Financial services advertising can be difficult to do well, but that’s usually because there’s nothing much to say. In the absence of a clear value proposition, a newcomer may use puns and tricks to establish name awareness. Comparethemarket has seemingly built its business on that alone. But it can wear thin pretty fast. Black horses, anyone? Lloyds have finally moved past their equine obsession to their “it’s good to talk about money” campaign – though still it’s not clear what their role is. By contrast, when Santander promoted its 123 account with a market-leading 3% interest rate and lots of cashback, the message was enough. (Apparently this was because they had a clear business need to rebuild their deposits, leading to a great deal for customers, for a while.) Aviva’s promise to ensure existing insurance customers will get as good a deal as new ones is a modest but welcome move from which they’ve generated some striking communication. Directline’s “Does your home/car/landlord insurance do that?” has given them a platform to make lots of small features add up to feeling quite distinctive. So, if a marketing team finds it’s having to rely on weak puns, dodgy jokes or the screen appeal of celebrities, maybe it should go back and think again.

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What could be worse than saying we’re targeting women because they don’t understand money? In the 1980s Johnson & Johnson launched Empathy shampoo, clearly targeting older women. It didn’t last long. Presumably there was some functional benefit based on how hair changes with age, but it just came across as being for older women. Whatever the benefit was supposed to be, it transpired that nobody wants to buy the shampoo for old folks.

Targeting a group so explicitly based on one demographic is always a risky business. It’s one thing to say, “if you feel this way, we can do this for you”, knowing that women are more likely to feel that way. It’s a bit different to say, “This is for women”. Even if it’s true, no one likes to be told they’re all the same. The strategy may be to target women but that should be the media strategy not the message. It may seem old-fashioned, but you can’t go wrong with an insight about the need, leading to a clear benefit-led proposition. Just don’t tell them it?s because they’re old or female.

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His second book on the global financial meltdown, Boomerang, came out of Lewis’s research for The Big Short, and it’s a real page turner. There’s a chapter on each country and its madness – how US mortgage lending caused Greece to go bust, the precarious finances of the European country-sized state of California, and how even some sober-seeming Germans lost their heads, and their liberty. He’s sharp and very funny on national quirks – the chapters on what happened in Ireland and Iceland made me laugh out loud even as I gasped, “How could they get away with that?! And how did we not notice at the time?”

Related posts:

You’re a what?! Why job titles matter

Britain’s banks: our role in their downfall

Banks and customers – a lesson in obliquity

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Is that unfair? Here’s a bank trying to do better. The problem with their monthly courtesy call is that it is content-free. They offer me nothing. No information, no news, nothing that could be useful to me. In truth it’s unlikely they’ll chance upon something I want to hear anyway. It feels like something they’re measuring for their own purposes: “We call all our business customers at least six times a year and check all is well.” The presumption here is that I will value the calls, or perhaps it’s a tool to alert them to potential defectors.

The last time he called to check all was well, he failed to mention that it was also the last day of my introductory period of free banking. I only found that out when the charges came through. Somewhere in that organisation there is a lovely powerpoint deck showing the customer journey, and how they manage the transition at the end of the free banking period. Whether he bottled it, or whether making the call was really enough to tick the box and meet the target, somehow I don’t think that’s what was envisaged.

People calling from financial institutions are on a hiding to nothing anyway. Twenty years of receiving their outbound calls tells me that they probably have a target for some new “product” they’re trying to sell and I must be on my guard, reveal nothing and end the call for my own protection. I’m sure I’m not the only one who treats their calls like a training exercise in withstanding interrogation. I can’t respond to it in isolation from all my previous experience with banking. When someone calling himself a relationship manager calls I’m baffled and defensive in equal measure. It takes a long time to change entrenched views, especially when they’re emotional as much as rational. Honest and transparent communication would be a good start.

Perhaps they could take a lead from the insurance industry. After all the recent flooding there’ll be a lot of loss adjusters out and about. Now there’s a job title to focus the mind. The closest I’ve ever been to a loss adjuster is when I read William Boyd’s novel, Armadillo, but there seems to be a widely-held view that the loss to the insurance company figures as much as the loss to the householder, and any adjustment tends to be in one direction only. Consequently, you hear stories of people’s surprise and delight when a loss adjuster turns up and is helpful to them.

