What is financial resilience and wellbeing?
Alex BurdenGroup Strategist
The world is entering (another) tough period, with far-reaching inflationary impacts on home budgets. The terms ‘financial resilience’ and ‘wellbeing’ keep cropping up – but what do they actually mean for marketers?
A shortage of workers, rising energy wholesale prices, a sinking pound (£), Brexit impacts on importing and exporting costs have helped lay a rocky road for the economy. Major drivers of high inflation currently include food, beverages, transport, housing, water, energy, and fuels. That’s almost everything we use in our day-to-day lives.
It’s predicted that a further 250,000 UK households face ‘destitution’ in 2023, according to the National Institute of Economic and Social Research. At least 1.5m households will see their bills outstrip their disposable income.
It’s clear that for most people, finances have taken a turn for the worse.
The ONS revealed that 90% of UK adults reported that their cost of living had increased in June 2022, as well as 94% reporting that the cost of food shopping had increased, leading them to cut back on non-essentials and energy use. Expenditure is increasing on credit cards or deferred to loans – it’s clear that for most people finances have taken a turn for the worse.
The difference between wellbeing and resilience
Brands, especially those working in financial services, are paying close attention to wellbeing and resilience.
- Financial wellbeing means being in control of your daily finances, as well as being able to purchase non-essentials that can make life enjoyable – a holiday, a spa day, or even seeing the latest Marvel film.
- Financial resilience means being able to withstand all that might be thrown at you – unexpected life events like redundancy, divorce or major house repairs, for example. It requires a longer-term strategic approach to money.
Recent economic events have pushed those with a good level of wellbeing into worrying territory, and reduced levels of resilience. When energy prices rise again, it’s feared that financial difficulties will increase across the board – including for businesses, who are already struggling with increased electricity costs.
Helping your customers improve their wellbeing and resilience
You might ask, how does this apply to marketers? What can we actually do? Marketing departments may not have much ability to influence fiscal or monetary policy, but your team – working together with sales – has the solution at your fingertips. Keep your content hub well-stocked with helpful tools, planners and insights. For example:
- Helping customers understand where they are on the scale of wellbeing and resilience. This could be a quiz on experiences of money pressures and following up with relevant advice.
- Tools that help customers understand the different products that could help build money. For example, higher-interest savings accounts versus ISAs, or ways to build your credit rating.
- Encouraging customers to check their credit score, and thoroughly explaining how it can impact access to financial products such as low-interest loans, or higher credit limits. Or suggesting alternatives to raising debt levels.
- Downloadable or online budget planners and tools to support healthy financial habits.
- Case studies of how people prioritised their budgets and found ways to cut back their overall outgoings.
By analysing customer behaviour you can detect / predict when the relationship may need extra servicing.
- Many banks now run free financial health-checks with customers – promote these as much as you can.
- Using an account-based management (ABM) strategy and your CRM to identify potentially vulnerable customers. The usual goal of an ABM strategy is to refine and direct your sales funnel. However, it can also support customers with financial knowledge that helps them. By analysing customer behaviour you can detect / predict when the relationship may need extra servicing.
Being there for your customers during this time ultimately builds their loyalty, your brand credibility, and retention rates.
We are here to help
Interested in getting to grips with building loyalty and supporting customers? If you want support with content that can improve customer loyalty and financial wellbeing, get in touch today.