Why Financial Service Providers Are Facing A Huge Challenge
Selling financial services can be difficult for several reasons even though they can be addressed differently to increase the chances of succeeding. Due to competition, the financial market has become saturated with players scrambling for a diminished customer base. Every year new players join the market with the same products, although they may be packaged differently. For instance, in the banking sector, customers may need to deposit money to their accounts using the ATM. That means there should be a utility that allows them to do so. Another player may introduce another method of depositing money using a mobile money system. Both products are meant to serve the same customer, raising the level of competition.
The reason why selling financial services is becoming difficult can be attributed to the rising competition from the industry players. While the customer base remains the same, more players are coming forth to sell the same products. Getting customers becomes hard as most of them either have those services or are in the process of acquiring them. It is even harder to sell an idea to a user who has heard that same story several times from different quarters. When the market is saturated with a product, its demand often goes down. It is odd why users would want to scramble for scarce opportunities and are reluctant when they can find it easily.
Financial players have increased significantly, and with a customer base that is diminishing, the market has become congested with the same service. For example, insurance has grown at a high rate due to the demand for insurance services. The curve has recently flattened with insurance customers not increasing at all. If they do, the percentage increase is negligible compared to the big number of insurance firms. There are now more brokers than before, yet there is no increase in the number of potential clients. The struggle is growing as financial companies scramble to introduce new products that they feel may capture the market. The intention is to rip customers from other competing companies, a task that is proving to be difficult.
The task is made even harder by the new tools being used to convey the information to potential clients. The push notification system has been adopted by almost every financial institution in an attempt to reach more people. These companies have to grapple with the limitations of this service. They are evasive and can cause some potential clients to loathe them. Not many would want to entertain unnecessary popups that keep bombarding their phones. Emails tend to convey a more coherent message than push messages. Push messages due to their length, cannot deliver complete thoughts that are sensible to the user.
That is another disadvantage that faces bankers and other financial systems. Push notifications can also be confusing with ads because of the way push notices pop up. Ads do trigger a negative reaction from some users who may discard them without giving them a thought. Even though push notifications are instant, you cannot be too sure the user will open the push message. Such disadvantages tend to work against financial institutions and can reduce conversions. The other biggest problem comes in how the products are packaged. Many users don’t understand what these financial institutions are selling.
There are hundreds of insurance policies to choose from. For a user to make a choice, he must be well-informed about that service before he can declare his interest. If only these service providers would package better campaigns to try to enlighten consumers on their products! There should be clear information on the benefits they are likely to get from using your product. You should not try to sell to a customer by giving him piecemeal information because it may not help to decide.
To sell financial services, you should understand the needs of your users. Try to give them a good policy along with an honest opinion, so they may see the importance of your product. If your product does exactly what your users understand from you, be sure to get more customers. He will convey a good message to his friends and relatives about your product. Although financial service providers are facing an uphill task, with proper strategies, things may change.