Driving expectations right down certainly creates the opportunity to exceed customer expectations, but it’s not a strategy I’d recommend (though it seems to be working for Ryanair). Clarity about your purpose, on the other hand, is helpful to everyone, and works at the individual level as well as for the whole enterprise. If the loss adjuster is clearly acting primarily to minimise the claim, they may as well come right out and say it – more or less as their job title does. By contrast, HSBC’s relationship manager doesn’t improve their “relationship” with me (if such a thing exists) by having a cuddly job title. Maybe it was even a factor in why he didn’t want to mention the nasty topic of bank charges – in case it spoiled the relationship, at least in that moment. More transparency to him about what’s expected might enable more transparency from him. In valued relationships each side gains something, and we don’t mind that the other side gains too. In good relationships people don’t have to conceal things from one another. So there should be no problem with the bank charges. If matey at the bank feels he daren’t mention it, something is wrong. Does he feel that they don’t represent fair value for me as the customer, or that I will give him a hard time if he flags it? Perhaps next time he should try asking me how I feel about it. I’d respect him for that. Listening is part of building a relationship too, so it wouldn’t do any harm on that front. Frankly I’d choose bank charges that come with efficient service in preference to the tedious phone calls. But they don’t know that because they’ve never asked. Rather than use labels and job titles to try to make things feel nicer, a bit of old-fashioned discovery about what delivers value could be liberating all round.

More comment on the financial services industry

Britain’s banks: our role in their downfall *

Banks and customers – a lesson in obliquity

Still not really “on your side”

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First, let’s think about efficiency. This should be good for customers and business alike, as long as you and your customers have a common view of what is efficient. I know a contact centre for a financial services business, which had, like so many, efficiency targets for its staff. They were measured on the number of calls they could handle in the day, to encourage them to be swift and efficient. As revenues declined, the drive to reduce costs through even greater efficiency meant pressure to get through more calls in a day. But the call centre people were committed, and experienced, and rose to the challenge.

Then, a new customer service director arrived who decided this was the wrong focus. He removed all time-based measures, and instead targeted them on resolving customer inquiries first time. Call times went up, and the number of calls per agent per day declined – but over time, the number of calls fell even more, because agents were resolving issues on the first call, even if it took a little longer. Soon, the business was able to reduce its contact centre staff by not replacing leavers, reducing costs while increasing customer satisfaction. The hidden cost of the old model was that customers had to call back time and again to get the job done. It incentivised staff to get customers off the phone as quickly as they could, with little regard for customer satisfaction. Those LED screens showing the number of calls waiting and average call handling time had no indicator for call outcomes – perhaps the thing customers cared about most.

My other example is about imagination as much as metrics. A high street bank had a tried and tested direct marketing process to encourage those with short term unsecured loans to borrow again as the current loan drew to a close. A letter offering a new loan was sent out when there was one month left on the current loan, and then monthly until the customer responded (or until the budget ran out presumably). The IT systems didn’t distinguish between those with 12 month loans and those with 24 month loans, which meant that customers with a two-year loan were getting offers to borrow again while they were barely halfway through their term. The prevailing view in the bank was that while it cost a few more letters and therefore reduced return on investment, it wasn’t a problem because the renewal rates were good enough to ensure the campaign was still profitable. In vain, the junior marketer (who told me this story) pointed out that while the campaign might deliver “positive ROI” financially, there could be a cost in reduced credibility and trust, damaging the bank’s relationship with its customers, but the negative impact of repeated unsolicited and ill-fitted offers wasn’t so easy to measure. I’ll bet it was heard in more than a few focus groups though, even if customers didn’t bother to complain proactively.

In both these cases, a bit of thought about purpose would have helped. A good purpose reflects a customer need, so it naturally prompts thinking around what customers expect and value.

Alternatively, common sense can do the same job. For any given customer interaction, ensure the dominant metric relates to the customer’s primary purpose in that interaction – the what, not the how. While the trimmings, like politeness and promptness, do matter, they cannot be at the expense of the what.

A customer-centric approach engineers processes that suit customers in the first place, and removes things that are not intuitive for customers. Just like elite athletes with their focus on finding marginal gains for the team, marketers can do the same for their customers, knowing it will deliver for the business in the long run.

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What would a chief customer officer do? Find out what customers care about, perhaps. Test people’s willingness to pay, so as to identify what they really value. Share this understanding with those who design and deliver the customer experience – whether that’s made in a factory or delivered via a call centre. Set up two-way communication with customers to shape their expectations and check that the business is meeting them. Drive the organisation to implement change for the better.

