Table of Contents
Issues in the Market
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- Main findings of the research
- Abbreviations
Insights and Opportunities
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- The CTF is creating clear opportunities for providers to exploit
- A desire to treat children equitably could boost non-CTF sales
- Providers need to encourage saving in the form of presents
- There would appear to be latent demand for affordable products
Market in Brief
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- A variety of factors are driving demand for children’s savings
- The children’s savings market has grown in the last few years
- Trade perspective: CTF has raised the profile of children’s savings
- Mintel’s research findings: Product ownership
- Mintel’s research findings: Attitudes towards saving for children
- Mintel’s research findings: Targeting opportunities
Fast Forward Trends
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- Living Better, Longer
- What's it about?
- What we've seen
- What’s next?
- Girls Think Pink
- What's it about?
- What we've seen
- What’s next?
Broader Market Environment
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- Key points
- The fertility rate now stands at its highest level in 26 years
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- Figure 1: Total fertility rate in the UK, 1960-2006
- The total number of children in the UK is projected to rise
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- Figure 2: UK population projections, by age, 1997-2027
- Household patterns have changed considerably in last few decades
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- Figure 3: Households, by type of household and family, Great Britain, 1971-2006
- The growth of the lone parent
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- Figure 4: Dependent children, by family type, Great Britain, 1972-2006
- Lone-parent families tend to save less than couple families
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- Figure 5: Distribution of savings, by family status and amount of savings, 2005/06
- The overall savings ratio remains at an historically low level
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- Figure 6: Personal disposable income, consumer expenditure and the savings ratio, 2002-12
- Any further rise in Child Benefit would also have a positive impact
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- Figure 7: Rates of Child Benefit, 1995-2007
- Pocket money trends could also boost children’s savings
- Heightened need for children to save will boost the market
- A farewell to alms
- The pension problem
- The housing problem
Internal Market Environment
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- Key points
- The CTF is having a major impact on children’s savings market
- The low-down on the CTF
- This initiative will inevitably boost the number of child savers
- The CTF could become a catalyst for developing a savings culture
- CTF success could dampen demand for ‘traditional’ products
- Low nominal interest rates tend to constrain deposit-based growth
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- Figure 8: Bank of England base rate, end of quarter, 1972-2007
- A strong stock market has boosted equity-based products…
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- Figure 9: FTSE 100 index, last working day of each month, 1994-2007
- … but market turbulence could hit future sales
Competitive Context
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- Key points
- Standard savings products are sometimes used to save for children
- Adult savings and debt repayments could hit children’s savings
- Presents could also be classed as a ‘competitor’
Strengths and Weaknesses in the Market
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- Strengths
- Weaknesses
Who’s Innovating?
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- Key points
- The CTF has stimulated innovation in product design
- A number of niche products have been launched
- This initiative has also led to the launch of other new products
Trade Perspective
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- The number of savers has increased in the last few years
- Firms adopt subtle differences when marketing to children
- The CTF has raised the profile of the children’s savings market
- Stakeholder dominates; but some parents prefer the cash option
- The CTF initiative is helping to engender a savings culture
- CTF accounts can be profitable despite the low charges
- Competition to recruit ‘future’ customers is expected to intensify
Market Size and Forecast
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- Key points
- Almost 13 million adults hold savings products for a child
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- Figure 10: Estimated number of adults owning children’s savings and investment products, 2003 and 2007
- On the downside
- 3 million CTF accounts have now been opened…
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- Figure 11: Number of Child Trust Fund vouchers issued and accounts opened by parents, 2005-07
- …but plenty of parents have left it to the experts
- Three quarters of all CTF accounts are stakeholder versions
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- Figure 12: Child Trust Fund breakdown, by type of account and asset value, April 2007
- One in four CTF accounts have received extra contributions
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- Figure 13: Child Trust Fund contributions, by account type, April 2007
- More than a fifth of CTF accounts are worth £600 or more
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- Figure 14: Child Trust Fund market values, by account type, April 2007
- The total amount saved on behalf of children is around £11 billion
- Forecast
- Assumptions
- Potential to bring 3.5 million new savers into the market
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- Figure 15: Market forecast for children’s savings products, 2003-2011
- Two key target groups
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- Figure 16: Identified target groups within total population, 2007
- How the 3.5 million potential future savers were estimated:
Market Share
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- Key points
- Family Investments is the leading provider of CTF accounts
- Family Investments – a look at the leader
- The Children’s Mutual
- Four providers account for six in ten children’s savings accounts
Companies and Products
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- Key points
- The children’s savings market covers a diverse product range
- Child Trust Fund accounts
- Savings deposit accounts
