Choices. They’re all around us. Every day, we are faced with a litany of them that shape our waking hours and how our days proceed. We make choices about the things we will do, the moods we will be in and directions we go.
I listened to a TED Talk recently from Sheena Iyengar “Why Are Some Choices So Paralyzing?” During her talk, she outlines three assumptions that we have about the choices we make and provides examples from her research and life to back up these assumptions. The three assumptions about choice are:
- You make should your own choices
- More options = better choices
- You should never say no to choice
As financial marketers, we live in a world where we need to take complex financial instruments – products and services – and explain the features and benefits in ways that all of our consumers can understand. Beyond that, we then need to present the features in benefits in the best light possible to sway the decision of our consumer and convince them to buy with us. It’s no easy task.
When I look across the financial industry, I find that banks and credit unions generally follow these assumptions about consumer choice. Unfortunately, I think this is ultimately to our own detriment.
- You should make your own choices: How many of our websites display every single detail of information a potential customer or member would need to know about your checking accounts? Do you lay it all out there? Tell them everything they need to know right up front?Beyond making our websites incredibly cluttered and hard to navigate, this also allows consumers to evaluate and choose what they think would be the best account option for them even before speaking with an expert.
As financial experts, our staff needs to be the ones helping our customers and members make decisions. They should be asking qualifying questions, making recommendations and finding the right financial fit. Not only is it good for the customer, it’s great for the relationship!
- More options = better choices: As Americans, we have this idea that the more options we have to pick from, the better choices we can make. However, this has proven to have the opposite affect. Consumers faced with too many options become paralyzed and then are unable to make a choice. Think about it in terms of grocery store chains. Your local Aldi or Trader Joe’s will move more product in a shorter period of time compared to a mega chain such as Kroger or Safeway, mainly because they carry a fraction of the SKUs. Instead of 34 choices of peanut butter, they have 7. Decisions become much easier to make. Crunchy or creamy? Organic or not?Take it back to your checking account lineup. Is your bank or credit union paralyzing consumer choice by presenting too many options? In an industry where many of our products are already viewed as commodities, why do we need so many options within our own product list?
- You should never say no to choice: From an early age, we are taught that, when presented with a choice, we should always pick. Choices are to be made, not left behind. That this is how we gain control over our lives and find happiness. However, Sheena explains in her talk that sometimes, it’s better if we let people make choices for us. It weighs less on our conscience and allows us the freedom of living with that choice without guilt or buyer’s remorse.This is where the rubber meets the road for us as financial experts. As advocates for our customers, we can help them make choices that will positively impact their financial lives. By taking the decision-making out of their hands and providing recommendations, they don’t have to make the choice for themselves and risk a financial misstep.
I’ve said all of that to say all of this: it’s time to cut product. Not only that, it’s time to cut content. Here’s how to do it in a smart way:
- Evaluate your product line and score products on a 1-to-5 scale in the following areas. Then consider trimming the product line appropriately.
- Does the product fit into the values of my core customer/member base?
- Is the product too complicated to easily understand?
- Do my customers/members automatically gravitate to this product?
- Is this a niche product that could be kept, but “back pocketed”?
- Next, it’s time to take a look at our website, brochures and emails.
- Print off the appropriate pages of your website, select product brochures and take a sampling of your emails. Lay them all out on a large table so that everything can be seen.
- Take three highlighters. One to highlight all of the areas where the content is talking about the bank or credit union. One to highlight feature and benefit information that talks to your consumers. And one to highlight areas that get into account details.
- Take a step back and evaluate. Work to cut back content that is talking about the organization and details of the product. All content should point back to your consumer.
The process allows you and the organization to be honest about where things stand and then take steps to create an environment where choices can be made easily.
What do you think? Does your bank or credit union need to cut products out of the product line? Drop us a line or leave a comment!