HC 271 Money Advice Service

Written evidence submitted by unbiased.co.uk

Introduction - about unbiased.co.uk

1. unbiased.co.uk is a portal for consumers and businesses to find local professional advice. We were set up in 1989 as IFA Promotion to promote the value of independent financial advice to consumers and in 2011, became Unbiased Ltd, better known as unbiased.co.uk.

2. Annually over 1 million people visit the site generating almost 500,000 consumer searches for an adviser. Our service covers independent financial advisers, whole of market mortgage advisers, solicitors and accountants, overall we list over 15,000 advisers and we estimate that we list over 90% of independent financial advisers in the market on our database

3. unbiased.co.uk generates 8,000 positive pieces of media coverage each year promoting independent advice.

Executive Summary

4. unbiased.co.uk welcomes the opportunity to respond to this inquiry. Broadly we are supportive of the Money Advice Service’s stated purpose and believe that improving financial understanding and capability among the public is fundamental.

5. We believe the MAS could considerably improve its effectiveness in directing relevant consumers towards regulated advice.

6. We would like MAS to be much more transparent regarding the number of regulated hand offs it makes and to ensure that consumers transition well from the MAS site to external service providers in order to ensure the consumer journey is as clear as possible.

7. We expect MAS to measure what impact it is having and to be much more clearly and publicly accountable for the service it has undertaken to provide.

8. MAS cannot offer ‘advice’, although the name ‘Money Advice Service,’ as well as the current advertising campaign both imply that it does, which is confusing for consumers.

9. unbiased.co.uk believes that MAS should create a network of preferred partners to provide a more coordinated service for consumers and to ensure that information they receive is current and relevant.

To what extent is the Money Advice Service (MAS) meeting its core statutory objectives:

§ To enhance the understanding and knowledge of members of the public of financial matters (including the UK financial system) and

§ To enhance the ability of members of the public to manage their own financial affairs?

10. unbiased.co.uk believe that currently MAS is not effectively helping people seek regulated financial advice should they need it.

11. MAS has succeeded in enhancing public understanding and knowledge of financial matters and in particular, MAS’s multi-million pound marketing campaign has created awareness of its services.

12. We believe that approximately 80% of customers that use the MAS services fall into their defined target market of people not well positioned to withstand unexpected life events and are not already engaged with financial services. The remaining 20% would benefit from regulated advice: currently the MAS refers them to a source of potential advisers via links to a large number of directories. Our concern lies in this ‘regulated hand off’, as a result of which consumers are faced with a vast choice of options via these directories to begin their journey for relevant and useful advice, without guidance on how to make the right choice for their own circumstances

13. We would like the MAS to be much more transparent regarding the number of regulated hand offs it makes across all its directories in order to clearly understand the demand for regulated advice among consumers using MAS services and to be clear which source directory is the most effective. Since 1 November 2011 unbiased.co.uk has received 2,138 referrals from MAS, with a conversion rate of 52% (1,121 consumers) that are searching for an adviser (Google analytics 30 May 2012). We consider this number to be low given the traffic estimated to be using the MAS site and from our experience of receiving traffic from links on other high profile consumer sites. This is evidence that consumers are not transitioning well from the MAS site to other external service providers. We also would like to see MAS signposting more clearly what consumers would get when they use a specific directory in order to simplify the process and provide a clearer journey for people. For instance some of the directories it currently points towards allow the consumer to find a tied adviser without the restrictions of this type of advice being clearly labelled on the directory.

14. Some of the historic Money Made Clear site has now been merged with the former Consumer Finance Education Board (CFEB) site. Both sites had different linking strategies to direct consumers to other organisations and this leads to confusion for consumers in the merged site. They are being faced with too much choice at the point where MAS can no longer help them and where they need to select a different service to enable them to move on and take the appropriate action.

15. If the consumer journey is not made clearer it will lead to fewer consumers making their way to a professional adviser who is well placed to help them. This surely defeats the ethos of the MAS.

16. There is also a concern that not all data on all directories is up to date. unbiased.co.uk provides details of advisers who offer whole of market advice and the data is verified weekly against the FSA database. In addition any adviser listing qualifications on our search will have had those qualifications verified with the awarding body prior to us putting those details into the consumer domain, as well as a declaration by the IFA that they meet the criteria for being on our database. The IFAs themselves provide us with around 200 data updates a month as it is in their own interest to ensure the leads they receive are for the type of business they want to write. This ensures the consumer always has access to high quality and up to date information.

