How can advisers best generate referrals?
The concept of customer advocacy as an alternative to traditional advertising has been gathering steam for some time.
In a digital world where consumers have ready access to information, they are no longer taking paid media at face value. Instead they are relying on word of mouth from friends and family before they buy products or services.
The trend can be seen across all industries, and the financial planning space is no different. So the question Financial Planners intent on building their business should be contemplating is, how do we best go about generating referrals? The answer may lie in an untapped resource: women.
Women in control
According to Galaxy research commissioned by ING DIRECT (2015), women are far from subservient when it comes to household financial decision making. Two thirds (66%)of women who are married or in a de-facto relationship say they make financial decisions jointly with their partner, while one in four (27%) say the majority of the financial decision making lies with them.
This is a trend which has been growing for some time. If we look at property investment, for example, over 40% of women said they would take on most of the decision making if they were buying a home today, compared to only 24% of women who said they were the primary decision maker when they bought their first home.
Yet, while women are increasingly a dominant force in financial decision making, the financial services industry on the whole has yet to adapt its customer proposition to address the needs of women.
Leveraging an opportunity
Referrals play a significant role in women’s financial decision making process. The opinions and recommendations of other women are particularly important to them, whether they obtain them through close relationships or via social media communities. So, I see enormous opportunity for planners to tailor their approach and engage with women to drive revenue, profitability and growth.
- Adjust your customer proposition: There is no ‘one size fits all’ approach so segment your customer base to provide tailored financial advice and bear in mind the nuances which exist between the genders. Women tend to invest differently to men, they have a lower appetite for risk and they prefer to include more conservative assets in their portfolio.
- Invest in digital technology: Women tend to take their time and ask more questions – gathering insights beforehand rather than making decisions on the fly. Equip women to take control of their finances by investing in and leveraging digital assets. Consider creating original You Tube content, or developing online tools and calculators to assist their decision making.
The financial services industry has plenty of room for growth in terms of engaging women and helping them make the right financial decisions. Add to that the high propensity for women to advocate on behalf of their service provider and, for forward thinking Financial Planners who position their delivery accordingly, the rewards are there for the reaping.
Lisa Claes is ING DIRECT’s Executive Director of Customer Delivery.
Find out more about ING DIRECT and Living Super at http://adviser.ingdirect.com.au/living-super.htm
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