Table of Contents
Issues in the Market
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- Scope of the report
- Definitions
- Abbreviations
Insights and Opportunities
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- Campaign continuity
- Getting a balance between tone and exposure
- Gender marketing
- High conversion from online advertising
- Funky post
- ‘Celebrity’ may be losing its gloss
Market in Brief
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- Sector profitability boosts marketing activity
- The core challenges facing financial marketeers
- The benefit of branding
- The finance sector spends more than any other on above-the-line advertising
- Assessing ad recall – Mintel’s consumer research findings
- More people are responding to online advertising…
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- Figure 1: Proportion of adults who have purchased products in response to financial advertising, by type, 2004 and 2006
- …while direct mail is being read by a declining proportion
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- Figure 2: Treatment of financial direct mail, 2004 and 2006
- So what makes effective marcoms in financial services?
- Some drivers to consider
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- Figure 3: Aspects which make consumers take note of financial adverts, 2004 and 2006
- Looking ahead
Fast Forward Trends
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- Trend 1: ‘The Influentials’
- Definition
- Context
- Market touch points/implications
- Trend 2: Marketing as decipherment
- Definition
- Context
- Market touchpoints/implications
- Trend 3: The Name Game
- Definition
- Context
- Market touchpoints/implications
The Business Environment
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- Industry transformation
- The economic climate
- Sector profitability
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- Figure 4: Gross operating surplus of financial corporations, 1998-2004
- Prospects
- Funding factors
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- Figure 5: Factors impacting on marketing activity and expenditure, 2007
Overcoming Obstacles to Communication
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- Figure 6: Summary of main obstacles to financial services marketing
- The nature of the beast
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- Figure 7: The product life arc
- Identifying ‘ready-to-buy’ consumers
- Product complexity and consumer apathy
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- Figure 8: Level of interest in financial services advertising and the financial press, 2004-06
- Certain sectors fare worse than others
- Tackling the intangibility issue
- Imagery and the good life
- Risky business
- The fear factor
- A matter of trust
- Misleading claims
- Financial companies must adhere to strict regulatory controls
- Consumer Credit Regulations 2004
- Distance marketing regulations 2004
- The regulatory process is not tough enough, say MPs
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Brand Power
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- An indelible mark
- Branding concepts
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- Figure 9: Hierarchy of branding concepts
- In the limelight
- Brand extension
- Multi-brands
- A common phenomenon
- Brand dominant
The Role of Advertising and Promotion
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- Marcoms throughout the business chain
- Customer retention is also vital
- An uphill struggle
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- Figure 10: Attitudes toward advertising, 2004-06
- Stimulating purchase behaviour
- What makes advertising effective?
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- Figure 11: Factors that increase and decrease effectiveness
- The celebrity bubble
- Use of humour
- Responsible advertising
- Making the right noises
Advertising Expenditure Trends
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- Financial brands dominate the media marketplace…
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- Figure 12: Total advertising expentidure, by industry sector, 2002-06
- The impact of regulation
- …but reduced spending on direct mail since 2004
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- Figure 13: Total advertising expenditure – financial sector, by media type, 2002-06
- Increased investment in Internet advertising…
- …benefiting other channels
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- Figure 14: Distribution of advertising expenditure – finance sector, by media type, 2002-06
- Internet advertising pulls ahead
- Adspend on savings accounts, mortgages and general insurance has risen strongly
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- Figure 15: Total advertising expenditure – financial sector, by main product category, 2002-06
- The more commoditised financial products attract the greatest adspend
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- Figure 16: Distribution of advertising expenditure, by main product category, 2006
- General insurance products claimed the largest share of advertising expenditure in 2006
- Falling demand for consumer credit products will impact on adspend on loans and credit cards
Leading Finance Sector Advertisers
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- Lloyds TSB was the highest-spending finance advertiser in 2006
- Figure 17 shows the top 20 highest-spending advertisers in the finance sector in 2006. The previous year’s data are shown for comparison.
