Personal finance social media has been ablaze following the FT’s report that the much-anticipated UK Retail Investment Campaign, organised by the Investment Association, is going to focus on a red squirrel as its core creative route.
Some benefit of the doubt must be given. We haven’t seen the final, official advertising yet. It could yet change, or come alive in a way the reporting couldn’t anticipate.
But if the campaign creative is as suggested, essentially another Meerkat tribute act, we will have a significant problem.
Eye-catching brand awareness campaigns are a pre-requisite for consumer-facing financial services brands. They do, of course, need to be sufficiently differentiated to cut through the noise. And raising awareness of the power and point of investing is more critical if we are going to revitalise retail investment. At present – this is a vital issue. For instance, while two-thirds of households in the US hold stocks and shares, just 23% of UK households do. Aside from helping households build wealth, greater retail investment supports our capital markets, supports listed companies, and in turn draws more international capital to the UK. The rationale behind an equivalent of the Tell Sid campaign is solid.
And while much of the reporting has highlighted the cost of the campaign, given the scale of the problem to address, and potential returns on offer, this outlay will be seen as a cracking investment if its drives meaningful behavioural change.
But the issue is the execution – namely tone, and audience focus (or lack thereof). If you excuse the pun, it looks nuts.
Financial services already struggles with trust. It has never fully shaken off the legacy of the 2008 financial crisis. The issue of trust becomes even more critical if you are asking your audience to move substantial parts of their life savings into investments that – rightly or wrongly – are always seen as risker than holding cash in the long-term, in spite of the impact of inflation.
More importantly, it risks infantilising the very people the industry needs to reach. In a world where ChatGPT is now able to provide an asset allocation of a sufficient standard to impress former portfolio manager Stuart Kirk, the lack of sophistication is jarring and underestimates its intended audience.
This brings me on to the second point. Audience focus. Who is this character trying to connect with ultimately? At MHP one of our core principles is that the messenger is as important as the message. But who will identify with this?
UK households collectively hold well over £250 billion in cash ISAs alone, with total household bank and building society deposits exceeding £1.8 trillion in recent Bank of England data. A significant proportion of this is held by older generations that were heavily exposed to the financial crisis, and have seen multiple market cycles since. Is this character going to help them trust long-term investment as a means to manage inflation and longevity risk? They are not disengaged children. They are experienced adults making complex decisions about the next twenty to thirty years of their lives.
Will it land with those at the beginning of their savings journey – those under 35s? Many have low levels of investable assets, limited financial education and high exposure to social media narratives around crypto, day trading and quick wins. They need demystification, education and encouragement to start early, even with small amounts. But even here, the answer is not simplification to the point of parody. Younger audiences respond to authenticity and trusted messengers they identify with, as social media has shown time and time again.
In defence of the Investment Association, we must wait for the final product. But if this leak is to be believed, we are not going to see a new generation of bright-eyed and bushy-tailed retail investors emerge.
The UK faces a long term under investment problem at household level. Poorly judged messaging does not just fail to land. It reinforces scepticism that the industry does not understand its audience.
