Know thy client

Product knowledge is certainly essential. While on the surface many loans can appear to be similar, subtleties in policies and fees, and less tangibly, service from lenders, can make all the difference between a ‘suitable' product and a ‘more suitable' product for a client.

And there's little doubt that most brokers know their products intimately. While loan comparison software is useful when dealing with clients, any broker worth their salt is well across the product suite of their main lenders.

But while sound product knowledge is relatively straightforward, building a comprehensive picture of your target market can be more challenging. Big business spends billions of dollars every year on market research, trying to understand what makes consumers tick and exactly how they can influence them. For brokers that specialise in targeted market segments - such as investment or non-conforming - it can be relatively easy to build a pro?le of the typical client.

But for most brokers that move with the ebb and ?ow of the market, it can be more of a challenge to understand the client when the average customer may change from one market phase to another. Fortunately an increasing array of market research is emerging specifically for the broking industry.

The MFAA and Bankwest, Genworth and Retail Finance Intelligence are amongst the groups that provide an insight into the consumer market - invaluable in understanding the preferences of the borrower.

In this issue, with the help of one of Australia's leading demographers, we look in detail at how the consumer is changing - particularly in the wake of the GFC. As well as gaining a broad overview of what the consumer is looking for in a prospective financial services provider, we get down to looking at some specific likes and dislikes of the different market segments.

But while a helicopter view of the market is of value, brokers have the resources to look to their own client base to gain the best understanding of how they can better align their services with the changing needs of the client.

Conducting customer research is considerably easier these days thanks to web-based surveys and email. In this month's Effective Habits we provide a practical guide to how you can conduct your own customer research.

Not only will this exercise help you to better understand what your customers think of your services and how you can improve them, it could also give you some valuable information about what other products your existing customers may be crying out for.