The Meaning of Marketing
by Claire Nailor
I was looking at our life, pension and investment products the other day and pondering the meaning of marketing, as you do. It's a common belief amongst IFAs that some products, like insurance and pensions, sell themselves, whereas other products, like investment bonds and IHT mitigation trusts, need to be sold to customers by astute advisers.
It makes sense really- despite most of us being jaw-droppingly unprepared when it comes to pensions, if we’d gone to the trouble of seeing an IFA, many of us wouldn’t need too much convincing that we should bung fifty quid a month away for our old age. Ignoring IHT is understandable too- whilst we accept the fact that one day we’ll be pushing sixty, we’d rather not think about pushing up the daisies, and will consequently put off any decisions about what will happen to our amassed fortunes after death.
But does the old adage about some products being a hard sell and some being an easy sell really apply to marketing?
My thinking goes like this: if it’s true that certain products, for example pensions, fly off the shelves, what’s the reason for it? And more importantly, what’s the reason for somebody choosing a particular company over another one? More often than not, intermediaries and consumers will choose a product which seems reliable from a name they feel comfortable with. In other words the answer comes down to brand, and a heck of a lot of meticulous marketing and PR-building going on in the background.
Think about it- how many of us have done an insurance comparison quote and discounted the first few providers because we’ve never heard of them? How many of us always pop to the Post Office for travel insurance because we think we’re getting a great deal? I’m not knocking the Post Office or any other provider, but success in these ‘bread and butter’ products, as they’re affectionately described, is often based on excellent public perception. Not an easy task at all then, if you’re a marketer.
Secondly, just like bread and butter, the easy-sells are bland. Trying to market a stakeholder is like trying to dig sand with a fork: there’s nothing to get hold of. The charges are low, the commission is low, and the fund choice is low. The end. Dull, dull, dull. Even worse are the products which are ratings driven- if you’re trying to flog life insurance at twice the price of every other company, nobody’s going to buy it no matter how good your marketing is or how many bells and whistles you put on (sorry boss).
On the flipside, the products which Advisers find tricky to sell are more often the ones we can get our back- office teeth into. These ‘luxury’ products, like investments and healthcare, have actually got something going for them and it’s not difficult to make them appeal to people. This is the exciting area of financial services; where you can tap into consumers’ hopes and dreams, or play on their worst nightmares. You can even add on special offers and deals without getting strung up by the FSA. Marketing heaven (or as close as you’ll get in this industry).
Despite the products not selling in vast quantities, I’d argue that the more gritty area of the market doesn’t just get our lowly attention; it gets more attention from customers as well. Isn’t it the ‘nice to haves’ rather than the ‘have to haves’ which we put more effort into in life? For example, if you were choosing an investment bond for your child’s future, wouldn’t you give it far more of your energy than a straightforward insurance policy? The truth is, if you’ve got a bit of spare cash, you’ll make damn sure it’s put to good use. This is the time when marketing comes into its own; you can really sell a product based on its merits, not just because it’s cheap and easy. The audience is there and they’re interested in what you have to offer.
I suppose what it comes down to is that everyone has a wage to live on and it’s all about prioritising financial needs. Advisers are never going to persuade customers to put their money into non-essential areas if they don’t have basic life cover, and if they did they’d be struck off quicker than you can say “mis-selling” (rightly so). All the marketing department can promise is that if customers do come our way looking for a savings plan, our ads will be so shit hot they’ll never want to leave. And, in return, we’d appreciate the sales force giving stakeholder applications the massive respect they deserve in future.
By Claire Nailor - Investments Marketing Communications Executive
Wed, 06 May 2009
