Savings and investment services are a product, just like any other, yet it can seem counter-intuitive to “sell” people on saving money. So how do finance companies bring new investors into the fold? One option is to focus on the factors that motivate saving behaviors, particularly when targeting younger clients. The more we know about why people save and invest, the easier it is to market financial services to them without appearing to sell anything at all.
Identify Savings Goals
The most common way that finance companies market savings and investment services is by identifying major life cycle goals and concerns that widely influence savings behaviors. As such, it’s vital that your business identify the leading reasons people save money and what services you offer for those life events, including:
- retirement
- education
- buying a home
- emergencies
- luxury goods and vacations
By individually highlighting these diverse savings goals, you’re more likely to turn a lead into a conversion because you aren’t selling savings for the sake of savings. Instead, you’re offering clients assurances for their future. As such, they feel more confident investing their funds using your company’s services.
Put Planning First
As part of engaging potential financial services leads, it’s also important to offer commitment-free ways for people to familiarize themselves with your services. Clients need time to explore financial planning services, including those offered through their employers, their primary bank, and through specialized banking and investment groups. This helps increase trust and familiarity and makes it more likely that an individual will entrust your company with its funds.
Many companies offer commitment-free financial planning seminars or introductions that give potential customers an opportunity to meet your staff, hear client stories, and learn more about your services without putting any money on the line. They’re also a chance for everyone to determine whether they share a financial planning philosophy; conservative individuals who want a standard savings account, for example, may not be comfortable working with firms that play the stock market to increase earnings. The fit needs to be right, which is why these introductory planning seminars and potential client meet and greets are so important for companies trying to make meaningful conversions.
Create A Specialized Knowledge Base
Certain customer groups don’t want to work with just any financial brand – they want experts in specialized monetary and legal issues. This is particularly the case for adults with disabled children, who will require long-term financial planning services, advice on saving through a 529 ABLE account, trust formation guidance, and additional supports that may go beyond their own lives as clients. For financial services providers, then, it’s worth considering whether you want to develop the knowledge to be an industry leader in this area.
Financial planning for lifelong disability is increasingly lucrative for investment groups, as better healthcare and decreased institutionalization meansthat more disabled individuals live long lives in the community. Other growing areas of specialization include estate planning, real estate investment, and even retirement. Regardless of an individual’s financial concerns and position, it’s common for clients to seek out specialists rather than generalists when given the choice.
Diversify Your Offerings
Just as most banks and investment groups are generalists, they also typically offer similar services – savings accounts, stocks, bonds, 401(k), IRA – and most clients will choose one of these familiar options. However, there is absolutely a community of investors who are seeking alternatives to traditional savings and investment options. As a company, then, look for opportunities to diversify your offerings and develop profiles of those who would benefit from these alternative accounts.
Retirement savings accounts, in particular, offer great opportunities to diversify your options, particularly as many people are dissatisfied with current offerings. Some of the less common, yet highly beneficial savings options include SEP-IRAs, an option for self-employed individuals, SIMPLE IRAs for small companies of under 100 individuals, and even permanent life insurance, an unusual approach to savings that’s surprisingly simple to borrow against. Few people are familiar with these options, yet for the right users they can offer substantial financial benefits.
Think Small
Large financial services groups have some obvious advantages when it comes to converting leads, but in the world of finance, things aren’t always that straight forward. Remember “too big to fail?” Millennials certainly do, and in light of the Great Recession, these young adults are saving for retirement at higher rates than Gen X did at the same age. These young investors are also more likely to turn to more stable, conservative accounts, while older workers prefer to take their chances with the stock market.
Emphasizing your company’s small size has definite advantages for smaller banks and firms, but it’s important to factor in the services available from larger banks when making your appeal. For example, millennials are unlikely to invest anywhere that doesn’t allow them to bank online; they depend on digital connections to stay on top of their accounts, with millennials logging on to their accounts online or via an app 8.6 times a month, compared to 3.1 times a month among older investors.
Luckily, there are hardly any banks today that lack online services; even tiny community banks and credit unions have moved online.That means smaller financial groups have the ability to focus on developing authentic relationships with clients. Young investors don’t want the anonymity of a big bank. They want to work with a consultant and staff who know them and care about their long-term success, and small banks are far more likely to offer that – make it a selling point.
You can’t sell savings or investments the way you sell an iPhone or a car, but many standard marketing rules still apply. In order to drive client conversions, then, you need to tap into the core anxieties, concerns, and motivations of a wide range of customers. It’s never too late to start saving, but individuals will only follow that line of reasoning if they feel welcomed by financial professionals. What can you offer that your competitors can’t? That needs to be your selling point in a competitive, mainstream industry.
