Forget the stereotype of Brits squirming at the idea of talking about money. Turns out, consumers love to talk about finance brands that are getting it right (and wrong).
In November, YouGov published its list of the UK’s most recommended brands. Three of the top five are financial: Monzo, TransferWise and MoneySavingExpert.com.
A valuable marketing opportunity
Whether we’re struggling to pay rent or eyeing up the latest designer bag, money is never far from our minds (and conversations). When our friends talk about how they’ve managed to buy their first home, invest in a cool start-up, or insure their adorable yet accident prone puppy, we listen. And then we consider following in their footsteps.
The chances of us acting on a brand recommendation are even higher when seeking advice on money-related matters.
If I see a shirt I like, I’ll buy it. If I see a house I like, I’ll embark on a long decision-making process that starts with talking to the people I trust (and inevitably ends with realising I can’t afford it). If my dad recommends a mortgage provider, I’ll contact them. Even if that provider’s new customer incentive isn’t the best on the market.
Create a community of loyal customers
Google “which bank should I join” and you’ll see lots of comparison sites. This means consumers can make informed decisions without trawling through endless websites, but it’s also reductive.
Finance brands are forced to sell themselves solely on price, with no consideration of their service, brand positioning, or other important factors.
This has resulted in an unsustainable battle of one-upmanship. Natwest and RBS offer a £150 bonus; HSBC offers £175. As much as consumers would like otherwise, banks can’t endlessly increase their new customer offer to be the best out there. It also means the majority of consumers join financial brands with zero emotional investment. And that presents a major challenge: customer retention.
Nutmeg: a finance brand benefitting from a referral marketing channel. Once a new customer has claimed their reward, their head can easily be turned by another provider’s offer. Particularly if your financial brand focuses more on acquisition than retention.
In comparison, customers who sign up to brands via their friend’s recommendation already have a positive outlook. They’re willing to overlook apparent drawbacks – like not having the best sign-up incentive or an online-only presence – because they trust you're a good brand.
And they’re three times more likely to recommend your business to others, continuing the virtuous cycle and delivering more long-term customers.
Look at Monzo, the disruptor bank that (until this year) focused 80% of its marketing on word-of-mouth. It raised £20m in three hours of crowdfunding and grew its customer base to more than a million users. That’s how powerful a community of loyal advocates who actively recommended your brand to others can be.
Supercharge sustainable business growth
49% of consumers are likely to recommend a finance brand. Provide a great product coupled with a brilliant service and, as YouGov’s survey proves, this number rockets.
It won’t be long before your customer acquisition and retention numbers speak for themselves.