MARKETING STRATEGIES FOR THE MASS AFFLUENT FOR MORE INFORMATION For information Expanding Banking and Credit Relationships contact William McCracken Channel and Delivery Issues bmccracken@src- Investments, Wealth Management, and Advice co.com or (800) 423-4229. Key Finding from Previous SYNERGISTICS Research: PROJECT DELIVERABLES and KEY DATES Based on a 2003 study by SYNERGISTICS, three in ten comprise the lower-asset category of the mass affluent segment. More than four in ten fall into the mid range, April 13, 2007 and one-fifth are at the upper end of this market. Sponsor comments on questionnaire Investable Liquid Assets June 2007 (Base = have investable assets of $100K-$1M) Initial results Qualified/ July 2007 Not Project Report S pecified 5% $750K-$1M $100K- 20% $249.9K 31% $500K- $250K- $749.9K $499.9K 27% 17% Research Issues The mass affluent sector, typically defined as those having investable liquid assets of $100K to $1M, is a large and growing segment which is a veritable goldmine for financial institutions. There are roughly 33 million mass affluent households in the United States – representing about 30% of the population – who control approximately 37% of the country’s liquid assets, according to industry experts. Providers, including both banks and investment firms, are looking to acquire mass affluent dollars and grow these relationships through cross-selling. Products such as asset management accounts and separately managed accounts, which offer advisory services and independent money management for an asset-based fee, are being designed and promoted with these objectives in mind. In addition, many are offering wealth management services to address the needs of this market. Although investment and retirement products typically come to mind when considering the mass affluent market, this group, of course, has broader needs encompassing transaction and credit services. The major credit card players have developed products, such as World MasterCard and Visa Signature, tailored for this more affluent group. There is also widespread usage of home equity credit and mortgage products among this segment. The widely Internet-savvy mass affluent are also poised to become users of various new delivery options including mobile banking by cell phone or PDA and direct banking. There are still many questions to be answered in order to serve this group effectively. To what extent are provider relationships with this segment fragmented? What type of organization is considered to be their primary provider? How important are traditional banking products and delivery channels to the mass affluent? Does this segment have unaddressed investment or wealth management needs? To be successful, it is essential for providers to have a clear understanding of the mass affluent segment and its sub-segments. [F152] Research Description and Methodology This study examines the financial services profile of the mass affluent market. Their attitudes and involvement with depository accounts, credit, investments, and financial providers are explored. Experience with delivery and marketing channels is also assessed. National Internet Survey -- 800 consumers with investable liquid assets of $100K to $1M -- including 400 with assets of $100K-$499K and 400 with assets of $500K-$1M. Strategic Questions Is the concept of a "mass affluent" market primarily relevant to savings and investment products? Or, do the households in this segment also have unique needs in terms of banking services, credit products, and insurance? What is the role of the primary provider in servicing mass affluent households? Does this encompass "one-stop shopping" in terms of being a source of most accounts and services? Or, is it more perceptual and defined by providing certain services or functions? What information, marketing, and delivery channels are optimal for meeting the needs of the mass affluent? Do online, mobile, and other electronic channels compete with or complement traditional channels – such as branches or offices? To what extent have direct, online banking relationships impacted this market? Are the mass affluent an appropriate target market for financial products traditionally thought of as serving the needs of the highly affluent -- asset management accounts, separately managed accounts, and wealth management services such as estate planning, tax minimization strategies, and special credit services? Do the credit needs of mass affluent households call for more specialized or "prestigious" credit products? What is the experience and potential for prestige credit cards in this market? Is home equity credit and the accompanying tax advantages important to these households? What should be the role of investment advisory services in serving the needs of the mass affluent – full-service or on more of an "à la carte" basis? To what extent are such services currently used and for what purposes? Is the mass affluent market defined by very specific asset levels, or is it more of a "transition" segment also defined by needs and goals? Or, are there smaller segments within the market for which strategies and tactics must be tailored? SYNERGISTICS Research Corporation 2951 Flowers Rd South - Suite 230 - Atlanta, GA 30341 800-423-4229 • 404-237-3373 For more information, please contact William McCracken at firstname.lastname@example.org OR To unsubscribe from receiving any further e-mails, please type UNSUBSCRIBE in subject line at email@example.com.
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