Introducing that loveable financial services duo, Acc and Dec

Yes, OK, “Acc” doesn’t really look quite enough like “Ant” for the joke to work as well as I’d like.  But still, in the financial world, Acc and Dec – short for Accumulation and Decumulation – have become just as high-profile recently as the conjoined Geordie reality-TV-hosting twins.

You’ll have noticed a couple of things about Acc and Dec.  First, there’s still an irritating uncertainty about how to spell the longhand version of Dec – is it “decumulation,” or is it “de-accumulation”?  To me, it’s bleedin obvious that it should be the former:  “acc” means “in”, while “de” means “out”.  Talking about “de-accumulation” is as silly and self-contradictory as talking about an “in-outcome” or saying that you’re going “up-downstairs.” 

Sorry, whinge over: and more importantly, secondly, you’ll also notice that up till now the twin conceps of Acc and Dec are always used in the context of retirement planning: the idea is basically that up to the moment you retire you’re in the Accumulation phase, looking to build up a capital sum, and thereafter you’re in the Decumulation phase, looking to use that capital sum to provide your income.

Since I’ve woken up in an argumentative mood this morning, I’m tempted to challenge this model, especially as far as upmarket people with well-paid white collar jobs are concerned.  Increasingly, the idea of a “retirement date” as a watershed marking a fundamental change from life before to life after is looking like a last-century idea.  Instead, for more and more people, there’s a long blurry period from about age 50 to age 70 when they’re accumulating and decumulating at the same time, and in different proportions from year to year and even month to month.  As our parents live longer and longer, for example, the age of inheritance is getting older and older:  many of us, not just Prince Charles, will be well past our Selected Retirement Dates before we find ourselves heads of our families.  And vice versa, you can decumulate while you’re still accumulating: for some reason I don’t understand, even though I still think of myself absolutely as a long-term and full-time capital-accumulating wage-slave, as a part of a gruelling current programme of pension restructuring I was able, a couple of weeks ago, to decumulate a tax-free lump sum of about fifteen grand from a smal personal pension I’d left behind me in my wake two or three decades ago.

But actually, that wasn’t the point I wanted to make, even though you could certainly be forgiven for thinking it was.  The (non-argumentative) point I wanted to make is that when you come to think of it, the twin concepts of Acc and Dec are relevant ways of thinking about all sorts of other financial services markets, not just retirement savings.

Perhaps the most obvious example is the whole area of saving for children.  Whether through CTFs or otherwise, many parents, sometimes along with grandparents and godparents, accumulate capital throughout their offspring’s younger years – and then, later, there’s the flipover into the decumulation phase, with costs including going to uni, buying a first car, getting onto the proverbial property ladder, the dreaded daughter’s wedding and, of course, the simple non-specific paying-over of the proceeds of your darling son or daughter’s CTF (probably about £30k if you’ve maxed the top-ups every year) to him or her on his or her 18th birthday, so that he or she can enjoy the huge pleasure of spending it on whatever will make you most cross and upset.

Of course there are plenty of other Acc/Dec pairings in the world of savings.  I’m not sure if you still get Christmas Clubs, after a big and popular one fell rather spectacularly into a seasonal snowdrift a couple of years ago, but they obviously follow an annual Acc/Dec cycle.  So does holiday saving.  So does most saving, when you come to think about it.

What’s interesting, at least slightly, is that in the world of retirement savings thinking around Acc and Dec has led to a new generation of products that are designed to bridge across both phases – rather than cashing in your pension fund and using the proceeds to buy an annuity, you can now draw down capital from the fund either as well, or instead.  I wonder if it’s possible to come up with other product ideas that bridge across the Acc and Dec phases in other parts of the savings market:  for example, if you committed to saving enough, for long enough, towards a deposit on your first home, could the product you chose for the purpose also include some sort of discount or other benefit on the mortgage that you’ll need when you cross over from the Acc to the Dec phase?

I think there could be a big idea here:  if pension products are now designed to evolve to meet people’s needs through both accumulation and decumulation, couldn’t other savings products usefully do the same? 

As you’ve probably gathered, this line of thought isn’t completely clear in my mind yet.  Apologies for that, but to be honest, I’m hoping to find a client who’ll pay me to give it some more thought – after all, as I say, I’m still in the accumulation phase….

Hmm. Perhaps I was wrong about Santander. Sorry, SantandAIRE

I’ve been writing this for long enough now that it’s possible to test the accuracy of some of my more predictive pieces.  Sometimes I was right, but sometimes I wasn’t – and it’s starting to look as if I was wrong about the way we Brits are going to pronounce the name of the biggest Spanish brand on our High Streets.

No-one, I said, is going to call them SantandAIRE.  In English, words ending with -er are pronounced “err,” and we hardly ever put the stress on the last syllable.  To us, they’ll be SanTANder.

I don’t think the Spaniards have won the battle yet.  At the moment, I have a sense of a lot of people trying to avoid pronouncing their name at all, because they’re uncomfortable about how to do it.  But I have a feeling that the tide has turned, and in the end the result is going to be more 2008 European Championships than 1588 Armada, if you see what I mean:  SantandAIRE is what they’re going to be.   

Also, on present form, a crap brand is what they’re going to be, if you’ll pardon the Yoda-like sentence structure.  Nothing that they’re currently doing to build awareness gives any indication that they have a clue how to go about it.

