Joined-up customer communications used to be something of a pipe-dream in the financial intermediary sector.
Database experts could establish an all round view of each customer, but the processes of translating this intelligence into joined-up communications was either unwieldy or unaffordable.
However, three things have come to pass over the last two years. High-speed personalised printing has become affordable for all customer communications, rather than just the high-value ones.
The ability to create a tailored set of contents for each customer’s envelope has become very sophisticated and in addition to this, pioneer organisations have established the initial proof that personalised content on the website improves customer retention, satisfaction, cross-sales, and ultimately profitability.
In a way, financial advisers and intermediaries are pulled in two directions. On the one hand, it is essential to maintain not just the fact but also the presentation of the firm as an independent adviser and arranger, beholden to no-one.
Research has shown that financial advisers actually top the table for organisations with which people actively want to have a “relationship” (Source: Arvato Loyalty Services, Rewarding Relationships, June 2005). Hence the move by many towards fee arrangements with the customer rather than the less transparent commission-only arrangements.
At the same time, though, support is required from the financial product originators in the process of reporting to customers. As an independent adviser, a firm naturally wants to present its own brand to the customer. In some areas of retail, that jealous guarding of the brand has led to an exclusion of the identity of product originators.
In financial services and wealth management however, the need is for collaborative effort between product originator and intermediary. Recent developments in variable colour printing – where content and text can be altered for each document printed – are revolutionising the extent to which this collaboration can happen.
Another recently published piece of research from GI Insight (Got to Keep the Customer Satisfied, June 2007) has confirmed the close correlation between the personalisation and relevance of customer communications and the levels of customer satisfaction achieved. So personalised communications and reporting tangibly help to cement and develop customer relationships (and therefore the amount of business done with each customer).
Now that variable colour printing is of high quality and affordable, then product originators have begun to offer their intermediary community colour customer reports which are tailored to each customer, and which are branded up to the intermediary.
Digital print means that there is now no need for minimum quantities. And because the technology can now operate at high speed, then the economies of production scale required by the financial product companies to keep things affordable are also easily available from commercial printers.
Moreover, personalised reporting on financial products used to be very much a service only for the highest value customer segments. This is no longer the case. The economics offered by high speed variable colour printing mean that even low value customers can receive such a service.
This is a critical point for database marketers, whose job is not just to identify who the lower and higher value customers are, but also spot the segments with the greatest value growth potential and create strategies to migrate them from a lower value to higher value group. If we cannot afford to communicate in a personalised fashion with the lower value groups, how can they ever be persuaded to upgrade?
Finally, the new capabilities and economics of variable colour printing are also being harnessed by a handful of intermediaries themselves. Here the process can become very interesting – we know of at least one firm that is using personalised colour to collate each customer’s portfolio of reports into a single quarterly publication, which then encourages the customer to visit a personalised version of the firm’s website, where they can access all their detail online.
All through this process, targeted additional product advertising is served up to the customer with the aim of increasing their value through product offers they are likely to be interested in. An increasing number of product originators are now supporting their intermediaries with variable colour print and communications. However, expect also to see the number of financial advisers themselves taking advantage of these capabilities grow rapidly in the next few years.
Yolanda Noble is chief executive of dsicmmIFAonline
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