Consumer Duty: Raising the Bar for Social Media Promotions
If you're in the financial services industry, you know that the way you communicate with customers, especially through digital channels like social media, is under increasing scrutiny. The Consumer Duty, which came into force last year, sets a higher bar for how firms should approach their marketing and promotions, particularly on social media platforms.
This elevated standard will require a hard look at your current marketing tactics and audience targeting. Are you taking into account the unique vulnerabilities and characteristics of your social media audiences? Are your communications tailored to provide the proper context for the intricacies of your products and services?
For instance, let's say your firm specialises in rather complex investment funds. Promoting these offerings through snappy social ads and meme-inspired creative may catch eyes, but does it truly cultivate consumer comprehension? It's suggested to use social media judiciously in such cases – perhaps as an awareness driver pointing consumers to more educational resources.
The Duty also codifies the need for continuous testing, monitoring, and optimisation of your social media promotions. As platforms and consumer behaviours evolve, so too must your strategies for enabling good outcomes.
Gone are the days when simply ensuring your promotions are "fair, clear, and not misleading" was enough. Consumer Duty requires a more proactive and customer-centric approach. Here's what you need to know:
Tailor Your Message
One-size-fits-all promotions are a thing of the past. The Duty expects you to tailor your communications to the specific characteristics of your target audience and the social media platform you're using. This means going beyond just providing balanced information about risks and benefits – you need to consider factors like your audience's level of financial literacy, behavioural biases, and how they typically consume content on different platforms.
Test, Test, Test
Regular consumer testing is key to ensuring your promotions are actually resonating with your audience. The Duty expects you to continually monitor and adapt your communications to support good consumer outcomes, especially as social media platforms evolve and introduce new features that could impact how your message is received.
Avoid Exploitation
The Duty explicitly calls out bombarding consumers with excessive promotions as a potential form of exploitation that's not acting in good faith. If your marketing strategy relies on hammering people with the same ads over and over again, it's time for a rethink. The same goes for tactics that might prey on consumers' behavioural biases or vulnerabilities.
Consider Your Channels
While social media is a powerful marketing tool, the Duty also recognizes that it can be challenging to control who sees your promotions on these platforms. If you're aiming for a restricted target market, like professional investors, you'll need to carefully consider whether social media is truly an appropriate channel, or if you risk exposing the wrong audience to your content.
The Consumer Duty is a clear signal that regulators expect firms to go above and beyond the bare minimum when it comes to their marketing practices, especially in the fast-evolving world of social media. By tailoring your message, rigorously testing your approach, avoiding exploitative tactics, and carefully considering your channels, you can help ensure your promotions are truly supporting good consumer outcomes.
With the Consumer Duty coming into force, it has ushered in a new era of consumer-centric expectations for financial services marketing – social media promotions included.
Leveraging Research for Competitive Advantage
Thankfully, guidelines point to a wealth of published research that can help shape more consumer-centric social media marketing practices.
From exploring general risk disclosure principles to understanding the nuances of consumer vulnerability, these materials offer a knowledge base for promoting consumer understanding in our digital age. Firms would be wise to consult research notes focused specifically on high-risk investment promotions as well.
But the learning opportunities extend beyond general behavioural studies. Sector-specific reviews could impact your social media marketing approaches.
For example, findings on problematic relending tactics used by some high-cost lenders should be essential reading for consumer finance marketers crafting social promotions in that space. Similar sector-focused insights could provide your firm a competitive edge when applied to your digital marketing strategies.
Staying Ahead of the Curve: Adapting to a Fast-Changing Digital Landscape
No comprehensive social media marketing guide would be complete without acknowledging the lightspeed pace of change in the digital world. From new consultations on crypto asset marketing rules to potential platform-specific restrictions on certain product promotions, the regulatory landscape is constantly shifting. Firms must establish processes for continuous learning and rapid adaptation to evolving policies.
Those able to foster a true culture of compliance creativity – one that marries consumer-centric principles with cutting-edge digital marketing tactics – will be the ones forging the most trusted and sustainable relationships with customers through social media.
So get studying those guidelines. Update those policies. Re-think those content strategies. And if you are struggling to know if your marketing content passes the new FCA regulations – please reach out at contact@adclear.ai.
