It looks like we’re coming out of the worst days of the recession, and research from GfK shows that UK consumers are starting to return to brands they trust. But when times were tight, people learned to look for value and they now expect incentives for their loyalty. How should financial service brands ensure that those rewards not only encourage loyalty, but help develop stronger emotional ties with brands and increase engagement levels?
Latest research from Consumer Trends presented at the ‘For Love or Money’ event on 3rd July shows almost one half (44%) of people now agree “I only buy products and services from a trusted brand”, up 7% from 2011. GfK’s Director Ian Davis reviewed the variety of incentives that are available in financial services – and showed why cashback schemes are on the ascendancy, replacing air miles, points, vouchers and discounts. People want schemes that are simple, that have a value to them, and that are relevant to their lives. And as well as being right for the customer, they need to be right for the provider and support brand values. As more people return to trusted brands, having a reward that customers actually want – and that supports your brand – is crucial. So how do you do it?
Make experiences memorable to maximise brand engagement
Research presented by John Banerji showed GfK’s latest thinking on the role of positive memorable experiences - which become more important when every player is offering rewards. For instance retail banks could to look at their various customer touchpoints – branch visit, call centre, online, apps & mobile, financial review, paper statements, cashback rewards, travel insurance etc. and compare their customer experience with competitors. GfK’s research shows that the two most important drivers of recommendation are impression – with the branch coming top followed by advertising. For memorability they are online banking, an advisor meeting and a branch visit in that order. This emphasizes the importance of having a consistent brand experience across all channels – from the real world branch and advisors, through to online banking whichever device websites are accessed from.
Personalized, not personal
Colin Strong concluded the session with a look at the role of personalized rewards, versus personal incentives. The research presented at the event had shown that it’s important to offer relevant rewards to customers – but can you go too far with personalizing those benefits? GfK’s own research shows people are happy to share their data if there is a benefit to them: 71% if it helps them save money, and 63% if it helps them save time. But there is a tipping point reached when tailoring the rewards can be seen as being almost creepy – using too much person-level data. As we move from a big data to a personal data economy, financial services providers need to be careful not to get too personal with the information they hold on their customers. There’s a very fine line between perfectly targeted incentives and rewards, and getting too close and personal, turning customers off forever.