Marketing Forces

Marketing Forces

Marketing Forces Marketing financial advice is not as straightforward as marketing many physical products. A number of extra hurdles must be crossed before a purchase is made.
 
These can be boiled down to two key issues. First, financial and investment decisions entail a uniquely large commitment on the part of consumers compared with anything else they will buy, and the commitment is based on the trust they have in their advisor. The experience of Don O’Sullivan, an associate professor of marketing, is that the sheer size of the purchase slows down the consumption process compared with smaller transactions.
 
Secondly, there can be difficulties demonstrating that you are unique in the market – whether that’s in comparison with other advisors or direct investment opportunities. O’Sullivan adds that when marketing and selling financial advice, “you need to be more believable than the competition – and competition may default to price.”
 
The first issue – the perceived risk of the purchase – can be dealt with in a number of ways, not least through the reassurance of a strong brand, communicating in the right way at various points in the decision-making cycle and peer recommendation.
 
Differentiation to other service providers, meanwhile, can be carried out through a clear marketing strategy. How can you put one in place?
 
STEP ONE: SELECTING MARKETS
The first step in developing a marketing strategy is to identify the consumer group to whom you are making a unique offer – usually as part of your overall strategy setting.
 
The initial task is to evaluate the needs and characteristics of consumers and divide the market up into segments according to such things as geography, income, risk and so on. These segments should be evaluated in terms of profit and growth potential.
 
You may choose to focus on one segment, or service several. O’Sullivan points out that all financial planners have a choice of market and positioning and this should be an integral part of their strategy.
 
STEP TWO: KNOW YOUR STRENGTHS
Once you know the type of customer you are targeting, you can start to shape your market positioning and communications. However, you also need to know what you’re highlighting as your key messages to various market segments.
 
There are a range of marketing tools available to do this, with the long-established “Seven Ps” of services marketing (see box right) commonly used to analyze your marketing strategy.
 
Another, simpler but arguably just as effective tool that’s become popular in recent years is the concept of the “value proposition”: in effect, this is a short statement espousing the unique factors that explain why a customer should use your service or product. Again, these may differ for market segments, but tend to be similar.
 
Marketers argue that this value proposition is something that businesses should pay extra attention to; Kirrily Dear, founder of marketing and management consultancy, Eyes Wide Open, sees financial advice businesses struggling most with the area of value proposition.
 
STEP THREE: KNOW THE CUSTOMER’S JOURNEY
Anouche Newman, associate lecturer in marketing at the University of Technology, agrees that customer experience is crucial – and you need to be on top of it from the word go.
 
The customer experience takes place “from the moment that they meet a planner through to experiencing the service and actually consuming the service itself.
 
“That should all be taken into account from a strategic perspective.”
 
Newman suggests that a worthwhile exercise when planning your marketing strategy is to ask exactly what the customer experiences from start to finish and then determine how you, as a marketer, can communicate your value proposition at all stages of the process.
 
O’Sullivan adds that you should also demonstrate that you are unique in the market: that comes back to researching the market and having the right elements like promises of delivery – in effect, being able to get the customer the financial outcome they need and want.
 
STEP FOUR: COMMUNICATE YOUR MESSAGE
Once you know: a) your value proposition; b) your target consumer group(s); and c) the customer journey, you can then work out the best ways to communicate with them at each stage.
 
The integration of communications into the advice marketing mix has taken on new dimensions with the ever-increasing number of ways you can contact consumers.
 
Matt Mitchener, marketing manager at Vow Financial, recommends three key methods of client contact.
 
“First, simple eDMs (electronic direct mail) to your database – no matter who they are. It is important to get your name, brand and contact details in the inbox of your database at pertinent times during the year,” he says.
 
“Second, text messaging, for quick, cheap and easy communication en masse to your current clients. Why not send out a personalized SMS for a birthday?
 
“Finally, telephone – finding a reason to talk to a client or prospect is easy. All you have to do from there is keep the contact regular so that you remain top of mind.”
 
Make sure you can monitor which methods are most effective – whether that’s putting a special offer code on a print advertisement, using analytics software or a simple where-did-you-hear-about-us question put into your initial client interview – because being able to assess which methods of communication are most effective is essential in refining future communications.
 
Dear warns that you can face an uphill struggle in a world that’s increasingly bombarded with marketing and media messages.
 
“There is an absolutely huge amount of market cynicism to overcome,” she says. “Physical evidence, case studies and results, and all the measurable aspects of what you do are critical in overcoming that.”
 
Providing something that’s more than just a sales pitch can make the difference between gaining a client or being instantly dismissed.
 
“The days of formalized communications; ie, putting on a persona have gone by the wayside,” says Dear.
 
“Buyers are looking for a very authentic voice within the marketplace so they feel like they are connecting and understanding the real person behind the service.
 
“That again helps with the feeling that they’re buying a known product.”
 
On a practical level, it is important to make sure that communication is consistent across every single interaction that a consumer might have with your firm, either online or face to face.
 
“For example, you might have a wonderful website with lots of information and a beautiful design,” says Newman.
 
“However, it sends the wrong message if the office is really shabby and the colours and branding that were used on the website are nowhere to be seen.”