Marketing Trends across Financial Services

SNAPSHOT REPORT arketin Trends across Insights from over 550 marketing leaders in the banking, capital markets, wealth management, and insurance sectors worldwide 11111 -�

Marketing Trends across Financial Services 02 About This Report Salesforce Research surveyed over 550 marketing leaders in the financial services sector - including banking, capital markets, wealth management, and insurance-to discover • How top marketers in these industries are gaining customer loyalty and a competitive edge • Which common challenges are hindering a connected customer experience • Which marketing channels and technologies will see the biggest growth over the next two years Throughout this report, high-performing marketing leaders are defined as those who are extremely satisfied with the curr ent outcomes realized as a direct result of their company's marketing investment Data in this report is a subset of findings from the fourth annual "State of Marketing" study conducted in April 2017. The blind survey generated 556 responses from full-time marketing leaders in the financial services sector- those holding a manager or higher leadership role within their organization - in the US, Canada, Brazil, U.K./Ireland, France, Germany, the Netherlands, Japan, and Australia/ New Zealand. All respondents are third-party panelists (not limited to Salesforce customers) Due to rounding, not all percentage totals in this report equal 100%. All comparison calculations are made from total numbers (not rounded numbers) •••• • ••••• ••••••• •••• •••• • •• • •• ••• • •••••••••••• ••• • •• • •• •• •• ••••• • ••••••••••••• • •• • ••• • • • ••••••••••••••• • ••• • ••• •• •••••• • •••••••••• •• • ••••••• •• • ••• ••••• •• • •••••••••• • • ••••••••••••••• • ••• •••• • •••••• • ••••••••• •• • •••••••••••••••••••••••••• • •••••••• ••••• •• •••• • ••••• • ••••••• •••••• •• • ••••••••••••••••••••••••••••••••• ••••••••••••••••••••••• • ••••• •••••••• • •••• ••••••••••••••••••••••••••••••••••• •••••••••••••••••••••• • ••• • ••• •• ••• •• ••••••••••••••••••••••••••••••••••••••• • •••••••••••••••••••• • •• • •• • •••• •••••••••• • •••••••••••••••••••••••••••••••• •••••••••••••••••••• •• • • •••• ••••••••• •••••••••••••••••••••••••• •• •• •••••••••••• • •••• • •• •••••••••• •••••••••••••••••••••• • •• ••••••••••••••• • •••• •• •• •••••••••• ••••••••••••••••••••• •• • • ••••••••••••••••••• •• •••••••••••••••••••••• •••••• •••• •••• • •••••••••••••••••• •••••••••••••••••••••• •••• ••••••••••••• • •••••••••••••••••• •••••••••• ••• ••••••••••••••••••••••••• • ••••••••••••••• • ••••••••••• •• ••••••••••••••••••••••• • • ••••••••••••••• ••• • •••• ••••• • •••••••••••••••••••• • ••••••••••••• •• • •• •••••• ••••••••••••••••••••• • •••••••••••• •••• ••••••••••••••••••••••• • •• •••••••••• ••••••• •• ••••••••••••••••••••••••• • • ••••• • ••••••••••••••••• •••••••••••••••••••• • • • ••••••••••••• •••• • •••••••••••••••• • • •• • ••• • •• •••••••••••••• ••••••• ••••• •••• • •••• •• • ••••••••••••••• ••••• ••• ••• • ••• •••••••••••••••• •• •• ••• • •• • ••• •••••••••••••••• • ••• • • • ••••• ••••••••••••••••• • • • •• • •••••••• ••••••••••• • • •• • • •••••••• •••••••••• • •• • • • •••••••••••• ••••••••• •• • • ••• • • ••••••••••••• •••••••• ••• • •• •••••••••••• •••••••• • • •••••••••• •••••••• • •• • ••••••••• ••••••• •• • •••••• • •••••••• ••••••• •• • •••••••• • ••••••• ••••• • ••••••••••• •••••• ••••• • ••••••••••• •••••• ••• • •••••••••• •••• • •• • •••• ••••• • •• • •••• • ••• • • • •• • • •• • •• •• Salesforce Research provides data-driven insights to help businesses tra nsform how they drive customer success. Browse all reports at salesforce.com/research. Salesforce Research

