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Megatrends and Financial Services
MacroMonitor Marketing Report
January 2003
Vol. V, No. 14
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Capturing business opportunities requires exploring the big picture and then
focusing on actionable strategies. As we thankfully close 2002 and optimistically usher in
the new year, this issue of the MacroMonitor paints with a broad brush social
and technology trends that will shape the nature and business of consumer
financial services in the next decade. Drawing on the resources of the various programs
of SRIConsulting Business Intelligence, we define several forces of change that
should be (if they are not already) on financial institutions' radar screen.
- Aging Boomers versus Echo Boomers. Marketing to divided generations will be a challenge for financial institutions because the large market of Boomers will
be moving into retirement just as another large population bulge, the Echo
Boomers, begins buying its first cars, first houses, first mutual funds, and first
stocks. Management of retirement assets and the need for credit and insurance
products will undergo changes as aging Boomers redefine the retirement life
stage. Meanwhile, Echo Boomers' different generational experience will mean
a reassessment of financial institutions' delivery and marketing strategies.
- The time-based economy. Financial institutions must contend with
time-starved consumers. Successful products and services will either save customers' time
and attention or supplant some other attention-monopolizing activity.
Financial companies will gain competitive advantage and achieve brand differentiation
by addressing time-based—economy issues such as information overload,
mobility, and complex financial processes and relationships.
- A cashless, checkless society. Asking consumers to forgo cash and checks is asking too much too soon. But eventually, most consumers will adapt as
more businesses reward early adopters and penalize the laggards. The complex array
of electronic payments systems will push financial institutions to find ways
of anchoring customers through better pricing, greater choice, and strong
alliances and partnerships with e-commerce businesses. In the meantime, instead of
having the anticipated cost savings, financial institutions face increasing costs
and redundancy as they try to maintain all payment platforms: cash, checks,
and various e-payment technologies.
- Technology thresholds. Advances in wireless technologies and speech recognition and other computer-user interfaces make the availability of financial services anytime, anywhere, and by any means closer to reality. Much work remains in integrating information networks and automating and accessing basic information and transaction processes. Implementation will not be easy, but it is, in many cases, inevitable.
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