New Insights into Consumer Confidence in Financial Services - A Critical Analysis



New Insights into Consumer Confidence in Financial Services - A Critical Analysis

1. Explain the purpose of the article, its main line of reasoning, and its conclusion

Purpose

The main purpose of the article 'New Insights into Consumer Confidence in Financial Services' by Adele Gritten, is an iteration of a prevalent phenomenon in these times of recession. The phenomenon is essentially a movement away from the norms, by the consumer with regards to their confidence in the market and especially the financial services sector. The current financial turmoil has brought along a recessionary period that is one of its kind. Individuals and families have to do considerable evaluations of their household and personal finances, to remain afloat in the economy. Gritten has aptly explored the concept of consumer confidence, and the way it has been tarnished in these times. Most importantly the author seeks to explore the underlying causes that led to this phenomenon. Moreover, reflection has been offered on the changes in British psyche, after the financial markets collapsed. This reflective analysis has offered insights into where actually the customer is looking for confidence in this economy. Additionally, these insights would also clarify the issues that led to this paradigm shift in consumer confidence. Finally, the paper offers plausible explanations in consumer behaviour, in the likely environment of continual financial instabilities.

Line of Reasoning

Gritten has essentially focused on the conflicts in the consumers mind due to persistent financial instability in the current times. As such these consumers are highly evaluative of their financial choices. Further, the consumer has become sceptical of the financial services and their products unreliability. This is because financial services acquire customers through relentless marketing that assert the importance of long term and medium term financial products such as mortgages, pensions, investments and savings. However, events such as the housing bubble and decrease in pensioners long term savings, because of financial markets tanking; have left an acrid taste in consumer's mouth. Gritten argues that the British consumer psyche has been compromised. These individuals and families are having issues of trust. Further they are becoming unsure of what to do financially. These changes are entirely blameable on the economic meltdown. During good times many invested in pensions, investments, savings and property. However all these investment instruments collapsed in market value, due to the financial turmoil; this deflated the wealth of the investor and blunted their confidence drastically.

Gritten offers insights on consumer's recent frustration and resentment due to financial planning and its results. These consumers are socially and psychologically shocked. Further, the conflicts have induced irrational behaviours by consumers in terms of financial decision making and their lifestyle choices.

Conclusion Points

Gritten, in the article, portrays a mixed imagery of how consumer's actual spending behaviours and attitudes have modified sine the financial crisis began. This period is market with credit squeeze, recessionary phase and a slow and gradual recovery process. Recently, things have become slightly better; however, pressures still exist and are ...