What accountability mechanisms are in place for the MAS? Are they sufficient? How can the effectiveness of the MAS be assessed?

17. It goes without saying that any large public expenditure should always be accountable. It is fundamental that MAS is able to measure and report on the impact it is making.

18. Without adequately measuring if consumers are having a positive or negative experience using the services, MAS cannot adapt their offering to best suit consumer needs. According to its 2012/13 Business Plan MAS runs exit polls to see how consumers rate their interaction with it. However, our trials on the site have not resulted in us being polled. Furthermore our own experience shows that exit polling is not enough to fully understand customer engagement. On average, it takes a consumer 3-6 months to follow through with the advice they have been given and so MAS needs a more sophisticated way of tracking activity. We have previously collected email addresses (on an opt in basis) of those using our service so that we could track purchasing activity at a reasonable time after the adviser search has taken place in order to evaluate our own services – i.e. did they go on to see an adviser, did they take advice and did they purchase any financial product, and were they satisfied with the service and process. MAS needs to undertake similar research in order to evaluate the effectiveness of the regulated hand off process from its site.

19. We are pleased to see that MAS is currently researching how people manage their money and how their attitudes and mind set influence the decisions they make and actions they take. As this will take over 12 months to complete, we advise other mechanisms of evaluation are used in the meantime, particularly to understand user experience and outcomes. The new baseline study that MAS intends to take forward, building on the work of the FSA, will also be helpful in measuring the effectiveness of their service and provide a benchmark for future evaluation.

To what extent are the services provided by MAS also provided by other organisations? How does the MAS compare to these organisations?

20. MAS cannot offer ‘advice’ and we believe it should not purport to do so as the current advertising campaign implies. The heavy use of the words ‘unbiased’ ‘independent’ and ‘advice’ in the MAS advertising material causes consumer confusion given these words have been attributed to the advice that Independent Financial Advisers provide and have been promoted to consumers by unbiased.co.uk for over a decade.

21. The name Money Advice Service is misleading because MAS cannot offer advice or tell consumers where to go for advice. ‘Advice’ is a term that has been defined (and is regulated) by the FSA and a better term for the service provided would have been ‘information’. Again, this only causes confusion for consumers and we believe there needs to be further consideration about how and where people go to find regulated advice when their needs fall outside the service offered by MAS.

22. MAS has outlined its commitment to develop the use of partners and trusted intermediaries to ensure the service is present in everyday lives and to refer customers who would benefit from regulated advice to a trusted source of potential advisers. unbiased.co.uk believes MAS should create a network of preferred partners in order to provide a more coordinated service for consumers and to ensure that information is current and relevant. This would be in keeping with the current sentiment from the Department of Business, Innovations and Skills which has committed to clarifying the consumer landscape in order to improve consumer protection.

23. Unbiased.co.uk has an annual budget of around £2m and within this budget we achieve over 1 million people visiting the site each year generating almost 500,000 consumer searches for IFAs. We allow the consumer to search in confidence and remain in control of the process by providing them with adviser details instead of collecting their personal information and passing this on as a lead. Our search function is postcode based and can be further tailored by business area, payment options, qualifications and adviser gender. This consumer traffic is generated in numerous ways: digital marketing such as search engine optimisation; pay per click activity; placed articles; online and offline PR and social media activity. Over 60 white label versions of our adviser search are carried by big brand portals, personal finance websites, newspapers, product providers, and trade bodies including sites such as timesonline.co.uk, telegraph.co.uk, thisismoney.co.uk, msn.com, aifa.net and nsandi.com. Our recent ‘Value of Advice’ PR campaign has generated coverage in bbc.co.uk, Mail on Sunday, The Times, City AM, The Scotsman and moneysavingexpert.com. We list over 20,000 advisers on our directory of which 15,400 advisers listed from 8,200 branch locations are IFAs, the remainder being mortgage brokers, solicitors and accountants.

24. In working together with preferred partners, we believe that MAS and the partners will be able to much better communicate their services and provide a clearer customer journey which will result in more advice being sought. For example, unbiased.co.uk currently generates over 8,000 positive media messages every year promoting independent advice and such a relationship would only further help MAS with its reach and messaging to the public. We would also be able to help garner support from the adviser community itself due to our brand recognition and strong relationships in this area.

Is MAS reaching its target audience?

25. unbiased.co.uk has been unable to assess this and we would appreciate further information on any statistics or other data measuring whether MAS is reaching its target audience and which groups are unable to access MAS’s services at present.

May 2012

Prepared 15th June 2012