Closing the gap: How to make Targeted Support a success

So, what appetite are we seeing from the market to introduce targeted support? Well, it’s been interesting to see how firms have responded to the policy consultation that the FCA issued in June 

We’ve certainly seen and heard a lot of enthusiasm in the market for the potential opportunities that Targeted Support offers to build greater decision confidence in customers but the pace of mobilisation to make a targeted support service a reality has been a bit slower than we might have imagined in the summer 

We think there are three key reasons for this: 

First, firms are thinking long-term, they want to take the time to get the overall vision and strategy right before launching into delivery 

Second, there are lots of internal stakeholders to bring on the journey and getting those stakeholder comfortable on how to effectively mitigate the risks of getting targeted support wrong has probably been a more complex process than envisioned 

And finally, it's important to remember that the final targeted support policy hasn’t been released yet. So there is still some residual uncertainty that has caused firms to be a bit more cautious about their speed of mobilisation 

Ultimately though, momentum is building now. The big challenge for those wishing to be early adopters is whether they’ve got enough time to deliver what they need to deliver ahead of the FCA’s authorisation window opening next Spring. 

What should firms focus on to make targeted support a success? Well in our view there are three clear areas:  

Firstly, establish a long-term vision that helps to set the organisational approach and view of what targeted support will be. Knowing the value to customers but also to the organisation is imperative. Establishing its fit within the existing advice and guidance propositions and digital channels provided are all questions that should be answered in order to shape up the targeted support implementation successfully. Firms need to answer the questions – what's the purpose of this.  

Secondly, understanding the route to that vision is critical and how we see a long term programme. This is tricky because of the iterative nature, agile nature and learning that is required when the industry is launching something new. With all this ambiguity, it can be helpful to rapidly develop a vision and route there with 80% certainty. This will help break the inertia.  

And finally, The delivery and iteration of targeted support journeys will require a new way of working. Cross functional teams, highly iterative and agile delivery, underpinned by a culture of learning as firms get to grips with how customer journeys will work, how to get them to resonate with customers and how to ensure the journeys and underlying operating model meet the new regulation.

A key question we get asked is how do we set up our targeted support programme so we can deliver a first use case by spring 2026?  

The timelines are definitely tight if you’re aiming to have a that first use case developed by the opening of the FCA’s authorisation window in March 2026. But it can be done – the best way to approach it is to structure it around some clear principles. 

The first one – look at having two clear streams of work 

One focused on designing and delivering your priority use case, 

The other focused on developing BAU operating model which will enable you to maintain and grow your targeted support service in BAU. 

Once you’ve got your structure established, it’s important to think carefully about the characteristics of your first use case.  

Because the timeline is so tight, it will make sense to choose the a simple use case which will rely on a limited suite of data – this might limit your target customer base, but will enable you to get to market more quickly 

When taking this approach, we would also advise its that customer characteristics which you are defining should be clear and intuitive and you should be able to identify those characteristics with data points which are readily available 

Finally, digital only distribution will be another enabler to fast mobilisation. . While some voice capability may be required to support exits from the targeted support journey, digital identification, engagement and fulfilment vastly reduces the complexity of the implementation effort. 

One of the most frequent questions we get asked on targeted support is what challenges firms expect to face in segmenting customers into cohorts aligned to specific situations.  

And customer segmentation is definitely one of the biggest and most complex challenges that we see our clients grappling with at the moment! 

Instinctively, firms are tending towards segments that are too granular and therefore risk becoming overly individualised. 

The motivation for this is generally well-intentioned, with firms seeking to mitigate the risk of aligning an individual to an inappropriate cohort and failing to deliver a better outcome – or worse, the intervention resulting in customer harm.   

This desire to increase confidence in the robustness of a segment is resulting in firms establishing too many qualifying data attributes, which inadvertently risks creating the perception of a fully advised recommendation at the point of engagement 

Typically, it’s the sheer volume of data that an individual would be asked to provide or validate that tells us that a segment is too granular 

While we don’t expect the regulator to be prescriptive in the final policy statement about how much data is too much, we do think that they’ll re-emphasise a focus on the defining characteristics of a cohort and a need to evidence an understanding of the critical data that aligns to each of those characteristics 

The complexity of the challenge is one of the key reasons why we’re recommending simplicity in the first targeted support situation and suggestion journey firms develop, especially if firms are targeting early adoption.