Targeting Emerging Consumer Segments - The Cautious Consumer

The recessionary environment is encouraging consumer segments to emerge and develop. Cautious consumers are now looking to shield themselves from future loss through making the correct financial decisions today. FS providers must therefore understand what these consumers want and how their Cautious status may influence their behavior.

Scope

- Using data from our global FSCI survey this report profiles the attitudes and behaviors of the emerging Cautious consumer segment.

- The report identifies these consumers and analyses the drivers of their future behavior.

- The report provides concrete actions for FS providers to position themselves competitively in order to capture a share of the Cautious wallet.

Highlights of this title

Limiting exposure to loss is the chief concern of the Cautious consumer segment. Cautious consumers are always looking to reduce their downside on future financial transactions and are willing to spend time, money and effort in achieving this goal.

Older generations may be more resilient to changes in their finances, having a harder time altering lifelong habits. It could be this greater inflexibility that explains the higher representation of Cautious consumers among the younger demographics.

Through attracting young Cautious consumers with high earning potential and developed financial intelligence, advisors can effectively build a relationship that may last a lifetime.

Key reasons to purchase this title

- Access the results of Global FS Consumer Insight survey in order to profile this key emerging Cautious segment.

- Identify what drives Cautious consumer action and predict their future behaviors.

- Identify the opportunities Cautious consumers represent and advise strategies you can take to effectively gain share of the Cautious wallet.

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Overview
Catalyst
Summary
Methodology
Introduction
Customer segmentation is vital for an effective marketing strategy
The Future Decoded
Trend: Lower numbers of Conscientious consumers have emerged than expected
Insight: Financial pressures do not dictate Conscientious behavior
Insight: Demographic and lifestage findings have had some bearing on the emergence of Conscientious behavior
Trend: Conscientious consumers have a greater appetite for FS products than the average consumer
Insight: Though seemingly debt-averse, Conscientious consumers have more credit cards than the average consumer
Insight: Conscientious consumers are financially intelligent
Insight: Conscientious consumers still have higher than average product holdings with their primary bank and represent a key cross-selling opportunity
Insight: Conscientious consumers are more trusting than the average consumer
Insight: Conscientious consumers are receptive to financial advice through a wide variety of sources
Trend: Conscientious consumers are optimistic about the future
Insight: Conscientious consumers’ future actions are aligned with their positivity
Action Points
Action: Emerging markets can provide valuable lessons for FS providers
Action: Target Conscientious consumers with innovative regular savings products
Action: Datamonitor’s Megatrend Framework can help identify strategies for targeting this segment
APPENDIX
Data tables
Methodology
Definitions
Further reading
Ask the analyst
Datamonitor consulting
Disclaimer

TABLE OF FIGURES
Figure 1: Lower numbers of Conscientious consumers have emerged than expected
Figure 2: Financial pressures do not dictate Conscientious behavior
Figure 3: The emergence of Conscientious behavior has been more prevalent amongst younger Accumulators
Figure 4: Australia has a surprising number of older Conscientious consumers
Figure 5: Employment status has also influenced the emergence of more conscientious behaviour
Figure 6: Australia contains significantly more Conscientious consumers who are recently unemployed than elsewhere
Figure 7: Conscientious consumers have a greater appetite for FS products than the average consumer
Figure 8: Conscientious consumers are almost doubly likely to have two or more of each product than the average global consumer
Figure 9: Conscientious consumers in the UK are particularly receptive to instant access savings accounts
Figure 10: Notice savings accounts in India are more popular than elsewhere
Figure 11: Life insurance is relatively unpopular in Australia
Figure 12: Credit cards are most populat amongst Conscientious consumers in Japan, Singapore and the US
Figure 13: Conscientious consumers are financially intelligent
Figure 14: Conscientious consumers in the US are more Conscientious than others
Figure 15: Conscientious consumers in Australia, Japan and Singapore are actually slightly less financially intelligent than average
Figure 16: Brazilian and Indian Conscientious consumers are at odds in terms of financial awareness
Figure 17: Conscientious consumers have higher than average product holdings with their primary bank
Figure 18: Conscientious consumers in France are by far the most loyal to their primary bank
Figure 19: There is still an opportunity for non-primary bank providers to capture share of the Conscientious wallet
Figure 20: Conscientious consumers are more trusting than the average consumer
Figure 21: Conscientious consumers in the UK and US feel very differently about the way the crisis has been handled by their banks
Figure 22: Conscientious consumers can afford professional advice but still shop around for the best deals
Figure 23: Conscientious consumers in the US are comfortable making their decisions through online research rather than using other sources of advice
Figure 24: Australians are not keen to take advice from family and friends
Figure 25: Conscientious consumers in Brazil are most confident in seeking advice from their primary bank
Figure 26: Conscientious consumers’ are optimistic about the future
Figure 27: Conscientious consumers intend to pay more into their savings but cut back on insurance premiums
Figure 28: Conscientious consumers in the UK are still disinclined to save for either the short- or long-term
Figure 29: SmartyPig has created an innovative savings platform
Figure 30: ING Direct has employed innovate use of Web 2.0 technology
Figure 31: SmartyPig has also harnessed Web 2.0 and social networking to appeal through Connectivity
Figure 32: Virgin’s Climate Change ISA is a prime example of ethical and green credentials

TABLE OF TABLES
Table 1: Conscientious and Non Conscientious consumers segmented by country
Table 2: Degree to which household financial situation has worsened over the last 12 months versus percentage of Conscientious consumers, segmented by country
Table 3: Conscientious consumers segmented by age
Table 4: Conscientious consumers segmented by age and country
Table 5: Conscientious consumers segmented by employment status
Table 6: Conscientious consumers segmented by employment status and country
Table 7: Average product holding amongst Conscientious and global consumers
Table 8: Product holdings amongst Conscientious and global consumers (those with two or more)
Table 9: Instant access savings holdings amongst Conscientious consumers, segmented by country
Table 10: Notice savings account holdings amongst Conscientious consumers, segmented by country
Table 11: Life insurance holdings amongst Conscientious consumers, segmented by country
Table 12: Credit card holdings amongst Conscientious consumers, segmented by country
Table 13: Indicators of financial intelligence amongst Conscientious and global consumers
Table 14: Indicators of financial intelligence amongst Conscientious consumers, segmented by country
Table 15: Non current account primary bank product holdings amongst Conscientious and global consumers
Table 16: Non current account primary bank product holdings amongst Conscientious consumers, segmented by country
Table 17: Products held with primary bank amongst Conscientious and global consumers
Table 18: Indicators of trust amongst Conscientious and global consumers
Table 19: Opinion of bank handling of the crisis and governmental intervention amongst Conscientious consumers, segmented by country
Table 20: Steps before making financial decisions amongst Conscientious and global consumers
Table 21: Steps before making financial decisions amongst Conscientious consumers, segmented by country
Table 22: Expectations for the future amongst Conscientious and global consumers
Table 23: Actions over the next six months among Conscientious and global consumers
Table 24: Actions over the next six months among Conscientious consumers, segmented by country