The Marketing Process

1818 words 8 pages
Deniaro Brown

When developing financial services marketing strategies, it is essential to appreciate some of the limitations cited in this chapter. However, it is equally imporant to appreciate the ethical dilemmas that these limitations present to the financial services marketer. The abuse of the consumers' inability to process the necessary information when evaluating a financial service is not only unethical, but in certain cases, it may violate regulations and result in legal repercussions. It is therefore essential for a financial services marketer not only to be aware of regulations that govern and restrict their marketing activities, but also to be fully aware of the company policies that may constrain the scope of
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According to Erta author of “Applying Behavioral Economics at the Financial Conduct Authority” People do not always make choices in a rational and calculated way. In fact, most human decision-making uses thought processes that are intuitive and automatic rather than deliberative and controlled. Firms play a crucial role in shaping consumer choices. Product design, marketing or sales processes can intensify the effects of preconceptions and cause problems (Erta, 2014).

Firms can respond to the different preconception in specific way. One important response is that firms will tend to increase future pricing and decrease present prices in which they know will be attractive to consumer because of their thinking process.
If consumers tend to underestimate how much they will spend on their credit card in the future (because of projection bias or overconfidence), firms have an incentive to offer low rates today with higher rates later (Erta, 2014). The way consumers analyze present gratification and future results affects competition within the financial service market. They can lead firms to compete in ways that are not in consumer interests, e.g. by offering products that appeal to the consumer because they appeal to present gratification (Erta, 2014). Based on evidence on the common mistakes people make, firms suggest a set of indicators that can help identify where consumer detriment from mistakes may be particularly high (Erta, 2014). The indicators


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