NOTE: THIS FIRST APPEARED ON THE HBR BLOG 4/17/14:
Financial services firms want to reach more women; so I conclude from data presented by Pamela Grossman of Getty Images at SXSW this year. According to data collected by Getty, financial firms are buying 20 percent more stock photos of women today than they were five years ago. At the same time, the share of men shown in their advertising has declined.
Of course, we live in a wildly diverse world; we want to be inclusive and broad minded ourselves, and we therefore want our providers of financial advice, energy, and technology to reflect those values. We prefer Morgan Stanley or CitiGroup to be talking to all of us, showing us that they have transcended their traditional, mostly white and male clientele. According to Chris Edwards, former Group Creative Director for Arnold Worldwide, we also want visual evidence that the professionals at these firms are as diverse as the clientele they seek. Advertising images reinforce and extend these efforts.
Financial institutions portray women today as competent and self-confident, and often feature attractive, middle-aged advisors talking to couples in which the woman is similarly well dressed and clearly attentive. According to Dr. Emma Firestone, who has studied the audience perception and response to images and words in media and entertainment, from a cognitive perspective, "It makes sense for advertisers to present women as strong, well-educated consumers. This is appealing to women who see an attractive self-image reflected back at them, and to men, who are flattered by the idea that smart, self-possessed, and financially secure women are their own life partners." Men are much more likely today, than decades ago, to be comfortable with and appreciate their spouses as full partners in their own financial decision-making -- at the same time, imagery of supportive female financial advisors plays into comforting stereotypes of the woman-as-helpmeet, perhaps humanizing an industry consumers view as confusing or even threatening.
However, there is a trapdoor in this picture. The rise in strong feminine images in financial advertising also coincides with some very negative portrayals of men in the industry: The testosterone-driven traders and gamblers who led us over the financial cliff in 2008. As Christine Lagarde, Director of the International Monetary Fund has famously stated, only partly in jest, if the firm had been called "Lehman Sisters" there might not have been the same resulting devastation to world economies. There has been extensive coverage of research suggesting that if financial firms had fewer men, those firms would have taken on less risk. Both headlines and Hollywood have also focused on the antics of a few particularly macho financial executives, from the Wolf of Wall Street to the "London Whale." It may be that today's financial firms are trying to portray a "feminized" face to distance themselves from stereotypes like these.
But it's not all "optics" -- more and more women are actually taking on breadwinning roles. Grossman touched on several demographic factors supporting the trend: One-third of working women earn more than their husbands, 40 percent of households with children under 18 are headed by a women; and female students account for 57 percent of undergraduates in the United States. More women have also taken on more responsibility for retirement planning, in part, due to market and retirement plan upheaval; in 1978, the IRS created the structure in which the federal government essentially shifted the burden of retirement financing from employers to employees. Without the safety of defined benefit pension plans in a era of diminished job security, most Americans, as couples or individually, need to be much more active players in the dialogue about their own asset allocation and investment options well in advance of retirement.
Mark McKenna, Head of Global Marketing at Putnam Investments, says he's also seen women assuming prominent roles in the personal finance sector; whether they have been stay-at-home moms or asset builders in their own names, women often have primary control of the finances and they generally outlive their spouses. The statistics are staggering: Baby Boomer women control over 60 percent of the country's wealth; women make 80 percent of the U.S. collective household buying decisions; 41 percent of the 3.3 million Americans with incomes over $500,000 a year are women; and they account for over 50 percent of all stock ownership. The financial services industry needs to reflect these realities and speak directly to women.
Of course, it's not enough to show women in their advertisements; the next step is for financial services firms to effectively engage women with products and services tailored to their needs and desires, including a risk profile that's distinct from men's. While men are more interested in wealth accumulation, according to a large-scale study by BCG, women focus on long-term financial security for themselves and their families. They value being heard and respected by their financial advisors and place trust as a very high priority. Offering more images of women in advertisements is a clever marketing step to improve sales; serving these clients well is the key to building that business over the long term.