The Global Economic Crisis: The Impact On Consumer Attitudes Towards Financial Services in Singapore and Australia

Introduction

Consumer confidence in Australia and Singapore has been damaged by the global economic downturn, but FS must acknowledge that, not only do the attitudes and behaviors of consumers in these countries vary considerably from one another, but also do not wholly tally with what might be expected according to the reality of the economic situations.

Scope

*Using data from our global FSCI survey, this report provides a detailed analysis of Australian and Singaporean consumers' 'recessionary mindset'

*The report provides insight into how their 'recessionary mindset' translates into attitudes towards future prospects and cross-sell potential

*The report provides concrete actions for providers to follow in order to boost acquisition and retention levels

Highlights

Australian and Singaporean consumer have revealed themselves to be far less likely than average to now more likely to shop around for FS than they were before the downturn, presenting an opportunity to cross-sell to existing customers and highlighting a need for primary providers to reassure their consumers that their money is safe where it is.

Datamonitor has found considerable disparity between views on the economy at large and attitudes towards more personal aspects of consumers' lives in both Australia and Singapore, while considering economic conditions to have worsened over the last 12 months, consumers felt that their general lives had actually remained the same.

Reasons to Purchase

*Gain a detailed understanding of changing consumer attitudes amid the global downturn in order to build appropriate recessionary strategies

*Assist consumer targeting efforts by accessing data from Datamonitor's Global FS Consumer Insight survey


Report Highlights
Australian and Singaporean consumer have revealed themselves to be far less likely than average to now more likely to shop around for FS than they were before the downturn, presenting an opportunity to cross-sell to existing customers and highlighting a need for primary providers to reassure their consumers that their money is safe where it is.

