Financial Marketers Research Articles

An exploratory study of divided pricing effects on financial service quality expectations

Financial services are often provided to consumers over an extended period of time. In pricing these services, financial services marketers have the ability to charge lump-sum amounts in advance, of the time period during which the service will be provided, or to divide their prices into a sequence of payments extended over the length of the service agreement. Consumer perceptions of the offer and their subsequent expectations regarding service quality may be affected by the marketer's choice of divided or lump-sum pricing. Service quality expectations may be further affected by the reputation of the financial services provider and the risk associated with the financial transaction. The goal of this article is to explore the perceptual effects of divided versus lump-sum pricing, and potential interactions that may exist with company reputation and financial service risk. Using an experimental design, the results indicate that divided pricing has varying effects on consumer expectations of service quality, depending on firm reputation and the underlying risk associated with the financial service. The article concludes with a discussion of the findings and implications for practitioners and researchers.

Do services marketers' success measures match their strategies?

PurposeThe paper seeks to show that the strategic types of service marketers (e.g. Prospectors, Defenders or Analyzers) match the types of success measures that they use to evaluate new services.Design/methodology/approachA theory is developed to show why service marketers of different strategic types use different success measures for the evaluation of new services. Using responses from 202 financial services marketers, strategic types are shown to relate in theoretically expected ways with the importance ratings of the categorized success measures.FindingsNotable relationships among strategic types and their success measure are identified. Prospectors, for example, attach greater importance to growth performance measures, consistent with the growth orientation of their service development programs. Defenders, on the other hand, attach more importance than Prospectors to efficiency performance measures, which relate to their programs' efficiency orientation. Analyzers, interestingly, place more emphasis on objectives‐based performance measures, including strategic fit, than Prospectors.Research limitations/implicationsThe sampling frame purposely contains only US financial services firms; as such, future research may build upon this single‐industry, single‐country study.Practical implicationsAcademic success literature generally disregards the strategic types of respondents in measuring the success of service development programs. Practitioners, however, seek performance measures that are consistent with their firm's business strategy. This study provides a categorization of the most important success measures as appropriate to different strategic types.Originality/valueThe service success literature has often dealt with the question of “what causes success?” and has rarely confronted, head‐on, the question of “what is success?”. This paper addresses this critical research gap.

Building credibility in international banking and financial markets

PurposeThe research aims to draw a detailed picture of how international corporate banks and financial institutions approach image advertising to enhance impressions of their credibility. The purpose of the work is twofold, namely to demonstrate how corporate credibility can be conceptualised and made operational for strategic communication, and how the operational categories are utilised in the planning of recent image advertising campaigns in Europe.Design/methodology/approachA reconceptualised model of credibility dimensions was first proposed to obtain a collection of operational appeal forms. A corpus of 74 print adverts was then analysed in order to establish how financial marketers use the appeal forms to strengthen their corporate reputations. The patterns of credibility appeals obtained were then linked to the supporting visuals to provide a fuller picture of the industry's current praxis for portraying its expertise, trustworthiness and empathy.FindingsThe results reveal an overwhelming focus in both text and images on recounting companies' achievements and competencies at the expense of providing assurance of their integrity, truthfulness or attention to clients' needs. There is also clear evidence that corporate advertising is in fact strongly focussed on communicating credibility with less than 10 percent of discourse and visuals devoted to credibility‐free themes and issues.Research limitations/implicationsThe study takes a production perspective, using discourse and rhetorical analysis to determine how corporate documents are planned and executed. The data do not thus explain how advertising professionals distinguish between credibility appeals or how their target audiences recognise or respond to text and images communicating credibility.Practical implicationsThe results of the research are intended to bring increased attention to the rhetorical options for managing reputations and their potential effects on corporate credibility discourse.Originality/valueThe study demonstrates how dimensions of credibility can be conceptualised at a level relevant both to practitioners and to academic writing courses. Additionally, the application of the credibility appeals disconfirms the expectation that financial services providers are increasingly branding themselves to the market on the basis of their character and concern for customers' well‐being.

Restoring consumer confidence in financial services

PurposeThe purpose of this paper is to seek to explore the role of brand advertising in restoring trust in the sector. Consumer confidence in financial services has been bruised and battered over recent months.Design/methodology/approachThe paper uses data from a variety of respected online analysts and commentators to explore current and future trends in online advertising and their impact on trust in the financial services sector.FindingsThe role of trusted adviser in the financial services sector is now the domain of online sources and last year, 36 per cent of the total online population visited a personal finance site. Financial services marketers have realised the importance of online as a direct response mechanism to support offline marketing activity. However the effort to balance direct response and brand building activities through offline channels is, at present, far from being replicated online. And with the migration away from traditional media on an upward spiral, the approach to internet marketing and advertising will have to catch up.Originality/valueThe paper provides financial services marketers some insight into the future of online advertising and explains the benefits of adopting a dual approach of both brand advertising and search marketing to restore consumer confidence.

