Marketing for financial services is not a quick, straightforward or universal solution. There are many moving parts to any marketing plan, and this needs to be tailored to your unique needs and goals.
Yet there are some foundational “building blocks” to most marketing plans which can be applied to the majority of financial firms; big or small, B2B or B2C and in various stages of the business cycle. The aim of this guide is to summarise some of these key building blocks, and to help inspire and inform your thinking as you devise the marketing plan for your own financial services firm.
We hope you find this content helpful, and invite you to book a free consultation with a member of our team if you’d like to discuss your own financial marketing strategy with us.
Establish your position
Right now, where does your financial firm sit in the business cycle? Different people break the various stages down in various ways, but a common progression would be:
- Startup. Here, your financial firm is gathering itself to enter the marketplace. You are designing your branding, getting the website ready and submitting your FCA registration.
- Expansion. Your business is starting to take off, characterised by growing employment and revenue growth. You might start raising your prices too.
- Peak. You have now reached the pinnacle of your growth potential.
- Contraction. People start leaving the company, revenue falls and your prices decline.
- Trough. The business can no longer be sustained in its current form.
Of course, not all businesses go through all of these stages in this exact order. A contraction might be followed by another expansion phase, for instance, due to a repositioning of your company.
Yet it’s important to be honest with yourself about where your financial firm fits in this broad cycle, as this will affect your marketing strategy. Do you increase digital advertising spend, for example, to accelerate the growth of your expansion phase? Do you divert marketing resources elsewhere – perhaps to sustain relationships with your existing client base – to mitigate a contraction?
Establish differentiation
Closely related to the above is where you “sit” in the marketplace. Here, your financial marketing needs to answer the fundamental question: “what makes your business different, and why would people buy from you instead of a competitor?”
Broadly speaking, there are two ways you can compete in the marketplace. The first way is to compete on cost, by offering customers the lowest price. This can work well in some cases. For instance, many passive investment funds have successfully taken business from active fund managers in 2019 by offering lower annual management fees.
However, you do need to consider whether a cost-based competitive advantage can be sustained. What if a competitor (or the entire marketplace) meets your prices and you can’t go any lower? What if your business is in the expansion phase above, and the pressure is to start raising your prices?
The second way to compete is to differentiate yourself, and there are many ways to do this. For instance, a financial adviser could position themself as a specialist in final salary pension transfers, or an expert in helping expatriates living in the Far East.
Here, you need to carefully consider whether your idea of differentiation offers real value to customers. Some financial advisers, for instance, put their discretionary service front-and-centre to their value proposition, because they are understandably very proud that they can offer this rare service. However, unless most people in their marketplace appreciate the nature and value of discretionary wealth management (and many don’t), this value proposition is likely to fall flat – especially if the broad movement of the market is towards passive forms of investing.
Establish direction
Should you continue selling your existing portfolio of financial services or products to your current marketplace? Or, should you pivot these towards a new market which is perhaps more viable?
Should you keep your attention on your current market, but with a new set of products and services? Or, perhaps a complete overhaul of your business is required, offering a new market a new offering?
Many factors can influence your financial marketing strategy in this respect. For instance, if you are in the expansion stage in your business cycle, does it make sense to abandon what you are doing? On the other hand, if you are in the contraction stage, could it be that your products or services are no longer seen a valuable? Or, perhaps your marketplace is declining and another one is required to keep your business growing, or at its peak.
Establish segments
All of this, of course, relates to the important question: “Who is your target audience?” It’s important that your financial marketing plan goes beyond the basic demographics of age, gender, income and location (although these are important).
Ask yourself whether or not the target audience is stable in number, growing or declining. What matters to them? How do they make buying decisions? Which pain points are they experiencing, and how urgently do they want them to be fixed? How can you address these more effectively than the range of possible solutions already available to them in the marketplace?
Final Thoughts
This is really just scratching the surface of getting an effective financial marketing strategy together. We haven’t had time to talk about analysing your current market environment, for instance, or how to establish a set of goals for your marketing plan. There is also the important matter of reviewing your marketing plan once it is implemented, and ensuring a process is in place to make improvements.
The above ideas, moreover, all feed into each other in important ways and should not necessarily be dealt with in chronological order. Your choice of target audience, for instance, is likely to have a big impact on your strategic direction. The stage of your business in its lifecycle, moreover, will surely also influence your choice of target audience. Quite often, here at MarketingAdviser we help financial firms address these important areas concurrently, to ensure that all aspects of the marketing plan work well together.
If you are interested in speaking with us about your own financial marketing plan, please get in touch to arrange a free (no-commitment) consultation with a member of our team.