Forex Brokerage Marketing During COVID-19
How has COVID-19 Affected Forex Marketing?
The pandemic is changing the way we do business.
While 2019 proved to be a little slow on the uptake, 2020 has shown significant action. Brokers needed to reevaluate their value propositions and rethink their entire business models, staff logistics and of course, their marketing.
Unlike other industries however, due to the nature of the business, retail FX brokers were already lucky enough to be set-up with online operations and client relationships. We can also safely say that the volatility in the financial market, and the significant number of bored lock-down users, benefited the industry considerably. In fact, in a few recent articles from FinanceMagnates, brokers have reported record-breaking growth on new accounts and trading volumes during their February and March earnings reports.
But it’s not all so rosy. Let’s not forget what is still yet to come. The knock-on effect of the suffering economy will lead to a change in people’s purchasing power. With the unpredictable horizon, we’ve seen many brokers re-prioritizing their short and long term focus to side with more short-term strategies in their marketing mix. The emphasis on immediate performance-based marketing seems to reflect their goals of maximizing current revenues, which can be used to offset the risk of possible losses later down the line.
To help you prepare as best as possible for the unpredictable second half of this year, we’ve outlined two elements that we see impacting Forex marketing for both now, and the future. Let’s start off with the first point.
Trust and reliability
Trader trust is a critical long term success indicator for brokers. Especially more so nowadays, with so much misinformation, and fake news sites publishing conspiracy content online each day.
This means, your team needs to work harder to build trust and reputation during the first impression. Whether that’s a potential client reading an article on your website or someone signing up for an account.
So, if building a personal and trusting relationship with your traders is proving to be more important than ever, it means that your CRM system becomes the crucial enabler to help you achieve that success.
Your CRM can be used in many ways, but a quick tip for building trust and relevance is to segment clients using key characteristics and offer tailored media communications to target certain types of clients. That way, you can deliver relevant information to traders that cuts through the market noise.
Something to remember though, is that trust can only get you so far. Reliability is also key. Today’s online audiences are showing less patience than ever before. There is little room for a broker’s website to be down, let alone the possibility of their CRM and back office having issues related to registering, placing orders or processing withdrawals. Make sure you are working with a Forex CRM provider that you can rely on.
The real effects of the economic downturn for the FX industry are still ahead of us. The S&P 500 draw down report states that when the market drops by 20%, it takes a minimum of three months to hit its lowest point and thoroughly impact the economy. It also suggests that it takes a minimum of three and a half months to recover from a low period. So what does the future hold? It seems to show that many brokerages will adopt strategies that will incorporate leaner operations and a laser focus on the activities that matter the most.
Operational efficiency is now an emergency. Not only because online users are hungry for more immediate experiences, but also to reduce operating costs and wasted staff hours.
Some silver lining is visible when thinking about cost reduction. Through the numerous lay-offs, buy-outs and bail-outs happening, now is a great time to hire high-quality staff. You can find exceptional team members willing to work at competitive wages, and hire remotely across any geographic location in the world. Decentralized employment has become a new norm.
Also, many marketing budgets were cut across industries, so if your team still has budget remaining, now is the time to strike and gain a larger market share. When there is less active advertising competition, it means your investments capture a larger share of voice. If we look at today’s performance marketing world, your marketing dollars go further than they did during pre-COVID times. CPMs and CPCs are lower than average, meaning your overall CPA will be cheaper until the pricing recovers.
A final thought
Navigating the uncertainty of managing a brokerage during unprecedented times doesn’t have to be done alone. If you’d like to have a chat about some best practices we’ve seen from successful clients, or industry players, feel free to reach out for a quick call. We’re happy to help.