Financial PR: Catching a ride on the financial bandwagon - As the Government urges more people to save and competition in the financial services sector increases, service providers are turning to PR to make them more consumer friendly

The appointment of Barkers PR to work on Barclays’ personal savings business is only the latest reminder of the opportunities for PR firms working in the financial services sector.

The appointment of Barkers PR to work on Barclays’ personal savings

business is only the latest reminder of the opportunities for PR firms

working in the financial services sector.



Since last year the Government has been proactive in encouraging a wider

range of people to save, and in protecting consumers by naming and

shaming pension providers accused of mis-selling. In addition, new

businesses have entered the sector, with supermarkets, for example,

setting up banking services.



Financial specialists, like Lansons Communications, have been doing

well.



The agency saw its fee income rise 14 per cent last year and has grown

into a pounds 2.3 million fee income business since its launch in

1989.



Understandably, other firms are moving in on this lucrative area.

Corporate and financial consultancy Grandfield, and full-service agency

Edelman PR Worldwide have both set up financial services teams this

year. Financial Dynamics, which already caters for the sector, plans to

take on new people to work on projects targeting specific groups of

consumers such as students or the retired.



Government activity in promoting financial self-reliance has given

financial services more opportunities to sell their products. Individual

Savings Accounts (ISAs) have been introduced to replace Personal Equity

Plans (PEPs) and Tax Exempt Special Savings Accounts (TESSAs), which are

held largely by the middle classes. ISAs are expected to reach a much

wider range of consumers. Last week the Government said savers would be

able to open ISA accounts by telephone or via the internet. In order to

take advantage of these changes, Lansons joint MD Tony Langham says

providers will have to focus on marketing their new products.



Julian Polhill, managing director of Polhill Communications, says

clients are now more sophisticated when it comes to press work, possibly

because an increasing number of marketing managers are coming into

financial services from FMCG backgrounds, where targeted marketing is

fundamental.



Where five years ago clients would have been satisfied with any

coverage, they now want coverage that hits particular audiences.

Polhill, for example, has been briefed to get financial product coverage

into computer trade magazines, to reach the IT staff whose earnings have

rocketed.



Lansons joint managing director Tony Langham argues that PR is a more

effective medium for financial services companies than advertising.

’People don’t read a magazine to decide what deodorant to buy, but they

accept more external influence in the buying decision for a financial

services product,’ he said.



Paul Burgin, divisional director of financial services at Ludgate

believes that financial services PR is more cost-effective than

advertising. Nonetheless, he argues that agencies and clients should do

more to monitor PR’s effectiveness, for example by asking customers who

call financial services firms whether they were prompted to do so by an

advertisement, a press article or some other source.



PR has a wider role to play than in just selling products. The

introduction of ISAs and the pensions mis-selling scandal have brought

what was previously a rather cosy sector blinking into the glare of the

political and media spotlight. And providers are waiting to see whether

the City watchdogs will prove more troublesome now that they have been

amalgamated into one super-regulator, the Financial Services

Authority.



Burgin says the agency’s financial services and public affairs teams are

working increasingly closely together. Pensions and life assurance

provider Scottish Widows and investment management company Fidelity have

both turned to Shandwick’s public affairs arm for advice this year.



Another factor driving financial services providers’ use of PR is

increased competition. New and often more consumer-friendly players are

entering the market, and established players are diversifying into new

areas. Sainsbury’s, Tesco and Safeway, for example, are all now offering

bank accounts along with their more traditional grocery fare.

Sainsbury’s bank marketing director David Noble hired Dewe Rogerson in

March to help sustain media interest in the bank, which was launched in

February 1997. Companies known for their life and pensions products are

also now competing with the high street banks. Standard Life has

recently set up a banking operation.



With new entrants trying to grab market share while long-standing

players attempt to keep what they already have, money is being pumped

into marketing products and companies. Government emphasis on

self-reliance and intensified competition have led to a growing volume

of financial product newspaper advertising. That, in turn, has required

the production of more editorial, which means PR agencies can attract

more coverage for their clients.



However, agencies should not underestimate the task of selling the

sector to the media. Barclays has briefed its PR agency Barkers to

target mainstream consumer titles as well as personal finance pages. The

reason for this is that Barclays, along with other providers, is well

aware that despite extensive media coverage, many savers remain wary,

uninterested or just plain baffled by personal finance products.



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