Industry: Banking
What happens when a negatively slanted article is published in a national business magazine and your company's product is mentioned?
The Option Adjustable Rate Mortgage is a seemingly benign way to better manage one's monthly cash flow by lowering the monthly mortgage payment. (Read more on Option ARMs). However, if consumers had bothered to read the fine print, the introductory or teaser rates offered by banks and mortgage lenders are temporary; the rates, that is, lasting for 30 days up to a year. What is unfathomable to me are the greed and stupidity factors. People were refinancing their 30-year fixed 5.X% loan for a 30-day 1% rate? Inconceivable!
The alarming parts of that article are where "1.3 million borrowers took out as much as $389 billion in option ARMs in 2004 and 2005" and "Up to 80% of all option ARM borrowers make only the minimum payment each month, according to Fitch Ratings." It makes you wonder why the mortgage industry is relatively unregulated. There's already an estimated 20% shrinkage of the mortgage industry over the next 5-10 years. You'd think that it'd be in a company's best interest to not be so greedy as to push consumer risk to its breaking point. For now, banks and mortgage lenders are able to record phantom profits on their books because GAAP allows them to even when a borrower only pays the minimum amount each month. A lot of borrowers are likely to default on their loans, lose their property, or have to resort to a hard money loan to keep their property. It would then mean that consumer debt will skyrocket, leaving less disposable income to spend for durable goods, luxury items, travel, entertainment, etc. One would surmise that a recession is coming, maybe not today, but within the next five years. There's only so much in defaulted loans that any financial institution can really afford to have on its books. The ideal is to not have any at all.
(On a side note, I think now would be a good time to adjust my 401k to include bonds.)
So why consider Option ARMs if they're so risky? Rates not low enough? Did inflation stabilize? Was there really a cooling of the housing market due to rising interest rates or was it simply seasonally based? Consumers believe that the economy is continously growing, the housing market will always rise (maybe only in California, NY, or MA), and that their earnings will grow as they gain more work experience, responsibilities, college degrees, etc.
Washington Mutual's response to their lending practices: "Borrowers who request an adjustable loan with payment options should understand those options and potential adjustments throughout the life of the loan. We make detailed disclosures to customers that are designed to develop a more informed consumer of mortgage products and ensure that our customers are comfortable with the loan products they select."
WaMu's response is prudent and shifts the responsibility to the consumer, as it should be. Sounds fair, but is it enough?
For clarity purposes, I don't work for WaMu. And, I have yet to see what PR spins out of where I am. I'll update this post when I know more.
Campaign Decomposition
Vocus - "Decode The Secret"
Media: direct mail, 1st class postage; Flash presentation via customized website
Audience: subscribers of DM News
The elements of the direct mail piece included a handwritten 6" x 9" manila envelope, a pair of 3D glasses and one 8 1/2" x 11" sheet of white paper personally addressed with first name, and one call to action:
"Put on your glasses and visit your web site at"
www.DecodeTheSecret.com/(name)
The only magazines that are tied to both my workplace and home residence are business related. Seeing how I only subscribe to three print publications, it was easy to narrow down where my contact information was harvested from. I did initial research on the piece itself. I looked up the web URL in the Internet Wayback Machine (archive.org) and at AllWhois.com to see who owned the website. The website was first archived in September 2004 with no changes since February 2005. From the lack of information there, one could assume that perhaps html tags were used to prevent search engine indexing.
What does this tell me? I was more interested in how the campaign was executed rather than the content this marketing services firm was trying to convey. So what happened? The direct mail piece that drove me to their special website was poorly done and amateurish. The direct mail concept and execution suggests that it was done by a person or group of people who are at least a decade younger than myself. How do I know this? Because the mid-to-late 80s had spy vs. spy product marketing geared towards kids and this is a campaign to reconnect with one's youthful experiences of discovering "secret" data that you could only unlock with "special" tools like 3D glasses. I suppose there are more modern incarnations of toy product marketing for todays youths, but nothing is as classic as the secret decoder ring or homemade invisible ink.
I was disappointed to find that there was only one tiny section of one web page that used the 3D glasses, instead of finding elements throughout the campaign that would spell out a keyword or give "secret" directions about their services or their company. The Flash presentation was very direct and straightforward, but otherwise bland for the share of the market this company competes for.
Am I likely to use their services or pass on their content to my colleagues? Probably not. I don't believe that I'm the right point of contact.
If I were a PR or marketing services agency, what would I do differently?
One, I wouldn't send a broadcast direct mail piece (a traditional marketing, shotgun approach) to a mass audience. In Vocus' news archive, there's an article that says they acquired PRWeb, a press release newswire that many, many companies use to disseminate PR articles about their company, products/services, or individuals. Perhaps a future campaign could utilize a more targeted database, e.g., the people using PRWeb, instead of using DM News' print edition subscriber base.
Second, have a better initial presentation. A pre-printed #10 business envelope might have had better impact than a handwritten envelope. Addressing was written with a felt-tip pen. The use of a felt pen vs. ballpoint? It's about the same. It depends on what image you want to convey. Use of either suggests a very small company with less than 10 key employees. I can tell by the handwriting style that the person was educated in Europe. The British styled numerics are a clear giveaway. Paper does come in different colors these days. Even if they were mail dropping this in-house, it'd still might look more professional if mailing labels or gender personalization (like, Mr. John Sample, instead of John Sample) were used.
