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Recent years have seen various developments changing the financial services and consumer landscape. The global financial crisis amplified changing consumer expectations of their financial service providers. Recent surveys have shown that financial service consumers have altered their service expectations and are more demanding and specific about the service they require.
Yesterday’s consumers of financial products were content to leave the decision-making to someone else. Focus was on the immediate return on investment, not on whether the product would help achieve long-term investment objectives.
This fragmented approach caused savings and investments not being viewed as part of a holistic financial plan.
The financial crisis highlighted the lack of understanding of investments and the implications of the market downturn on returns. It also highlighted gaps in the service models of financial service providers.
Today’s consumers are significantly more aware of financial products they invest in. The focus has shifted to gaining a better understanding of the purpose of the product they are consuming and how it fits into long-term goals and objectives.
This refocus partially stems from a greater social trend, in that consumers are re-evaluating their values and the way in which they choose to live.
A recent survey by market research firm Synovate, on how money management styles and attitudes changed after the financial crisis, showed that almost half of 11 400 respondents in 16 countries permanently changed their attitudes to savings.
The survey further show that South African consumers significantly altered their attitudes to money management.
During the second half of 2009, 15% of South Africans changed their banks, 12% switched to safer investments, and 23% increased their overall emergency reserves.
More than half of South African consumers have written or revised their budgets as they begin to take greater control of their financial future.
In addition to the changing financial consumer habits, the regulatory environment in recent years has shifted the focus to protecting consumer rights with regard to financial services. The starting point was the introduction of FAIS, and has moved forward to the recent Consumer Protection Act.
Financial service providers have embarked also on a process of consumer education as part of their strategic focus on corporate social responsibility.
A more tech-savvy financial consumer generation has introduced a new challenge to financial service providers’ service models. Providers have to take into account the need for immediate access to information, the impact of interconnectedness of consumer communities (Facebook, Twitter, etc.), and what that means for their perceptions of service quality.
Furthermore, financial service providers must understand the importance of providing options for self-service, whether through the Internet or mobile technology.
Service providers are faced with the challenge of meeting the dual service expectations of the new-generation and the conventional consumer who has a need for human interaction.
In order to keep track of changing consumer preferences and to understand better what clients value most, financial service providers use client surveys to gain feedback on how best to refine their service offerings.
The 2009 Orange Index, a leading survey undertaken by Ask Afrika, highlighted the drivers of service most valued by South African consumers of financial products and services. These drivers include assurance, reliability, responsiveness, empathy and tangibles.
The assurance driver was given the highest importance during 2008 and 2009, as people had a greater need to feel valued by their financial institution. This could be explained by the general lack of confidence experienced due to the global financial crisis.
Consumers also have expressed a greater need for reliability, in that financial service providers deliver on what they promise and meet agreed deadlines.
The service expectations of South African customers are shifting from the tangible elements such as image and visual appeal to value for money and service excellence.
Absa Investments, as a provider of investment products and solutions, has recognised the opportunities for providing excellent service stemming from the main trends in consumer behaviour and expectations.
Providing service to customers is viewed as living out the values of integrity, honesty and professionalism. These aspects are incorporated into the process of building investment products, providing advice and implementing solutions for clients.
As investments are generally a long-term wealth-creation process, significant focus is placed on the ongoing support and customer service experience.
In addition to accessibility, flexibility and responsiveness are viewed as enablers offering customers an individualised service experience.
Customer service satisfaction is measured on an ongoing basis as part of a process to develop customer service as a key competitive differentiator.
The continued enhancement of service delivery allows Absa Investments to deliver a consistent customer service experience.
Isabel de Moura is a Client Strategy and Research analyst with Absa Investments
Articles 
Investments The consumer landscape changed
Investments The consumer landscape changed
