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Talking To Your Customers: How Financial Services Can Speak The Language Of Retail Investors

Carmen Reid 24 January 2022

This is the short, blog version of our white paper – packed with advice, examples, links and stats, and available to download right here.

It’s possible that this blog will make you afraid.

That’s because this is a warning of what lies ahead for financial services companies that don’t act very soon to dramatically improve their customer communications.

Let this heart-warming sentence be an inkling of what you’re up against: ‘Some folks… kind of helped us out on the ground and made introductions so we could sort of plead our case.’

Sounds nice, doesn’t it? Note the use of the word ‘folks’, that simple ‘helped us out’ and the emotive ‘plead our case’. If I tell you this was a startup talking, you’d think: ‘Oh bless, those creative young millennials… trying to improve the world for everyone. Let’s give them all the help we can’.

Millennials trust apps … but not your financial brand

This startup was Zenefits. According to author Corey Pein, when Utah regulators accused it of violating consumer protection rules, Zenefits flew into town with those folksy ‘folks’, who in fact included five professional lobbyists and one former exec director of the Utah Republican Party. But Zenefits had bent over backward to make itself sound friendly, accessible and kinda cool.

Or take the example of Uber, the global app-based minicab service, which has taken on the authorities (that once licensed and insured minicabs in the interest of keeping the public safe) and has mainly won. An estimated 2 million drivers across the world now work for Uber – and, usually, they don’t have to answer to the official regulation that existed before.

You need to know that most millennials don’t care about the regulatory upset; they have embraced Uber (regular Uber and Lyft users are most likely to be aged 16–34). They trust the brand, trust the app, trust the customer reviews, trust that little red dot on a screen heading towards their door. A license from City Hall means nothing to the under-35s, but knowing they are logged on with an app and being tracked by GPS is totally reassuring.

The threat of fintechs, the shadow of Amazon

And if you work in financial services, the above really does matter because a swarm of new and hungry financial-technology (fintech) companies is vying to look after your customers’ money. The fintechers want to put banking, saving and, yes, investing literally into their customer’s hands – via their phone screens.

The threat of Facebook or Amazon becoming active in financial services is giving the masters of finance sleepless nights. Amazon looks set to venture into investment funds, and it’s worth knowing that research house Bernstein has found that 41% of Amazon’s 100 million Prime customers would choose an Amazon retirement account.

Robo-advisory services like Alibaba’s Ant Financial already have assets under management of US$345 billion. And just to give you a sense of the scale, Ant Financial has 1 billion customers – that’s five times more than Citigroup.

The giants and the startups are coming.

Download the Full Report Here

Talking to investors like best friends

All of these new service providers on the block have bent over backwards to make their offerings so simple and friendly. They’re talking to you one to one in the private confines of your personal digital universe. There’s no queuing at the branch for these short consumer loans, no form-filling, no eyeballing the bank manager. Instead, there’s an excited ‘Yay! You’re pre-approved!’

When the fintech startups come for your customers with their shiny but simple tech vehicles and their one-paragraph friendly explanations, they may very well get them. These companies talk to their customers like old friends. And the customer, who has spent more time online than anywhere else other than asleep in bed, feels like they are old friends.

The customers of the future are going to trust big tech brands or little startups that sound like their best friends over the distant, corporate, mainstream bank, asset manager or investment company.

How can asset managers talk to end investors?

How can the incumbent investment managers fight back? The first step is to make sure that the products and services you offer are fantastic. The next step is to change your comms.

The aim of marketing communications is no longer to win customers over with clever sales talk; it’s to make friends. To explain like a friend would, to help like a friend does, to recommend the right thing, just like a friend.

Here, we have two examples of the major companies already doing this well (for more, please take a look at our full white paper).

1. We like the language used on the Vanguard UK website,

From the ‘overview on investing’

Some people say investing is complicated. We don’t think it has to be. In fact, we think successful investing rests on four simple principles:

Goals Balance Cost Discipline

2. We think Virgin Money always does an excellent job of breaking complex information down, so that it’s easily grasped.

Here is the website copy on drawing your pension:

How can I access my pension savings?

You don’t have to decide any time soon, but when you do reach age 55, the good news is that recent rule changes mean you have more flexibility than ever before.

You can continue to contribute until you choose to retire or:

  • Withdraw all your savings – up to the first 25% is tax-free.
  • Leave your savings untouched until you need them – they could continue to grow in the meantime.
  • Flexibly access your savings, enabling you to access cash, secure income and income drawdown.
  • Use your pension pot to buy a secure retirement income, typically known as an ‘annuity’.
  • Transfer free of charge to another pension provider – useful if you are combining pension pots or you want withdraw cash as and when you need it.”

If you’d like to find out more about talking to your customers like a friend, please take a look at our white paper, where we explain the steps, reveal the tips and highlight the companies doing it well.

If you’re in a hurry, then our ‘cheat sheet’ infographic is for you!