Research is invaluable to any sector. The data and information obtained in research are used in many ways, often for the betterment of something. The same can be said for the financial industry, as without figures and metrics, the market would crash down.
Financial services market research has many benefits, but it could be relatively easy to disregard the tedious manual research process and opt for automated and quicker methods to gain insights. This lets someone have data quickly, but this will make them fail to obtain other essential metrics.
What is Market Research and What Are Metrics?
In a nutshell, market research is the gathering of either qualitative and quantitative data about the viability of a service. This data provides insights on opportunities for future developments.
Financial services market research lets a financial institution overcome challenges using the vast amount of data that the research itself provides. It enables them to conduct both proactive and reactive measures, allowing them to achieve maximal consumer satisfaction.
Metrics, on the other hand, are measurable values that track and illustrate the effectiveness of something. Effective tracking of metrics lets a financial institution reach different target goals.
Key Metrics in Market Research in the Finance Sector
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(NPS) Net Promoter Score
A net promoter score allows institutions to measure consumer loyalty and their willingness to recommend a bank or other establishments in simple terms. A qualitative study is commonly used to gauge NPS by carrying out online surveys.
NPS requires more than 400 responses for a diverse and effective set of data. This data is then used to improve consumer experience and increase the likelihood of promotion.
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Account Closure Reasons
This metric is commonly used for banks to assess why consumers choose to close their accounts for good, preventing similar phenomena from happening in the future. This lets financial establishments do reactive measures to retain consumers and ensure their loyalty.
Before account closure, it is best to ask consumers why they opted for that decision by conducting a quick survey – letting financial institutions look at the factors that led them to their decision. This should be done every month to gauge how your countermeasures have fared.
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PFI (Primary Financial Institution) Score
This metric lets financial institutions get a glimpse of how many consumers have decided to have them as their PFI. Data for this metric can be gathered from either online or telephone surveys. Then, this data is further used to convert more consumers into PFI users, increasing loyalty.
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Employee engagement
Consumers aren’t the only essential stakeholders in a financial institution. Disregarding employees cause poor customer service and absenteeism. These aren’t minor factors, as poor employee performance can cost financial establishments millions of dollars.
Hence, an anonymous standard engagement survey must be conducted regularly on employees. The data obtained from the study let an institution assess if intervention is needed or not and how much effort is needed to raise monthly scores.
Research is essential for the finance sector, as it helps them obtain maximum consumer satisfaction and reach desired goals. Almost nothing will improve if research is not conducted, leading to a harmful lack of knowledge. Knowing how vital market research is and knowing key metrics is essential for maximizing profit, leading to the success and longevity of any financial institution.
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