social insights for the financial service industry

2/23/2017 Consumer Insights for the Financial Service IndustryBrandwatch

https://www.brandwatch.com/reports/financial-services/view/ 1/13

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Financial ServicesSOCI AL INSIGHTS

Technology, digital transformation, and the industry’s evolutiontowards the customer

7 Minute Read

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Financial service institutions facilitate billions of transactions each day. Here’s howtechnology and younger consumers are molding the industry.

Executive Summary

As some of the least trusted organizations, and with customers increasingly in�uenced by thedigital revolution of other sectors, �nancial service institutions must build comprehensivestrategies that prepare them for the changing consumer universe.

Through the perspective of social data, Brandwatch looked at a few ways that technology andchanging consumer behaviors have affected three branches of �nancial services: consumerbanking, card/payment, and insurance.

In the last section, we discuss how these societal changes will continue to affect the industry and�nancial consumers globally. Fintech will continue to transition from the tools utilized mostly byMillennials to the main service touchpoint for most customers, and new monetary systems likebitcoin will disrupt both consumer behavior and �nancial regulations around the industry.

Financial service institutions will need to convert real-time data into immediate actions in orderto face the inevitable changes in their industry.

REPORT HIGHLIGHTS:

Introduction

How technology is shifting customers’ relationships with �nancial services

When discussing �nancial services, consumers mention ‘convenience’ 6X more often thanthey do ‘security’

•

Digital banking experiences on mobile and web bank apps are more positively discussedthan non-digital banking experiences

•

Baby Boomers make up nearly three-fourths of insurance conversation online•






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Financial service institutions are charged with keeping our money, assets, and transactionssecure. Monetary and �nancial institutions have been in existence for millennia, and many banksstill in operation can trace their origins—and their business structure—back several centuries.While �nancial institutions are among the most established companies of any industry, theintegral space they occupy in our society makes these institutions most threatened by changes inconsumer behavior and a progressively technological society.

Since the recession, �nancial service institutions have experienced a lack of consumer trust andlag in market growth, compared to other industries. In tandem with the growing distrust, thechanging market and consumer base are transforming how these institutions interact with theircustomers.

A generation de�ned by their relationship with the internet revolution of the 2000s, millennials areemerging as important �nancial decision-makers across the globe.This demographic is vital for�nancial institutions to consider, as their behaviors are currently informing decisions about�nancial technologies and in�uencing the market at large.

Additionally, as consumers are increasing demand for convenient, on-demand services in everyindustry, �nancial institutions must be sure they’re acclimating to expectations. In an industryonce shackled by the goals of keeping company data secure and private, �nancial institutionsnow must also consider the ease and convenience of their services compared to theircompetitors. This trend among consumers is immediately apparent when looking at the conversationssurrounding 41 of the largest �nancial institutions. When referencing these organizations,‘convenience’ was discussed much more frequently than mentions related to security, with onlytemporary bursts of conversations about security and safety occurring directly following securitybreaches or data hacks.






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Consumer Priorities for Financial Institutions

Figure 1: Analyzed 15,491 conversations about 41 �nancial services institutions on Twitter throughsegmentation with Brandwatch's Rules and Categories features.

Does this trend show that customers today feel security is a given, and thus don’t discuss it asmuch? Or is this trend indicative of the industry-agnostic , an artifact of anindustry shifting its priorities towards convenient, easy services?

Brandwatch was interested in diving deeper into the expectations and sentiment consumers hadaround different �nancial service institutions.

With , social data analyses revealed trends within three sectors of �nancialinstitutions: banks, payment/card companies, and insurance companies. Speci�cally, weexamined important facets of the brand-customer relationship, and the role technology will playin the future of �nancial services.

Banking Institutions

age of the consumer

Brandwatch Analytics


https://go.forrester.com/age-of-the-customer/

https://www.brandwatch.com/brandwatch-analytics/





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Consumer insights reveal the effects of �nancial service digital transformation

Since the 2007 global �nancial crisis, trust and loyalty for banks have been unstable at best.Banks have experienced the over the last 10 years, and according toForbes, their banking services in the next fewyears.

With diminished brand loyalty in banking institutions, banks must consider how they positionthemselves with the changing times. Banking has typically been thought of as traditional andinconvenient; however, technology—both customer-facing and within the organization— can helpthese companies provide more positive experiences.

The effect of mobile and web banking on customer sentiment is apparent when looking at socialdata. It’s expected that when consumers reference banking experiences of any kind, theconversations would generally be more negative. We just typically don’t mention average orpleasant banking experience on social media.