Music, scent and time preferences for waiting lines

PurposeWaiting for service by customers is an important problem for many financial services marketers. The purpose of this paper is to present a new approach proposing that customer evaluation of the service can be increased with an ambient scent. The paper also aims to identify a cognitive variable which differentiates customers by the way they value time.Design/methodology/approachPre‐tests included focus groups which highlighted financial services and a pilot test of 105 subjects. These were followed by a main sample of 607 subjects. Structural equation modelling and multivariate analysis of covariance were used for analysis.FindingsTwo environmental interventions, music and scent, can increase customer satisfaction among customers kept waiting in a line and reduce queue rage.Practical implicationsService contact points can reduce incidence of “queue rage” and enhance customer satisfaction by either or both of two simple modifications to the service environment or a preventive strategy of offering targeted customers an alternative.Originality/valueA new environmental intervention for customers waiting in line and a potential new method of segmentation are proposed.

“I'll always be in debt”: Irish and UK student behaviour in a credit led environment

PurposeThis research seeks to explore current attitudes, motivations and behaviours in relation to student credit and debt consumption in the UK and Ireland.Design/methodology/approachKey qualitative consumer research based on 20 interviews with Irish and UK higher education students is presented.FindingsThe findings highlight that, while the UK and Irish student contexts are significantly different in terms of accommodation costs, tuition fees and living expenses, many Irish students reported relatively high debt levels, with some exceeding their UK counterparts. The research identifies key contextual factors associated with the credit‐friendly environment in which students live in addition to shedding light on student orientation towards credit and debt, with specific conclusions for future student debt.Research limitations/ implicationsGiven the rise in debt and its detrimental consequences, the study has far‐reaching implications for policy makers, consumer agencies financial providers and marketers in terms of creating an environment where good student financial capability and management is developed and facilitated through increased financial education and regulation. The research has implications for other western countries in terms of predicting comparative trends in student credit and debt attitude and behaviour.Originality/valueThis paper addresses the lack of analytical and academic commentary exploring the dynamics and nature of student credit and debt, particularly within an Irish context, in addition to providing a cross‐cultural comparison between credit and debt consumption in Ireland, where debt is a relatively new phenomenon, and the UK, a country well‐entrenched in debt.

Marketing financial services to Hispanic American consumers: a portfolio‐centric analysis

PurposeTo provide financial service marketers with information useful in targeting and marketing financial services to Hispanic American consumers.Design/methodology/approachIt profiles the changing demographics of the Hispanic American financial services market and, utilizing data from the Survey of Consumer Finances, tests three hypotheses to compare financial service consumption patterns of Hispanics with those of non‐Hispanic whites.FindingsThe paper shows that the Hispanic American segment has grown in size and importance over the last decade, but that Hispanics differ markedly from their non‐Hispanic White counterparts in terms of financial product preferences and investment asset portfolio composition. Further, Hispanic Americans trail their non‐Hispanic White counterparts in terms of breadth and depth of financial holdings, particularly in the area of more risky but historically higher return asset categories.Research limitations/implicationsThis study examines the results of financial decisions at one point in time. Future research could involve primary studies to determine whether, financial consumption behavior changes in Hispanics over time, as they become more acculturated, and why Hispanics favor liquid short‐term assets to more risky, but potentially higher returning, longer‐term instruments.Originality/valueThe article provides value to financial service providers by highlighting opportunities in the Hispanic American market and offering suggestions for more effectively marketing to the Hispanic community. Among the suggestions are recognizing and reflecting the importance of emotional positioning in financial services promotion, employing both Spanish and English language communications, and sponsoring Hispanic community‐based programs to build brand awareness and loyalty.

The potential impact of new technology and European mail deregulation on financial services marketers

This paper identifies the problems and opportunities presented to financial services marketers by European mail deregulation and the advent of new document technology in 2003. It explains the theory and current reality of mail deregulation in the UK and explains the timetable for its introduction. It goes on to explore the opportunities deregulation will create for more targeted direct marketing and even one-to-one marketing through new services and technology. It concludes that the financial services companies that utilise these new opportunities earliest to meet the needs of their customers will benefit most in both brand and net revenue terms.

Cyber dudes and cyber babes: Gender differences and internet financial services

Previous research contended that men and women have different information processing tendencies, and suggested that they react differently to certain features of written communication created by financial services direct marketers. Women respond well to bright colours, photographs and images and men respond well to bold headlines, bullet points and graphs. Responses can also vary according to the amount of perceived risk involved in the transaction. This exploratory study attempted to contextualise some of these issues in terms of gender and explored how men and women used the internet, their responses to certain types of website and whether there were gender implications for web page design.

How consumers choose a financial institution: decision‐making criteria and heuristics

Using both qualitative and quantitative approaches, how consumers choose a financial institution for their checking accounts is investigated in this study. It was found that, although most consumers value convenience as one of the most important decision‐making criteria, their definitions of convenience vary across consumers. How different consumers use different decision‐making criteria and heuristics is reported, and the implications for financial service marketers are drawn from the findings.

Predictors of equity in relationships between financial services providers and retail customers

Relationship marketing has been embraced in a wide range of industries, including financial services. Despite considerable study and widespread application, it appears that many services marketers have accepted the concept of relationship marketing with little examination of the basis for genuine, quality relationships. Based on a review of the social psychology and relationship marketing literature, the authors offer a consumer‐focused approach to defining the principles of relationship marketing, and examine the conditions under which services marketers can expect to form relationships with their customers. Also presented are empirical findings on the predictors of the level of equity which resides in relationships between financial services providers and their retail customers. The research reveals that the affective dimensions of the service encounter best predict quality relationships. The implications for financial services marketers are discussed.