Finances are very personal. They are often discussed quietly and confidentially with trusted financial advisers. That's why many of the challenges that financial services providers face don't have to do with dollars and cents. Emotional issues are involved with finances.
These are some strategies that help financial services managers meet the challenges of doing business in today's market.
1. Attract and retain clients
Banks and financial services firms have to stand out in the crowd by offering customers something extra.
"The bottom line is there is nothing that can differentiate one bank from another, other than making a connection with customers," says Joe Sullivan, CEO of Market Insights. Sullivan's company helps financial institutions with business strategy, planning and marketing. "Make an emotional connection with the consumer and let them know you understand their financial needs. Then come at them with solution-based thinking, not product pushing."
The financial services providers that help customers take ownership of their finances and teach them to become better money managers will have larger client bases, says Sullivan.
2. Know your customer
In a rapidly changing world, financial services providers must be aware that their customers are changing, too.
Consumers are savvier and more aware of their finances than they were five years ago, according to Sullivan. The best providers engage customers and learn how their needs are evolving.
If a bank or a business has not looked at its market or its customers to learn "what is going on with them in the last year, you don't know your customers." Sullivan said.
3. Promote confidence in the economy
The economic crisis that began in 2008 is still very fresh in customers' minds. Large financial institutions collapsed and the government bailed out troubled banks. The stock market lost value and in much of the country the housing market eroded.
Now financial advisers are called on to provide factual evidence to customers that the economy is getting stronger.
4. Use technology that customers expect
"Technology has changed the expectations consumers and small businesses have of their bank," Sullivan said.
Clients use information on the Internet to compare financial service firms. Many more customers are comfortable with managing their money online and they expect user-friendly tools to do so.
E-mail messaging and chat interaction may now be primary ways financial advisers communicate with clients. Companies must react to changes in technology to keep reaching customers in the most effective ways.
5. Watch your reputation
The financial services world is like high school in some ways: Reputations can be difficult to control or change. At the moment, consumers are not forgiving many of the companies that were front and center during the economic crisis.
A recent Harris poll surveyed consumer opinion on the reputations of America's 60 most visible companies. The top nine most disliked companies list includes six of the large financial services firms.
- Wells Fargo
- Bank of America
- Goldman Sachs
Financial services companies that stay focused on customers and their needs will be the companies customers keep at the top of their "like" list. These companies have to stay in tune as customers' needs shift and they have to provide workable solutions.
Carla Turchetti is a veteran print and broadcast journalist who likes to break a topic down and keep her copy tight. That's why this bio is so brief. Carla blogs for Contently.