You know where this is going, don’t you? The Marketing Society’s manifesto for marketing leadership talks about mobilising the organisation and this is what we mean. It’s part of the marketer’s job to match the capabilities of the organisation to the needs of the marketplace. Marketing communication is when you tell people about that – it’s only part of the job. Brand management was invented in fmcg as the place where the whole enterprise came to a focus around meeting a promise – the brand – being made to a customer (originally the end-consumer but now encompassing the retailer or distributor too). So, learning my trade in fmcg, where brand management and marketing are synonymous, I never had any doubt that marketers were best placed to help the organisation identify and create market opportunities. Marketers carried both the responsibility and the authority to orchestrate the organisation and its resources to meet consumer needs better than competitors, so as to gain market share and grow the brand profitably. This meant a brand manager had to be connected to the marketplace and to the commercials of the business equally well, and able to share that understanding with others. We should not cede that ground. And yet, some chief marketing officers, including one in a highly respected fmcg business known for its smart marketers, have added a reference to customer to their title. As if marketing isn’t about the customer.

So what’s gone wrong? Part of the problem is that in the USA, and increasingly here too, marketing is used to mean the promotion of whatever the business is selling – but that’s just marketing communications, an important subset of marketing, not the whole thing. Perhaps it’s no accident that brand management was invented by an American company – maybe because marketing was already limited as a term.

I know from experience that it’s harder in other sectors like financial services where the authority of the marketing department is constrained. We have to find other ways to influence the rest of the business. A common response to this is to set out a brand vision or purpose-led brand promise, and then promote it internally as a unifying concept that can set the direction for the whole business. This rarely works (unless the CEO leads it), precisely because marketing as a function doesn’t have that kind of authority or credibility. It’s frustrating for marketing people in service businesses that other functions tend to see the brand as communications and design, maybe a promise, but not as an agenda for anyone else to follow. I used to share their frustration, but I’ve changed my view. Why on earth should other parts of the business see the world in a brand-centred way? I’d go further and say that brand can be a divisive concept inside a large business, especially in service businesses where there’s no pack labelled with the brand name. Such businesses often have lots of initiatives going on, led by different functions. This can be confusing for people in the business, at best, and they may cause different functions to compete for initiative supremacy – HR with their culture change, marketing with their brand-led change, perhaps customer service with something about service excellence, all of them with merit. Notice that all these initiatives have internally-defined reference points. However much marketers insist that brands are created in the minds of consumers, a brand vision is something articulated by the marketing department. Why should the other functions all accept marketing’s view of the world, as defined by their brand ambition?

The solution is to take an external reference point – your customers. It’s still strategic marketing, because no business can serve all customers equally, so the core disciplines of market segmentation and positioning are still vital. The benefit is that the customer, unlike the brand, cannot be owned by one department. Everyone plays a part in serving customers. If marketing see their job as being to identify the best fit between customers’ needs and the capabilities of the business, well, that’s an agenda that everyone can engage in. So I’m all in favour of every business having a chief customer officer, as long as she’s called the marketing director. Step forward, marketers – it’s our job to represent the customer. Sometimes it helps to spell things out so there is no room for doubt. But even if it’s not in your job title, it’s in your job.

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Taleb is funny and irreverent as well as original and hellishly smart. He says this book is the culmination of the thinking he’s been working through in Fooled by Randomness and then Black Swan. The big idea in here is that systems that build strength through responding to stress are stronger than those which simply resist stress – these latter types may be robust up to a point, but then fail big. Banking, the human body, entrepreneurs and corporate journeymen all feature in bringing this idea to life. I’ve taken my investment strategy from this book: limit your downside, create exposure to large potential upside even if it seems unlikely (something he calls creating optionality). This is the natural evolution of his Black Swan theory. For a business, it translates into a totally different approach to risk assessment: forget about prediction and probability; instead identify and mitigate your areas of vulnerability, based on their potential impact. Strong stuff that may change how you see business and government – and you will also laugh out loud. What a joy.

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So the banks are baddies, the utility providers are exploitative and now we learn that supermarkets and food manufacturers are mostly incompetents being hoist by their own over-extended-supply-chain petard (if you can say that). Morrison’s and Waitrose are out there talking about their local sourcing and close relationships with farmers. This is a highly credible response, since it’s rooted in who they are – their brand, if you like – and so is already reflected in their established working practices and instore offerings. It’s also delivering a benefit to their customers, and I hope they get their rewards.