For a start, the cornerstone Lewis Hamilton sponsorship looks like a hugely expensive mistake, for all sorts of reasons:  for a bank that claims that it wants to be known for its prudence, Formula One is the most profligately and corruptly wrong association imaginable except perhaps sponsoring the Afghan poppy crop;  as a growing body of desperately contrived television and print ads demonstrate, it’s almos impossible to use Lewis and F1 as metaphors or analogies in any remotely effective communication about financial services;  even leaving aside the fact that it’s profligate and corrupt the huge majority of people who are not adolescent males simply couldn’t care less about Formula One;  and, of course, this year Lewis and Maclaren are getting slaughtered so SantandAIRE don’t even have the benefit of being associated with success.

But probably because they’ve spent so much on the sponsorship, SantandAIRE simply cannot see even a centimetre beyond it.  All that their advertising consists of is irrelevant and distracting pictures of Lewis and his car with copy or voice-overs reading extracts from corporate literature.  This is absolutely not a) how you communicate or b) how you build a brand.

More often than not, in financial services, the key argument in favour of rebranding – particularly after mergers and acquisitions – is that the exiting brands have so little value that you might as well get rid of them.  I don’t think that’s true in this case.  I’m not sure if Alliance & Leicester has ever meant very much, but both Bradford & Bingley and Abbey have real resonance.

The way it’s looking at the moment, migrating all three businesses to the vapid and meaningless SantandAIRE looks like one of the greatest acts of brand vandalism in history. I wonder if I’ll be proved wrong about that too?

So farewell, Capital One. I’d like to say it’s been great…

…but, of course, it hasn’t.  Somewhat to my surprise, I’ve just been dumped by Capital One:  they’ve sent me an “It’s not us, it’s you” letter explaining that since I haven’t used my Capital One credit card for such a long time they think I’d be happier without it cluttering up my wallet.

It’s true I haven’t used it for a very long time, and the reason for that is that I hate them.  I hate everything about them.  I hate their horrible contrived unfunny advertising (in fact, my hatred of it was the subject of my second-ever blog nearly three years ago).  And I hate the horrible manipulative credit card cheques they’re always sending me, and the rip-off ASU insurance (which in fact I don’t think they offer any more) and the rip-off penalty charge if my payment is held up a day longer than usual in the banking system.  In fact, I can’t think of anything they’ve ever done which I’ve ever not hated.

This is odd for two reasons.  First, you’d think that they’d have tried a bit harder, over the ten years or so that I’ve had the card, to make some money out of me.  I’m a heavy user of credit cards, and at times I’ve run large balances from month to month.  Also, during the period I’ve been a Capital One customer, I’ve been involved in choosing company credit cards on two occasions, and also choosing first cards for both my teenage children.  Capital One know nothing about any of this, because they’ve never asked me anything or found out anything at all about me.  If they had, I’d have been happy to tell them a great deal – not just about these personal circumstances, but also about more attitudinal stuff like my hatred of those credit card cheques.

And second, I know Justin Basini, Capital One’s outgoing Head of Brand Marketing, slightly, and he’s one of the most intelligent, thoughtful and progressive financial marketers I’ve ever met, if not perhaps the most intelligent, thoughtful and progressive.

Which raises three questions.  How can an organisation which depends for its success on its ability to build good customer relationships be so hopelessly, uselessly bad at it?  Bigger picture, what the hell happened to that wonderful world of personalised, customised, relationship-based one-to-one marketing that we were first shown, as a not-far-distant promised land, in books, speeches and articles by various direct marketing gurus fifteen years or more ago?  And smaller picture, how could anyone as smart as Justin preside over the crude fumblings of such a lousy organisation?

I can’t answer any of these questions, and I’d be very pleased to hear from anyone who can.  All I can say is that actually, I’m delighted to have been dumped by Capital One – I don’t think I’ve ever had a less rewarding relationship.

Want better work and better service? Just be nicer

There’s one category of client for whom agencies do better work, try harder, offer better value for money and usually overservice.  This category, perhaps unamazingly, is made up of clients we like.

At the opposite extreme, there is also a category of clients for whom, try as we might, we really can’t find the motivation to do anything special for.  We’ll do what we’re contracted to do, but no more.  The stuff will be ordinary, the service sluggish and so far from going the extra mile, we’ll rarely manage an extra yard.  This category, obviously, is made up of clients that we hate.

There’s a whole other blog to be written about why we love some clients and hate others.  For now, let’s just say that it’s for more or less exactly the same reasons that we love or hate anyone else – reasons ultimately to do with what sort of people we think they are, and how they behave towards us.

But the point I want to make now is that if I was you – especially if I was you in this cash-strapped climate – then for entirely professional reasons I’d be working quite hard to climb up that likeability league table.   

Ultimately, agencies have three motivations to work for clients:  to make money, to do great work and to enjoy ourselves.  In a perfect client relationship, we achieve all three.  We’ll settle very happily indeed for two, and actually we’re pretty satisfied with one:  but if the relationship really isn’t delivering against any of them, then it’s only natural a) to wonder a bit why you’re doing it, and b) to do it with less than 100% enthusiasm and commitment.   

It may simply be impossible to make your account profitable at the moment.  It may – although I have my doubts – be impossible to get great work through, especially if your firm has particularly complicated and bureaucratic approval processes.  But it’s never impossible to make life more enjoyable – and, I promise you, for every extra unit of enjoyment you can bring to the proceedings, you’ll get back ten units in creativity, energy, commitment and service.

So, in short, my advice to anyone who wants a better agency is, quite simply, to try being nicer to the one you’ve already got.  And, yes, of course, I can see that the same advice applies in reverse to me and all my colleagues on the agency side whenever we long for a better client.