- National Savings & Investments products
- Tax-exempt children’s savings plans
- Other equity-based products
- Pensions
- A broad range of organisations operate within this sector
- The mutual sector accounts for the majority of CTF providers
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- Figure 17: List of organisations approved to provide CTF accounts, September 2007
Brand Communication and Promotion
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- Key points
- The government has spent almost £11 million promoting the CTF
- A major campaign
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- Figure 18: Total amount spent by the government on advertising the CTF, by media type, 2004/05-2006/07
- From small seeds…
- Total industry adspend amounted to £1.2 million in last 12 months
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- Figure 19: Advertising expenditure on children’s savings and investment products, 2002/03-2006/07
- Declining spend
- The press accounts for the largest proportion of expenditure
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- Figure 20: Advertising expenditure on children’s savings and investment products, by media type, 2005/06 and 2006/07
- Investment firms top the children’s savings adspend chart
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- Figure 21: Advertising expenditure on children’s savings and investment products, by organisation, 2005/06 and 2006/07
- A friendly word in your ear
Brand Elements
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- Brand map
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- Figure 22: Attitudes and usage of children’s saving brands, July 2007
- Halifax/HBOS
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 23: Attitudes towards the Halifax/hbos brand, July 2007
- Nationwide
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 24: Attitudes towards the Nationwide brand, July 2007
- HSBC
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 25: Attitudes towards the HSBC brand, July 2007
- National Savings & Investments
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 26: Attitudes towards National Savings & Investments, July 2007
- Lloyds TSB
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 27: Attitudes towards the Lloyds TSB brand, July 2007
- Barclays
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 28: Attitudes towards the Barclays brand, July 2007
- Children’s Mutual
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 29: Attitudes towards the Children’s Mutual brand, July 2007
- Britannia Building Society
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 30: Attitudes towards the Britannia brand, July 2007
- Abbey
- Brand background
- What the brand is trying to achieve.
- What consumers think?
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- Figure 31: Attitudes towards the Abbey brand, July 2007
- Brand qualities of children’s savings products brands
- Nationwide and Halifax are most accessible
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- Figure 32: Brand qualities of various children’s saving brands, July 2007
- Brand usage and consideration for children’s savings
- Children’s Mutual is least familiar
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- Figure 33: Usage and Consideration of various children’s savings brands, July 2007
- Brand satisfaction in children’s savings
- A mutually rewarding relationship
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- Figure 34: Satisfaction with various children’s savings brands, July 2007
- Brand commitment in children’s savings
- Nationwide customers are most committed
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- Figure 35: Commitment to various children’s savings product brands, July 2007
- Round up
Channels to Market
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- Key points
- Various channels are used to distribute children’s savings products
- Some CTF providers work with a wide array of distributors
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- Figure 36: List of CTF distributors, by provider organisation they are working with, September 2007
- Affinity partnerships can be used to generate new custom
- The Internet is becoming an increasingly important channel
The Consumer – Product Ownership
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- Key points
- Survey background
- One in eight consumers regularly save for their own children
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- Figure 37: Frequency of saving or investing for children, by relationship to child, July 2007
- A total of 15 million adults are saving for a child’s future
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- Figure 38: Proportion of adults saving or investing for children, July 2007
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- Figure 39: Profile overview of adults saving or investing for children, July 2007
- C2 aspirations
- Family savings analysis
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- Figure 40: Frequency of saving or investing for own children by parents at the family lifestage, by gender, age, socio-economic group, income and newspaper readership, July 2007
- CTF accounts are the most commonly held children’s products
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- Figure 41: Types of saving and investment products held for or on behalf of children, July 2007
- Deposit-based savings
- Three quarters of parents with under-5s hold a CTF account
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- Figure 42: Types of saving and investment products held for or on behalf of children, by age of own children in household, July 2007
- The CTF effect
- NS&I products are a popular choice with grandparents
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- Figure 43: Types of saving and investment products held for or on behalf of children, by relationship to child, July 2007
The Consumer – Attitudes towards Saving for Children
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- Key points
- A large majority of adults feel children need to have savings
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- Figure 44: “It is essential children have savings for when they are older”, July 2007
- All those against
- Here’s to absent presents
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- Figure 45: “It is a good idea to spend less on presents and instead save more for the future”, July 2007
- The present profile
- Most respondents feel the CTF will encourage parents to save
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- Figure 46: “The Child Trust Fund will help parents get into the savings habit”, July 2007
- Hitting the gaps in the market?
