Now the chief marketing officers of the big banks don’t earn the kind of money that Barclays, for example, dispenses among its top managers and performers.
Which, with share sales granted under incentive schemes, means that Barclays CEO Bob Diamond will pick up £27m maximum this year and two traders at Barclays Capital, Jerry del Missier and Rich Ricci (no, this isn’t a joke, it’s not The Sopranos) will trouser a max of £47m and £44m respectively.
All this at a time when long-suffering Barclays shareholders have seen the value of £100 invested in the bank five years ago fall to £53 today while the whole FTSE Index has risen to £126 in that time.
The entirely predictable outcome is widespread outrage. The world’s big banks (including Barclays) have been supported by a tidal wave of government money since the credit crunch struck in the fall of 2008.
So Barclays and the like have been lending money that cost them a bit above nothing to others at interest rates at five per cent and above and have profited mightily. But far more for themselves than shareholders.
So how on earth can you make a credible case to consumers that you’re a responsible institution that will, first, be an appropriate home for customers’ accounts and savings and then be something worth investing in?
And, then, how can you exercise the skills of advertising and marketing to attract a bigger share of the audience by presenting yourself as an attractive institution? When the whole world thinks you’re another bunch of bandits among a veritable Hole in the Wall Gang?
Well it’s hard obviously.
For a start you can’t differentiate yourself. You can’t say ‘they’re all crooks but we’re not,’ or a milder equivalent thereof.
Also you’re beset by rules and regulations about what you can offer. So radio ads for financial services are almost pointless because two thirds of the airtime is occupied by caveats insisted on by the Financial Services Authority in the UK and other such entities around the world.
This is a classic case of not seeing the wood for the trees. It’s not the individual products which are at fault but some of the banks and others who sell them.
So how do you get around it – honestly.
We’ll look at advertising in a moment but most people’s main experience of banks is still bank branches and, while they are less forbidding and more helpful places than in the past (at least in the UK) they still don’t exactly fall over themselves to make customers feel wanted.
Some of the big UK banks are experimenting with a different approach in a few of their big city, posher branches but it’s a bit of a giveaway that we say ‘experimenting.’
Creating a more customer-friendly experience should be an ongoing process surely and not one confined just to big, posh branches.
A new US-backed bank in the UK, Metro Bank, has just two branches in London’s Holborn and Earl’s Court but it has already made quite an impact through its retail-style customer service. It calls its branches ‘stores’ although in truth they look more like a mid-western casino.
Barclays has a posh new ‘designer store’ branch in Sloane Square (handy for the capital’s toffs when they’re out shopping at Peter Jones, hoping to catch a glimpse of princess-to-be Kate Middleton). HSBC has been trying to spruce up its act as has Lloyds.
If Sir Richard Branson’s Virgin Money ever succeeds in getting its hands on a branch network (he’s interested in the 600 branches Lloyds has to sell to satisfy the European Commission and also the about-to-be privatised Northern Rock) we could probably expect something quite radical.
Good old-fashioned branches are the focus of competition now between the banks as most of them have (belatedly perhaps) improved their online offerings.
A cynic would say that a real competitive advantage would be offering cheaper loans, mortgages and credit cards (and better rates to savers). Cue sharp intake of breath among the banking establishment.
Advertising though remains important and has the decided advantage if being able to avoid bankers entirely (which is where we came in).
Lloyds Bank advertising in the UK from RKCR/Y&R is a pretty good example. Lloyds has been in the knacker’s yard because of its disastrous government-induced merger with Halifax, ending up with the UK taxpayer owning just over 40 per cent of the merged businesses.
But the Lloyds core business still works pretty well and, sooner or later, it will pay back the British taxpayer. Next year the merged business will earn about £8bn I reckon, unless the Eurozone (especially Ireland) goes down the tubes completely.
And Lloyds’ rather fey, animated campaign on the theme of ‘the journey’ has been exactly the horse for the course.
It doesn’t feature people or anyone who could possibly look like a real, hated banker. It’s a benevolent Brothers Grimm version of charting your way through your financial life.
It’s very clever.
It wouldn’t work for everybody of course but it’s a classic case of selling your product whilst surgically removing who’s selling it.
Here’s an example.
Selling banking without bankers really is the name of the game just now.