Flat Champagne

Less than three years ago, as the new millennium drew near, many firms were anticipating a year 2000 marketing push. For evidence, see our "Millennium Marketing" article in the September 1997 issue. The industry hoped the then-reluctant-to-invest baby boomers would look at the calendar and start making serious retirement and investment plans.But Y2K as a marketing theme has become as flat as champagne

Less than three years ago, as the new millennium drew near, many firms were anticipating a year 2000 marketing push. For evidence, see our "Millennium Marketing" article in the September 1997 issue. The industry hoped the then-reluctant-to-invest baby boomers would look at the calendar and start making serious retirement and investment plans.

But Y2K as a marketing theme has become as flat as champagne on New Year's morning.

A Merrill Lynch spokesperson says the firm doesn't anticipate any new marketing approach in the year 2000.

When asked if First Union Securities is doing anything with a millennium theme, marketing head David Acey says: "We're not really into fads. Firms in general will probably not be doing anything differently."

What happened to the great millennium marketing opportunity?

Several things. Baby boomers are reforming their spendthrift ways and embracing the idea of saving. Online trading exploded and now dominates marketing campaigns. Meanwhile, a strong market has convinced more people than ever to invest. And fears of the Y2K computer glitch have not left any room for upbeat millennium messages.

Times Change Three years ago, the baby boomer segment of the population (those born between 1946 and 1964) was viewed as a huge, yet untapped group of potential investors. Y2K marketing seemed like a natural for this crowd. After all, boomers will retire and die in the 21st century. What better time to get them to re-evaluate their financial situations?

But now, boomers seem to be coming around, some industry observers say.

"You invest because of your age and your risk power," says Larry Silver, head of marketing at Raymond James Financial in St. Petersburg, Fla. Many of the older boomers (50- to 54-year-olds) have reached the age and risk threshold when they begin serious investing, he says.

J.R. Helmig, a rep with Merrill Lynch in Phoenix, agrees. People need financial services as they age, and "that's where [baby boomers'] focus is now," Helmig says.

Meanwhile, the industry is concentrating on online trading, which was barely a blip on its radar screen three years ago.

"Our marketing thrust is on Merrill Lynch Direct," says Selena Morris, Merrill's vice president of technology and corporate services communications in New York. "We haven't looked at any other marketing angle."

And the industry hasn't really needed a new angle. Over the past three years, the Dow has gained roughly 3,500 points.

"There has been a lot of political and economic upheaval over that time, but the market has been good to us," says Jack Handy Jr., executive vice president in charge of marketing at Financial Investment Corp. in Torrance, Calif. "We don't plan to do anything [including marketing] differently."

The Y2K computer problem also put a damper on the marketing party. Investors' fear of glitches mixed with pressure from Congress and regulators preoccupied the industry with implementing and publicizing huge remediation projects. Meanwhile, the public came to associate millennium with "bug" and Y2K with "problem."

The upshot: Y2K as a marketing message just doesn't cut it. Mention Y2K as an opportunity, and people were more likely to react with fear and pull money out of investments.

"The industry must be careful not to bait the bear," explained one financial services firm spokesperson to Registered Representative last year.

The millennium change "will make no difference in the way we do things," Silver concludes. "We are dealing with the same issue we had 10 years ago. It's going to be business as usual."

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