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Friday Fiver

posted by Edward Jones

 

Image source: STV

1. FRIDAY FIVER IS BACK!

After a brief winter hiatus, we are delighted to announce that Friday Fiver is back with a vengeance! We’re sorry we went away and we hope you’ll have us back!

2. Blimey… Tax evaders named and shamed by Revenue

This feels like a bold step from HMRC. Will ramp up pressure on the Govt to disclose big business’ tax evasion – as demonstrated by Margaret Hodge’s intervention.

3. Trial by media or trial by jury?

Judging by the number of online mentions of the tragic incident of Reeva Steenkamp’s death, which was close to 1,000,000 on the day of the shooting, it’s hard to detract from the two trials Oscar Pistorius is facing. One in front of the Magistrate’s court and the other in front of the world’s media and the court of public opinion. Nicely summarised in this piece by Daniel Howden and Ian Burrell at The Independent:

“…in many ways his trial began as soon as news of his lover’s death reached the media. The only difference here is that the facts of the case carry a much lower burden of proof. The slow grind of South Africa’s justice system, which barely recognises contempt of court, has been unable to keep pace in the era of social media and rolling TV news. As a consequence, the first disabled global sports superstar has found himself deluged with accusations and insinuations masquerading as facts.”

4. Harry Styles Backs Ed Miliband for PM

This is BIG NEWS! Really big, but begs the question ‘Who do the other members support?’ Perhaps they’re all lefties! Harry is the lead singer afterall. Ok. What about One Direction’s big rivals - The Wanted? They must be true blues. Mumford and Sons? Lib Dems. Definitely. Their love of string instruments, country folk and their urban upbringing must surely indicate a yellow streak.  

5. FPS FATTIES

And a lighter story to end this week’s Friday Fiver, especially for the snack-loving FPS team, and for the myth of the “H+K stone” to be confirmed by a story in the papers this week. Research by The Village Bakery found that office workers are amongst the worst offenders for piling on the pounds – over 6lbs in fact – with cakes and biscuits brought into work by colleagues. This week already, we’ve had homemade cupcakes brought in by the lovely Clare M and the week before, a deliciously moist lemon drizzle cake made lovingly by Liz, Syrian delights and Jersey fudge from the islands. Temptation is just too hard to resist. Pass the biscuit please.

Thanks to @liyywln for contributing to this week’s Friday Fiver

Five lessons from the US election campaign

posted by Edward Jones

1. BE BOLD.

I was fortunate enough to attend a debate hosted by H+K last Monday on the US Presidential election, never ones to blow our own trumpet enough, it’s worth saying it was an excellent event. One of the panelists, Philip Stephens, a columnist for the FT hit upon the idea of Obama treating the first term of his Presidency as a delicate vase. Incidentally, the FT ran this cartoon (£) a few days later. The idea that Obama hadn’t been bold enough struck a chord with the audience. As I have sought the views of colleagues it is clear that in the UK at least, commentators think he could have been bolder, both in his Presidency and the campaign. That is the enduring hope for the second term.

2. IF DISASTER STRIKES. FOCUS ON THE DISASTER.

The President’s response to Hurricane Sandy served him well. Not least because of the ringing endorsement of the Republican, New Jersey Governor, Chris Christie. This WSJ On Leadership article is an excellent summary of its impact.

3. KNOW YOUR AUDIENCE.

It’s a simple enough concept and one we’re mostly familiar with. My colleague, Ted Robinson, who has followed developments more closely than most in the UK at least (I’ve asked him to write a post on this too), highlighted the confusion within the Republican camp with who they were targeting, asking:

“Are the GOP just communicating to whites or are they the party of social conservative hispanics? Lesson: decide who your audience is – does it surprise you?”

He had previously highlighted that…

“The Republicans have to win back California as they did under Nixon and Reagan – winning 49% of the pop vote and getting nailed in the electoral college sucks”

Quite. What drove this point on audience home for me though and brings me on to my fourth point is sophisticated use of digital…

4. USE DIGITAL. BE SOPHISTICATED.

The Obama camp, building on the success of their social media campaign and fundraising in 2008 have raised the bar. Again. They knew who they were targeting and they weren’t bashful about it, as this excellent piece from Will Foxton in the Telegraph attests.

5. DON’T OFFEND.

Romney’s campaign started to derail in the UK. Whilst the cynics said that doesn’t actually matter, it was only a part of a catalogue of well documented errors. Celebrated today on the Times website (£). 

For a view on what Cameron might learn, I can’t recommend Matthew D’Ancona’s piece in the Evening Standard today, highly enough.