Marketing Trends across Financial Services 03 About This Report High-performing financial services marketing teams represent 12% of the overall financial services survey population. Marketers surveyed include B2B, B2C, and B2B2C teams. Moderate performers either are "very or moderately satisfied" with their current outcomes realized as a direct result of their company's marketing investment or are "extremely satisfied" with it but not with their marketing performance compared to their competitors Underperformers High performers . . . . . . . . . . . . . . . . . . . . . . . . . . . . ' # • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • are "slightly or not at all satisfied" with are "extremely satisfied" with the the current outcomes realized as a current outcomes realized as a direct direct result of t result of heir company's their company's marketing marketing investment investment Salesforce Research

ial Services 04 nc ina F ross ac rends rketing T Ma Contents Table of . 05 . . . . . . . . . . . . . . andscape L oyalty L e a New gat i ters Nav e ial Mark Fi nanc Introduction: . 06 . . . . . . . . . . . . . . . . . . . . lenges Chal ut ho wit t Not Key, bu Is e xperienc E r Custome 01 I . 08 . . . . . . . . . . . . . . . . . . . . . . . . . . View Customer ingle S a Way of the in Silos Stand 02 I . 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Multiply Channels Rise as Marketing Budgets 03 I . 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Growth Channel for Way Leads the Mobile 04 I . 12 . . . . . . . . Acquisition and Loyalty ourney Influences J Customer the Connecting 05 I . 14 . . . . . . . . . . . h . Growt ipated Antic for ts Char Tops the Tech Marketing lligent Inte 06 I . 15 . . . ion. izat rm Perso nal Transfo l ay AI Wil S s eader L Services Marketing Financial 07 I Reads Related • • • • • • • • • • • • • • • • • • 0 • • • • • • • • • • • • • • • • • • • • • • • • 16 • • • • • • • • • • • • • • • • • • • • • rch esea R Salesforce

n., . .,. COITlDetitors g assets across a p oducts allenge s clear F nanc mult a pie nst 1ons he1r bus1ness around brands mus ransfo m the1r customers. By creat ng he pful, persona ized experiences for customers throughout the ir financ i a l jo urneys, financi a l services compan i es can find a clearer path to reta ining business and increasing wallet share. Transformation i s easier sai d than done. In add i t' or to loya ' ty challenges, fnancial mari

Marketing Trends across Financial Services 06 Customer Experience Is Key, but Not without Challenges Today, 70% of consumers and 82% of business buyers Top Financial Services Marketers Lead the say technology has made it easier than ever to take their Customer Experience Charge business elsewhere.* How can banks, insurance companies, or wealth management companies win wallet share among highly connected customers? Many agree that customer experience is the new battlefield for oyalty, and top marketing teams are leading customer l the char ge. 80% 0 High Performers vs. /o of marketing leaders in the financial Underperformers services sector agree that their company is increasingly 2.3x competing on the b asis of customer experience more li

Marketing Trends across Financial Services 07 Customer Experience Is Key, but Not without Challenges Despite the general consensus among financial services marketing leaders that customer experience is an important differentiator, many still face challenges in its pursuit. Across financial seNices segments, marketing leaders are hitting some similar obstacles in their quest to create connected customer experiences. Marketers in banking, capital markets, insurance, wealth management, and other financial services* point to disparate data sources, disconnected roles and tools, and insufficient resources. Top Three Challenges Financial Marketers Face in Creating a Connected Customer Experience* Banking 1 Difficulty leverag ing data from different sources 2 Difficulty aligning roles to customer lifecyc le stages 3 Creating a shared, single view of the customer Insurance 1 Difficulty leverag ing data from different sources 2 Insufficient interna l resources 3

Marketing Trends across Financial Services 08 Silos Stand in the Way of a Single Customer View Creating a connected customer experience starts with High-Performing Financial Marketers running a connected business. The silos that restrict the Integrate Systems for a Single fl ow of data between marketing departments and other Customer View business units limit a financial seNices company's ability to gain a single customer view And this siloed view contributes to a fragmented customer experience. Only 24°/o of marketing leaders in the financial services sector say their current High Performers vs. tech stack is extremely effective at Underperformers driving collaboration across the business (e.g., across sales, service, 2.5x and marketing teams). more li

