Light in the gloom for financial service firms?

At a time when the financial services industry is seeking answers to issues of consumer trust and business performance, it is noteworthy that a financial company has come out on top in the design industry’s premier awards. Legal & General has walked off with the Grand Prix in the DBA’s Design Effectiveness Awards, judged exclusively by senior marketers and notable for being the only award scheme that uses commercial data as a key judging criterion.

After a 5 year internal and external branding and revitalisation process overseen by specialist branding agency Smith & Milton (www.smithandmilton.com), Legal & General saw its 2010 operating profits increase by a cross-company average of 12%, its market share grow by 2.9% in the same period and its share price rise 65% - four times faster than the sector – in the year to July 2011.

After hundreds of staff and customer interviews, workshops, focus groups and online research, a single-minded customer focus was organized and made real under one central thought, ‘Every Day Matters’. This over-riding thought was used to guide the actions of company staff, their interactions with each other and with stakeholders and customers, both internally and externally.

The sheer size and scale of the undertaking belies the common criticism that financial services branding owes more to style than substance. Legal & General’s 6000 staff, from CEO Tim Breedon down to the company’s graduate placements, were all part of a sophisticated 2 year employee engagement programme across 5 company locations covering each of the insurance, investment and savings businesses – all very different in terms of organisation, processes and culture.

Advocacy and brand attraction measures were up 15% in 2009 and 16% in 2010, while the company’s employee engagement scores were the highest ever recorded.

With the branding strategy working operationally and validated commercially, Legal & General has just announced its intention to run its first TV advertising for 15 years, bringing Every Day Matters to a wider consumer audience through agency Inferno.

Ben Mott, Business Director at Smith & Milton, said, “The incredible success of the Every Day Matters work is down to a serious commitment to the cause on the part of the client, and unwavering support from the whole team at Smith & Milton – a true reflection of what a client/agency partnership can achieve when it shares a mutual ambition. The DBA's recognition of the importance of commercial impact fits perfectly with our own aspirations for our clients' brands and, ultimately, their businesses."

Richard Nunn, Group Brand and Web Director at Legal & General, said, “You've created tremendous properties in Every Day Matters and the visual identity that is delivering an ever-increasing snowball effect internally. This will set the right context and tone for deeper engagement with our teams, help our quest to build a world class marketing community and finally, when we externalize Every Day Matters later this year.”

FACTFILE:
Founded in 1980, Smith & Milton (www.smithandmilton.com) is recognised as one of the UK's leading brand and communications companies. The company’s experience has been gained from working with leading brand owners, including Warburtons, Legal & General, CBRE, AXA, Travelex, Asprey and the NHS.

Fasthosts reveals 1 in 3 consumers has posted a negative review of a firm online

Fasthosts, a top UK web hosting provider, has revealed that one third of British consumers has posted negative material online relating to a company or product.

The survey of 1300 UK consumers, commissioned by the web hosting company, found that it is now common place for Britons to express their gripes openly online, most commonly on social networking sites such as Facebook and Twitter, as well as online forums. Over half of young adults have published negative online reviews.  Encouragingly for firms, the vast majority of consumers are willing to give a company a second chance if it responds well to their online complaints.

Whilst willingness to share frustrations online is equal across both genders, the issue ranges in frequency according to age.  Younger Britons are far more likely to publish their grievances.  Some 52 per cent of under 24 year olds have turned to the web in this way.  39 per cent aged 25-34, and 38 per cent of adults aged between 45-54 years have done so. 1 in 4 of those older (28 per cent) vented their concerns online.  Geographical location also appears to be a driver, with the issue most common in the south east (38 per cent) and far north of England, such as North East (37 per cent). 

However, some 84 per cent of consumers would forgive a company for mistakes and be willing to use it again if the firm engaged with their negative online review and discussed the issues with them. 

It appears that few British companies are seeing the benefits of getting to grips with the issue of negative online material.  Data from 400 UK small businesses reveals that few UK companies choose to interact with customers who publish negative material about them. Despite the prevalence of online complaints, only 12 per cent of small firms have ever engaged with an online complaint. 

Stephen Holford, Marketing Director, Fasthosts Internet, commented: "It is understandable that many business owners' first instinct may be to shy away from their customers' online complaints.  However, addressing negative online material enables a company to learn about their customer experience as well as improve their customer retention and online reputation."

Graham Jones, Internet Psychologist, added: "People who want to complain about a company are getting a sense of freedom and power as a result of social networks and feel encouraged to make such complaints.  As a result, this is a growing problem for companies and is something they must do as a matter of routine.  Interestingly, several studies show that when people have their complaints positively responded to they are more supportive of the business than they were before the complaint was made.  Psychological research shows this is linked to the fact that when the complaint is responded to well, people feel as though they are being cared for, which produces positive emotional responses."

www.fasthosts.co.uk

(EDITOR: With many firms not even bothering to reply to emails asking for details of the services they provide, is this any wonder?)