Prudential is preparing a major online ad campaign for its
one-year-old direct banking service, Egg. But the insurance giant
cracked the market using more traditional media.
The Egg service, which promises individually tailored financial
services, launched on 11 October last year using the line, 'individual
money matters'.
Egg spent almost pounds 6 million on its launch advertising - pounds
3.24 million on TV and pounds 2.3 million on press between October and
November. The remainder was spent on radio campaigns that ran on Capital
FM and Melody FM.
The debut press campaign featured pictures of individuals who cited the
reasons why they thought Egg was fantastic.
Since launch, Egg has stopped using TV, and its spend in 1999 has
comprised pounds 2.1 million on press and pounds 1.5 million on direct
mail. Loose press inserts were used to promote its personal loan, which
also benefited from a door-drop to more than two million homes.
The Daily Mail has picked up by far the biggest share of the press
spend, with 21.1 per cent. The next most popular vehicle was The
Express, which landed 13.9 per cent, well ahead of The Daily Telegraph
(9.4 per cent), The Sunday Times (8.9 per cent) and The Mail on Sunday
(8.8 per cent).
The media buying strategy clearly worked as Egg achieved its target of
500,000 customers within the first six months, and had achieved its
initial five-year target of attracting pounds 5 billion of savings.
But from this summer onwards it looks as if Egg is going to take much of
its advertising online.
In August, the company signed a pounds 1 million marketing deal with web
company Excite, followed by a pounds 6.4 million deal with AOL in
September. Egg is likely to spend more than pounds 14 million on
advertising in the next 12 months, and analysts predict that as much as
70 per cent of that will be on non-traditional media.
From the outset, Egg had a clear strategy of disseminating its products
online and through digital TV, and it has offered a number of
internet-only financial products. On several occasions, it has cited
research from the Henley Centre indicating that by 2013, two out of
every three financial products will be sold via the internet. The
company's whole ethos is to tap in to this valuable market, and it seems
to be working, as Egg is the UK's market leader in e-commerce financial
services.
Despite this, Egg has essentially bought market share by offering
savings and loan packages at rival-beating rates. Its losses in the
first half of 1999 were pounds 69 million. And although online
processing costs can be as much as four times lower than telephone
transactions - and ten times lower than via branches - Prudential will
be counting on the success of low-cost, high-return internet advertising
to help drag the company into profit.
Research by Media Monitoring Services, tel: 01763-245151
www.mediamonitoring.com.
