Financial firms must boost marketing activity

Research from customer insight and database marketing specialist KDB has revealed that UK financial firms need to boost marketing to take advantage of the economic recovery.

The results of KDB's survey of 1,000 consumers across the UK suggest that the market is ripe for firms marketing investment products and services, with 71 per cent of respondents saying they either invest directly themselves or through a financial adviser.

The research also revealed that 65 per cent of those respondents who said they invest also said they were increasing the amount they invest this year.

The survey, which was balanced by gender, region, social class and age, found that the older the person, the more likely they are to be investing.

The 55-plus age group - those most likely to be considering their pensions as they near retirement age - led the way in terms of making their savings work for them, with 84 per cent declaring that they were actively investing.

But even more than half of the respondents in the 18-24 age bracket said they were investors.

The survey also indicated, however, that financial firms are doing an insufficient job of marketing their products and services to prospective and existing customers, as 70 per cent of all respondents found that the majority of direct mail they received from these companies is irrelevant to them while only 13 per cent said that a substantial proportion of the post they receive from these companies is of interest to them.

A breakdown of the findings indicated, however, that financial firms were doing better in certain markets, particularly London where 19 per cent of respondents said they found that a significant potion of this type of direct mail was of interest to them and only 64 per cent found the majority of this post to be irrelevant.

What financial firms selling investment products and services should find particularly worrying though is that the demographic groups with the greatest earning power and likelihood to invest - those age 45 and up - appear to be the consumers these firms are doing the poorest job of reaching with their marketing.

The survey found that 77 per cent of these consumers said the majority of the direct mail they receive from these companies is irrelevant.

Only nine per cent of 45 to 55-year-olds and 11 per cent of the 55-plus age group found that a significant portion of the print communications sent to them from financial firms was of interest.

The survey also showed that men are slightly more likely to be investors with 72 per cent saying they put money into some kind of investment vehicle versus 69 per cent of women.

Regionally, the north east offered firms the fewest opportunities for targeting investors with only 55 per cent of the respondents in this region saying they are investors.

The south west, on the other hand, appears to be a hotbed of investment with 82 per cent of those surveyed there saying they invest.

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