Digital financial service marketing can be a key growth driver for financial service providers, but it requires a solid marketing plan to ensure success. A well-executed plan can lead to greater lead conversion, and nurturing of loyal clients, and brand evangelists.
The key to success is to assess internal financial services marketing resources and strategies and identify gaps that must be filled to provide the anticipated ROI. This involves understanding the ad spend, which is a crucial aspect of any marketing plan. Allocating the right budget to various marketing channels and strategies is essential to achieve the desired outcomes.
14% of all digital advertising worldwide is spent on financial services, while only $1 of every $92 spent on obtaining leads really results in a customer. Although this gap could seem like an oversight, the truth is more complex.
As a provider of financial services, you must reinvent how you promote your goods in order to be successful. This process begins with gaining a more excellent grasp of digital financial services marketing—what it is, how it operates, and what are the current marketing trends in this sector.
What is Financial Services Marketing?
There are various marketing methods and tactics that are used in financial service marketing to raise and maintain consumer awareness of financial products. Through a succession of ongoing marketing activities, the process continues to gather leads and turn them into devoted clients.
There are two main approaches used in the marketing of financial services:
- Digital marketing includes both outward and inbound digital marketing strategies, such as blogs and PPC advertisements.
- TV, radio, print, and signs are traditional marketing methods.
The majority of financial service firms will combine traditional and digital marketing. However, most rely more on conventional marketing methods due to past traditions.
This is altering as evidence of the efficiency of digital marketing initiatives for client outreach in the financial sector grows. To successfully apply these new marketing strategies on your own, it’s critical to understand what they are intended to accomplish.
Financial services marketing that works raises awareness, lowers customer acquisition costs, minimizes churn, and increases revenues.
Why Does Financial Services Marketing Need to Exist in the Financial Services Sector?
One of the oldest industries in the world is financial services. Additionally, all will use financial services at some point in their lives. These two elements can give the impression that financial institutions enjoy the rare luxury of doing nothing but waiting for clients to approach them. This used to be the case, but a number of variables have made it risky and ineffectual.
It involves –
- Commoditization: Financial product standardization has made it more challenging to stand out from the competition.
- Lack of trust: Customers’ trust in the banking sector has suffered a loss, and it must laboriously regain that trust.
- Digital transformation: Traditional marketing strategies are becoming useless as a result of innovations like marketing automation.
- Disruptive FinTechs: FinTechs (financial technologies) that challenge the existing quo to upend the established order totally.
- Regulatory barriers: Aggressive marketing is becoming more difficult due to stricter regulations.
- Digitization: Customers that are digital natives anticipate improved and customized digital experiences.
Financial service companies must develop and implement cutting-edge financial service marketing strategies that generate new business in order to overcome these obstacles.
Which Financial Institutions Can Profit from Marketing Financial Services?
Marketing for financial services can help businesses that sell any kind of financial service.
These entities include, among others:
- Investment banks and companies
- Insurance companies
- Credit card companies
- Accounting and tax advisory firms
- Retail and commercial banks
- Credit unions
- Mortgage providers
- Asset-based lending, and equipment financing
It is significant to remember that these organizations frequently come under various laws and rules. Therefore, depending on the form of the company, marketing operations must take the necessary needs into account.
What Makes Financial Services Marketing Different?
In contrast to other industries (possibly with the exception of the medical sector), the financial services sector is subject to a number of marketing-related rules and regulations.
Although these regulations are in place to protect the interests of customers, they pose a considerable obstacle to the promotion of financial services.
Here are some examples:
- Truth in Advertising Act: “No advertisement may be misleading or deceptive, should be supported whenever possible by scientific data, and cannot be unfair,” the statement reads.
- Fair Lending Laws: Prohibits credit allocation discrimination based on demographics or any other characteristic.
- Affiliations: Every piece of marketing must include the proper affiliations, like “Member FDIC.”
- Truth in Savings Act: Prevents financial organizations from withholding information about checking, savings, and investment accounts from consumers or company owners.
These merely represent the very top. These laws constitute a complicated marketing environment from a standpoint of marketing, and breaking any one of these laws can result in significant penalties.
How to Approach Financial Services Marketing the Right Way
A seismic change brought about by digitization has shifted power from the marketer to the consumer, with important ramifications for the marketing of financial services.