There are other brands, not mired in scandal, which are also trying to build trust by doing Good Things, presumably to show they are nice people and therefore can be trusted. On first glance these seem like the actions of a very caring company – but look closer and you’ll see it’s not about doing what’s best for their customers, it’s about caring about their own reputation, and looking like a nice company. When Virgin Trains finally won their legal battle against the flawed tendering process for the West Coast main line franchise, The Bearded One “pledged to donate all profits to good causes”. Why, for goodness sake? If you don’t want them Richard, have you thought that maybe your customers might? Why give the profits to charidee when you could reinvest them in making the service better or cheaper for the people who generated those profits in the first place. Then there’s Simply Health, the people who advertise that they “can be bothered”. For every like they get on Facebook they’ll give £1 to medical research, and they’ve made a TV ad about it. This is just daft. Give money to research by all means, but don’t waste serious money telling people about it. We don’t care! Better still, why not spend the money doing something for customers, and make an ad about that? Then they might win more customers. As it is, a customer could be quite annoyed that they’re spending money advertising a giveaway which non-customers can increase. Businesses have a responsibility – both to their customers and to their shareholders – to care about their customers, but that’s not about being nice, it’s about keeping customers satisfied, so as to keep customers.

I saw a lovely example in Homebase, which may be driven out of the necessity to reduce staff numbers in quieter periods, but which recognises the value of customers’ time. There’s a big colourful button at the paint mixing stations which you press for service if there’s no one there. If they don’t come in 2 minutes you get 10% off your paint. Pizza companies have long used these approaches – if it takes more than 30 minutes it’s free – as a way of showing their confidence in their speedy delivery. This is a bit different, because you’ll only press the button if there’s no one there to serve you; it says, we know that waiting around is a drag so either you won’t have to do it or we’ll compensate you. Now that’s the kind of caring I’m interested in. Homebase can give a fiver to Richard Branson every time the button is pushed for all I care*; as long as they’re putting me and my needs first, I can recommend them.

*though I’d rather they didn’t so if you do, Homebase, please don’t tell me, I’d rather not know.

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A couple of years ago I was incensed when Compare the Market narrowly won a vote among Marketing Society members to be brand of the year, beating Waitrose by one vote. Why my outrage? Because the much-loved (back then) Meerkats campaign was a witty, memorable trick that covered the total absence of a differentiated proposition. Full marks to the advertising agency, but surely no more than a C for the marketing director. This may be harsh as I have not seen hard data on its business performance, but I’m told that the Meerkats campaign has helped shift Compare the Market from a little-known minor player in its sector to a well-known minor player in its sector. This may still change, because, luckily for them, in the scrum of comparison websites, all shrieking to be heard, their competitors mostly have nothing much to say either, other than their names. That’s not great marketing, even if it is good clear communication. So I am reluctantly grateful that TopCashback not only tells you what they do and how it benefits you, the customer, but even covers the main differentiating points as well (no fees etc.) – all in a traditional thirty second TV ad. Full marks.

Meanwhile Nikon is airing a couple of lovely feel-good ads full of wonderful memorable moments, with something for everyone, and a great soundtrack. I wonder why. From a viewer’s point of view, it’s a much nicer experience than any I’ve mentioned so far, and no doubt they scored well in consumer research. Advertising research models, like Brainjuicer’s, increasingly correlate positive emotional responses with advertising effectiveness. This is a sound approach in many big categories like fmcg and retail, where brand communication is judged by its ability to drive consumer preference for one brand over another, the assumption being that people are in the category, and the challenge is to be the chosen brand. This campaign may well create a warm glow around Nikon, and may even make it people’s preferred camera brand (or, one we can name, at least). But from a business point of view, what can it do for them? It doesn’t say much about Nikon. Although it does subtly show different models through different executions, you have to be really interested to spot that. The ads are constructed around different moments worth capturing, not different features of the cameras. To the averagely attentive viewer, it feels like a generic ad for photography, providing a basic reminder that cameras exist. Yes that may be necessary – who remembers to bring a camera nowadays when your phone does the job? – but will reminding us really improve their fortunes?

Of course I know Christmas is a critical time for them, and they must seize the gifting moment while it’s here. It?s also possible that they’ve negotiated retailer promotions on the back of their TV campaign, or even that TV advertising was a requirement to gain shelf space in the major outlets at Christmas. They may feel they have no option but to advertise, just to stay on the shelves. No doubt about it, being the marketing director of a camera company right now is not for the faint-hearted. Along with alarm clocks, fax machines and camera film, there’s a market for them but their best days are behind them. Sadly, lovely advertising can’t save them if the product is obsolete, or if they don’t give us good reasons to choose it.

So what’s next for our neon-clad dancing friend from TopCashback? Well, there’s lots of evidence that consistency helps a brand to be recalled, which helps generate business. Oh dear. If TopCashback keep up the good work, we’ll all be singing that wretched jingle for a long time.

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