Barclaycard’s bungled announcement that its commercial director Shaun Powell is quitting the credit card giant was reminiscent of a scene from one of its own commercials.
In keeping with the secret service theme of the Rowan Atkinson advertising, Powell, 34, agreed with Barclaycard that his destination would be kept secret.
However, a bubbly press officer rang Marketing Week to say: “Shaun Powell has resigned and is going to Thomson Holidays to be marketing director.” Half an hour later, the same flustered press officer rang back to ask, in the true style of Richard Latham (Rowan Atkinson), if we could ignore the second piece of information that she had inadvertently given us.
How could we ignore the fact that Powell is leaving a company with the single most successful financial services brand in the history of marketing, and as a result of which he was shortlisted for marketer of the year by the Marketing Society? He is joining a company with relatively weak branding and which its bosses say is up for sale, in a sector with appalling distribution and the threat of legislation hanging over it.
In Powell’s relatively short time, he has progressed from graduate trainee at Glaxo to brand manager at Sterling Healthcare, to marketing controller at Homepride and commercial director at Barclaycard.
Powell is a young man in a hurry. Corny as it may seem, he likens his career path to a scene from Blade- runner featuring Rutger Hauer as an android with a shortened life-span. As Hauer releases a pigeon, and prepares to die, he says “burning bright and burning fast”. But if that is how Powell sees his career, why join Thomson as marketing director?
Although sources suggest that a bigger job is planned for him, it could be seen at best as a sideways move. People close to Powell say he only had two routes at Barclaycard – move over to the banking side or head Barclaycard’s European expansion plans, which are now on hold.
Though he studied history at Oxford and did an MBA at Cranfield – all of which goes down well in banking circles – Powell certainly doesn’t appear like a banker.
For a start there is his accent, finely honed from his home town – deepest Slough – and then his smile, which he describes as cheesy, akin to either The Joker from Batman or Tony Blair. He is often seen at functions wandering round with a beer bottle in his hand, and doesn’t mind getting very drunk with his staff. His secretary Val describes him with affection as “one of the lads”.
Even so, Barclaycard insiders were shocked by his resignation. In the four years he has been there, he has managed to maintain Barclaycard’s dominance – an 9 million customer base compared to its nearest rival Lloyds TSB with 5 million.
He was also responsible for coining a new term in financial services marketing – “vanilla brands” to describe the plain offering of its rivals compared with the premium “Tutti Frutti” offering of Barclaycard.
Powell’s strategy has been to defend Barclaycard’s market share by adding value to the brand. He reformed the Profile points scheme, launched alliances with Ford and Cellnet and created additional services such as Barclaycard Assist to justify its very high annual percentage rate (APR). Barclaycard recently signed up to BT’s new loyalty scheme which allows redemption of phone minutes.
He is evangelical about brands, and scathing about the way rival banks such as NatWest and subsequently the Royal Bank of Scotland got involved in own-label banking with supermarkets and other retail chains. “Branding as a discipline is all about sustaining your premium price.”
He is equally acerbic about companies which make price cuts central to their marketing strategy – such as Direct Line and Esso.
Though he could rightfully claim credit for the strength of the Barclaycard brand, he has been fortunate. Barclaycard’s only real branded credit card rival Access cunningly tried to outwit the market leader by committing suicide. The UK banks sold the brand to payment system MasterCard last year, which promptly closed it down.
Barclaycard has not clung solely to its Tutti Frutti strategy. Last year it launched its own aggressive brand switching campaign, but was rapped by the Advertising Standards Authority for a direct mailing which claimed to give up to 150 to people switching from their card to Barclaycard – the small print contained a pay-back clause for customers not spending enough.
Powell admits that the switching campaign – which cost Barclaycard 6m – is the one area that he is least proud of.
“We wanted to find out market information about what makes consumers switch from their existing card. When someone from Barclays says we are about to get slaughtered because ‘First USA Bank’ is coming over with an amazingly cheap card, we need the research to show that we can respond to that.
“One of my achievements has been resistance and being able to convince Barclaycard’s chief executive (Bob Potts) that there is no need to bow to pressure from the press or from Barclays Bank to fight on price. There is an inherent culture of risk aversion in financial services; it is not surprising because they are lending people money,” says Powell.
Others close to Barclaycard say the switching campaign was de-signed to appease Barclays Bank which wanted Barclaycard to take the battle to the new issuers. As market leader, Barclaycard has been hit hardest by the creation of own-label cards, with as many as seven per cent of new card holders moving from Barclaycard.
Powell admits there is pressure to fight on price.”When you mention brands in financial services, bankers think you mean the name or logo,” he says.
Arguably, the same could be said of Thomson. Years of being em-broiled in the travel agents’ price war has taken its toll on the brand. Under deputy managing director Richard Bowden-Doyle, the company declared last year that it would drop discounting in favour of a quality positioning.
But Powell remains dismissive about travel sector marketing. “There is very little difference between the products in the travel industry. The price wars have been self destructive. The way that pricing works is crazy. The later you book, the better deal you get. Those who book early – the most loyal customers – get the crappiest deal,” he says incredulously.
According to Chris Cowpe, joint managing director of BMP DDB, the agency which works for both Barclaycard and Thomson, Powell is a demanding client: “He wants to make things happen and sets himself and others stringent objectives.”
Powell’s youthful arrogance is probably one of the reasons he has been so successful. He is clear about his successes and scathing about those who fail to meet his expectations.
Marketing Society awards are a sore point with Powell. He didn’t win marketer of the year, and was miffed when the Marketing Society told him that the financial services category for the annual Awards, for which he had entered Barclaycard, had been dropped by the judges because the nominees failed to meet the criteria.
If Powell is determined to pursue a course of action that means burning bright and burning fast, we can expect to see changes at Thomson. For his sake, he had better hope that Messrs Latham and Bough – and eager press officers – are kept well away from his plans.