Selling To The Indifferent

Mass affluent Australians – the 3.2 million-odd among us who earn more than $100,000 a year – don’t care too much for retail banks.

Actually, that’s not quite true. Despite being convinced that financial institutions don’t particularly care about them, they are not sure exactly what to think about banks. 

Over the past six months, brandmanagement (owner of burningpants) has been expending a great deal of time and energy in understanding how the banking industry approaches and deals with the not quite rich and what this group thinks of banks?

By researching this generally under serviced market segment by asking them about credit cards, insurance, share trading and all elements of financial life – in addition to conducting transaction bank shadow shopping and home loan shadow shopping campaigns – it was revealed that banks are largely disinterested in mass affluent Australians (or at least unable to appeal to them in a significant way) as a collective customer base.

Just less than half of the more than 5,000 people involved stated they believed all banks were the same, while the other half was a bit more discerning in their perceptions noting that it depended on what they wanted to do and what products they were talking about.

This is where the research becomes interesting – the mass affluent market, which by its nature is selective, time-poor and willing to pay for services where it perceives it can extract value, has started to passively split the banks by their abilities to provide products and services.

The research reveals that a two speed industry is essentially emerging; that the CBA and ANZ have established a series of clear differentiators, where consumers can articulate price utility for particular services, and Westpac and NAB which have not.

What is even more curious is that a product-based examination reveals that in areas where specific banks are perceived as having a higher utility or price edge this isn’t actually the case when one looks at the products in question.

Meanwhile those banks, which are languishing in some instances, have similar and in some cases better products – it’s just that they are unable to get them to market effectively.

There is a message however that all of the respondents rejected out of hand – that is the idea that banks care about them in any way at all.

The idea they are there to help, that they are motivated by anything other than profit, has in the light of the global financial crisis been completely destroyed.

If you are going to tell your customers that you care about them – then it’s something you ought to be pretty careful about.