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Financial Services: The Path to Purchase - UK - June 2015

Published By :

Mintel

Published Date : Jun 2015

Category :

Banking

No. of Pages : N/A

Online channels now dominate all stages of the research and purchase process in most financial markets. There is still a group who prefer to use branch-based services, but most consumers now expect to be able to find, research and arrange any product online. A provider that has a sub-standard offering is now at a major disadvantage.
Table of Content

Introduction

Abbreviations

Executive Summary

Product arrangement
Insurance policies are the most commonly-arranged financial services products
Figure 1: Products arranged (including new or switched products) in the last three years, April 2015
Most new products are the result of opportunism, but active engagement is key
Figure 2: Reasons given for arranging a new current account, credit card, savings account and/or mortgage, April 2015
The research process
Online research is key for all products
Figure 3: Information sources used to research financial products before purchase, April 2015
Insurance buyers compare the market first: bank account buyers go direct to the provider
Figure 4: First information sources used to research financial products before purchase, April 2015
Preferred purchasing method
Consumers prefer to buy online, direct from their provider
Figure 5: Method used to arrange financial products in the last three years, April 2015
Figure 6: Agent used to arrange financial products in the last three years, April 2015
Attitudes towards arranging financial products
Taking personal responsibility is a valued quality
Figure 7: Agreement with attitudes towards researching and arranging financial services products, April 2015

Issues and Insights

The internet is now key at all stages of arranging a product
The facts
The implications
Price can get people to switch, but other considerations make them stay
The facts
The implications
The changing role of brand image
The facts
The implications

The Consumer – What You Need to Know

Consumers engage most regularly with insurance
Most new products are the result of opportunism, but active engagement is key
Online research is key for all products
The first point of call is heavily product-dependent
Consumers prefer to buy online, direct from their provider
Taking personal responsibility is a valued quality

Product Buying Activity

37% have arranged a new motor policy in the last three years
Figure 8: Products arranged (including new or switched products) in the last three years, April 2015
Millennials are the most likely to switch core products…
while Boomers concentrate on getting the best insurance deals
Figure 9: Products arranged (including new or switched products) in the last three years, by age group, April 2015
35% have arranged no financial products in the last three years

Prompts to Purchase

A fifth arranged a product because they keep up to date with products…
Figure 10: Reasons given for arranging a new current account, credit card, savings account and/or mortgage, April 2015
but opportunity is key
Figure 11: Reasons given for arranging a new current account, credit card, savings account and/or mortgage, April 2015
Limited offers can push people into bringing forward switching plans…
and the end of an introductory offer can act as a trigger to check the market
Changing personal circumstances can prove the worth of personal service
Brand image still matters

Product Research

Most people research financial products online…
Figure 12: Information sources used to research financial products before purchase, April 2015
but branches are still widely used
Figure 13: Use of bank/building society branch to research financial products, by product arranged, April 2015
Mortgage customers are the most likely to seek professional help
Figure 14: Use of professional personal advice/guidance* to research financial products, by product arranged, April 2015
Harness peer reviews to attract younger consumers
Figure 15: Consumers who spoke to friends and/or family when arranging their most recent current account, credit card or savings account, by age, April 2015
Figure 16: Consumers who spoke to friends and/or family when arranging their most recent car or home insurance policy, by age, April 2015

First Point of Contact

Price comparison websites are the key first stop for research
Figure 17: First information sources used to research financial products before purchase, April 2015
Insurance is product led…
while brands are more important for banking customers
Advisers are the most common first point of call for mortgage borrowers

Purchase Methods

Offline points of sale are falling away
Figure 18: Method used to arrange financial products in the last three years, April 2015
Finance, on the go
In the main, consumers prefer to arrange products directly
Figure 19: Agent used to arrange financial products in the last three years, April 2015

The Road to Purchase

Current accounts
Most common path to purchase
Figure 20: Current account purchase method, by initial research source, April 2015
Credit cards
Most common path to purchase
Figure 21: Credit card purchase method, by initial research source, April 2015
Savings accounts
Most common path to purchase
Figure 22: Savings account purchase method, by initial research source, April 2015
Car insurance
Most common path to purchase
Figure 23: Car insurance purchase method, by initial research source, April 2015
Home insurance
Most common path to purchase
Figure 24: Home insurance purchase method, by initial research source, April 2015

Attitudes towards Product Research and Purchase

It is essential to check Ts and Cs, but can it be done?
Figure 25: Attitudes towards researching and arranging financial services products, April 2015
Keep it simple to avoid confusion
Could regulation overcome apathy?
Figure 26: Agreement with attitudes towards researching and arranging financial services products, by product buying activity, April 2015
Half prefer to do their own research than trust experts
The price of loyalty
Figure 27: Agreement with the statement “Companies save their best offers for new customers”, by product buying activity, April 2015

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