Marketing Trends across Financial Services 09 Silos Stand in the Way of a Single Customer View Over the past 12-18 months, 58°/o of marketing leaders in financial services sectors say they've become more focused on creating a single view of the customer . In practice, this could mean insurance marketing leaders embracing new systems to give customer seNice, claims, and marketing visibility into a customer's history-and even prompting the next best cu stomer interaction, such as adding them to a policy renewal journey. Looking at specific financial seNices verticals, marketers in capital markets are most inclined to pursue a single customer vi ew, while those in wealth management lag behind. Percentage of Marketing Leaders Who Agree They've Been More Focused on Creating a Shared, Single View of the Customer over the Past 12-18 Months 7°/o 4 °/o of banking marketing leade rs of capital markets marketing leaders say they've been more focused on say they've been more focused on creating a shared, single view creating a shared, single view of the customer over the past of the customer over the past 12-18 months 12-18 months 1°/o 47°/o of insurance marke ting leaders of wea lth management and other say they've been more focused on financial services* marketing leaders creating a shared, single view say they've been more focused on of the customer over the past creating a shared, single view 12-18 months of the customer over the past 12-18 months • "Other financial services" includes survey respondents who identified as other financial services financial planners, investment managers, actuaries, and accountants). professionals (e.g., Salesforce Research

Marketing Trends across Financial Services 10 Budgets Rise as Marketing Channels Multiply Over the past two years, 65% of marketing leade rs in Financial Services Marketing Budgets Are fi nancial services say their budget has increase d. But as New Channels Expanding into budgets increase, so do the number of marketing channels, l eading to thin allocations across the board. 50% As cove red in section 1, budget constraints are a commonly cited challenge to creating a connected customer 400/o expe rience. Top marketers in financial services are more focused on the 30% connectivity of channels than the sheer number of 41°/o them. High performers are nearly twice as likely (1.8x) as underpe rformers to crea te predictive of their current budget anticipate their budget 20% to channels t two years from now journeys across channels. In other words, they're goes deli didn't know existed five going to channels they vering personalized messages based on customer inter didn't know existed five actions with previous marketing messages-instead 10% of blast ing the same message across every channel - to years ago help move customers along a JOurney ()O/o Currently Two years from now 0 /o of marketing leaders in financial services anticipate their budgets increasing over the next two years.

Marketing Trends across Financial Services 11 Mobile Leads the Way for Channel Growth Consu mers say banking is one of the most important Top Financial Services Marketing activities they conduct on their mobile devices-seco nd Channels for Anticipated Growth in the GPS navigation. This ranks above access ing even Next 12 Months** only to the weather or news. Additionally, Millennia I Anticipated consumers are 1.8x more likely than other Mobile text messaging (SMS) Growth generations to say that mobile access to stocks and wealth management is absolutely critical.* 60% 23°/o Paid search Given this context, it's easy to see why mobile tops the 65% 23°/o ces charts of growing channels for financial serv i marketing departments. Within the next year, 91% of Mobile app marketing leaders in financial services will use or plan to 68% 23°/o use mobile apps (83% for SMS) , in addition to ramping Content marketing paid search and content marketing. up 70% 23°/o Native advertising/sponsored content 68% 22°/o Video advertising (e.g., You Tube) 68% 21°/o +31°/o Organic search 69% 19°/o Customer communities (e.g., online forums) 71% 19°/o +27°/o Advertising on social platforms • State of the Connected Customer survey, Salesforce Research, June 2016. Data may or may not be represented in the 74% 19°/o "State of the Connected Customer" report Display I ban ner ads 72% 19°/o Social media marketing 74% 19°/o Email marketing 75% 16°/o • Currently use • Plan to use within next 12 months •• Partial list Salesforce Research

Marketing Trends across Financial Services 12 Connecting the Customer Journey Influences Loyalty and Acquisition While marke ters may assume that a disconnected High-Performing Financial Marketers customer experience is merely an incon venience, Are Actively Mapping Their it has a measurable impact on loyalty. For instance, Customers' Journeys if an ins urance company's marke ting department is cordoned off from its service department, customers can sense the disconnect as they move across touch points. 7 °/o of consumers are likely to switch High Performers vs. companies if they rece ive inconsistent levels of serv ice Underperformers across departments.* 2.3x roo'e ·key to 8e mapp·ng {he custoroer jou r'ley across Leading marketing teams are aware of the link between t'le co"'lpa'ly consistency and loyalty, and are actively mapping the (e.g., soles, service, and marketing interactions) customer journey steps across their company. • High-performing financial services marketers • Moderate-performing financial services marketers • Underperforming financial services marketers • ·s{atc of the Connected Customer," Salesforce Resea rch, October 2016. Salesforce Research

