Ah, that’s what I’ve been meaning for the last ten years or more (sob).

Anyone who’s heard me talking about financial advertising over the last ten years – more, actually, make that 20 – will have heard me go on about what a privilege it is to be dealing with a subject that’s so rich in emotion, meaning and importance for people.  Money, I’ve said a million times, really matters – it’s inextricably bound up with people’s hopes, fears, dreams and feelings towards each other, in a way that hair conditioner and dairy products just aren’t.

But strongly as I feel about this, I suppose that if I’m honest I’ve only once been involved in producing a campaign that actually delivers on these lofty ideas.  I’m thinking of the campaign for the children’s savings scheme Jump, originated by my good friend Chris Wardle – and the trouble is, it has always been so small and obscure that hardly anyone knows anything about it (with the exception, I must say, of a lot of advertising awards juries over the years, who I’m sure have made it collectively by far the highest-scoring financial campaign ever in terms of awards won to media pounds spent).

And it’s not just me.  Ever since the heyday of US financial adviser John Hancock’s TV advertising, there’s been a lack of really good examples of campaigns showing the kind of emotional engagement I’ve been talking about.

Well, now there’s a new one – and in the most unlikely of categories, funeral plans, a part of the market almost always characterised by rip-off products and cynical, manipulative advertising designed to frighten poor old people into buying cover they don’t need and can’t afford.

Until this:   http://vimeo.com/67128329.  Absolutely brilliant.  And exactly what I’ve been talking about, without knowing it, for the last 10 or 20 years.

Darling of the City, hate figure for the customers

Gatwick Airport, 8am yesterday morning.  I want to buy a newspaper.  This means battling with WHSmith – the objective of the battle being to find a way that I can give them some of my money.

This is far from easy.  The single automated Fast Track payment machine near the newspapers is out of order, as it has been for weeks.  At the far end of the shop, the queue to pay is a mile long.  Only one of the five ordinary tills is in operation.  Four of the nine Fast Track (you are kidding) tills are out of order.  The other five are doing their usual job of totally baffling 90% of the customers, especially the many who don’t speak English.  (Unlike ATMs and other automated payment systems, there are no foreign-language options.)  There is a member of staff there supposedly to help the customers, but she speaks little English and is more of whatever the Polish is for a hindrance.  There is never-ending cacophony of robotic cries of “Unexpected Item In The Bagging Area.”  Inexplicably, whatever you buy, you have to scan your boarding card.(why is this?  I’ve no idea) and half the customers don’t have boarding cards with them because they’ve left them with spouses or partners who’ve gone to Pret, Boots or the loo. There simply is no slower, horrider, more infuriating way to buy a newspaper.

All this truly dreadful modus operandi has been developed during the period of service of CEO Kate Swann, who has recently stepped down after a nine-year stint during which she became one of the most admired business leaders in the country.  In particular, her strategy of concentrating WHSmith’s retail presence on transport hubs – mainly stations and airports – and cost-cutting is universally applauded in the investment community.

Well, it’s universally detested in the customer community.  During my interminable wait to buy my paper yesterday, I was thinking that WHS today is kind of the 21st century capitalist version of what GUM department stores used to be in 20th century communist Russia – useless and horrible, but packed with punters lacking any alternative.  Buying a Guardian in Smiths today, you know what buying a jar of borscht was like in Moscow in the Brezhnev years.

By chance, as well as my hard-won newspaper, the other reading material that I had on my flight was Don Peppers’ and Martha Rogers’ Return On Customer, a business book warning firms against improving short-term business performance by means of tactics which encourage customers to defect in the medium to long term.

I was already starting to think that this is a naive and simplistic book, failing to understand that in the medium to long term CEOs are long gone.  But when I googled Kate Swann after my Gatwick experience and found that she’s been trousering (or should that be skirting?) about £4 million a year, with a final pay-off of about £6 million, for presiding over the development of this utterly useless customer experience, my suspicions became complete certainties.

Bishop to king’s knight six. Oh, bollocks.

It’s a long time since I played chess, but I can still remember the very particular pain of realising that you’ve made a terrible move.  It’s the pain that comes from a double blow – first the shock of realisation that your brilliant attacking ploy is a whole lot less brilliantly attacking than you thought it was, and second the horror of discovery that you’ve given your opponent an unmissable opportunity to do you terrible damage

I mention this because in their lengthy, disorganised and largely unsuccessful resistance to the introduction of the RDR, I wonder if IFAs have made an error of just this sort.

