Background The former building society Abbey National is now one of
the UK’s most innovative banks, with a portfolio of products and
distribution channels that is the envy of many of its rivals. But amid
rumours that it is a takeover target, how is the Abbey National brand
shaping up to challenges from competitors while keeping up with
Abbey National has traditionally regarded itself as a single brand
spanning a variety of banking and insurance products. But the emergence
of internet banks has forced it to create separately branded web banking
operations to retain its more profitable customers. Its main net bank -
Cahoot.com - will launch in May with a pounds 15 million marketing
budget. This will be followed by a second internet product - codenamed
Prosper - aimed at high-net-worth individuals, later this year.
These launches - and its promise to spend pounds 200 million on
e-commerce in 2001 - are designed to counter claims that the bank is
lagging behind on the net.
Media mix Abbey National had a group ad expenditure of pounds 27.8
million in 1999. Most of this went on direct mail, a particularly
cost-effective medium for cross-selling to its customer base. The bank
was also a major user of TV and press and, unusually for a financial
services company, also ran fairly large radio, cinema and outdoor
Last year Abbey National spent 36 per cent (pounds 10.1 million) of its
total budget on TV, 15.5 per cent (pounds 4.3 million) on press and 43
per cent (pounds 12 million) on direct mail. Interestingly, it spent
slightly more on cinema - 2 per cent, or pounds 563,281 - than on radio
or outdoor, which ate up 1.8 per cent and 1.3 per cent respectively.
Key ad campaigns launched in 1999 included ISA promotions on TV and
radio in April, savings and pensions TV campaigns in July and September,
and mortgage advertising on posters in October, followed by TV in
In common with most high street banks with large customer bases, most of
Abbey National’s direct mail campaigns advertised home and motor
insurance and personal loans. Spend was distributed fairly evenly across
the year, although TV advertising made September and October the two
highest spending months. Outdoor ads ran only in October, and cinema
campaigns appeared only in the last four months of the year.
Agencies Media incumbent Carat has been hired to handle planning and
buying for the new internet bank. Euro RSCG Wnek Gosper will handle
creative and WWAV Rapp Collins takes care of direct mail.
Trends Abbey National’s adspend will rise sharply this year as it
promotes its new ventures. Ads for Cahoot.com will need to adopt a
radically different stance if the brand is to hold its own against the
established internet banking rivals Egg and Smile.
Research by AC Nielsen MMS, telephone: 01344-627553