Datamonitor has found considerable disparity between views on the economy at large and attitudes towards more personal aspects of consumers' lives in both Australia and Singapore, while considering economic conditions to have worsened over the last 12 months, consumers felt that their general lives had actually remained the same.
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OVERVIEW 1
Catalyst 1
Summary 1
INTRODUCTION 2
Understanding how recessionary mindsets influence attitudes is vital 2
The recessionary mindset of consumers in Singapore and Australia has intensified with consumers' widespread belief that they are living in a recession 2
THE FUTURE DECODED 4
TREND: Consumer confidence has fallen among consumers in Australia and Singapore 4
Perceptions of the worsening of economic conditions do not wholly tally with the belief that one's country is in a recession 4
Despite a worse economic situation, Singaporeans are surprisingly more positive about the extent to which economic conditions have worsened 4
Singaporeans feel more looked after by their banks than Australians 5
Singaporeans are more sensitive to publicity than Australians 6
Negativity surrounding the economy at large was greater than that shown by consumers towards their personal situation 7
Consumers in Australia and Singapore showed cautious optimism for the six months ahead 8
Australian and Singaporean expectations are varied 8
ACTION: Providers, particularly in Australia, must communicate effectively with customers in order to provide reassurance and rebuild trust 9
Banks lack certainty about how to use social media effectively 9
Social media cannot be ignored by banks 9
The use of social media in customer service strategies helps consumers engage with their bank 10
INSIGHT: Low consumer confidence in Australia and Singapore has translated into heightened concern surrounding the value of savings 12
Singaporeans are far more concerned about their finances in all areas than Australians 12
Australians are relatively unconcerned about the value of long-term investments 12
Australian and Singaporean consumers are aligned with the global average in that they are less concerned about debt than before the downturn 13
INSIGHT: While they are marginally more motivated than the average consumer, uncertainty is still leading people in Australia and Singapore to embrace the status quo 14
Increased concern over the value of savings has led to some limited motivation to save more over the coming six months 15
Although consumers in Australia and Singapore are cautious about actually taking action, they now show signs of greater engagement with their finances 15
Singaporeans' intentions are particularly encouraging 15
ACTION: Provide Australian and Singaporean consumers with facilitating tools to coax them into action, such as innovative savings products 16
TREND: Consumers in Australia and Singapore hold significant cross-selling potential 18
Primary bank loyalty is current comparatively low and some key opportunities are being missed 19
Savings products represent the biggest cross-selling opportunity for primary banks in Australia and Singapore 19
Singaporean banks are apparently not offering competitive mortgage deals to their existing customers 20
Banks are missing opportunities to cross-sell certain types of insurance to their customers, particularly life insurance 20
INSIGHT: Trust and financial intelligence are affecting cross-selling success in Australia 21
Trust is vital, because those with greater trust levels are less likely to switch 22
Financial intelligence is synonymous with high primary bank product holdings 23
Singaporeans are both more trusting and more financially intelligent than Australians 24
INSIGHT: Financial stability is far more important than cost for consumers in Australia and Singapore 26
Australians are relatively unreceptive to professional advice 27
Singaporeans are significantly more concerned about green and ethical credentials 27
ACTION: Focus marketing efforts on product value and financial security 28
Financial stability is of the utmost importance to Australians and Singaporeans 28
Providers should target Singaporeans by offering multiple channels for financial advice 28
Ethical credentials should be a key element when targeting Singaporean consumers 28
APPENDIX 30
Additional data 30
Methodology 37
Further reading 38
Ask the analyst 39
Datamonitor consulting 39
Disclaimer 39
List of Tables
Table 1: Extent to which Australian, Singaporean and global consumers agree that their country is in recession 30
Table 2: Australian, Singaporean and global views on the changes of economic conditions over the previous 12 months 30
Table 3: Indicators of trust in banks among Australian, Singaporean and global consumers 31
Table 4: Australian, Singaporean and global comparison of the previous 12 months and expectations for the coming six months in various aspects 32
Table 5: Levels of concern about different product areas among Australian, Singaporean and global consumers 33
Table 6: Likelihood of actions being taken over the coming six months among Australian, Singaporean and global consumers 34
Table 7: Indicators of financial engagement among Australian, Singaporean and global consumers 35
Table 8: Likelihood to now shop around more among Australian, Singaporean and global consumers 35
Table 9: Primary bank product holding among Australian, Singaporean and global consumers 36
Table 10: Primary bank multiple product holding among Australian, Singaporean and global consumers 37
List of Figures
Figure 1: Datamonitor's Recession and Recovery portal allows industry players to continually identify emerging opportunities and track what is happening in the UK economy as it occurs 2
Figure 2: More than half of Australian and over three quarters of Singaporean consumers believe that their country is in a recession, which is indicative of a deep recessionary mindset 3
Figure 3: Australian and Singaporean consumers' heightened economic concerns are in line with the global average 5
Figure 4: Singaporean consumers feel more looked after by their banks 6
Figure 5: Australian and Singaporean consumers are optimistic about the future 8
Figure 6: Use of social media such as Twitter represents a key marketing opportunity 11
Figure 7: Singaporeans are far more concerned about their finances than Australians in all areas 13
Figure 8: Australian and Singaporean consumers are embracing the status quo 14
Figure 9: Singaporeans' intentions to engage more with their finances are particularly encouraging 16
Figure 10: SmartyPig has created an innovative savings platform 17
Figure 11: Consumers in Australia and Singapore are less likely than average to be shopping around more since the downturn 19
Figure 12: Savings products represent the biggest cross-selling opportunity for primary banks in Australia and Singapore 21
Figure 13: Singaporean providers have achieved higher multiple product holding levels 22
Figure 14: Consumers with greater trust are less likely to switch 23
Figure 15: Australian and Singaporeans consumers with more primary bank product holdings are also financially intelligent 24
Figure 16: Singaporeans are more financially intelligent than Australians 25
Figure 17: Singaporeans are more proactive than Australians about putting their financial knowledge into practice 26
Figure 18: Financial stability is far more important than cost for consumers in Australia and Singapore 27
Figure 19: Virgin's Climate Change ISA is a prime example of ethical and green credentials 29

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