Their main argument against the move from commission paid by providers to fees paid by clients was that only their high net worth clients would be able to afford these new-fangled fees, and so effectively the advisers would be obliged to withdraw their services from the lower and middle parts of the market – leaving a huge and damaging “advice gap.”.

Given that most advisers are taking exactly the same amount of remuneration – three percent initial and half a percent ongoing.- after RDR as they were taking previously, it’s difficult to see why this broad withdrawal of service should occur.  The only clearly-apparent reason relates to the regulator’s demand that from now on advisers should actually do something in return for their half-percent ongoing fee, and claiming this as a problem necessitates the rather embarrassing admission that it’s been treated as free money hitherto.

So as an attacking move, this was a complete failure, and RDR has been implemented with the adviser charging rules in place.

But it’s worse than that.  As I’ve said on many other occasions, virtually all major product providers had separately decided that with the lever of commission now unavailable to them, betting their retail businesses on the advice channel alone had simply become too dangerous.  They were looking for a rationale to launch new direct-to-consumer offerings under their own brand and management – and the biggest obstacle they had to overcome was the long-established protocol that said they would never try to poach advisers’ clients.

Bingo.  Advisers’ ridiculous claim that they could no longer afford to service a huge proportion of their client bases gave providers the rationale they needed.  In fact, more than a rationale, it arguably gave them an obligation to do something – the regulator would frown at the idea of these lower-value clients being left in the dust.

Providers are now massing their rooks, knights and bishops to pour through the gap created by this strategic blunder.  (In fact, literally while I’ve been writing this, my old friends at hitherto-IFA-dominated Royal London have announces a new initiative in the area.)  Expressing an inability to serve 90-odd per cent of the UK population (by number, at least, although obviously not by share of assets) is turning out to be just as stupid a move as it looked at the time.

To everyone except the IFAs making it, that is.

Big trouble in brain tumour charity land

It’s funny how sometimes one word, used unexpectedly, or out of context, or in a context that says quite different things to the writer and to the reader, can convey a world of meaning that would otherwise have remained hidden beneath the surface.

The new tube poster designed to raise awareness of the forthcoming Brain Tumour Awareness Day (no, me neither), is a case in point.  “Wear A Hat Day”, announces the headline, innocuously enough.  But then look at the subhead – ” The UK’s Premier Brain Tumour Awareness Event.”  What a clear, sad and damaging story is told by that one word “Premier.”

From this single (and from the consumer point of view entirely unnecessary and pointless) word, it’s not hard to deduce what’s happened.  Once upon a time there was only one brain tumour awareness charity.  It raised awareness of, and I guess money for, research into this terrible illness as best it could.  All the energies of those involved were dedicated to the cause.

Then something happened.  There was some kind of bust-up – a disagreement over money, strategy, priorities, could have been anything.  One or more of the team broke away, and set up a rival charity of their own.  From then on, the whole thing has degenerated into feuding.  It’s John Cleese and the Judean People’s Liberation Front and the People’s Front for the Liberation of Judea.  At least half the energy formerly spent on promoting the cause is now spent sniping at the enemy.  Even when it comes to the most important fund-raising event of the year, the divisions go on:  presumably that “premier” tells us that the other lot have an awareness day too, and whoever wrote the headline couldn’t resist the temptation to take a pop at it.

In fact, if you think about it, it’s a bit more than taking a pop.  The entire orientation of the headline has been skewed away from delivering any persuasive or constructive message, and entirely towards a meaningless and irrelevant comparison with some other event that no-one seeing their poster in the underground knows of or cares about.  The poster is half as effective as it could have been.

I suppose I have to say now that I’ve completely made all this up.  It may be that my whole story is wrong, and the word “premier” appears in that headline for some quite different reason.  If so, my apologies to those concerned.  And on the upside, at least I’ve done a little bit to promote awareness of their day.

But still, what I think has happened here makes me angry. I’m not sure what it would do for both sides’ mental wellbeing, but I’d like to knock their heads together.

When we say we hate payday lenders, are we just being middle-class snobs?