Marketing Trends across Financial Services 13 Connecting the Customer Journey Influences Loyalty and Acquisition While the term "customer journey" was just hatching a Percentage of Financial Services Marketing decade ago, it's now top of mind -and with good Leaders Who Say a Connected Customer r easo n. The positive benefits assoc iated with customer Journey Positively Impacts the Following JOurney efforts speak for themselves, as detailed in this chart Reve nue growth 74% 7 °/o of marketing leaders in the financial Customers' willingness to recommend our products/serv ices services sector say that creating a connected customer 70% JOurney has positively impacted their customers' Customer satisfaction (CSAT ) scores willin gness to recommend their products and services. 68% Customer recommendations are not only a si Customer loyalty gn of advocacy but a 67% springboard for new custo mer acq uisition. Sixty-one percent of consumers say they're Overall customer engage ment li kely to pu rchase products and services recommended to them by friends or family* 66% High-performing marketers in the financial services Customer churn rates sector are 2.6x more likely than underperformers to say 64% creating a connected customer journey has positively influenced customer loya lty. • "State of the Connected Customer," Salesforce Resea rch, October 2016.

Marketing Trends across Financial Services 14 Intelligent Marketing Tech Tops the Charts for Anticipated Growth Looking ahead, consumers have high hopes for Top Financial Services Marketing ogy impacting businesses in the financial technol Technologies with the Highest Anticipated serv ices sector. Sixty- eight percent of consumers Growth Rates in the Next Two Years** believe advancements in technology will posit ively impact their relationships with banks and insurance Anticipated Artificial intelligence (AI) G prov iders by 2020.* When it comes to mapping and rowth managing the customer journey, marketers are turning 58% 28°/o +49°/o ogy to lighten their workload. Although to technol Internet ofThings (loT) I connected devices banking, capital marke ts, insurance, and wealth 71% 22°/o management companies aren't new business models, many plan on branching out with new technologies over Guided selling the next two years . 69% 22°/o Marke ters in financial seNices expec t that artificial Mobile campaign management intelli gence (AI) and the Internet of Things (loT) will see 70% 21°/o +30°/o tremendous growth in the next two years (49% and Lead nurturing and scoring tools 32%, respec tively). 70% 21°/o +30°/o The Internet of Things/connected devices is the top Marketing analytics/ measurement tools technology that insurance marketing leaders say is 73% 22°/o +30°/o essen tial to creating 1-to-1 marke ting across abso lutely Data targeting and segmentation every touchpoint. 74% 21°/o Marketing automation platform By 2020, 61 °/o of consumers anticipate 72% 20°/o smart/connected vehicles would have Social publishing tools a major or moderate impact on their 72% 20°/o daily life.* Email campaign management 72% 20°/o +27°/o • Currently use • Plan to use within two years • State of the Connected Customer survey, Salesforce Research, •• Partial list. une 2016. Data may or may not be represented in the J "State of the Connected Customer" report. Salesforce Research

Marketing Trends across Financial Services 15 Financial Services Marketing Leaders Say AI Will Transform Personalization With AI as the fastest growing marketing tech for financial services, it's worth a closer look at its expected impact. Most anticipate that AI will transform, to some degree, their ability to personalize marketing and deliver the right message at the right moment. However, budget constraints and customer privacy are the top roadblocks to executing an AI strategy. Fina ncial services businesses would do well to keep customer privacy top of mind, since 78% of consumers say their loyalty to a company is influenced by that company maintaining their personal privacy.* Anticipated Top Areas Where Financial Marketers Expect AI to Have a Transformational Growth in Impact on Their Business over the Next Five Years* * AI Use Banking 1 2 3 65% 24% +37°/o Delivery of the right User-generated Sentiment analysis • Currently use • Plan to use within two years message, on the right content channel, at the right ume Capital Markets 1 2 3 59°/o 31 °/o Hyper-personalized Productivity of marketers/ Delivery of the right product business insights across message, on the right • Currently use • Plan to use within two years recommendations data and systems channel, at the right time Insurance 3 +60°/o 1 2 55% 33% Hyper-persona, :zation Productivity of Programmatic advertising content marketers and media buying/ • Currently use • Plan to use within two years of delivery of the right on the right message, channel, at the right time Wealth Management and Other Financial Services*** 1 2 3 Dig·tal asset management

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