Google reports that over the previous two years, searches for terms like “financial counselor” and “financial planning” increased by between 60% and 115%. The Boston Consulting Group and the same study’s findings suggest up to 50% of offline investors start their research online.
These data reveal a recurring pattern: technology is offering customers more power and influence over their financial decision-making.
Digital-First Financial Services Marketing Strategy
A digital-first financial services marketing strategy is necessary to connect with digital-first consumers. This requires financial service providers to include the following techniques in their overarching plan, and partnering with an experienced SEO company can significantly enhance their online visibility.
Go digital with marketing
Traditional marketing has always been a source of revenue for financial service companies, but doing so now would be a losing strategy.
Reaching a consumer who is mostly online requires embracing digital marketing strategies including pay-per-click (PPC) advertising, email marketing, search engine optimization (SEO), search engine marketing (SEM), content marketing, and social media marketing.
Use all available channels, including social media
Digital marketing using omnichannel strategies is extremely well-liked and for good reason.
According to research by Omnisend, omnichannel marketing initiatives increase engagement by 18.96% as opposed to 5.4% for single-channel campaigns. Similar to how they outperform single-channel initiatives, they have a 90% greater retention rate.
This means that campaigns for the promotion of financial services must provide a seamless user experience across websites, mobile applications, text messages, emails, social media, and other digital platforms.
Integrated campaigns must also react to different touchpoints, such as changing in response to client interactions. For instance, when a customer opens a promotional email, a text message with a link to the landing page is sent.
Utilize content marketing to inform and empower your audience
According to a study by Facebook research company Facebook IQ, only 8% of millennials look to financial institutions for advice. These figures demonstrate that financial service providers face a difficult challenge ahead of them despite the fact that the causes for this mistrust are various.
The most effective technique for doing this for financial service providers is content marketing, an inbound methodology that creates high-value content (text, video, and audio) and draws in, persuades, and converts prospects.
One study discovered that the most effective predictor of client loyalty in the financial services industry was customer education provided through an engaging content strategy.
Connect and Engage
Consumers are drawn to more humanized businesses that care about the same things they do in an era of big brands and faceless companies.
Community marketing may successfully mobilize consumers behind a company and a cause, especially on social media platforms where it is practised.
Community marketing is conversation-focused, as opposed to other marketing strategies that are generally conversion-focused. A financial brand can set itself apart through genuine dialogues and, as a result, stand out from the competition by gaining greater mindshare.
Standardize and Optimize Branding and Messaging
All branding elements, such as logos, profile photographs, header images, and banner ads, should follow a similar style and concept. Customers should encounter consistency and familiarity as they connect with your business over a variety of channels, which are essential elements in establishing trust and acquiring more mindshare.
While this is going on, messaging should be consistent across all channels and be based on a core message brief.
In addition to standards, branding and messaging should be tailored to each medium, taking into account:
- Imagery (Instagram)
- Authority (LinkedIn, influencer marketing)
- Brevity (Twitter)
- Searchability/SEO (website, business blog)
- Audio-visual (YouTube, Facebook, webinars)
Design Frictionless Digital Experiences
A marketing campaign for financial services can lose its impact if the content, graphics, and navigation are confusing.
Increased friction (the difficulty of accomplishing a task) increases the chance that users will leave the website/app/profile and visit a rival. In actuality, 88% of online users are less inclined to visit a website again following a negative user experience.
A simplified digital encounter may include:
- Optimizing web pages so they load fast on desktop and mobile.
- Removing unnecessary steps in navigation (e.g., linking directly to a download instead of to a downloads page).
- Continually analyzing and optimizing the overall digital experience based on customer data and analytics.
Improve the customer experience
Financial organizations can utilize customer journey optimization as a potent tool to save their marketing expenses while increasing conversions.
According to a study by OTT, businesses that invest in customer journey management saw a 24.9% YoY rise in marketing-driven revenue, a 21.2% decrease in service expenses, and a 16.8% decrease in the typical sales cycle.
Among the techniques on hand are:
- Segmenting customers with data
- Enhancing travel for each target group
- Connecting customer service touchpoints to each segment’s customer journey
- Putting more money into the middle of the funnel rather than simply the top and bottom