- Most families with young children have faith in the CTF
- The CTF is also expected to get children into the savings habit
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- Figure 47: “The Child Trust Fund will help children get into the savings habit”, July 2007
- Creating a savings habit among non-savers?
- Most mid-income households feel the CTF will boost savings
The Consumer – Targeting Opportunities
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- Key points
- Four in ten consumers feel the CTF is a good idea
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- Figure 48: Level of agreement with various statements relating to saving for children, by age of own children in household, July 2007
- Optimising on gifts
- The family budget
- Financial fears
- Passing on the saving habit
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- Figure 49: Level of agreement with various statements relating to saving for children among savers, by relationship to child, July 2007
- Most savers hold just one type of children’s savings product
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- Figure 50: Number of children’s savings and investment products held, July 2007
- CTF and deposit accounts dominate the single-product group
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- Figure 51: Repertoire analysis on number of children’s savings and investment products held, July 2007
- Dissecting the sample according to attitude and behaviour
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- Figure 52: Segmentation according to attitude and behaviour towards children’s savings products, July 2007
- The 18-44s and ABC1s tend to be positive and proactive
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- Figure 53: Segments based upon attitude and behaviour towards children’s savings products, by gender, age and socio-economic group, July 2007
- Financial constraints are likely to hinder would-be savers
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- Figure 54: Segments based upon attitude and behaviour towards children’s savings products, by working status, income, TV region, age of children and newspaper readership, July 2007
Appendix
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- Proportion of adults saving for children
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- Figure 55: Proportion of adults saving or investing for children, by gender, age, socio-economic group and age/socio-economic group, July 2007
- Figure 56: Proportion of adults saving or investing for children, by lifestage, Mintel’s Special Groups, detailed family lifestage and marital status, July 2007
- Figure 57: Proportion of adults saving or investing for children, by working status, income, TV region and newspaper readership, July 2007
- Product ownership
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- Figure 58: Types of saving and investment products held for or on behalf of children, by gender, age, socio-economic group and TV region, July 2007
- Figure 59: Types of saving and investment products held for or on behalf of children, by lifestage, Mintel’s Special Groups, working status and income, July 2007
- Importance of children’s savings
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- Figure 60: “It is essential children have savings for when they are older”, by gender, age, socio-economic group and age/socio-economic group, July 2007
- Figure 61: “It is essential children have savings for when they are older”, by TV region, income, lifestage and detailed family lifestage, July 2007
- Presents or cash?
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- Figure 62: “It is a good idea to spend less on presents and instead save more for the future”, by gender, age, socio-economic group and age/socio-economic group, July 2007
- Figure 63: “It is a good idea to spend less on presents and instead save more for the future”, by TV region, income, lifestage and detailed family lifestage, July 2007
- Impact on parents’ savings habits
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- Figure 64: “The Child Trust Fund will help parents get into the savings habit”, by gender, age, socio-economic group and age/socio-economic group, July 2007
- Figure 65: “The Child Trust Fund will help parents get into the savings habit”, by TV region, income, lifestage and detailed family lifestage, July 2007
- Impact on children’s savings habits
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- Figure 66: “The Child Trust Fund will help children get into the savings habit”, by gender, age, socio-economic group and age/socio-economic group, July 2007
- Figure 67: “The Child Trust Fund will help children get into the savings habit”, by TV region, income, lifestage and detailed family lifestage, July 2007
- Attitudes towards saving for children
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- Figure 68: Level of agreement with various statements relating to saving for children, July 2007
- Figure 69: Level of agreement with various statements relating to saving for children, by relationship to child, July 2007
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