MAKING CREDIT CLEARER

I’ve talked frequently on this blog about banking and how financial services companies should be engaging with their specific customer groups rather than broadcasting to the masses (see Engaging with the Web 2.0 consumer or Just how special and different are financial services brands?).

We saw First Direct making a foray into the space when it started to externalise its social media commentary through First Direct Live. That was a confident move for a brand that knows it is good at service.

I also covered “A Crocodile for Billy” which was a children’s financial education initiative by LloydsTSB a while back. This was a positive first step but insignificant versus the scale of financial illiteracy in the UK.

Those in the industry (and most likely very few others) will also have seen the FSA‘s website MoneyMadeClear which was created from industry money by the FSA to give unbiased basic information about how money and financial products work and how to manage money, debt and personal finances.

Unfortunately the most striking aspect of MoneyMadeClear is that is it so unengaging and boring.

You can tell it has been developed by a branch of government. Given the opportunities to engage and bring to life complex information using rich media that the internet provides this was a massive missed opportunity.

Now (unfettered by my management!) the team at Capital One have launched an initiative to explain how credit cards work and should be used. Capital One over the past couple of years have been retrenching into products for those parts of the market that find it harder to get credit cards. Having listened and talked for many hours with these customers myself the lack of understanding of how finance and money works, even at the most basic level, is sometimes shocking. Perhaps the best (worst?) example of this was a respondent in a piece of research who was convinced that an interest rate of 40% was better than an interest rate of 20% “because it is higher”.

So given their focus on this part of the market financial education is an important responsibility for Capital One which is why they have launched an initiative called Credit Made Clearer. What I think is impressive is that they have made a genuine attempt to engage the audience. Simple explanations, engaging graphics, in short chunks of information; there is no product sell apart from the branding of Capital One. They have integrated a range of channels and approaches such as a YouTube channel.

No Brainers

Using your credit card

Of course they will expect an uplift in their brand perception and perhaps an uplift in applications so one could argue that this is a thinly veneered marketing campaign. However in my experience the intention and desire to get credit is rarely solely driven by a marketing offer and I would much rather have people taking cards when they understand the process more fully and think more carefully about it. So if this initiative from Capital One can help even a few people understand how credit and credit cards work more fully then it is making a valid contribution.

But all these activities lead to a bigger question for the financial services industry: how can we use this initiative, together with MoneyMadeClear and A Crocodile for Billy, to work together in coalition, using the considerable resources available of talent, time and money, perhaps linking with our new coalition government, to really make a massive, integrated, impact on financial education.

If you want to talk about this idea – then drop me a line or post a comment below – perhaps we could pull together and make a big difference.

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Justin

Mail me: justin@basini.com
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A CROCODILE FOR BILLY?

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In his speech to the Financial Services Forum dinner in December Nigel Gilbert the outgoing Chief Marketing Officer of LloydsTSB talked about the role of marketing and the consumer in banking. He also talked about an initiative that LloydsTSB ran last year called “A Crocodile for Billy”. This is a book / ebook about saving and spending for parents to use with young kids.

His themes about the role of marketing and brands in financial services echo my own thoughts around the rights and responsibilities of marketing departments. I outlined some of these in my Battle of the Big Thinking presentation: Escaping The Matrix. Undoubtedly there is a massive need for more human understanding in business with its overfocus with quantitative analysis and comfort with people who are technically gifted but less comfortable with vision and working in our very human and emotional world.

When operating well marketing should be the “heart of an organisation” – and I mean that not to indicate its position but to capture its unique added value. Businesses and brands, the great ones anyway, are full of heart, vision, ambition and human understanding. They are often driven by a passionate leader who captures the heads and hearts of employees and customers alike. Marketing and the brands they develop have the ability to inspire and energise even when a charismatic founder or CEO isn’t available.

And there is something here that is at the core of why our big banks are not great businesses or brands. They have little heart, vision, ambition or human understanding. They can’t understand why people are appalled at billions sitting in bonus pools after the past two years of bailouts. They don’t have a vision for the role that banks and financial institutions need to play in our society. A senior executive at LloydsTSB recently said to me that their vision was “to become the UKs most recommended bank”. If that is the extent of their collective vision for a business that has been given near monopoly share levels and billions in state money (your money, my money) then my vote would be to break it up – they don’t deserve to exist with that little ambition or understanding of their responsibilities in society.

And Crocodile of Billy is a neat example of the practical impact of this lack of vision and “head beneath the parapet” attitude that most of our banks are operating in currently. Its cute, I like it, I’d like to get a copy (although I can’t see how? You can’t buy it anywhere?), and I’d like to read it to Luca and Daniel. There is no doubt that we need desperately need more financial education in our society. But Crocodile for Billy is a tiny, albeit positive, effort in this regard. Why doesn’t the financial services industry realise that they have a massive responsibility and the resources to fill this gap? They could work together, invest the hundreds of millions needed and ensure that every child gets the information they need to make informed decisions in their financial choices.

That would be a vision. That would be added value. That could be transformative to our view of financial services brands. Until they realise that we demand more as their customers and as members of our society, especially in the light of the last two years, financial brands will remain in the gutter, actively distrusted and disliked.

Get involved in the debate – comment below. Do you work for LloydsTSB or another UK bank – are you brave enough to share your view?

Happy New Year! I hope 2010 brings you all that you need.

Justin

Email me: justin@basini.com
My website: http://www.basini.com/
Read my blog: http://www.blog.basini.com/
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