Recessionary Consumers in Financial Services

Powered by

All the vital news, analysis, and commentary curated by our industry experts.

Consumers are coping with high degrees of uncertainty regarding the pandemic and depressing recessionary news. As a result, there will be key changes to attitudes and behaviors that will persist well after the crisis subsides. Each consumer will respond in a different way depending on their country, job security, personal situation, and general optimism, as well as the real-life effects they have felt. Countries are now beginning to exit the crisis into a harsh recession; some lockdown behaviors will become embedded, while others will change based on the severity of the economic contraction. This will impact consumers irrespective of their financial position.

This report details the major enduring changes to consumer spending and banking habits that occur during a recession and recovery. It outlines how banks should tailor their targeting strategies, messaging, and product features to best cope with the precipitous and enduring loss of consumer confidence around the world.

Scope

– Consumer confidence has collapsed and will remain depressed.

– Uncertainty avoidance and risk aversion will be dominant forces.

– Consumers will be streamlining their spending even outside of lockdown periods.

– Switching will decline for core banking products.

Reasons to Buy

– Develop and enhance your client targeting strategies using our data on how consumer behavior will shift in the recession.

– Give your marketing strategies the edge required and capture new clients using insights from our data on customers’ preferences for the various key banking products.

– Tailor your investment product portfolio to match the current and future demand for different asset classes among recessionary-minded investors.

– Develop your payments proposition to match the service and product demand expressed by consumers streamlining their lifestyles in light of the recession.

Barclays
Deutsche Bank
HSBC
Quirin Bank

Table of Contents

Table of Contents

1. EXECUTIVE SUMMARY

1.1. Market summary

1.2. Key findings

1.3. Critical success factors

2. RECESSIONARY CONSUMERS

2.1. Consumer confidence is low regardless of direct experiences

2.1.1. The crisis has precipitated a dramatic and enduring fall in confidence

2.1.2. Consumers in the post-COVID-19 crisis period are anxious and will remain so going forward

3. AVOIDING UNCERTAINTY

3.1. Change and uncertainty are hallmarks of crisis and recession

3.2. Demand for PFM rises as consumers worry

3.2.1. Economic uncertainty and change leads most consumers to engage more with their finances

3.2.2. Consumers want to cut back and save more in recessions, andvalue tools that help them do so

3.3. Despite being more exposed to risk assets those in higher asset bands bear up the best, but liquidity solutions are key

3.3.1. Mass affluent investors’ greater holdings of and allocations to risk assets expose them to greater losses, but the segment will recover more rapidly

3.3.2. HNW investors’ more diversified portfolios and higher penetration of advice mitigates downward volatility, but providing liquidity is essential

3.4. Market downturns have a significant impact on risk aversion

3.4.1. 2008 financial crisis data foreshadows greater risk aversion in the HNW space

3.4.2. Younger consumers and those in lower affluent bands are more willing to take risks to capitalize on a market rebound, but a certain amount of hand-holding is paramount

3.4.3. Being more receptive to financial engagement campaigns amid market turbulence suggests now is the time to foster loyalty with the desirable millennial segment

3.4.4. A focus on funds will prove beneficial as investors are looking to diversify their portfolios

4. STREAMLINEDSPENDING

5. CONSUMERSWITCHING BEHAVIORS

6. DIGITAL CHANNEL SHIFTS

7. THE RISE OF NEW PRODUCTS

8. ACTION POINTS

9. APPENDIX

Table

List of Tables

Table 1: Monthly Australian household deposit growth, selected banks, December 2019 to April 2020

Table 2: Mobile wallet usage, penetration, and interest in adoption, 2020

Figures

List of Figures

Figure 1: Consumer confidence takes many quarters to recover after the initial plunge

Figure 2: Improving views on the virus doesnot mean concern goes away

Figure 3: Anxiety around the economy dominates consumer thinking and results in low consumer sentiment

Figure 4: Consumers value budgeting and money management functionality but it is rarely top of mind

Figure 5: Change – particularly negative change – drives consumer engagement with their finances

