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The resonators

Keep communicating through good and bad times and make your message reverberate.

Ask people in financial services how they should market themselves and you may well get a different reply from each individual.

Conventional wisdom still says advertising is the main tactic but there are other approaches to consider.

Lessons can be learnt by examining the behaviour of some of the biggest players in the market.

A company needs to consider its environment. Confidence in the market and financial institutions is still jittery and consumers are sitting on their hands. The proportion of money going into savings accounts reached an all-time high last year.

After a lot of analysis, our view is that things are tough and, in the life industry at least, no one is really doing anything which might be seen as putting their head above the parapet.

In marketing terms, this is a cardinal sin.

Advertising for any business is crucial. Brand is fundamental for the bigger firms. These groups are facing challenges and the power of brand icons is diminishing. Reson-ance is what it is all about.

ING has cleaned up in the savings account market. First Active has, by all accounts, made a very good start. In each case, both contain a simple message which is well expressed.

The consumer confidence shortfall has made things difficult for IFAs but when times are difficult you must communicate.

McGraw-Hill Research analysed 600 industrial companies covering 16 different SIC industries from 1980-85.

The results showed that those firms which maintained or increased their advertising expenditures during the 1981-82 downturn averaged significantly higher sales growth both during the recession and for the following three years than those companies which either eliminated or decreased advertising.

By 1985, the sales of companies which were aggressive recession advertisers had risen by 256 per cent over those that did not keep up with their advertising.

Advertising gives you share of mind and therefore permission to speak but what do you say to your customers?

For a start, you do not talk about product. Financial products are, by and large, similar and the lack of confidence means you should spend your time justifying why you are recommending one company over another – this is why life companies spend so much on brand advertising.

You get the basics right, you talk about service and you hire top-quality internal people to do your communication.

First Active, for example, planned its products and launch around MCOB regulations and has stolen a march on competitors.

Keep your promises realistic. You can run the greatest marketing campaign but if you do not live up to the promise, your customers will spot the gap.

Maintaining your communications gives the image of stability. Take Standard Life. There is still a good degree of loyalty among IFAs despite its recent difficulties.

The reason is that the firm has kept in touch with advisers through good times and bad. The people at Standard Life know that when times are good, you should communicate but when times are bad, you must communicate.

Sharing knowledge is another important factor. If a firm wants to be a market leader then it must behave like one. Product does not give competitive advantage, knowledge does. Many of our projects in financial services and in other sectors revolve around the judicious deployment of knowledge-based activity.

Finally, there are two pieces of advice which are crucial.

First, marketing is everyone’s task. Everyone bad-mouths the huge budgets, the waste, the marketing department. Marketing is everyone’s job – it is not an adjunct to what goes on in the rest of the organisation.

In financial services today, marketing is the lifeblood of an organisation. Helping people come round to this way of thinking is one of the most effective things that can be done.

Second, we recommendation that a firm’s marketing director is put on the board. Marketing is not an adjunct to the business of making money. More say at board level should mean better marketing and encourage more of those nervous investors.

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