April 2015 will see the introduction of sweeping pension changes that will increase the freedom of pension aged consumers to access and manage their pensions.
Well, April is now a short hop and skip away. And while we don’t quite know what lies at the end of this pension yellow brick road, the scale of change is certainly significant.
That the advice gap will be even more prevalent is hardly a bold prediction. But there is reason to be hopeful, and here’s why.
The financial services information landscape is pretty rich, and is getting even richer. In fact, by pushing consumers to consciously engage with a wider set of options, what will emerge is a better engaged consumer.
Financial services consumer reviews have a large role to play as part of the engagement process
Picture TripAdvisor. TripAdvisor helps consumers to get the inside track on restaurants and hotels. By reading reviews, it becomes easy to discern which restaurants should be avoided, and which are worth a try. More importantly, it helps the consumer to formulate a hierarchy of needs and helps them to quickly discern differences between products and providers. This is the wisdom of the crowd.
By harnessing the wisdom of the crowd, consumers will become better engaged and more confident. Some consumers will take this confidence and choose to go it alone, while others will realise that they really do need a good independent financial adviser to help guide them.
Take for instance this Zurich pension review submitted on the Smart Money People site. It provides a simple to understand and valuable piece of customer insight.
Making informed choices when something as important as your pension is at stake is vital. And yet many consumers have difficulty in engaging with the Financial Services industry. Sometimes this is due to the snooze factor, and other times it is because the industry really hasn’t done enough to make independent information easy enough to come by and to understand.
Businesses are increasing looking to the wisdom of the crowd to fund their expansion, or to fund working capital requirements (look at the rise of the Peer-to-Peer or Crowdfunding industries). The pensions industry can also learn from these examples.
A brave new world?
It is also in the interest of product providers to foster an open and independent information ecosystem with consumer reviews at its heart. The importance of conduct risk, and brand reputation means that providers also have a stake in making sure that consumers better engage and understand the options available to them.
The way that the pensions customer journey will work post April is far from clearly defined, however within a rich information ecosystem, consumers are increasingly able to assimilate information from multiple sources. Ultimately consumer reviews will not replace professional advice. However, they do have a role to play in better engaging consumers.
Write your independent customer reviews today!