2018 Financial Services Marketing Trends: How did we do?
At the end of 2017, Mintel unveiled a series of trends across key industries tracked by Comperemedia, including Financial Services. The four Financial Services Marketing Trends we identified are:
Do You Trust Me?
Trust is up for grabs as consumers struggle to balance their desire for convenience and technology with their concern over data breaches and the security of their personal or financial information.
DIY Financial Wellness
The personal financial management tools of yesterday are evolving into do-it-yourself financial improvement apps founded on the basics of behavioral economics and powered by artificial intelligence.
Consumers are faced with more and more options for financial products. The primary banking relationship is changing and giving rise to new disruptors and new approaches from traditional financial institutions.
Alternative Risk Assessment
The traditional credit score is being challenged by companies looking to change how creditworthiness is determined. The growth of non-credit metrics and predictive analytics will give rise to new opportunities in the credit industry.
As we approach the release or our 2019 Financial Services Marketing Trends, let’s see how we did with a review of two trends from 2018 that evolved the most over the last year.
DIY Financial Wellness
Personal financial management (PFM) has come a long way from its foundation as a basic budgeting and transaction analysis tool. PFM is blurring the lines between reactive notifications and proactive recommendations, with some innovative gamification all mixed into one. By the first quarter of 2018, US household debt was at an all-time high of $13.2 trillion and more than half of consumers are experiencing significant stress over their finances, according to Mintel US research on lifestage marketing in financial services. At the same time, consumers are paying more attention to their personal finances and looking for ways to avoid debt or pay down the debt they currently have. According to Mintel US research on credit cards, more than half of Millennials and three in five iGens think it is best to avoid using credit cards as much as possible, more so than any generation before them.
As consumer awareness around debt continues to grow, the market is responding with tools, products and services grounded in developing greater financial wellness. This trend is also playing out with a growing connection between finances and physical health. For example, this summer, RBC launched Finfit, a fitness-based approach to spending smarter and controlling your finances through a mobile app. The Financial Gym is another fitness-based financial service offering bringing the subscription-based gym model to personal financial coaching, where “personal trainers” keep you on track to reach your financial goals.
Consumers are not going to be able to avoid debt altogether, but brands that can help their customers better manage their debt and make more informed decisions will create stronger and longer lasting relationships.
As the number of financial offerings available continues to rise, so does the number of accounts that consumers own. The diversity of products available is further enabled by the overall rise in digital banking, which removes many of the frictions normally associated with changing a bank relationship.
Loyalty is up for grabs, but some brands are fighting back. This summer, JPMorgan Chase released two new products: Sapphire Banking, a suite of mid-affluent banking products and the You Invest personal investing platform. Chase positions You Invest as a natural extension of its consumer banking products, which lowers the barrier of entry for existing customers. Trust is also a factor that Chase is tapping into, acknowledging that “there are customers out there who may not want to trust their credentials or their money to an app of the month.”
With Sapphire Reserve, Finn by Chase, and You Invest, Chase has established a track record of modernized, disruptive product offerings. Traditional financial institutions will be challenged to expand and adapt their own suite of services to compete with Chase as well as the FinTech startups that are looking to disrupt the industry and solve major pain points in the everyday banking experience.
As we look ahead to 2019, we’re already excited and talking about key trends that will drive the industry next year. Stay tuned for the release of the 2019 Financial Services Marketing Trends, coming soon!