1. The Power of Consumer-to-Consumer
Recommendations in the Financial
Services Sector

2. About RewardStream
RewardStream is an emerging leader in consumer-to-consumer (C2C)
marketing solutions for brands targeting the socially connected customer.
We help clients to energize consumers to recommend & refer to their
trusted networks, and then to evolve them into loyal, high value
relationships.
Since 1999, we have delivered customer referral, loyalty and engagement
solutions for some of the world’s most esteemed brands.

3. Speakers
Alexandra Best Bryan Mavrow
VP Marketing SVP Marketing
RewardStream First West Credit Union

4. Agenda
• Quick Look: Marketing in the Financial Services Sector
• Overview of Research: Keller Fay & WOM for the
Financial Services Sector
• Case Study: Using Customer Referrals to Perk Up a
Growing Family of Credit Unions
• Q&A

5. Have a question?
• Use the chat window in GoToMeeting
to submit your questions throughout
the session; we have left time for
Q&A at the end of the webinar
• If we don’t get to your question
during the session, please send
questions directly to
amberlie.denny@rewardstream.com

6. Dynamics Facing Financial Services
Marketers

7. • Search was once the stalwart of the web marketing
world
• The growth of social networking sites and non-PC
devices like mobile has encouraged retailers to shift
focus
• Search is predicted to lose share from 55% to 44% of all
interactive spend in 2016
*Forrester, US Interactive Marketing Forecast 2011 – 2016 (published August 2011)

8. “We do on the order of a billion queries a day, and
we’re not even trying. Most of it is people trying to
find people, but a bunch does link to commercial
behavior like trying to find brand pages. You get these
search engines where you type in keywords and it runs
some magic to tell you what it thinks you want. But I
think search is evolving to provide specific answers.
Facebook is pretty uniquely positioned to answer most
of the questions people want to ask. Like “What
restaurants do my friends like?”
- Mark Zuckerberg
At Techcrunch Disrupt
September 11, 2012

9. Deliver great service. Give customers something to talk about.
The importance of brand is not entirely going to
disappear; but your value as a brand is going to be
about service performance and delivery capability. The
brands that will have high advocacy are those that
deliver on the promise. The brands that suffer will be
those brands that say, “We’re fantastic”, and then show
by their actions that they’re not.
- Brett King

10. Listen to what customers are saying.
“We are happy to take recommendations from
friends, so as long as it’s not overt.”
- Brett King

11. “The role of banks as the financial expert has been
replaced by ‘word of mouth’ peer conversations…the
rapid emergence of social media in parallel with the
rise of mobility has seen customers increasingly turn to
their peers for information and advice, rather than to
financial experts in banks.”
- PricewaterhouseCoopers (2011)

12. How valuable Is word of mouth?
• The value of any one customer does not reside solely in
what that person buys
• How your customers feel about you and what they are
prepared to tell others can influence your revenue and
profit just as much
“How Valuable is Word of Mouth,” Kumar, Petersen, Leone: Harvard Business
Review, 2011

13. How valuable Is word of mouth?
• Ideally, a company that wants to know a customer’s full
value will include a measure of that person’s ability to
bring in profitable new customers
• Nearest most companies get to establishing the value of
a customer’s referral power is some gauge of the
individual’s willingness to make referrals (e.g. Bain & Co.,
Fred Reichheld “Net Promoter” Score)

14. Method
• Polled 9900 Telco customers, 6700 Financial Services
customers about referral intentions
• Then tracked customers’ actual behavior and behavior of
the referred customers over time

15. Results

16. “Marketers spend millions of dollars on elaborately
conceived advertising campaigns, yet often what
really makes up a consumer’s mind is not only
simple but also free: a Word of Mouth
recommendation from a trusted source. A Word of
Mouth recommendation is the primary factor
behind 20 to 50% of all purchasing decisions.“
- McKinsey Quarterly, April 2010

17. Word of Mouth: The Keller Fay Report
General Findings

18. Research goals
• What is the influence of word-of-mouth
recommendations in the retail category?
• Are word-of-mouth recommendations more or less
influential at different points during the consideration
and purchase lifecycle?
• Is there a difference in the impact of solicited vs.
unsolicited recommendations?

19. Who is The Keller Fay Group?
• The first research-based marketing consultancy
focused exclusively on word of mouth
• A few nuggets from The Face-to-Face Book:
• It’s an invaluable tool for marketers who want to spread
the word about their products and brands faster than
the speed of Facebook and with far greater impact.
• In-person social networking, not online marketing, is the
secret to soaring revenues.
• 90% of recommendations that lead to consumer action
happen offline.

20. Methodology
• RewardStream commissioned Keller Fay to study how
recommendations affect purchases in Banking, Vacation
Travel, Communications, Subscription Entertainment,
and Financial Services categories.
• The survey was conducted among a total sample of
1,274 adults ages 18-59 who had purchased, applied to,
or subscribed to a new product or service in the past 12
months.

