Focus on Finance: Understanding Consumer Behavior in the Midst of COVID-19

January 29, 2021 — 4 Minute Read

This post was republished from Bankingdive.com

There isn’t a business on earth that could have foreseen the financial, health, and operational challenges that the global pandemic has unleashed. This crisis is forcing organizations in every industry to quickly pivot and reimagine how they can operate in a smarter, more resilient and efficient way. Among the business functions feeling this shift most acutely: marketing.

Understanding consumer behavior, especially in the finance arena, is not something companies can take lightly. Now more than ever, the messaging to customers needs to match how they’re feeling. And in the midst of a pandemic, those emotions are often fear and uncertainty. Michael Mirsky, media buyer for online financial newsletter Behind the Markets, said people have a larger appetite for news these days simply because they are scared. “Everyone wants to know what to do with their finances and investments, and they feel like they have to make decisions more quickly because of what is going on in the world today,” he said.

Outside of meeting customers where they are — increasingly, digital channels — marketers also need to convey sensitivity and compassion during these challenging times to retain and even attract new customers. The results of a recent Criteo survey bears this out. A majority of marketers confirmed that the marketing function at their firm had grown in importance during the pandemic. The reason: a greater need to retain existing customers and attract new ones with targeted campaigns. Further, a majority of the respondents said that spending on digital marketing campaigns had increased during COVID-19.1

Of course, while the emphasis over the past nine months has been on the havoc the pandemic has caused, marketers have confirmed some positive outcomes. In the Criteo survey, 40% of the U.S. marketers responding said they had seen an increase in website sales or bookings. Nearly that same percentage noted that productivity had increased, and 36% said that they had experienced rapid digital transformation of various business processes. A third of the companies had seen greater customer loyalty and a lower cost of sales.2

And while winning new customers — and keeping existing customers — is crucial during these challenging times, U.S. marketers are focusing on other important issues. For instance, nearly half of the U.S. companies responding said that amplifying brand awareness as they entered the holiday season was very important to them. With so many people turning to ecommerce to get their shopping done, it’s vital that brands are front and center in consumers’ minds. That kind of brand awareness is especially important in the finance space since so many consumers are banking through digital channels — with an increasing number using their smartphones. Interestingly, more than 40% of U.S. marketers said that driving app installations was very important to them, underscoring the undeniable connection that consumers — of all ages — have with their mobile devices.

Finally, a whopping 92% of the U.S. companies responding said that they made at least some changes to their marketing strategy because of COVID-19. All this circles back to the idea that since digital channels of all kinds are growing, so, too, is the need for superior customer service. “When a consumer can talk to a customer service person and have his or her problem resolved or at least have that person empathize with what they’re going through, that’s a huge win,” Mirsky said.

Experts say the degree to which consumers return to their pre-pandemic behavior — including how they bank — is directly tied to how safe they feel being out in the world again and around other people. But if the digital transformation that’s taking place now has taught us anything, it’s that customers want options. If in-person isn’t viable — or desired — then marketers must offer online solutions that are fast, easy to use and secure. Indeed, nearly 75% of the U.S.marketers in our survey said alternative distribution channels and partnerships had grown since the pandemic began. The companies that are going to come out ahead in the months and years to come are investing in these changes now.

1Source: Criteo COVID-19 Impact on Marketing Survey, Global, October 2020, n=1039.

2Source: Criteo COVID-19 Impact on Marketing Survey, US, October 2020, n=100.

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