Third, I'd have a better call to action at the end of the presentation. There are two elements of the end page. A, they want viewers to put in a telephone or e-mail contact information to sign them up for a services demo. B, they baited the viewer with a free $50 gift card to Barnes and Noble. Viewer signs up and becomes a lead. The rep may disqualify the viewer when talking about the on-demand PR software. Once a sales rep calls and shows the viewer a demo, is the company really obligated to send the viewer that $50 gift card when there is no possibility of a sale?
Four, consistent messaging. Once you do get to the last page there's a disclosure about the gift card, except it's for a $75 gift card and not a $50 gift card. This lack of attention to detail is a very key issue for marketers. If your PR firm can't even get their own details straight, what makes you think they'll get yours right? Also, there was a lack of continuity of the "decode the secret" theme.
Five, and probably the most important part. Have a clear goal for what the campaign is supposed to achieve. If it's product or service awareness, that's fine. Tying a free gift to the experience isn't necessary. It's a cheap way to go, and I don't mean by the campaign being inexpensive. It cheapens the campaign and the messaging that goes with it.
Ok, there's one more. Six, know your audience. By the focus of this campaign and the services offered, I shouldn't have received this campaign at all. This is where the shotgun approach of launching a campaign to everyone who has a pulse in the marketing industry isn't necessarily a good approach.
Media: direct mail, 1st class postage; Flash presentation via customized website
Audience: subscribers of DM News
The elements of the direct mail piece included a handwritten 6" x 9" manila envelope, a pair of 3D glasses and one 8 1/2" x 11" sheet of white paper personally addressed with first name, and one call to action:
"Put on your glasses and visit your web site at"
www.DecodeTheSecret.com/(name)
The only magazines that are tied to both my workplace and home residence are business related. Seeing how I only subscribe to three print publications, it was easy to narrow down where my contact information was harvested from. I did initial research on the piece itself. I looked up the web URL in the Internet Wayback Machine (archive.org) and at AllWhois.com to see who owned the website. The website was first archived in September 2004 with no changes since February 2005. From the lack of information there, one could assume that perhaps html tags were used to prevent search engine indexing.
What does this tell me? I was more interested in how the campaign was executed rather than the content this marketing services firm was trying to convey. So what happened? The direct mail piece that drove me to their special website was poorly done and amateurish. The direct mail concept and execution suggests that it was done by a person or group of people who are at least a decade younger than myself. How do I know this? Because the mid-to-late 80s had spy vs. spy product marketing geared towards kids and this is a campaign to reconnect with one's youthful experiences of discovering "secret" data that you could only unlock with "special" tools like 3D glasses. I suppose there are more modern incarnations of toy product marketing for todays youths, but nothing is as classic as the secret decoder ring or homemade invisible ink.
I was disappointed to find that there was only one tiny section of one web page that used the 3D glasses, instead of finding elements throughout the campaign that would spell out a keyword or give "secret" directions about their services or their company. The Flash presentation was very direct and straightforward, but otherwise bland for the share of the market this company competes for.
Am I likely to use their services or pass on their content to my colleagues? Probably not. I don't believe that I'm the right point of contact.
If I were a PR or marketing services agency, what would I do differently?
One, I wouldn't send a broadcast direct mail piece (a traditional marketing, shotgun approach) to a mass audience. In Vocus' news archive, there's an article that says they acquired PRWeb, a press release newswire that many, many companies use to disseminate PR articles about their company, products/services, or individuals. Perhaps a future campaign could utilize a more targeted database, e.g., the people using PRWeb, instead of using DM News' print edition subscriber base.
Second, have a better initial presentation. A pre-printed #10 business envelope might have had better impact than a handwritten envelope. Addressing was written with a felt-tip pen. The use of a felt pen vs. ballpoint? It's about the same. It depends on what image you want to convey. Use of either suggests a very small company with less than 10 key employees. I can tell by the handwriting style that the person was educated in Europe. The British styled numerics are a clear giveaway. Paper does come in different colors these days. Even if they were mail dropping this in-house, it'd still might look more professional if mailing labels or gender personalization (like, Mr. John Sample, instead of John Sample) were used.
Third, I'd have a better call to action at the end of the presentation. There are two elements of the end page. A, they want viewers to put in a telephone or e-mail contact information to sign them up for a services demo. B, they baited the viewer with a free $50 gift card to Barnes and Noble. Viewer signs up and becomes a lead. The rep may disqualify the viewer when talking about the on-demand PR software. Once a sales rep calls and shows the viewer a demo, is the company really obligated to send the viewer that $50 gift card when there is no possibility of a sale?
Four, consistent messaging. Once you do get to the last page there's a disclosure about the gift card, except it's for a $75 gift card and not a $50 gift card. This lack of attention to detail is a very key issue for marketers. If your PR firm can't even get their own details straight, what makes you think they'll get yours right? Also, there was a lack of continuity of the "decode the secret" theme.
Five, and probably the most important part. Have a clear goal for what the campaign is supposed to achieve. If it's product or service awareness, that's fine. Tying a free gift to the experience isn't necessary. It's a cheap way to go, and I don't mean by the campaign being inexpensive. It cheapens the campaign and the messaging that goes with it.
Ok, there's one more. Six, know your audience. By the focus of this campaign and the services offered, I shouldn't have received this campaign at all. This is where the shotgun approach of launching a campaign to everyone who has a pulse in the marketing industry isn't necessarily a good approach.
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