In the tough world of business today, financial companies, just like others, use ads and digital marketing to build their brand, show off what they offer, and connect with customers. Statista’s big study tells us that the US financial sector spent a whopping $21 billion on digital ads in 2020. And get this—it’s predicted to jump even higher, hitting around $30.75 billion by the end of 2023! During this time, it is important to be aware of several compliances like FINRA rule 2210 and FINRA rule 3220.
Why Financial Firms Use Digital Marketing?
Financial services firms use digital marketing because it helps them reach specific audiences cost-effectively. Digital advertising allows them to expand their presence across different locations while maintaining a consistent online image. This boosts brand visibility, trust, and credibility. Furthermore, digital marketing serves as a valuable platform for sharing easy-to-understand educational content on complex financial topics, positioning the company as a reliable source of information.
Risks in Financial Services Marketing
Financial services marketing comes with risks. The industry is heavily regulated to ensure fairness, protect consumers, and keep financial stability. Various bodies like the CFPB, SEC, and FINRA set rules on consumer protection, suitability, and investment. If companies don’t follow these rules, they face penalties and harm to their reputation. That’s why, it is essential to know the FINRA rule 2210 and FINRA rule 3320 along with other compliant rules.
Non-compliance can happen due to errors or a lack of understanding, not just intentional wrongdoing. So, it’s crucial for firms to prioritize following regulations in their marketing.
Marketing compliance is about ensuring a positive customer experience. Since the 2008 financial crisis, financial institutions have had to rebuild consumer trust. Regulations have strengthened to protect consumers, making it crucial for financial services companies to communicate transparent and trustworthy practices. Whether it’s on a blog, website, email, online ad, video, or any other channel, information should empower consumers with helpful, accurate, and clear communication. Importantly, all these channels must maintain information integrity.
Showing Marketing Compliance in Financial Services
Financial companies need to show they’re following the rules in their marketing. They can do this by:
Clear Rules: Financial companies should create clear written rules for their marketing. These rules should cover everything from ads to how they use customer data and communicate with customers.
Employee Training: Make sure the people in charge of marketing know the rules. Regular training sessions should teach them about the laws, ethical marketing, and how to protect customer data.
Record Keeping: Keep a good record of all marketing stuff—ads, campaigns, and customer communications. Before anything goes out, make sure it follows the rules by doing a thorough check.
Archives: Save digital records of customer interactions. This helps understand what customers experience and serves as proof if needed.
Protecting Data: Get permission to use and keep customer info. Always follow data protection laws to keep everything legal and secure.
Financial services companies can demonstrate their strong dedication to following marketing rules by using these proactive strategies. This helps protect them from legal and reputational issues and builds trust with customers and stakeholders.