The government wants to provide future pensioners with information about retirement saving, so advertising seems a sensible option.
But is advertising a good use of taxpayer’s money?
In particular, how valuable are advertising campaigns featuring furry monsters, workplace mini mes and celebs-talking-pensions?
David Ogilvy, founder of Ogilvy & Mather and known as the 'father of advertising’ (who ought to know about such things), once said: “I do not regard advertising as entertainment or an art form, but as a medium of information”.
So surely a subject as important as retirement savings should be promoted with serious content by informed spokespeople – not trivialised with gimmicks and children’s toys?
Stimulating engagement is a continuous exercise, and advertising is just one method of raising awareness and interest.Perhaps things are different from the way they were in Mr Ogilvy’s time.
The annual John Lewis Christmas ad. The Cadbury’s gorilla thumping out some Phil Collins on the drums. These are memorable not for the information they provide, but for the way they are created and presented.
To stimulate interest and engagement – surely the government’s aim when rolling out pensions adverts – perhaps there needs to be an entertainment factor to lift the communication from background noise to something that has a meaningful impact.
That said, we do have to look at the numbers to see if the juice is worth the squeeze.
How much?
The government spent £18m on promoting its free advice service, Pension Wise, while pensions minister Guy Opperman has confirmed that £25m went towards auto-enrolment awareness campaigns.
A further £1.7 million was spent on social media advertising (promoted posts on Instagram, Twitter and Facebook) between June 2017 and September 2018, which gives an indication of the size of the spend.
These are not insignificant numbers, clearly. But it seems that the adverts are getting traction.
According to Pension Wise evaluations, 29 per cent of appointment customers became aware of the advisory service from TV, radio or press advertising.
For context, this is the largest source for Pension Wise appointments, behind only provider referrals.
Similarly, the government has said that its ‘Get to know your pension’ campaign has helped to drive an additional 9.4m people to take advantage of auto-enrolment.
Stimulating engagement is a continuous exercise, and advertising is just one method of raising awareness and interest.
Some of the advertising ‘tricks’, such as enlisting comedians David Baddiel and Frank Skinner to tout the benefits of early engagement with retirement issues may seem gimmicky, but if comedy duos move the needle for financial education, then this suggests that the expenditure is worthwhile.
Information may already be accessible through government channels, but this information is useless unless people know where to look for it.
“Paying to reach the widest possible audience is both necessary and responsible,” said the Department for Work and Pensions' Justin Tomlinson late last year.
While it is clear that the figures should be monitored to ensure the balance between expenditure and impact remains appropriate, it is encouraging to see some creative thinking from government when it comes to addressing the issue of how to better engage people with issues relating to retirement savings.
More can be done around financial education and use of technology, in particular, to get people thinking about saving for their retirement earlier on in life.
But efforts to connect with savers through TV, radio and online advertising is a worthwhile endeavour – and, to counter Mr Ogilvy’s point, perhaps the ‘entertainment’ factor is vital to prevent most people from fast-forwarding through them.
The next challenge – once the Pensions Dashboard is up and running – will be to get people to log on and monitor the state of their retirement savings.
We look forward to an innovative and eye-catching advertising campaign later this year.
Bob Scott is a senior partner at Lane Clark & Peacock
