April 21, 2006

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Selling Money Using Emotion Financial marketers enjoy huge brand awareness but dramatically less brand loyalty. For some reason it’s been this way for a long time. Why? My guess is myopia Banks, insurance companies, credit card issuers, financial conglomerates and other peddling cash or the promise of future security chronically underestimate the role of emotion in making financial choices and money decisions. The fact that very few financial marketers really connect with their customers might explain the conventional wisdom which favors maintaining multiple relationships to mitigate risk. And yet institutions see a greater share of every consumers’ wallet as the Holy Grail. Too little understanding of perception, persuasion and personal experience among target segments is compounded by too much reliance on product features. The numbers guys cook up the products. They run the numbers often without any understanding of who might use the product and how they think and behave. In most financial institutions a “new” or variation product is easy to craft and if only X percent take the offer, the profit numbers add up quickly. Take rates for the most innovative financial products rarely crack 10% of the targeted universe and many great ideas and cool products have died because the target customer didn’t understand or appreciate the offering. Its no wonder favorability rankings for banks, insurance companies and credit card issuers are generally low. Money is the most intensely emotional topic you can raise with anyone. It presses more buttons than sex, relationships, family members, jobs or pets. Most people are anxious about money and finances. They want their money to go farther and to do a better job of financial planning but never actually get around to doing something about it. Consumers don’t know who to trust on this subject and are intimidated by the complexity of money issues and associated rules or regulations especially because they have little formal education or training on money matters. In most cases people make spur of the moment financial planning decisions on the first day of a new job. They fill out the forms, check a few boxes and never revisit those choices again. Very few ever really understand what they are buying and if the truth be told demographics and psychographics drive most of those choices. To change the current state of affairs and gain a shot at upselling and cross selling millions of exisating customers, financial marketers need to craft messages that resonate with discrete consumer segments. One size doesn’t fit all. Life style and life cycles matter and not all “Soccer Moms” or “Upwardly Mobile Urban Singles” think or act alike. Add to the creative challenge the notion that changing routine, often unconscious, behavior is the most difficult communication objective Cracking the code on financial marketing communications begins by getting inside consumers’ consideration set. The creative process has to be rooted in understanding Attitudes toward and usage of specific financial products. Attitudes about money, lifecycle events and financial resources. Lifestyle issues affecting likely user segments Demographic and psychographics by segment Social networks and the influential role played by Spouses/Partners Language and imagery preferences by segment Channel and media preferences
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The Solution Illusion Where was I when everything became a solution? Have you noticed that everything from software to hardware to financial services to professional services to dentistry has become a solution? The problem is that all these so-called “solutions” never really solve anything. They are partial answers masquerading as solutions. And while I’m rarely accused of being too literal it seems to me that the word solution means -- final answer to a problem. A solution puts a particular problem to bed, at least until the problem morphs and requires a new solution. Jonas Salk discovered the solution to polio. And we haven’t had a case in this country for 60 years. Einstein solved the relativity puzzle. We’ve also used his proof ever since. That’s how a solution works. So why have my marketing brethren adopted this term to pitch their wares? In fact they’ve adopted it at such a pace that almost everyone, everywhere in every industry uses the phrase “seamlessly integrated solutions” to describe whatever they’ve got. Beyond the obvious copycatting somebody or a lot of somebodies think that this innocuous phrase not only means something important but distinguishes one offering from another and keeps up with the Joneses. News Flash – it doesn’t. Buyers glance at or hear this phrase, nod and move on. Even if it truly represents table stakes in your category, no one is getting any extra credit or extra consideration for having “seamlessly integrated solutions.” At best it’s a pro forma check off. In fact it is so ubiquitous, even though there is no common understanding of what it actually means, that it means nothing. And if every Tom, Dick and Harry has something that seamlessly integrates how big a difference can their possibly be between products and services? The dumbest prospective client can figure this much out. Does the embrace of the term “solution” represent a universal craving for answers? Maybe. Does the “seamless integration” part hint that buyers don’t want to toss out what they already have and have finally paid for to buy something new? Probably. So how do you beat the solution illusion? You have to have the nerve to buck the trend and sidestep the obvious. You must create a new vocabulary to separate your brand from the bad guys. You have to get past what the sales guys and the product team are familiar with and parrot on cue. And while it will feel uncomfortable, it will set you apart, which is the whole point of branding and marketing in the first place! You have to call a spade a spade. The alternative is being like everyone else lost in the soup of sameness and meaninglessness.

Danny Flamberg

I am a veteran marketing consultant working with leading and emerging brands

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