Figure 6: Expectation of change drives consumerengagement with their finances, as seen during the global financial crisis

Figure 7: Investment product holding rises in line with level of affluence across the world

Figure 8: The global financial crisis had a significant impact on customer loyalty and risk appetite

Figure 9: Barclays’ structured product offering appeals to risk-averse investors

Figure 10: Quirin Privatbank addresses investor uncertainty through its webinar and podcast series

Figure 11: Younger investors are notably more open to new investment ideas

Figure 12: Millennials have been eager to capitalize on a market rebound

Figure 13: Younger consumers are more likely to pay increased attention to financial literature in challenging investment times

Figure 14: A need for diversification is driving demand for fund products

Figure 15: Growth in the value ofcard spending will be slow for much of the 2020-21 period

Figure 16: Cash will be squeezed in all economies, accelerating a trend already in play

Figure 17: Consumer credit does decline in times of crisis and recession, but the trend is erratic

Figure 18: In the first quarter of 2020, Australian consumers had started cutting back on major purchases in anticipation of a formal recession

Figure 19: Current account switching has declined significantly in the UK due to COVID-19

Figure 20: After an initial spike, refinance collapsedalong with broader consumer confidence

Figure 21: Consumers have typically valued convenience and transparency in their banking partners

Figure 22: Neobanks were making headway in deposits but lag when it comes to credit

Figure 23: Banks have much more competition as financial advisors and wealth managers

Figure 24: Investor retention requires clear and effective communications

Figure 25: Repairing trust will be critical in the financial advice industry as the global financial crisis showed

Figure 26: E-commerce has received a big boost in consumer awareness and use

Figure 27: A drop in cash usage will reduce the deployment of ATMs and increase POS terminal adoption

Figure 28: Only the Middle East and Africa will see enduring growth in ATMs

Figure 29: General banking activity has trended digital,with mobile banking on the rise

Figure 30: Digital channels dominate key relationship-building activities with customers

Figure 31: COVID-19 has had a significant impact on channel preferences

Figure 32: Some markets are yet to transition from payment cards to mobile wallets

Figure 33: Some markets are yet to adopt contactless while others have leapfrogged to mobile

Figure 34: Younger consumers are more likely to offshore parts of their wealth

Frequently asked questions

Recessionary Consumers in Financial Services standard reports
Currency USD
$3,450

Can be used by individual purchaser only

$10,350

Can be shared globally by unlimited users within the purchasing corporation e.g. all employees of a single company


Undecided about purchasing this report?

Enquire Before Buying Request a Free Sample

Get in touch to find out about multi-purchase discounts

reportstore@globaldata.com
Tel +44 20 7947 2745

Every customer’s requirement is unique. With over 220,000 construction projects tracked, we can create a tailored dataset for you based on the types of projects you are looking for. Please get in touch with your specific requirements and we can send you a quote.

Sample Report

Recessionary Consumers in Financial Services was curated by the best experts in the industry and we are confident about its unique quality. However, we want you to make the most beneficial decision for your business, so we offer free sample pages to help you:

  • Assess the relevance of the report
  • Evaluate the quality of the report
  • Justify the cost

Download your copy of the sample report and make an informed decision about whether the full report will provide you with the insights and information you need.

Below is a sample report to understand what you are buying

See what our customers are saying

“The GlobalData platform is our go-to tool for intelligence services. GlobalData provides an easy way to access comprehensive intelligence data around multiple sectors, which essentially makes it a one-for-all intelligence platform, for tendering and approaching customers.

GlobalData is very customer orientated, with a high degree of personalised services, which benefits everyday use. The highly detailed project intelligence and forecast reports can be utilised across multiple departments and workflow scopes, from operational to strategic level, and often support strategic decisions. GlobalData Analytics and visualisation solutions has contributed positively when preparing management presentations and strategic papers.”

