Financial Industry Email Marketing Benchmarks

The financial services industry is incredibly important to the UK as a whole; as well as providing a regular source of income for individuals, the financial services sector also accounts for a significant portion of the country’s GDP. The industry is highly regulated and considered to be very important to national security, which means that personal data is highly valued and protected.

Given the sensitive nature of the data that these organizations handle on a daily basis, email marketing is a particularly important tool for these companies to use to connect with their target audience. However, the kind of content that they need to produce and the approach that they need to take to succeed in their quest for customers is somewhat different to that of a standard email marketing campaign.

So what is special about the financial services industry that makes email marketing so valuable to them? Let’s take a look.

Personal Data Protection Is Of Utmost Importance

Data protection is an extremely important aspect of life in the digital age. The General Data Protection Regulation (GDPR) was implemented on May 25th 2018 and establishes a new set of data protection rules that come into effect across Europe. The legislation aims to give individuals greater control over their personal data and to protect their privacy. It also creates better data ownership with more meaningful choices regarding how their data is used. Essentially, GDPR gives individuals the power to decide what happens to their personal data.

One of the major changes that GDPR brings is a clearer definition of data protection responsibilities. In the past, the onus was generally placed upon the individual using personal data (i.e., the data subject) to ensure that their personal data is protected. However, now that GDPR has introduced a new concept known as the data protection officer (DPO), organizations are also responsible for ensuring that their internal policies and procedures around data protection are followed. Moreover, as a data controller, organizations must appoint someone to the role of DPO, ensuring that the individual is suitably trained and able to carry out their responsibilities.

Regulation Makes The Market Volatile

The UK’s Financial Conduct Authority (FCA) is one of the main regulatory bodies governing the financial services industry. Established in 2015, the FCA’s role is to protect and promote the interests of consumers within the financial services sector. One of the main areas of focus for the authority is email marketing. Like data protection, email marketing is seen as a useful tool for keeping customers up to date with the latest news and offers within the financial services industry. However, the way that the FCA views and regulates this form of marketing is somewhat different to that of a standard email marketing campaign.

The FCA states that, while conventional wisdom would have you believe that personalisation is the way forward, online marketing with a personalized message can actually backfire and damage consumer trust. This is because, while organisations may mean well, the tendency is for recipients of these emails to feel like they’re receiving pitches from unknown brands.

The Need For Authentic Content

These days, individuals have become extremely wary of online marketing and its content. Due to the sheer volume of spam and the low-quality (often malicious) content that is commonplace, establishing credibility and trust is considerably more difficult in online marketing. In order to fight this battle for minds and fingers, it is critical that the content that an organization produces is of a quality that encourages the reader to continue. This is known as “brand journalism” and is seen as a more effective and less intrusive form of marketing than standard email marketing due to its focus on offering value rather than selling a product. One of the ways that organizations have tried to buck the trend and provide value is through the use of “subscription-based email marketing.”

Subscription-based email marketing is a term used when an individual signs up to receive certain types of content from an organization (i.e., product or service news, alerts, etc.) via email. Usually, these emails are dispatched in a daily or weekly basis and include content that is most relevant to that particular audience. Because subscribers are receiving highly personalized content, the appeal to this audience is considerably higher than that of a standard email marketing campaign. However, this form of marketing also has several disadvantages. One major drawback is that the content that subscribers are receiving is often repurposed from other sources and may not be as fully authentic as content produced directly by the organization. Moreover, with the emphasis on subscriptions and the constant need to keep up with trending topics, content can become rather stale and ineffective.

Thought Leadership Is Also Key

Another way that organizations seek to stand out from competitors is through the production of thought leadership articles and the dissemination of such content through social media platforms.

Thought leadership is considered to be “the practice of an organization shaping public discourse, generally for the benefit of stakeholder groups” within the financial services industry. The underlying principle of thought leadership is to engage with industry insiders and other influencers to generate interest in a specific topic and to encourage the publication of high-quality original content on a given theme. This content is usually commissioned by the sponsoring organization and is therefore completely authentic and free from commercial interests. Moreover, since it builds upon the expertise and status of those who are contributing, thought leadership is also often seen as a method of legitimizing a brand or product.

In the financial services industry, thought leadership is an incredibly valuable tool for organizations looking to establish a voice and gain credibility. However, like other forms of digital marketing, it comes with several challenges. First, it can be difficult to establish thought leadership if you don’t already have a large audience. Moreover, since this content is often disseminated through various social media platforms (i.e., LinkedIn, Twitter, and Facebook), your content may not always get the reach that you want it to. Finally, keeping up with the constantly evolving nature of digital marketing can be hugely time-consuming.

Email Marketing Is Here To Stay

While it is always important to keep up with the times and develop new ways of reaching audiences, the role of email marketing in the future of financial services is quite clear: it is here to stay.

Email marketing will always be a critical component of a well-rounded digital marketing strategy and will continue to grow in importance as more and more individuals become reliant upon digital platforms for their personal and business lives. Moreover, with GDPR placing more emphasis upon individual privacy and data protection, organizations must look towards alternative methods of marketing to keep their customers satisfied.

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