Think the future of retail FX is completely unsustainable? Meet Jack!
Today, the plethora of retail FX brokerages which take common services from common providers and are competing for market share in an extremely competitive business with ever-decreasing margins is very much a matter which the leaders of the FX industry are making a major point of bringing to light. Here at the iFXEXPO in Cyprus, […]
Today, the plethora of retail FX brokerages which take common services from common providers and are competing for market share in an extremely competitive business with ever-decreasing margins is very much a matter which the leaders of the FX industry are making a major point of bringing to light.
Here at the iFXEXPO in Cyprus, FinanceFeeds spoke to Nicc Lewis, VP Marketing at Leverate, who went into pragmatic detail about the dichotomy between direct response and brand awareness and automation.
“The market is maturing” said Mr. Lewis. “It is becoming more and more competitive, everyone is offering very similar products, some are providing similar offers to their clients, many on the same platform as other firms and it is unsustainable, especially for a smaller broker” he said.
“It has got to the point where brokers need to build their differentiation” explained Mr. Lewis. “Whether it is brand awareness or automation, as we discussed today here at the iFXEXPO, these could be two aspects but just looking at increasing branding, for example, is not the entire solution.”
“The starting point is to ascertain who you are as a brokerage” is Mr. Lewis’ advice. “As a broker, you have to decide where you are going and what you want, an in order to survive and grow, these fundamental aspects are what need to be focused on first.”
“One of the tools that I have used in the past is profiling. And I mean really profiling. We looked at a user in the UK within a certain age range, income bracket, and from a specific demographic. We built a person, his name is Jack. We knew what he did in is leisure time, and for a living. We mapped his lifestyle and we worked out where we could meet him on his journey” – Nicc Lewis, VP Marketing, Leverate.
“By doing it this way, terms like brand awareness do not take on the same expensive difficulties that they did during previous trends such as the sponsorship of a premier league football team” said Mr. Lewis.
“Brand awareness these days is about generating micro brand awareness. This brings far better in direct response and leads to ability to expand. Taking ‘Jack’ as a pioneering project on how to channel toward specific users, we can now look for Hans, or Peter, or Pierre, by using the same methodology” explained Mr. Lewis.
After building a sustainable model comes automation
“Now comes the path where you are increasing your reach and generating traffic, and need to start thinking about automation.”
“There are very basic levels of automation, for smaller brokers. An example is having a small website, with an exit traffic strategy, which ensures that clients can’t leave the site without a call. There is an auto dialer that then calls the call queue and prioritizes customers who are about to leave the site to be contacted by a sales or retention agent.”
Mr. Lewis explained “The next level of automation is conversion retention. This is about building funnels and flows. In terms of functionality, if a person accesses the website, this level of automation works out whether he registered or not, and if not the system sends him back to the registration point but gives him a certain message, or a push notification, for example.”
“Within this level of automation, if the client did register, then the next stage in funnel is to prompt them to deposit, so therefore it works out what stage the client is at on an ongoing basis taking them through first time deposit, and retention procedures.”
“Eventually, brokers can start optimizing costs of acquisition, therefore they have more money to generate further reach” said Mr. Lewis.
In conclusion, he said “Today’s model has to be via an assisted buying decision. The hard sell is gone. Brokers need to intervene on a human level at a key decision point for certain traders, because when you ask people to invest between $5 to $10,000 they need the human trust, however automation of the vast majority of processes is the way forward.”
“Therefore, I recommend to build your brand identity, focus and execute by optimization and assist buy decisions by human intervention.”
