Christian Debt Recovery

Debt One Fs

May 1st, 2011 |

Author: Gavin

debt one fs

The Impact of Financial Intelligence on Consumer Trends in Financial Services

Introduction

High levels of household debt and reduced levels of household savings left many consumers unprepared and vulnerable when the global economic crisis hit. FS providers have a role to play in increasing financial intelligence and making consumers responsible for their own debt. Increasing engagement with the industry and financial products will help to address low financial intelligence.

Features and benefits

* Encourage consumers to address their finances by engaging them with the FS industry.
* Learn why consumers do not always act rationally through understanding innate, cognitive biases.
* Demonstrate empathy with consumers debt problems through relevant advice and tools.

Highlights

Product holding increases with both financial intelligence and engagement. Consumers who avoid their finances are also avoiding saving and have a lower holding of a number of insurance products.Older consumers are more financially intelligent highlighting the importance of experience with the FS industry and its products. Providers can increase financial intelligence among younger consumers by bringing this experience to them earlier.Consumers are not always rational in their decision making processes. FS providers must understand this and use innate cognitive biases to their advantage when positioning their products and services.

Your key questions answered

* Why has consumer debt reached such high levels while savings have dropped?
* Why do consumers often fail to make rational decisions about their finances?
* How can FS providers help consumers to face up to their debt?
* Can financial intelligence be taught, or does it simply come down to experience?

Table of Contents :
Executive Summary
The FS landscape has changed post-downturn
A holistic view of consumers must be adopted
Tracking consumer trends is fundamental to long-term success
Strategic context: consumer debt has risen to untenable levels in the last decade
Providers can increase product holding by raising levels of financial intelligence
Consumer understanding of the FS industry is driven by engagement and experience
Strategy in focus
Even financially literate consumers fail to manage their finances wisely
Providers need to address consumer disengagement
Consumers are actively avoiding engaging with their finances and the industry
Sources of financial advice are changing
Providers must make consumers aware of their own responsibility for debt
Strategic action points
OVERVIEW
Catalyst
Summary
Methodology
INTRODUCTION: THE IMPORTANCE OF TREND TRACKING TO FINANCIAL SERVICES
The post-recessionary FS market presents new challenges to the industry
A microscope has been placed over the activities of the FS community
Competition is fierce within the industry
Consumer empowerment means that providers must work harder then ever to attract and retain customers
Competing on price alone does not necessarily result in profitability
Datamonitor is committed to creating a holistic view of the consumer
Tracking consumer Megatrends is fundamental to long-term success
Megatrends can be classified in two ways, according to desirable product/service benefits or societal complexities
Megatrends can be broken down into trends and sub-trends to provide structure and clarity at a time of ‘information overload’
Adopting a broader, global perspective to trend tracking facilitates better decision-making by overcoming myopia
Trends have greater long-term implications than fads
For every trend there is a ‘counter-trend’, while ‘trend-crossover’ is also an important phenomenon
Trends are aligned with pre-existing but evolving human values, attitudes, needs, and behaviors
STRATEGIC CONTEXT
Consumer debt has risen to untenable levels in the last decade
Favorable lending practices have allowed many to live beyond their means
Consumers in developed countries saw rising debt levels for years before the global economic crisis
Household savings have also fallen in the past decade
Consumers need educating about their finances
Insight: providers can increase product holding by raising levels of financial intelligence
Consumers who avoid their finances are also avoiding saving
Consumers who would rather not think about their finances are rejecting discretionary insurance products
Consumers who are not engaged with the FS industry are less likely to have a current account
Consumers who blame the industry for consumer debt have a high product holding
Insight: consumer understanding of the FS industry is driven by engagement and experience
The Financial Intelligence Complexity Megatrend is comprised of five key trends
Financial intelligence is not determined by levels of education
Experience helps to raise levels of financial intelligence
Addressing financial intelligence is beneficial to providers as well as consumers

For some-more information, Great fully visit:

http://www.aarkstore.com/reports/The-Impact-of-Financial-Intelligence-on-Consumer-Trends-in-Financial-Services-92248.html

About the Author

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