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Providers growing disillusioned with affinity marketing

Product providers are frustrated with affinity partnerships which offer nothing more than a distribution channel for their marketing literature, according to a report from consultancy Watson Wyatt.

The report, Affinity Trends in the Development of Distribution Partnership, reveals that financial services companies are complaining of apathy, lack of focus, slow decision-making, inexperience and poor operational quality on the part of affinity groups through which they market their products.

Because of this attitude, Watson Wyatt says providers are focusing on groups with large membership or customer bases, quite often ones which are themselves in the financial services industry.

It points to relationships between organisations such as Tesco and Direct Line Insurance, Ford and Norwich Union, Centrica and the AA and Goldfish and British Gas as successful examples of affinity partnerships.

But, the consultancy says, for every success there are countless failures and it expects many affinity partnerships to be reviewed over the next year.

Senior consultant and report co-author Frank Fletcher says: “Partner commitment is a concern for all involved in this market but affinity groups that sell financial products to their members or customers on behalf of insurers will not make a success of it unless they take their role in marketing these products seriously.

“There is a huge opportunity for mutual commercial success in these relationships but too often there is a mismatch of expectations or the distribution arrangements are poorly implemented.”

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