“Only 2% of consumers would go to a financial planner to take out life or other personal insurance”
“Only 9% of consumers would go to a financial planner for retirement planning”
“12% of consumers would seek investment advice from a financial planner”
What on earth do consumers think financial planners actually do?
These statistics are from research conducted in Australia a year and a half ago, so perhaps the consumers perception of what financial planners do has shifted substantially since then – but I doubt it. Perhaps also these results are uniquely Australian, and everywhere else in the world consumers are smarter or better informed. I doubt that too.
Financial advisers have a problem. The problem is not dumb consumers either; the problem is the industry.
Clearly there is an issue with the financial advice industry as a whole being able to express the basics of what it does for its customers in a way that makes sense to them. There is an issue also with being able to deliver a clear and compelling value proposition. I separated those two out, even though they are inextricably linked, because there are clearly 2 issues at work here:
- General education of what financial advisers do
- Value propositions of individual firms that express their point of difference to their particular target market segment
I strongly believe that a well defined and articulated value proposition is the central ingredient in a professionals marketing strategy, however this research suggests that possibly a great value proposition just isn’t enough. Perhaps it isn’t enough if the consumers do not understand the positioning and function of the adviser to begin with. For instance; knowing that an adviser is an investment tax planning specialist, who can ensure you lose as little as possible – legally! – in tax simply won’t resonate with the market if they don’t understand how and where they could be paying too much tax, or what impact that may have on them personally.
We have to accept that if consumers are essentially ignorant in respect of understanding what advisers can do and help them with then a well crafted and pointed value proposition remains meaningless. Beautiful branding and market positioning also are meaningless until the target market understand the broader offering and range of possibilities which are available to them.
One thing should be abundantly clear to advisers by now though: consumers simply won’t use us until they know what it is we can do for them. And that is our first marketing challenge.
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