Branding and brand development through direct marketing in the consumer financial services sector

Branding and brand development through direct marketing in the consumer financial services sector


Direct mail volume is heavy in the consumer financial services sector, with 3,123 million items mailed in 1998 but branding is thought to be weak in consumer financial services, in the sense that consumers do not recognise many brands within this sector.

‘Most strikingly 50 per cent of consumers did not know the name of any [financial card] company which had mailed them.

This paper examines how branding and the development of brand loyalty are being addressed in a direct marketing context and, more specifically, by financial services providers. This issue is an important one given the large amount spent by consumer financial services providers on direct mailings (£1,665m in 1998 in the UK), heightened competition
from retailers, and two other emerging trends. First, the global value of corporate brands is increasingly being seen as a tangible asset for the balance sheet and is being measured in terms of brand equity by consultancies, such as Interbrand, and by theorists. At the same time new media, such as direct marketing (DM), the Internet, digital television and wireless application protocol (WAP) technology are resulting in splintered media and distribution channels, increasingly making brand the peg on which to hang marketing communications and raising questions about consistency and integration.

The paper first examines the key components of the brand-building process, from the branding literature, and considers both branding and direct marketing as parts of a two-way, relational process with customers. It then highlights some negative consumer attitudes towards financial services direct mail. The research explores, with brand-building experts in direct marketing, their key criteria for successful branding in direct mail by financial services providers. The paper describes the extent to which there may be barriers preventing financial services providers from developing these key success factors within a direct marketing medium — direct mail — and results are analysed against the key brand-building components found in the branding literature. Interviewees were asked to give examples of good practice, or of improvements that could be made and these are described in the Appendix along with associated recommendations for management.

Representative APR 391%

Let's say you want to borrow $100 for two week. Lender can charge you $15 for borrowing $100 for two weeks. You will need to return $115 to the lender at the end of 2 weeks. The cost of the $100 loan is a $15 finance charge and an annual percentage rate of 391 percent. If you decide to roll over the loan for another two weeks, lender can charge you another $15. If you roll-over the loan three times, the finance charge would climb to $60 to borrow the $100.

Implications of Non-payment: Some lenders in our network may automatically roll over your existing loan for another two weeks if you don't pay back the loan on time. Fees for renewing the loan range from lender to lender. Most of the time these fees equal the fees you paid to get the initial payday loan. We ask lenders in our network to follow legal and ethical collection practices set by industry associations and government agencies. Non-payment of a payday loan might negatively effect your credit history.

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