Establishing a Partnership Strategy for the Highly Regulated Finance Sector

Establishing a Partnership Strategy for the Highly Regulated Finance Sector

Consumer interest in financial products has exploded during the lockdown, as many stay-at-home people take time to reassess their finances. This trend continued in 2022, with data from Rakuten Advertising showing that half (50%) of UK consumers are considering or are already opening an account with a new payment provider this year other than credit or debit cards. With the easing of the epidemic and increasing consumer confidence, many financial services brands are trying to build on this momentum by turning to additional payment services and rewards.

Why choose an affiliate?

With over half (54%) of UK people likely to choose a new payment solution based on the rewards it offers, and 60% of consumers opting for cashback services, financial brands are investing heavily in digital advertising formats to educate and transform. new customers.

While traditional banks still have a resource advantage in this regard, new players in the financial space are rapidly gaining market share. Given the highly competitive environment, it’s no surprise that brands are looking to increase their digital ad spend to over $20 billion by 2022 – more than double the £8 billion spent in 2017.

Looking at exactly where this advertising budget is going to be spent by financial services firms, a big slice will be pumped into affiliate marketing – a high return on investment, a results-driven way to reach new customers (and sell products more to existing customers).

However, the ability of advertisers in this industry to drive growth through affiliate marketing has been hampered by the challenges presented by compliance.

Compatibility challenges

While every brand entering the affiliate marketing space must be sensitive to consent and privacy, this is further increased for financial services due to the special regulation of financial services and products. Being responsible for data and proprietary information isn’t a ‘nice to have’ thing for these companies – it’s a success or a break. Concerns over the compatibility of affiliated publisher partners have previously stifled innovation in the financial services industry.

FCA regulations and company compliance requirements need to be carefully managed to ensure publishers and offer communication are compliant. For financial brands to operate effectively through the affiliate channel, solid compliance must form the basis of the entire strategy. Tracking solutions, processing and sharing of data, publisher hiring, optimizing offers, messaging on third-party sites, and reporting requirements are all under the microscope to protect consumers, publishers, and advertisers alike.

Issuers, especially in the financial sector, always bear the burden of financial, legal and operational risks arising from third-party partnerships. Some advertisers are completely discouraged from engaging with affiliate publishers due to the cost of tracking and the risk of fines.

Working with networks where compatibility is a priority

To meet this challenge, it is critical that financial services work with an affiliate partner who can demonstrate that they are using robust compliance processes and technology to mitigate any risk. This is something that can only be achieved through a combination of financial services industry experts and automated specialized tools to monitor ever-changing compliance requirements.

Only when the right partner is found can financial advertisers scale and optimize messages shared through the affiliate network with absolute confidence.

There are several features of an affiliate network that are specifically designed to offer compliance protection. First, real-time monitoring and alerts allow potential fraudulent activity to be detected immediately. Constant monitoring of content means aligning messaging with business requirements across all publisher sites. Social listening monitors brand sentiment – ​​again, it warns of any problems, albeit at an early stage – and monitors arrive. Finally, real-time updates between publishers ensure there are no marketing errors, preventing issues before they happen.

As a result, with consumers increasingly turning to trusted third parties to discover and understand new financial offers and seek advice and reviews on them, it is critical that financial brands have a strong presence on these sites. But even more important – even mission critical – for financial advertisers is choosing the right affiliate network. Doing so will give them confidence that they are reaching and engaging with new consumer groups while maintaining compliance with financial services industry regulations. Protecting consumers and brands is the ultimate win-win.

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