee(launchedbyJohnLewisin2006andnowrenamedaftertheretailer)andSheila’sWheels(launchedbyesurein2005).Themostsuccessfulbrandsfromnon-conventionalinsuranceprovidersarecompanieswithastrongcustomerrelationshipinothersectors,suchasRACDirect,Sagaandthesupermarketchains.

BreakingthroughthebarrierwhereoneintenormoreconsumerswouldpreferthebrandhasprovendifficultforevensomeofthebiggestprovidersandcompaniesintheUK,however,withthelikesofRSAandASDAunabletogainmorethan7percentofconsumerchoices.ThedecisionbyFortistorebrandasAgeasseemsunlikelytoloseitanytractionsinceonly4percentofconsumerssaidtheywouldpicktheoldbrand.

3.4 Reasons for Choosing Insurance Provider

Choosinganinsuranceprovidermaybeamundanetaskformanyconsumers,butitinvolvesacomplexsuiteoffactorsthatneedtocometogetherattherightmoment.Whereasforsomebrands,previousexperienceisdominant(Churchill,esure,Fortis,LV=,RSA,Saga,Shiela’sWheels,Swinton,TescoBank),forothersitisreputationthatledtothebuyingdecisionmorethananythingelse(AA,Admiral,ASDA,Budget,DirectLine,GreenBee,RACDirect,Zurich).

Trustisararerbasisonwhichtomakeachoice,withAllianz,Halifax,PrivilegeandSainsbury’sPersonalFinancescoringhighestonthisdimension.Butthereissignificantscopeforchallengerbrandstowinmarketsharethroughadvertising,despitewhatconsumersmightsay–eightoutoftenconsumerswhopickedInsurandgodidsobecauseofitsads,with79percentofDialDirectcustomersalsoswayedbyitsads.

Responsesareofcourseonlyfromthoseconsumerswhorecentlyboughtinsuranceandfromtheseparticularcompanies.Insomecases,therewillbelimitednumbersofindividualsinvolved,makingtheirreasonsforthechoiceappearmoresignificantthanwherealargenumberofconsumershaveboughtabrand.

Reason for Choosing Insurance Provider

5439

25424244

4934

1142

2514

6930

937

254142

3027

5136

323336

4337

56

3015

5533

2833

1315

927

1445

4650

424

3723

2829

6136

2533

5020

1235

22

3829

2224

3945

3445

637

5855

1436

856

4145

4338

2524

5048

2746

5245

44

1029

640

49

1225

7926

114

715

8011

12157

2217

1165

526

4165

AA

Admiral

Allianz

ASDA

AXA

Barclays

Budget

Churchill

Dial Direct

Direct Line

esure

Fortis

Green bee (John Lewis)

Halifax

insureandgo

LV= (Liverpool and Victoria)

Lloyds TSB

More Th>n

NatWest

Aviva / Norwich Union

Privilege

RAC Direct

Royal and Sun Alliance

Saga

Sainsbury's

Sheila’s Wheels

Swinton

Tesco

Zurich

(%)

Reputation Trust Previous Experience Advertising





17 questions were submitted onto a fast.MaP online self-completion survey and broadcast from March 30 to april 5, 2011, and repeated from november 29 to December 5 to a panel the demographics of which echo those of the Uk population.

The panellists were entered into a prize draw to win £250.

results were then weighted in terms of age and gender to give a true representation of the Uk.

Sample size (n) March 30 to april 5, 2011= 1,353 Sample size (n) november 29 to December 5, 2011= 1,305

Statistical confidence March 30 to april 5, 2011 +/- 2.16%Statistical confidence november 29 to December 5, 2011 +/- 2.34%

Randomisation of images and answer options to avoid top box bias / creative skew

Acceptable completion time for the survey and removing any that are completed in a quicker time

Intelligent Routing to ensure a quality survey experience as questions are relevant

Constant re-qualification of the panel to ensure that background variables are updated. Differences from initial recruitment can result in being removed from the panel

Methodology



About the DMAThe Direct Marketing association (DMa) is europe’s largest professional body representing the direct marketing industry. With a large in-house team of specialists offering everything from free legal advice and government lobbying on direct marketing issues to research papers and best practice, it is always at the forefront of developments in the industry.

The DMa protects the direct marketing industry and consumers. it promotes the highest standards through self-regulation and lobbies against over-regulation. The DM code of Practice sits at the heart of everything we do – and all members are required to adhere to it. it sets out the industry’s standards of ethical conduct and best practice.

Our 10 DMa councils/Board committees cover the whole marketing spectrum – from the digital world of social media and mobile marketing to the ‘real’ world channels of door drops and inserts. The councils are made up of DMa members and regularly produce best practice and how to guides for our members.

We also have a packed calendar of conferences, workshops and discussions on the latest topics and best practice, and 80% of them are free for members and their staff.

as the industry moves on so do we, which is why we’ve recently launched a number of new services for our members – a vaT helpline, a Social Media Helpdesk and an iP Protection Service.

visit www.dma.org.uk regularly to keep up to date with all our services.

http://www.dma.org.uk



fast.MAP is an insight partner that continuously connects clients in real-time with their customers.

as exclusive insight partner to the DMa, we run a number of tracking studies designed to give DMa members primary insight into key areas that support the Direct Marketing discipline.

The combined experience of our Directors spans many industries, disciplines and methodologies and the solutions we provide can be executed from within the business.

Industry expertise: Financial, automotive, Travel/Transport, charity, Marketing communications, Media, iT/Technology, retail, Pharmaceutical, Travel/Transport, FMcg and more

Methodologies: Quantitative: online, telephone and face to face; Qualitative: in-depth interviews and online focus groups

Our aim is to help clients to:

Improve Marketing Effectiveness:

Branding Studies•concept Testing•Message/copy Testing - ads (Tv, Press), leaflets, direct mail•

Understand Markets:

Demand estimation and Sizing/audits•Market Segmentation and Pricing•competitor analysis•

Understand Consumers:

attitude and Usage research•customer Profiling•customer loyalty and Satisfaction•

For further information visit www.fastmap.com or call Paul Seabrook on 0207 242 0702 ([email protected])

About fast.MAP





http://www.fastmap.com

mailto:[email protected]



The Financial Services Tracking Study is published by The Direct Marketing association (Uk) ltd copyright © Direct Marketing association. all rights reserved. no part of this publication may be reproduced, copied or transmitted in any form or by any means, or stored in a retrieval system of any nature, without the prior permission of the DMa (Uk) ltd except as permitted by the provisions of the copyright, Designs and Patents act 1988 and related legislation. application for permission to reproduce all or part of the copyright material shall be made to the DMa (Uk) ltd, DMa House, 70 Margaret Street, london, W1W 8SS.

although the greatest care has been taken in the preparation and compilation of The Financial Services Tracking Study, no liability or responsibility of any kind (to extent permitted by law), including responsibility for negligence is accepted by the DMa, its servants or agents. all information gathered is believed correct at november 2011. all corrections should be sent to the DMa for future editions.

Ordering copies of the full report:

DMa membersMembers can view the full report for free•LogontotheDMAWebsiteatwww.dma.org.uk•GotoToolkitandsearchfor‘FinancialServicesTrackingStudy’inthekeywordsearchbox

non DMa membersThe Financial Services Tracking Study costs £100. Please contact Yashraj Jain on 020 7291 3359 or email [email protected]

Copyright and disclaimer

http://www.dma.org.uk

mailto:[email protected]

financial services tracking - dma services... · financial services tracking study 2012 copyright:...

Documents