While I waited at the bus stop in Camden Road this morning, the exhaust clattered off a fifteen-year-old Ford Fiesta just as it passed me.  A young mum was driving, obviously on the school run, two young kids in the back.  There, I thought to myself as I kicked the broken silencer into the gutter, is one of today’s first customers for Wonga.com.

Of course I might have been completely wrong:  the young mum might like driving her old Fiesta for sentimental reasons and keep half-a-dozen newer, pricier and more exotic machines on the driveway of her Hampstead home.  But I doubt it.  And it’s Thursday, which is the tightest day of the weeks for family finances.  And she only has about six hours before those kids need picking up again.

I remember a piece of research a few years ago reporting that some astonishingly high proportion of the population – could it have been half? – agreed with the statement that they would be “unable to put their hands on £50 in cash by 9am tomorrow morning.”   Maybe it was a quarter.  Or an eighth.  But whatever it was, it’s a statement that is incomprehensible to the rest of us.  How many different ways could I lay my hands on £50 by 9am tomorrow morning?  At least a dozen.  And that without either cadging off friends or resorting to crime.

But what we in the affluent middle classes have to understand is that there really are millions of people in the country for whom borrowing from a payday lender is the only way of getting that exhaust fixed by 3 o’clock this afternoon.  The only way.  And to say that borrowing at four-thousand-and-something per cent APR is a terrible decision, and the people who lend the money are terrible people, completely misses the point.  Or, indeed, several points.

It misses the point that the only other available decision – the one which involves leaving the kids outside the school gate at 3.30 wondering what’s happened to mum – is a good deal more terrible.

It misses the point that we’re just absolutely not operating here in, or anywhere near, the world of APR comparison-shopping.  This is not about looking at best-buy personal loan tables in the Daily Telegraph, finding a small Midlands building society that’s three bips below everyone else, filling in an online application form and waiting for our positive credit check to come back from Experian.  That’s not in any way a meaningful comparison or frame of reference here.

And it misses the point that our young mum isn’t actually paying four-thousand-and-something per cent, or anything like.  What she’s doing is borrowing £50, and paying back £60 when she gets paid tomorrow (or possibly £30 when she gets paid tomorrow and £35 next Friday).  The cost to her is not four-thousand-and something per cent:  it’s a tenner.  And given that it’s the only game in town (and given that this kind of lending represents a level of risk that no-one else will touch), she’s not too gobsmacked by that.

Ah yes, credit risk.  Surely we’re appalled by the strongarm tactics that many of these firmsuse to, um,. encourage reluctant repayers?  Well, yes, of course, no question, utterly disgraceful and repugnant.  But our outrage may well be out of line with the feelings of punctual repayers.  If more defaults meant even higher rates, the majority would surely support a higher, not lower, level of encouragement for the minority.

The thing is, it seems to me that being against payday lenders reflects a total failure to recognise how very poor people live.  If a payday loan is the only way to feed the family for the next 48 hours, or the only way to pay for your travel to work until Friday, or the only way to keep the electricity on during the current cold snap, then pious hand-wringing doesn’t do much good for the borrower.  I suppose it might be nice if the lenders dropped their APRs by a thousand per cent or so, but would borrowing £50 today and paying back £54 instead of £55 tomorrow really be all that different?  And if the rate cut meant tougher credit checks, more rejections, slower approvals and fiercer pursuit of defaulters, are we really sure that would represent a net gain for the market these lenders serve?

I need to interrupt this somewhat unexpected defence of payday lending to emphasise that payday lending, like any other financial product or service and indeed any other non-financial product or service, would indeed be impossible to defend if the providers were exploiting their customers to make obscenely high profits.   As far as I can see, looking quickly at a few of the bigger players, that doesn’t seem to be the case – in fact, at least one seems to be on the brink of insolvency.  Payday lending isn’t remotely in the same class as PPI, for example, when it comes to preposterous profitability.

In short, I think being against payday lending is being against being poor.  Today, this Thursday, if you announced that you were going to abolish the whole universe of payday lending at lunchtime, there are tens of thousands of people with empty fridges and credit-less Oyster cards who’d be panic-stricken at the news.

And a certain fifteen-year-old Ford Fiesta that wouldn’t be in its usual spot outside Brecknock Primary this afternoon.