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- Figure 17: Top 20 advertisers in the finance sector, by expenditure, 2005 and 2006
- Multiple media options
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- Figure 18: Top ten advertisers in the financial services sector, by media type, 2006
- Direct mail appeals to plastic card issuers and insurers
- Personal Loan Express and Virgin Money are proactive online
- Top ten TV advertisers
- The press holds wide appeal
Brand Elements
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- Halifax
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- Figure 19: Words associated with Halifax, February 2007
- Brand qualities
- Recommendations and opportunities
- Lloyds TSB
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- Figure 20: Words associated with Lloyds TSB, February 2007
- Brand qualities
- Recommendations and opportunities
- HSBC
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- Figure 21: Words associated with HSBC, February 2007
- Brand qualities
- Recommendations and opportunities
- NatWest
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- Figure 22: Words associated with NatWest, February 2007
- Brand qualities
- Recommendations and opportunities
- Barclays
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- Figure 23: Words associated with Barclays, February 2007
- Brand qualities
- Recommendations and opportunities
- Capital One
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- Figure 24: Words associated with Capital One, February 2007
- Brand qualities
- Recommendations and opportunities
- Direct Line
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- Figure 25: Words associated with Direct Line, February 2007
- Brand qualities
- Recommendations and opportunities
- Norwich Union
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- Figure 26: Words associated with Norwich Union, February 2007
- Brand qualities
- Recommendations and opportunities
- Usage of brands
- Nearly a third of respondents have a Halifax product
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- Figure 27: Consumer usage of various brands, February 2007
- Attitudes towards brands
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- Figure 28: Attitudes towards brands, February 2007
- Brand satisfaction and performance
- Halifax and HSBC are highly regarded
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- Figure 29: Customer rating of financial brands, February 2007
- Brand commitment
- Halifax customers endorse the brand
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- Figure 30: Degree of customer commitment to brands, February 2007
The Consumer – Ad Recall
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- Survey background
- Halifax’ ‘Big Brovaz’ ad achieves highest recall rate
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- Figure 31: Consumer views on seven TV adverts, by selected finance companies, November 2006
- Barclays’ personal loan ad is the least recognised
- Attention grabbers
- Ad frequency: getting the right balance
- Being clever can also be confusing
- Barclays’ personal loan ad appeals more to men than women
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- Figure 32: Recall and view of Barclays’ TV ad, by gender, age and socio-economic group, November 2006
- Capital One’s ad is viewed more favourably by younger adults
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- Figure 33: Recall and view of Capital One’s TV ad, by gender, age and socio-economic group, November 2006
- Scottish Widows evolves the brand, while remaining committed to its core values
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- Figure 34: Recall and view of Scottish Widows’ TV ad, by gender, age and socio-economic group, November 2006
- Halifax’ Broadway act polarises the public
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- Figure 35: Recall and view of Halifax’ TV ad, by gender, age and socio-economic group, November 2006
- NatWest seeks to appeal to the disgruntled
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- Figure 36: Recall and view of NatWest’s TV ad, by gender, age and socio-economic group, November 2006
- Most consumers are not carried away by HSBC’s takeaway ad
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- Figure 37: Recall and view of HSBC TV ad, by gender, age and socio-economic group, November 2006
- Barclaycard hits the right note with men
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- Figure 38: Recall and view of Barclaycard’s TV ad, by gender, age and socio-economic group, November 2006
The Consumer – Behavioural Response
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- Over two thirds of consumers follow up on adverts
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- Figure 39: Proportion of adults who have sought information in response to different types of financial advertising, 2004 and 2006
- Implications
- Men are twice as likely as women to respond to online advertising
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- Figure 40: Proportion of adults who have sought information in response to financial advertising, by gender, age and socio-economic group, November 2006
- Implications
- TV ads make considerable impact on the under-35s
- Implications
- ABs most likely to respond to text messages and emails
- Broadsheet readers are most likely to respond to press ads
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- Figure 41: Proportion of adults who have sought information in response to financial advertising, by new technology usage, newspaper readership, commercial TV viewing, TV region and ACORN category, November 2006
- Over a quarter of the sample have made a purchase in response to ads
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- Figure 42: Proportion of adults who have made a purchase in response to different types of financial advertising, 2004 and 2006
- Implications
- TV ads are most effective at targeting the 25-34 age group
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- Figure 43: Proportion of adults who have made a purchase in response to financial advertising, by gender, age and socio-economic group, November 2006
- Implications
- The under-45s are most influenced by advertising
- Gender differences
- Ads tend to target the higher socio-economic groups
- Are providers succeeding in targeting workers via primetime ads?
