Pensions minister Steve Webb talks about automatic enrolment as a “quiet revolution” but his department is (to paraphrase Work and Pensions Secretary Iain Duncan Smith’s infamous speech) “turning up the volume” in promoting the reforms to the UK public.
From adverts featuring TV stars to branded sandwich bags, the DWP is pulling out all the stops to ensure the £11m auto-enrolment marketing budget it squeezed out of the Treasury is well spent.
The big(ish) budget TV advertising campaign
The cornerstone of the Government’s attempts to promote auto-enrolment is a £3.5m TV campaign featuring The Apprentice stars Nick Hewer and Karen Brady and Dragons Den’s Theo Paphitis.
The adverts have generally been well received by the industry.
Legal & General pensions strategy director Adrian Boulding says: “The TV advertising campaign has been fabulously successful because it has a very, very simple message.
“That has been part of changing the mindset of the country around pensions and we are witnessing the results with amazingly low early opt-out rates.”
B&CE director of customer solutions Jamie Fiveash says: “The TV campaign the DWP has run was needed and has been very successful in raising awareness among individuals.
“We are now moving into a phase where the volumes are all about employers and the awareness campaign needs to switch focus to making sure they know what they need to be doing.”
Auto-enrolment has also, incredibly, become something of a youtube sensation – thanks to a rap from Rochelle, one of the stars of the TV ad campaign. The clip has been viewed over 90,000 times.
The DWP’s communications campaign has not been without problems, however.
The first iteration of the project, a poster campaign, involved a selection of Lego characters and building blocks showing who pays what into a pension scheme under auto-enrolment.
One senior industry source says: “We had to tell the DWP to go back to the drawing board after the first set of posters were produced because they simply weren’t good enough.
“They were not clear at all about what auto-enrolment actually is but to give the DWP credit they listened and came back with something which was much, much better.”
Boulding says: “The simplicity of the TV campaign is in stark contrast to the early material the DWP put out with the Lego characters and an explanation of the different percentages.
“It was too much detail. Great for pension geeks like me and finance directors, but no good for consumers.”
“Something to chew over”
The DWP is not just relying on celebrities to tell people about auto-enrolment.
It has distributed DWP-branded sandwich papers bags to 600 outlets nationwide with the message: “Something to chew over”.
A DWP spokeswoman says: “Using techniques such as the sandwich bags helps us to reach employees during their working day, in context.
“This tactic encourages workers to find out more about the campaign online during their lunch hour.”
Between May and June 2013, the Government used a “commuter strategy” – targeting people on their journey to work through commuter press and outdoor media.
The Government has also used large-scale “super banners” in major UK cities to draw attention to the reforms.
The employer awareness problem
Industry experts say the DWP is failing to instil a sense of urgency among small and medium-sized employers, and warn of potential mass non-compliance if the issue is not addressed.
Boulding says: “The worrying side of the story is the messaging for medium-sized employers who are due to stage next year.
“The DWP has relied too much on advisers and pension providers driving the activity. The gestation period for creating a pension scheme is closer to that of an elephant than a mouse – it is not something you can deliver over night.
“If DWP does not improve its communications with these people we do face the prospect of mass non-compliance. That would be a disaster because the regulator’s enforcement regime is based on the premise that 95 per cent of employers will comply.”
Hargreaves Lansdown head of corporate research Laith Khalaf says the employer awareness problem risks being compounded by an anticipated “capacity crunch” next year.
He says: “Most employers know auto-enrolment is coming but don’t know what is required to be compliant.
“In most cases, a six-month lead-in time is appropriate but a lot of employers are assuming they can just carry on with their existing provider and do nothing.
“That is not necessarily the case and this problem risks being compounded by a capacity crunch which is fast coming down the track.”
A DWP spokeswoman says: “The campaign targeting employers launched on 30 September and will continue until 15 December.
“It comprises national press advertising, business press, radio, mobile and digital display and is designed to supplement a range of targeted direct communications to employers from The Pensions Regulator as they reach various stages of their compliance with the new law.”
Visit moneymarketing.co.uk to see the DWP’s adverts in full