If you're in the financial services industry, you know that the way you communicate with customers, especially through digital channels like social media, is under increasing scrutiny. The Consumer Duty, which came into force last year, sets a higher bar for how firms should approach their marketing and promotions, particularly on social media platforms.
This elevated standard will require a hard look at your current marketing tactics and audience targeting. Are you taking into account the unique vulnerabilities and characteristics of your social media audiences? Are your communications tailored to provide the proper context for the intricacies of your products and services?
For instance, let's say your firm specialises in rather complex investment funds. Promoting these offerings through snappy social ads and meme-inspired creative may catch eyes, but does it truly cultivate consumer comprehension? It's suggested to use social media judiciously in such cases – perhaps as an awareness driver pointing consumers to more educational resources.
The Duty also codifies the need for continuous testing, monitoring, and optimisation of your social media promotions. As platforms and consumer behaviours evolve, so too must your strategies for enabling good outcomes.
Gone are the days when simply ensuring your promotions are "fair, clear, and not misleading" was enough. Consumer Duty requires a more proactive and customer-centric approach. Here's what you need to know:
Tailor Your Message
One-size-fits-all promotions are a thing of the past. The Duty expects you to tailor your communications to the specific characteristics of your target audience and the social media platform you're using. This means going beyond just providing balanced information about risks and benefits – you need to consider factors like your audience's level of financial literacy, behavioural biases, and how they typically consume content on different platforms.
Test, Test, Test
Regular consumer testing is key to ensuring your promotions are actually resonating with your audience. The Duty expects you to continually monitor and adapt your communications to support good consumer outcomes, especially as social media platforms evolve and introduce new features that could impact how your message is received.
Avoid Exploitation
The Duty explicitly calls out bombarding consumers with excessive promotions as a potential form of exploitation that's not acting in good faith. If your marketing strategy relies on hammering people with the same ads over and over again, it's time for a rethink. The same goes for tactics that might prey on consumers' behavioural biases or vulnerabilities.
Consider Your Channels
While social media is a powerful marketing tool, the Duty also recognizes that it can be challenging to control who sees your promotions on these platforms. If you're aiming for a restricted target market, like professional investors, you'll need to carefully consider whether social media is truly an appropriate channel, or if you risk exposing the wrong audience to your content.
The Consumer Duty is a clear signal that regulators expect firms to go above and beyond the bare minimum when it comes to their marketing practices, especially in the fast-evolving world of social media. By tailoring your message, rigorously testing your approach, avoiding exploitative tactics, and carefully considering your channels, you can help ensure your promotions are truly supporting good consumer outcomes.
With the Consumer Duty coming into force, it has ushered in a new era of consumer-centric expectations for financial services marketing – social media promotions included.
Leveraging Research for Competitive Advantage
Thankfully, guidelines point to a wealth of published research that can help shape more consumer-centric social media marketing practices.
From exploring general risk disclosure principles to understanding the nuances of consumer vulnerability, these materials offer a knowledge base for promoting consumer understanding in our digital age. Firms would be wise to consult research notes focused specifically on high-risk investment promotions as well.
But the learning opportunities extend beyond general behavioural studies. Sector-specific reviews could impact your social media marketing approaches.
For example, findings on problematic relending tactics used by some high-cost lenders should be essential reading for consumer finance marketers crafting social promotions in that space. Similar sector-focused insights could provide your firm a competitive edge when applied to your digital marketing strategies.
Staying Ahead of the Curve: Adapting to a Fast-Changing Digital Landscape
No comprehensive social media marketing guide would be complete without acknowledging the lightspeed pace of change in the digital world. From new consultations on crypto asset marketing rules to potential platform-specific restrictions on certain product promotions, the regulatory landscape is constantly shifting. Firms must establish processes for continuous learning and rapid adaptation to evolving policies.
Those able to foster a true culture of compliance creativity – one that marries consumer-centric principles with cutting-edge digital marketing tactics – will be the ones forging the most trusted and sustainable relationships with customers through social media.
So get studying those guidelines. Update those policies. Re-think those content strategies. And if you are struggling to know if your marketing content passes the new FCA regulations – please reach out at contact@adclear.ai.
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