5 numbers that tell the story of why everyone’s getting a pension from Monday

Pensions. I know, dull, dull and more dull right? Correct. Unfortunately, pensions are about to become like unwashed dishes in the sink – visually unavoidable, uncomfortable smelling and constantly in your face as you walk past them, nagging you to deal with them. Monday is the start of the much heralded and overly written about auto-enrolment. Starting a pension will no longer become a case of “yes please” if you want one but rather “no thanks” if you don’t.

I’ve already written about the challenge of selling this to 7m people, but it’s just worth considering why the Government is doing this. To round out the week, here’s a few numbers which hopefully tell the story behind auto-enrolment. Alternatively, you can watch the new promo adverts for auto-enrolment on YouTube:

8.2 million – that’s the number of people who have a workplace pension. That’s less than one in three adults

£20,000 – that’s what people want to live off each year in retirement

£11,000 – that’s what people think they’ll actually have each year in retirement. That’s a £9,000 gap

82.3 years – that’s the average life expectancy of a girl born today in the UK. It’s rising by nearly 3 years every decade

£400,000 – that’s how much money a woman needs to buy £20,000 a year of income in retirement

Just to reiterate that last one – £400,000. Or to put it another way, that’s the cost of this mansion in Northern Ireland.

The Reshuffle: Three initial thoughts

Business, Foreign, Home, Deputy and a host of other key offices of state are still in place following today’s reshuffle, leading some to call it a damp squib. But that doesn’t mean the day isn’t turning out to be highly interesting in other ways. Three initial thoughts on the reshuffle from us as follows (thanks to Matt, Ed and Ed for their views):

1. Britain is back from Summer: The Olympics created an unusually long summer (silly) season and accompanying downtime for politics and business news. Yesterday’s war cry by Cameron, today’s reshuffle and a host of key European dates coming up mean the political and business communities are very much now back. Expect the news agenda to tighten significantly and the tone to darken markedly in the next week or two.

2. The Government has dodged a brick wall on Jeremy Hunt: Whether intentional or not, the shifting of Justine Greening away from Transport and subsequent attack from Boris Johnson that this greenlights Heathrow’s expansion will likely be the lead story on tonight’s evening broadcasts and tomorrow’s papers. Jeremy Hunt’s promotion to Health, despite his public embarrassment over News Corp will enjoy a much more comfortable second or third slot in the billing.

3. Women in the Cabinet is a weak point for Cameron: The Prime Minister has made his commitment to women occupying a third of his cabinet clear. Today’s reshuffle casts doubt on his ability to fulfill it. We don’t know the scope of junior roles yet, but the decision to give Maria Miller both the Culture and Equality/Women briefs looks strange, especially given her lack of profile prior to today. DCMS is an important department, particularly at present so why burden its Minister with a second job instead of promoting another female star to the second role? Labour will be itching to pounce.

How long will Virgin’s PR window remain open on the West Coast?

Kudos to Richard Branson. His crusade to repeal the decision to award the West Coast Main Line to someone else shows no signs of slowing down. However, are the tables starting to turn? The FT reported yesterday on the large financial incentive for Branson to keep the rail contract in the Virgin stable – the line generates far higher revenues and margins than other lines in Britain, in part because of geography (it goes through the North West) but also because Virgin benefitted from the huge upgrade it got during the noughties.

To date Branson has based his campaign just like any other using the Virgin brand and its values – it’s the slightly alternative, anti-establishment brand run by that eternally young blonde haired guy who occasionally jumps off buildings – he’s the best of British and he tries to offer you a great experience on Virgin. People love the brand, even if the trains themselves are average at best in the eyes of some (for my sins I have a strange attraction to Virgin planes over others so the ‘brand thing’ clearly does work).

The problem is, the West Coast dispute is now in its third week. Initial sympathy and that feeling of “oh but Virgin are always good, we should keep them” from consumers will begin to peter out, especially as other events capture their attention again. The deeper look at the financial value of the line won’t help either – the more this becomes about bottom line and the less it’s about the Virgin brand, the better it looks for First Group.

If that wasn’t enough of a problem, the final blow for Branson would be if his pursuit of this issue starts to affect the quality of the service itself. Any perceived detorioration in the service, either now or as Virgin winds up its tenure later this year will likely be the final nail in the coffin. Consumers will tolerate a protest from Virgin, but not at the expense of a comfortable, on-time train ride.

So Branson continues to stay in the fight for now. But the longer it goes on, the lower his chances of success via public sympathy.

Do you remember your first car?

A question that has sparked quite the conversation amongst the team as we shared stories about our old, but much loved, bangers from the days of our youth.

We’ve had a couple of Renault Clios that are not without their battery and engine ailments, a rundown Morris Minor and a clapped out Rover 200 – no brakes, a dodgy handbrake but a great stereo.