Business Intelligence & Marketing Manager, SAL Heavy Lift

“COVID-19 has caused significant interference to our business and the COVID-19 intelligence from GlobalData has helped us reach better decisions around strategy. These two highlights have helped enormously to understand the projections into the future concerning our business units, we also utilise the project database to source new projects for Liebherr-Werk to use as an additional source to pitch for new business.”

Market Analyst & Management, Liebherr-Werk

Your daily news has saved me a lot of time and keeps me up-to-date with what is happening in the market, I like that you almost always have a link to the source origin. We also use your market data in our Strategic Business Process to support our business decisions. By having everything in one place on the Intelligence Center it has saved me a lot of time versus looking on different sources, the alert function also helps with this.

Head of Key Accounts, Saab AB

Having used several other market research companies, I find that GlobalData manages to provide that ‘difficult-to-get’ market data that others can’t, as well as very diverse and complete consumer surveys.

Marketing Intelligence Manager, Portugal Foods

Our experience with GlobalData has been very good, from the platform itself to the people. I find that the analysts and the account team have a high level of customer focus and responsiveness and therefore I can always rely on. The platform is more holistic than other providers. It is convenient and almost like a one stop shop. The pricing suite is highly competitive and value for our organisation.

I like reports that inform new segments such as the analysis on generation Z, millennials, the impact of COVID 19 to our banking customers and their new channel habits. Secondly the specialist insight on affluent sector significantly increases our understanding about this group of customers. The combination of those give us depth and breadth of the evolving market.

I’m in the business of answering and helping people make decisions so with the intelligence center I can do that, effectively and efficiently. I can share quickly key insights that answer and satisfy our country stakeholders by giving them many quality studies and primary research about competitive landscape beyond the outlook of our bank. It helps me be seen as an advisory partner and that makes a big difference. A big benefit of our subscription is that no one holds the whole data and because it allows so many people, so many different parts of our organisation have access, it enables all teams to have the same level of knowledge and decision support.

Head of Customer Insight and Research, Standard Chartered

“I know that I can always rely on Globaldata’s work when I’m searching for the right consumer and market insights. I use Globaldata insights to understand the changing market & consumer landscape and help create better taste & wellbeing solutions for our customers in food, beverage and healthcare industries.

Globaldata has the right data and the reports are of very high quality compared to your competitors. Globaldata not only has overall market sizes & consumer insights on food & beverages but also provides insights at the ingredient & flavour level. That is key for B2B companies like Givaudan. This way we understand our customers’ business and also gain insight to our unique industry”

Head of Consumer Sensory Insights, Givaudan

GlobalData provides a great range of information and reports on various sectors that is highly relevant, timely, easy to access and utilise.  The reports and data dashboards help engagement with clients; they provide valuable industry and market insights that can enrich client conversations and can help in the shaping of value propositions. Moreover, using GlobalData products has helped increase my knowledge of the finance sector, the players within it, and the general threats and opportunities.

I find the consumer surveys that are carried out to be extremely beneficial and not something I have seen anywhere else. They provided an insightful view of why and which consumers take (or don’t) particular financial products. This can help shape conversations with clients to ensure they make the right strategic decisions for their business.

One of the challenges I have found is that data in the payments space is often piecemeal. With GD all of the data I need is in one place, but it also comes with additional market reports that provide useful extra context and information. Having the ability to set-up alerts on relevant movements in the industry, be it competitors or customers, and have them emailed directly to me, ensures I get early sight of industry activity and don’t have to search for news.

Senior Account Manager, TSYS
Financial Services
New
Worldline - Competitor Profile
$350 | March 2024
Financial Services
New
PhonePe - Competitor Profile
$350 | April 2024
Go even deeper with GlobalData Intelligence Center

Every Company Report we produce is powered by the GlobalData Intelligence Center.

Subscribing to our intelligence platform means you can monitor developments at Recessionary Consumers in Financial Services in real time.

  • Access a live Recessionary Consumers in Financial Services dashboard for 12 months, with up-to-the-minute insights.
  • Fuel your decision making with real-time deal coverage and media activity.
  • Turn insights on financials, deals, products and pipelines into powerful agents of commercial advantage.