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- Figure 44: Proportion of adults who have made a purchase in response to financial advertising, by new technology usage, newspaper readership, commercial TV viewing, TV region and ACORN category, November 2006
- Internet ads generate high conversion
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- Figure 45: Proportion of adults who have sought information or made a purchase in response to financial advertising, November 2006
- Link between ad response and product holdings
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- Figure 46: Financial products owned, by type of response to advertising, November 2006
- CHAID analysis identifies target groups
- What is CHAID analysis?
- The main target groups identified
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- Figure 47: Target groups identified for the main types of advertising media, November 2006
- Who reads direct mail?
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- Figure 48: Treatment of financial direct mail, 2004 and 2006
- Improving the odds of people reading your mail
- A small, but growing, proportion of people never read direct mail
- Younger people are more receptive to direct mail
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- Figure 49: Treatment of financial direct mail received, by gender, age, socio-economic group, lifestage and marital status, November 2006
- A fifth of mortgagors will read direct mail sent by a familiar brand
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- Figure 50: Treatment of financial direct mail, by working status, tenure, TV region and ACORN category, November 2006
- Getting people to read it in the first place is half the battle
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- Figure 51: Proportion of adults who have sought information and made a purchase, by treatment of financial direct mail, November 2006
- One in 20 adults do not receive direct mail
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- Figure 52: Demographic profile of adults who never receive direct mail versus the total sample, by gender, age, socio-economic group, TV region and ACORN category, November 2006
The Consumer – Response Stimuli
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- Advertising bells and whistles
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- Figure 53: Aspects which make consumers take note of financial adverts, 2004 and 2006
- Being humorous can help to win over consumers
- Celebrity saturation backlash?
- Entertain and inform: the best approach
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- Figure 54: Aspects that make consumers take note of financial adverts, by type of response to advertising, November 2006
- Targeting those who are already in the market
- Cluster analysis
- What is cluster analysis?
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- Figure 55: Total sample segmented into four ad-response clusters, November 2006
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- Figure 56: Aspects which make consumers take note of financial adverts, by ad-response cluster, November 2006
- Bargain Hunters
- Humour-mongers
- Motto Admirers
- Disengaged
- Bargain Hunters respond best to advertising…
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- Figure 57: Proportion of adults who have sought information in response to different types of financial advertising, by ad-response clusters, November 2006
- …over half have bought a product directly as a result of ad exposure
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- Figure 58: Proportion of adults who have made a purchase in response to different types of financial advertising, by ad-response clusters, November 2006
- Bargain Hunters are selective readers of direct mail
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- Figure 59: Treatment of financial direct mail, by ad-response clusters, November 2006
- Older age groups are more likely to be Disengaged
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- Figure 60: Ad-response clusters, by gender, age, socio-economic group, marital status, lifestage and working status, November 2006
- High-income households are twice as likely to be Humour-mongers
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- Figure 61: Ad-response clusters, by tenure, gross annual household income, region and ACORN category, November 2006
- Mid-market tabloids attract a fair share of Motto Admirers
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- Figure 62: Ad-response clusters, by new technology usage, newspaper readership, commercial TV viewing and supermarket usage, November 2006
- Further analysis
Summing Up and Moving On
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- Effective marketing communication underpins brand survival
- The best advertising hooks
- Brand salience is key
- Direct mail will continue to dominate…
- …but how effective is it?
- New media, new opportunities
- Converging technologies
- Internet advertising set to rocket
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