However, there is a stark difference between how customers discuss interacting with electronicservices using mobile and web apps and the conversations they have about human interactions.The following data highlights key insights into what bank customers need and expect frombanking interactions.

least growth in brand valuenearly half of Millennials would consider switching


https://www2.deloitte.com/us/en/pages/financial-services/articles/banking-industry-disrupter.html

http://www.forbes.com/forbes/welcome/?toURL=http://www.forbes.com/sites/laurashin/2015/05/07/how-millennials-money-habits-could-shake-up-the-financial-services-industry/&refURL=&referrer=#25f31b7e3955





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Sentiment Around Banking Experiences

Figure 2: Analyzes 31,237 conversations around bank services on social media. Experiences weresegmentation using Brandwatch's Rules and Categories features.

Nearly 60% of complaints about banks online are about non-digital experiences like bank visitsand phone calls. Over three-fourths of all emotive conversation around non-digital are negative,with customers frequently complaining about negative banker interactions and extremely longwaittimes.

According to Viacom Media, almost expect technology to “overhaul the waybanks work.” Social consumer data provides a window into any banking experience, revealing

Nearly 60% of online complaints about banks are about non-digitalexperiences like visits and phone calls.

– Brandwatch

half of Millennials


https://twitter.com/share?url=http%3A%2F%2Fbrnw.ch%2F2mdwtDb&text=%E2%80%9CNearly+60%25+of+online+complaints+about+banks+are+about+non-digital+experiences+like+visits+and+phone+calls.%E2%80%9D+%E2%80%93+Brandwatch

http://www.millennialdisruptionindex.com/





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insights as speci�c as the most common issues U.S. customers have with mobile check deposits.

In an industry notorious for inconvenient experiences, learning from audience pain points canhelp banks comprehend their customers’ needs and expectations to better prioritize servicechanges and technological developments.

Payment Card Companies

Using social insights to connect with the new customer

Payment systems, including credit/debit card companies and technology companies like Paypal,are as integral in people’s personal �nances as companies can be. Like banking institutions, theinteractions between payment systems and their customers are very intimate and very frequent,with occurring each day.

These companies are charged with the task of transferring personal or corporate �nancialinformation to another trusted, speci�c entity. Individuals and corporations, therefore, expect thattheir transfer is safe, secure, accurate and convenient.Because of this intimate relationship, it isimportant for these companies to stay mindful of the mood of their clientele, and identify wheretheir relationships are weakest.

Because of this intimate relationship, it is important for these companies to stay mindful of themood of their clientele, and identify where their relationships are weakest.

Twitter, Facebook and public forums are ripe with customer questions and grievances, providingcompanies with insight into their experiences. Therefore, it’s imperative for companies tomaximize on social intelligence technologies to capture these customer-service conversationsand crises online.

An audit of the conversations highlights three levels of service-related instances when peoplemention �nancial institutions directly: when they request help, after they’ve had a bad customerservice experience, and before they cancel, suspend their account, or threaten to switchproviders.

hundreds of millions of debit and credit card transactions


https://www.frbservices.org/files/communications/pdf/general/2013_fed_res_paymt_study_detailed_rpt.pdf





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Themes of Different Customer Service Mentions

Figure 3: Analyzes 11,374 online conversations surrounding �nancial service companies from April 1, 2016to February 1, 2017.

The analysis of conversations about insurance companies demonstrates a healthy customer-service relationship, with fewer than 15% of customer-service mentions any more severe thanrequesting help or asking questions.

However, banking institutions and card companies have more people reporting they had negativecustomer service experiences or threatening to leave. Being able to use an analysis like this todeduce the exact touchpoints where brand-customer relationships breakdown is integral inmaintaining trust, building loyalty, and improving customer sentiment around your brand.

HOW DO F IN ANCI AL SERVICES BUILD CUSTOMER TRUST?

Read more in our recent blog post about how �nancial service industry can use Brandwatch to buildstronger consumer relationships

READ NOW


https://www.brandwatch.com/blog/financial-services-building-trust-from-knowledge/





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An interesting addition to this— conversations regarding the electronic payment company PayPalresembled those of other payment services. However, Paypal did receive fewer severe customerexperience mentions, with only about 30% of the discussions regarding bad customerexperiences or threats of cancellation.

The customer-service issues Paypal did receive were more technical in nature, as expected whentheir transactions occur with minimal interpersonal activity needed. It will be interesting tomeasure how sentiment around traditional card companies changes as payments and purchasescontinue to reduce human involvement.

