Everyday purchases are intuitive. The process relies heavily on our senses and emotion; we see, touch, and evaluate products instinctively. Financial products radically contrast with everyday consumer products. Put simply, our senses and intuition play almost no role, while analytical thinking and emotion take centre stage.
Imagine buying a household appliance, like a washing machine. This kind of purchase is typically straightforward: you select the appliance, bring it home, plug it in, and start using it right away. It involves a short-term financial commitment, with few ongoing obligations. You’re buying a tangible product that you can see and even test in-store. Purchasing it is usually a simple and immediate decision. Additionally, you can learn how it works, and if it doesn’t meet your expectations, the appliance can easily be returned or replaced. This purchase carries minimal risk for your household finances, as most appliances come with a warranty that provides protection and peace of mind. Finally, once it’s installed, the washing machine fulfils its immediate purpose—there’s no fine print, no delay, and no surprises—you simply select the right washing programme.
The Case of Financial Products
Now, imagine applying the same process to a financial product:
Long-Term Commitments: Unlike everyday purchases, financial products like mortgages or pensions often involve obligations that span decades impacting long-term financial wellbeing.
Intangibility: Financial products can’t be seen, touched, or tested before purchase—there’s no equivalent of trying out a product in-store.
High Complexity: Understanding these products requires navigating dense terms, financial jargon, and trade-offs, making decisions far more demanding.
Delayed Value Realisation: The benefits appear only evident in the future—such as during retirement or when making a claim—requiring consumers to trust in delayed outcomes.
Limited Flexibility: Once a financial decision is made, options for change or reversal are limited, there’s no “return policy” in an investment.
Risk & Uncertainty: Performance depends on unpredictable factors like market movements or inflation, introducing emotional and financial volatility.
No Warranty: Financial products offer no guarantees of performance or return. There is no built-in safety net if outcomes fall short.
Instrumental Purpose: These products exist to support broader goals, like security or future purchases, rather than delivering immediate standalone value.
The contrast between consumer and financial products reveals the unique challenges of marketing in financial services. Unlike tangible goods driven by immediacy and intuition, financial products require trust, time, and a clear grasp of long-term impact. Effective financial marketing must blend analytical clarity with emotional resonance. It’s not just about selling a product, but about building lasting relationships and empowering long-term informed decisions.