Date published

Jan 19, 2024

How financial brands are harnessing the wave of growth in the UK Savings market

The UK savings market has entered a vibrant era of expansion, characterised by an intensely competitive landscape and a more financially engaged population. As a marketing professional within this space, understanding the consumer psyche—their motivations for saving, what they value in a provider, and the overarching factors driving market growth—is crucial for positioning your brand for success.

Consumer Considerations in Choosing a Savings Provider

The Quest for Best Rates

The rate of return on savings has always been significant, but never more so than now. In a market where savings rates are as dynamic as stock prices, consumers demand transparency and value. The days of static, low-interest offerings are behind us. Take, for example, the unexpected yet welcome interest rate of 5.15% from Paragon on an instant access account—a stark contrast to the rates we saw two years ago. It's a clear signal: today's savers are on the lookout for the best possible returns on their deposits, and they expect their providers to keep pace with the market's daily fluctuations.

Building Trust with Savers

Trust is the cornerstone of any savings provider's relationship with its consumers. Customers may compromise on who they borrow from, but when it comes to saving, they seek assurance—assurance that they can access their money and that it's safeguarded. Factors such as the brand's longevity, backing by reputable institutions, and guarantees like the FCA’s £85,000 protection all play into the trust equation.

Access and Flexibility

Access is a vital consideration for savers: understanding how long their money will be locked up is critical, especially when longer commitments often yield higher rates. However, the prospect of higher returns must be balanced with flexibility, as savers value the ability to access their funds when needed.

Ease of Use

The ease with which customers can set up and manage their accounts, particularly through app-based platforms, can be a deciding factor in their choice of provider. A seamless, straightforward saving journey stands to attract a significant number of customers, contributing to enhanced loyalty and satisfaction.

The Innovators Leading the Charge

The savings market is witnessing an influx of new players, each bringing innovative products and marketing strategies:

  • Raisin: This savings aggregator is a pioneer in open banking and a leader in accessible online savings across Europe, offering customers a clear view of the best rates available.

  • Marcus by Goldman Sachs: A new brand from a storied financial institution, Marcus brings simplicity and efficiency to consumer savings through its app-based accounts.

  • Go Henry: Focused on financial education for the younger generation, Go Henry is embedding saving habits early with its innovative approach.

  • Beehive Money: This digital-driven arm of The Nottingham Building Society combines competitive rates with an ethical approach, appealing to the modern saver's conscience.

Financial services brands must adopt a multi-pronged approach to stand out:

  1. Transparently Communicate Rates: With interest rates as a significant draw, ensure that your communications clearly articulate the most current and competitive rates available.

  2. Build on Trust: Leverage your brand's heritage and provide evidence of security and easy fund access.

  3. Clarify Terms of Access: Clearly communicate the terms and conditions regarding access to funds, whether it's on-demand, fixed-term, or notice accounts.

  4. Simplify the Customer Experience: Showcase the simplicity of managing accounts through your user-friendly platforms.

Standing out in a crowded market by clearly positioning your brand

As a marketing professional, your role is as much about perception as it is about product. How do you position your brand in a market that's more competitive than ever? The answer lies in a blend of consumer education, deep personalisation, and a commitment to innovation that mirrors the evolving landscape of financial services.

Strategies for Market Differentiation

Embrace Educational Marketing

With a significant number of new potential savers entering the market, education is key. Your content should illuminate the paths to financial well-being. Tools, calculators, games, infographics, and informative blog posts can be crucial in helping consumers navigate the complexities of saving and investing.

The financial fitness tool Creode built for Skipton Building Society broke down the misconceptions about who could access financial advice and helped consumers with their personal financial situation.

Personalisation is Paramount

Consumers expect brands to know them – to tailor experiences and advice to their unique circumstances. Use data to personalise every interaction. From personalised email campaigns to user-specific website content, let your customers know that you see them as individuals.

Innovate and Iterate

To stand out, your brand needs to be bold, not bland.

Say things differently; talk to customers on a human level—not an institution talking at them or worse, trying to be their best friend or life support system. Explore new product variations, fresh marketing angles, or untapped segments of the market. Remember, innovation shouldn't be a one-off – it's a continuous process that keeps your brand relevant.

The Power of Partnerships

Collaborating with fintech startups can help you offer cutting-edge services to your clients quickly. Whether it's through app integrations that allow users to view all their financial products in one place or using tech to make the ISA process smoother, partnerships can propel your brand to the forefront of the savings market. Brands like Money Hub have partnered with many financial brands and used Open banking technology to extend the reach of their proposition.

Leverage Content Marketing

Craft content that speaks to the diverse reasons consumers save. Highlight stories of those who've made savvy financial choices with the help of your brand, and use your platform to advocate for smarter saving.

The Future’s Bright for Savers

The savings market in the UK is on the cusp of even greater growth. According to a recent analysis from Yorkshire Building Society and data consultancy CACI, an estimated £380.9 billion is currently languishing in accounts yielding little to no returns. With the Bank of England's base rate at a robust 5.25%, we can expect this to catalyse an upward trend in interest rates across savings products. Providers are already gearing up to disseminate powerful messages to consumers, urging them to 'wake up' their savings and make the most of the rising rates.

As the market continues to evolve, a comprehensive strategy that incorporates these elements will be imperative. Financial brands that can effectively educate, engage, and empower their customers will capture this growth and lead the market.

The potential for expansion is immense. With an attentive strategy and a finger on the pulse of market trends, financial services brands can tap into the reservoir of passive savings and guide consumers toward a more prosperous financial future.

Position Your Brand for 2024 and Beyond

Prepare for the upcoming surge in the savings market. As interest rates climb, so too will the opportunities for providers to encourage consumers to maximize their returns. With significant funds sitting in underperforming accounts, the environment is ripe for brands to guide savers toward making more informed, beneficial choices. As the market continues to grow, aligning your brand's message with the evolving needs and interests of savers will be crucial. Keep an ear to the ground and an eye on the horizon—2024 looks set to be a year of abundant growth for those ready to lead the charge in the UK savings market.