June 21, 2022 at 5:00 am ET
For Financial Services, Trust Is a Must, but Data Privacy Is the New Differentiator
Financial services analyst Charlotte Principato reveals consumers’ opinions on trust and data privacy in their financial services relationships
This memo is part of Morning Consult’s Most Trusted Brands 2022 series and a preview of our financial services report. Morning Consult’s Most Trusted Brands 2022 is the definitive measure of brand trust across industries, showcasing the companies and products that have earned or maintained consumer trust in 2022. To download the reports, click here.
When it comes to trust, honesty and especially data privacy, consumers hold their financial services providers to high standards — higher than for most other industries, according to new Morning Consult data. But while trust has long been part of banks’ and other financial institutions’ value propositions and held a prominent place in their branding, data privacy remains an untapped means for differentiation in the highly competitive industry.
Trust is table stakes in financial services
While trust is still vital to financial services relationships, it’s also table stakes.
Rather than being a differentiator, trust is expected in the financial services sector, and consumers will end their relationships forever if it’s violated. In fact, among adults who have permanently ended such relationships over broken trust, 29% say a financial services brand was involved — the highest share of any industry surveyed.
Compare that to the 17% of adults who lost trust in a financial services provider but said they would still consider using that provider again. Consumers are more likely to end their financial services relationships altogether when trust is broken rather than give their providers a second chance.
With trust being a must-have, financial services providers must look elsewhere for opportunities to differentiate in an increasingly commoditized industry.
Data privacy is the underused marketing tool for differentiation
While it doesn’t roll off the tongue quite as easily as trust, data privacy should hold an important place in every financial services brand’s marketing strategy for the simple reason that it matters to customers — a lot.
By a wide margin, financial services is the industry for which data privacy is the most important to consumers. As for trust and honesty, financial services trails only health care. Importantly, these sentiments are consistent across generations but intensify with age.
So while most financial services providers focus on trust and honesty in their value propositions and messaging, they should also make data privacy a central part of their offer to put customers at ease and further distinguish themselves from the pack.