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NS&I customer drive

NS&I customer drive

OMD UK case study

Background

In early 2005 NS&I were in trouble. Sales were down 15 per cent year on year, new customers were at a five year low, and the huge £3.5bn net finance target was rapidly moving out of reach.

NS&I had been resting on their laurels for too long.

Prolonged under-investment in the brand (whilst the business focused on the modernisation of customer service) had begun to erode goodwill towards NS&I and they were in danger of becoming an anachronism:

- Spontaneous awareness was low, only 10 per cent of adults knew NS&I

- The high percentage of sales through the Post Office did little to portray NS&I as a dynamic, progressive company

DR and DM fatigue had set in and return on investment through DR had plateaued and was falling. NS&I were suffering from an under investment in broadcast vs. direct response activity and they had been off air for six years.

Reviving equity markets saw money being moved into riskier but potentially more lucrative investments. NS&I had low SOV.

They had just 2.6 per cent versus the core 19 advertisers (0.6 per cent versus the total category) and there was increased competition led by ING’s aggressive support of headline rates.

But, we weren’t starting from scratch. In spite of the low spontaneous awareness, prompted awareness was still 80 per cent and we had a huge customer base of over 22 million people to re-engage.

There was still a lot of latent goodwill to unlock, and people who knew NS&I, liked NS&I!

In Premium Bonds NS&I had a fantastic hero product which accounted for 60 per cent of sales and had a new 2 x £1m draws to communicate.

Furthermore, Index Linked Savings Certificates were to be re-launched as “Inflation Beating Savings” (IBS) which meant that we had two 100 per cent secure, unique, tax free products to shout about.

The online sales channel was now ready and waiting to be unleashed and crucially was up 834 per cent year-on-year with limited support.

Strategy

A decisive change was needed to revive NS&I’s fortunes. The solution had to fulfil three objectives:

1. Reach the critical mass needed to hit the tough target

2. Re-engage the consumer

3. Re-invigorate the brand

TV was seen as the medium that could deliver the audience and meet the criteria.

Econometrics was used to convince the client that TV could dramatically improve falling ROI’s.  In fact, OMD Metrics indicated that TV could drive a 70 per cent uplift in responses for DR.

To target the TV campaign, two key customer segments were identified:

- Affluent Investors: Older, retired adults aged 50+ who were financially secure, adverse to risk and financially savvy

- Confident Careerists: Younger adults aged 35+, still working, with high disposable incomes, more likely to take risks and seek advice on financial matters

We also identified that Sundays were the key day for financial consideration and sales response data told us that Monday to Wednesday was the key timeframe to facilitate conversion.

So, we up-weighted Sunday in order to be more targeted and increase our SOV on a crucial day and we focused our response channels across Monday to Wednesday to exploit the raised consideration from Sunday TV.

Rapid cover build was crucial in ensuring that awareness peaked as the DM dropped and the DR press was consumed. This would ensure we achieved the optimal ROIs.

To establish the communication and hit the targets we convinced the client to double the spend year on year.

The new 2x £1 million copy was ready to launch in August, which gave us the opportunity to maximise our SOV and exploit lower CPT’s.

Implementation

The campaign was consolidated into four waves of activity building towards the crucial October sales period.

Each burst used what proved to be the memorable Sir Alan Sugar copy (created by CST) and rotated end frames directing people online, to the telephone or the Post Office.

The communication led with Premium Bonds. They would be used like a Trojan Horse to reengage the consumer before cross selling other products in the portfolio.

Premium Bonds activity was then followed by Inflation Beating Savings to showcase another part of the portfolio.

A fully integrated campaign ensured that the DR channels exploited the heightened awareness from the TV. Press & online were timed and up-weighted accordingly and in conjunction with EHS Brann the DM joined up with the TV.

Results

The results speak for themselves and show just how instrumental TV was in waking up this giant to a £2.5bn windfall.

Prior to the campaign we were running £1 billion behind the £3.5 billion net finance target. By the end of the campaign we had smashed the target and exceeded £5 billion!

The impact of the campaign was immediate:

- August Premium Bonds sales up 90 per cent (£859m vs. £452m avg.)

- September Inflation Beating Savings sales were up 125 per cent (£128m vs. £56m avg.)

- The online sales channel increased by 173 per cent (£112 vs. £41m avg.)

- August customer acquisition up 142 per cent (85k vs. 35k avg.)

And lasting:

- Monthly Premium Bonds sales were up 55 per cent across the campaign period

- Monthly Inflation Beating Savings sales were up 64 per cent across the campaign period

- Customer acquisition up 80 per cent across the campaign period

The effect on retention was equally impressive with repayments falling by £877m and we also increased familiarity and favourability to their highest levels in five years.

AJR
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