21. THE OVERALL IMPORTANCE OF
PERSONAL RECOMMENDATIONS

22. Recommendations are frequent
Recommended a product or service to Made a purchase based on a
someone recommendation
Never Never
1% 1%
Rarely Rarely
6% Very Often
7% Very Often 11%
16%
Sometimes
33% Sometimes
Often
42%
Often 40%
43%

23. Recommendations impact more purchases than any other source
% of purchases influenced at any purchase stage, all categories
A personal recommendation 40%
Past experience 32%
Something I saw in a store/office 19%
Online consumer review websites 17%
An advertisement in a magazine, newspaper, or online 17%
Price comparison websites 15%
A commercial on TV or the radio 14%
Something on a package, flyer, or brochure 10%
Over 20% of responses of
An article in a magazine, newspaper, or online 9% “Something Else” include a reference
A TV or radio program 6% to price, cost, an offer, or sale.
Another type of website 5%
Other items include convenience or
Online blog 4% need, or general references to family
Another type of ad 3% and friends.
Social media site 2%
Something else 22%

24. Face-to-face communication is the predominant way to make a
recommendation
% of purchases influenced by recommendations by mode at any stage, all categories
Face-to-face 82%
Over the phone 15%
Via e-mail 5%
Via SMS/text 1%
Via IM/chat
(e.g. AIM, GChat) 1%
Via Facebook or Twitter 1%
Via another social media site
(e.g. Google+, Tumblr) 1%
Some other way 6%

25. Recommendations are evenly divided between
solicited and unsolicited
% of solicited and unsolicited recommendations for specific purchases by purchase stage, all categories
Solicited Recommendations Unsolicited Recommendations
55%
47% 46%
44% 44%
37%
While becoming aware of a While researching various While preparing to purchase
specific brand options

26. Across all stages, recommendations are
most influential in purchases
% of purchases influenced by purchase stage, all
categories
Recommendations Advertisements (Net) Online (Net) In a Store (Net)
Nets defined as follows:
40% Online (Net)
• Online consumer review websites
35% • Price comparison websites
28% • Another type of website
30% 26% 26% • Online blog
• Social media site
25% 23%
23% 18% 19% Advertisements (Net)
20% • A commercial on TV or the radio
17% 13% • An ad in a magazine, newspaper, or
15% 14% online
17% 8% • Another type of ad
10%
5% In a Store (Net)
• Something I saw in a store/office
0% • Something on a package, flyer, or
brochure
While becoming aware While researching While preparing to
of a specific brand various options purchase

27. WORD OF MOUTH:
FINDINGS FOR THE FINANCIAL SECTOR

28. Financial sector highlights
1. For financial products and services, recommendations have a far
greater influence than advertisements across all stages of the
purchase lifecycle.
2. Rewards are effective drivers for financial services and products,
both for customers making the recommendation and for those
receiving the recommendation.
3. People are more likely to seek expert advice for financial services
and products than for any other category.

29. Purchase are influenced by recommendations much more than
advertisements

30. Rewards are effective drivers for both referrers and referees

31. More people seek expert advice for financial products and
services than any other category.
% of people likely to look for advice from different types of people for specific types of purchases
Somebody Close (Family/Friends) Distant Friend with Experience in Category
52%
38%
10%
A financial purchase/service (e.g. bank accounts, mortgages)

32. Percentage of purchases influenced by recommendations

33. Research takeaways
• Word-of-mouth recommendations are a strong driver of consumer purchase
behavior at all stages of the purchase lifecycle, regardless of purchase category.
• More people seek informed recommendations for financial services products
than in any other purchase category.
• For financial products and services recommendations are far more influential
than advertisements across all stages of the purchase lifecycle.
• Verbal referrals are significant driver of new customers.
• Your most valuable customers might be ones who refer you. Do you know who
they are?

34. Case Study: First West Credit Union’s
“Referral Perks” with Bryan Mavrow

35. First West Credit Union’s story
Scope: multi-brands, Envision Financial, Valley First,
Bank.Borrow.Insure.Invest
Size: 3rd largest Credit Union in BC, 170,000 members,
1,400 staff, 37 branches, $6.7B assets under management
Mission: To make a meaningful difference in the financial
lives of our members

36. Problem: it’s tough to get new credit union members
• Banking is competitive
• Products are ubiquitous
• Customers are loyal | Loyalty is Habitual | Pain points
cause switching

37. Therein, is the opportunity
• We’re not a bank: Act Local
• We’re differentiating ourselves:
Keeping it Simple™
• We rate very high on intention to
recommend…

38. So let’s make it simple to recommend
• SPARK™: stand alone, low maintenance, simple
• Social Media based: our demographic market focus
• Easily scalable across the brands

39. Ready, set, launch
• Figuring out our customer key
• What to reward with?
• Get the brand right first!

41. What’s next
• Results will be?
• Testing rewards: cash versus community giving
• Internal platform for staff
• Drive member awareness

43. Have a question?
• Use the chat window in GoToMeeting
to submit your questions throughout
the session; we have left time for
Q&A at the end of the webinar
• If we don’t get to your question
during the session, please send
questions directly to
amberlie.denny@rewardstream.com

44. Contact
Alexandra Best Bryan Mavrow
VP Marketing SVP Marketing
RewardStream First West Credit Union
alexandra.best@rewardstream.com bmavrow@firstwestcu.ca
604.282.7549
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