What prompted our nostalgia? This handy infographic from Aviva (cl) on top ten first cars of all time and accompanying story on the changing face of your typical first car owner. It looks like we weren’t the only ones inspired by the story as the Daily Mail, Sun, Telegraph, Daily Star and Evening Standard all took their own spin on it (no pun intended).

Car infographic

What was your first car?

Great expectations and the role of central banks in managing them

 

When the economy stalls we turn to central banks for stimulus measures. Throw in significant sovereign debt issues and central bankers here in Europe and in the US have plenty to contend with. 

Debate and speculation around interest rates and quantitative easing programmes is widespread. Financial markets are looking for any sign of a shift in attitude from central bankers as to their views on what may be needed to turn the situation around. That is why here in Britain, the release of the monthly Monetary Policy Committee meeting minutes has become something of a media event in its own right.

We noted with interest recent analysis on the Zerohedge blog of the US Federal Reserve’s Maturity Extension Program or “twist.” The policy was introduced to combat perceived weakening of the US economy. The post demonstrates the way in which those following these announcements analyse the wording on the economic outlook:

The description of the outlook suggested Fed officials now see slower growth and have a more pessimistic view on the labor market. Committee members expect growth to pick up “very gradually” (adding “very” to the previous language) and think the unemployment rate will decline “only slowly” (as opposed to “gradually”).

 It all goes to show how carefully central banks must word their outlooks with so many interested parties looking for a guide to what is in store.

The future of Libor – 2 key points from a comms perspective

On Friday I attended Martin Wheatley’s unveiling of the Government-commissioned review of Libor at Bloomberg’s offices. Wheatley, who will head the new Financial Conduct Authority, gave an hour long speech setting out the consultation. He’s set himself an ambitious task – the deadline for responses is only four weeks away and Wheatley will publish his final recommendations by the end of September.

The speech itself contained a mixture of detail and vision for the future of Libor or its replacement. From a Comms/PR point of view, there were two particularly interesting points:

1. Who Runs Libor or its replacement? At the moment, Libor is run by the British Bankers Association, the trade group and voice for the industry. Some people are concerned that Read the rest of this entry »

How do you PR pensions to 8m people?

This little conundrum is the question facing the National Employment Savings Trust (NEST) over the next few months. On 1st October, a new era of retirement saving will begin as workers are automatically enrolled into company pension plans without fail. You can opt out if you wish, but the hope from the Government is that two thirds of people won’t.

Now let’s get to the crux of the issue shall we? “Pensions”, “Saving” and “Retirement Planning” are all very dull, very unsexy words that most people the young side of 50 have little interest in discussing or thinking about.

The number of reports, press releases and speeches from companies and politicians on the yawning savings gap in the UK is enough to form a paper road to the moon. But it still makes little difference to savings rates, as was highlighted this week.

So, back to the question: how is NEST enticing 8m potential new pension savers to stay in their pension plans and not opt-out as soon as they can? Well, hats off to them. With restricted budget, they’re going hell for leather with an upbeat message, emphasising the joys of a later life spent in relative comfort. This is neatly summed up with the hashtag

#worthsavingfor

What’s pleasing to see is that they’ve avoided the old-school approach of just producing reports, surveys and general doom and gloom. We have the classic PR tactics like these in the mix, but they’re supported by a strong social media programme. Together, for me, it makes quite a package.

Will it work? It’s too early to say and we won’t really know for two or three years when most people will be auto-enrolled. Expect the papers to jump on any data showing high opt-out rates in big companies from December onwards. NEST and the Government are also clearly a little nervous, with rumours of an additional TV advertising campaign in the mix. Still, at this point, fair play to them.

10 analysts/economists/traders to follow on Twitter

Someone has fired the starting gun on the City and Twitter, because in recent months the number of City commentators taking to the airwaves has shot up. Some of the names are familiar from their traditional place on the rolling news channels. Others are less familiar but growing.

Below is our list of ten that are well worth following for an insight on the markets, investing and economic data. There are lots more, and we’ll run another list in a couple of months’ time to update on this:

Mike Van Dulken, Head of Research at Accendo Markets: @Accendo_Mike

Michael Hewson, Senior Market Analyst at CMC Markets: @michaelhewson

David Buik, BGC’s semi-retired veteran analyst: @truemagic68

Bond Vigilantes, M&G’s retail bond team: @bondvigilantes

Justin Urquhart Stewart, Director at 7 Investment Management: @ustewart

Nick Bubb, Retail Analyst: @NickBubb1

Joshua Raymond, Chief Market Strategist at City Index: @Josh_CityIndex

Paul Kavanagh, Chairman of Killik Capital: @KavanaghKillik

And two financial bloggers well worth following on Twitter to round out the set:

Zerohedge: @zerohedge

Felix Salmon, Reuters’ finance blogger: @felixsalmon