How the banking and financial services sector can lean into a changing market

The evidence is clear, Covid-19 accelerated the pace of consumers’ changing behaviours.

Our analysis on consumer attitudes towards returning to branches highlighted a 32% reduction in bank branch visits post-covid, with even the most resistant to channel shift turning to apps and websites to manage their finances.

This is against a backdrop of other changes in the UK’s financial services sector that are impacting marketer’s abilities to connect with customers and prospects.

Retaining your savvy savers

Rising interest rates mean that people are becoming incentivised to both start saving again, and to switch savings accounts again, with savvy savers searching for the best deals.

Our recent consumer insights have found that the younger demographic are still expecting to save in the next 12 months. And it is to be expected that your competitors will increase their efforts to attract your savers to their products. You need to be ready to retain them!

Buoyant lending with a shift to the suburbs

Across the UK we saw a shift from the cities to the suburbs, driven by the opportunity to work from home more regularly. A reduced commute and a chance for more space was an opportunity many felt could not be missed.

Coupled with the government provocation of the housing policy, using changes to the stamp duty tax threshold, there has been an incredibly active homebuyer market.

However, recent economic factors have driven up the interest rates available on new mortgages and to those coming to the end of their fixed deals. Consumers are therefore incentivised more than ever to find the best available deal. This becomes a potential flash point for marketers who need to develop trust with customers so that the retention battle can be won.

Insurers need to rethink incentives

New legislation from the FCA means that insurers must be willing to offer the same incentive to new and renewing customers. Past use of aggressive incentives to win new customers’ needs to adapt to regulatory challenges.

Like the other macro conditions, this requires marketers to engage in longer-term marketing journeys with potential consumers, to win them and retain them with value driven propositions.

The need to communicate with the individual

Whichever way you cut it, there’s a lot of change to contend with for the financial services marketer.

From CACI’s perspective, we see there being winners and losers in the market across banking, lending and insurance.

The winners will be those who utilise data and technology to serve customers as individuals. To maintain engaged relationships based on trust and demonstrate how the brand is taking care of the financial interests of the individual.

Throughout our new blog series for the financial service industry (starting with this blog), we will break down the opportunities for marketers to address these challenges through central decisioning engines, marketing attribution models, data modelling, machine learning and AI-driven recommendations. Continue reading at the links below: 

Blog 2 – Creating human banking experiences through data-led marketing

Blog 3 – Three ways to stand out in a crowded insurance market

For insights on consumer attitudes towards their financial services provider’s marketing and communications, download this report, created by Braze in partnership with CACI. With input from over 200 financial services brands, 1,500 marketing leaders in the financial services industry and 5,000 financial services consumers, the report uncovers a surprising disconnect between what banks think and how customers feel. It also provides guidance for brands in the financial services industry to better understand and meet shifting customer expectations.