Insurance Companies

Learning from audience decision-making to encouraging future-thinking

Insurance companies of all types are are �ghting an uphill battle. Today, people are just less likelyto get insurance. One role of insurance companies now is to get people to think of the future.People feel less secure in their positions, change jobs more frequently, and believe insurance isn’ta �nancial priority at the current time.

As easy as it is to silo this trend as a result of strange “Millennial” decision-making, datasuggests that many individuals younger than 60-years-old are saving and investing less, anddeferring purchasing insurance.

The following analysis overlays social data around insurance with savings data collected from a. It’s clear that the “Baby Boomer” generation is more

likely to be making future-oriented decisions, like having signi�cant savings and discussinginsurance.

survey of 5,000 adults of different ages


https://www.gobankingrates.com/personal-finance/data-americans-savings/





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How Age Relates to Financial Behaviour

Figure 4: Compares 5,583 authors of social mentions about insurance or insurance companies between April1, 2016 and February 1, 2017 with data from a GoBankingRates survey to analyze how age relates to

�nancial and economic decisions.

This trend doesn’t necessarily re�ect a lack of concern for �nancial decisions. Currently, owe student debt, a �nancial burden that is dictating most of the

generation’s important life decisions, from choice in one’s apartment to age to have children.

Not just a symptom of Millennials, comes from individuals over40. Our current economy and society have drastically morphed how people are making presentvs. future �nancial decisions.

Insurance customers are signi�cantly happier when they can receive an of information and solutions. So in order to get more people, especially younger people,considering the future in their �nancial decisions, insurance companies should clearly articulatesolutions that apply to both their current customers and the audiences they hope to attract.

To do this, it’s important to understand the aspects of insurance that often provoke confusion orrequire clari�cation. Social data provides one window into that information.

three-fourths of Millennials

35% of all current education debt

“effective, single source”


https://www.aba.com/Tools/Documents/Millennials-Banking-Infographic.pdf

http://www.businessinsider.com/americas-crushing-student-debt-has-bred-a-disturbing-new-phenomenon-2015-10

http://www.gallup.com/businessjournal/169301/time-insurance-carriers-win-customers.aspx





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Topics of Online Insurance Conversations

Figure 5: Analyzes 324,116 social media conversations mentioning insurance companies on Twitter orFacebook from April 1, 2016 to February 1, 2017.

On social media, people typically had the most questions about current claims they’ve made, orthe cost or pricing of services. Understanding what customers are currently using social mediafor arms insurance companies and even individual agents with the power to ensure currentcustomers with the exact resources they want and need.

Even more importantly, younger generations—those least likely to have insurance—are with their �nancial decisions, choosing to collect �nancial and investment

information themselves rather than deferring such decisions to an advisor. Learning how thesedemographics understand insurance, and their gaps in knowledge, should be informingmessaging and marketing strategy for companies targeting these groups.

Looking forward

Despite its current effect on the industry, digital services and FinTech isn’t new. Companiesalready know how vital an online presence is, and the impact of convenient web and mobile appsare on customer satisfaction. Even the most steadfastly traditional �nancial organizations knowthat the future of banking, transactions, requires both �exibility and an eye on technology.

moreautonomous


http://www.forbes.com/sites/laurashin/2015/05/07/how-millennials-money-habits-could-shake-up-the-financial-services-industry/#5315be963955





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So, why are many companies still resistant to change?

More and more consumers are taking digital currency seriously. Each day, generations of peoplewho don’t remember a time before internet services are becoming �nancial consumers. How cancompanies and entire �nancial systems quickly and ef�ciently respond to these changes?

It’s vital these institutions adopt and implement the right technology to stay up-to-date withconsumer trends. Additionally, monitoring the sentiment and opinions around current servicesand products can inform every part of a business: from development learning how people interactwith mobile products to individual advisors being trained on the needs and expectations ofdifferent groups of consumers.

Finally, ensuring that company insights are communicated quickly to the right stakeholders isimperative. Having an easy, instantaneous data communication platform like isuniquely valuable for companies needing to quickly turn data into action.

Social intelligence is incomparable in providing �nancial businesses with the tools needed tosituate themselves in the changing market. For more information about the data in this report orhow Brandwatch provides for �nancial services, explore more of our or request a ofour products.

Even the most steadfastly traditional �nancial organizations know theirfutures require both �exibility and an eye on changing technology

– Brandwatch

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