Celebrities to the rescue of ailing Post Office

West%20LifeThe Post Office’s new celebrity-led advertising push comes as the Government-owned company prepares to close 2,500 branches to safeguard its future.

The ads, the first from new agency Mother, feature such varied celebrities as boy band Westlife and actress Joan Collins, and are designed to make the Post Office more appealing to a “prime-time” audience.

The Post Office has the largest retail network in the UK, with more than 14,000 branches – more than all of the country’s banks and building societies put together. But the business is losing about £4m a week, not helped by the fact that pensions and child benefits – which previously accounted for 40% of the Post Office’s revenue – are now paid directly into bank accounts.

Alan Cook, the former chief executive of National Savings & Investments, was brought in as managing director last year, and the Government announced it would provide £1.7bn for the closure of up to 2,500 branches in response to the Post Office’s financial problems. Consultation on the closures, which it is hoped will help bring the organisation back to profit by 2011, begins this week.

Critical time
Gary Hockey-Morley, who joined the Post Office as marketing director from Abbey in November last year (MW September 7, 2006), admits it is a critical time for the business.

“This is our last chance,” he says. “Customer visits are falling and we don’t do nearly as much work for the Government as we used to. We can’t stay as we are – that’s not an option. We have to modernise and improve, and compete hard for income. If we don’t change, the future is bleak, but we are changing and we will continue to change.” 

The Post Office has 1 million financial services customers and almost 500,000 telephony customers. It is launching a broadband service this month and it is also planning to sell mortgages, on a trial basis initially, from selected branches in the North-east.

However, the new advertising activity comes amid a stream of negative publicity. In August, the Post Office was forced to deny that Cook would be in line for a £1m bonus if he completes the closure programme on time. The previous week, Cook had to apologise personally over an attempt to silence dissent among sub-postmasters. A leaked letter revealed the sub-postmasters had been warned they could lose compensation worth £60,000 if they did not stick to approved responses when customers asked about the closures.

A spokesman for postal watchdog Postwatch says: “The Post Office is trying to get more people through the door at a time when it is closing branches. That’s the challenge.” 

Marketing Week revealed earlier this year that the Post Office was axing its animated ant family from its advertising after appointing Mother (MW March 29). The new celebrity-led campaign breaks on October 14 and Hockey-Morley says it is designed to bring the Post Office’s new concept of “fairer, easier, better” to life.

Mass appeal
“We wanted to uncover the essence of the Post Office and show we’re on people’s side,” he adds. “We looked at the ants campaign and it just wasn’t doing it. Our new approach is to show our people and products as heroes. We want to appeal to a more prime-time audience and celebrities are a great device to do that.” 

Mother founding partner Stef Calcraft adds: “The brand needs a modern, populist idea that is loved and widely talked about up and down the country. The Post Office is an institution, but it’s a little dusty. This campaign will make it unashamedly popular and relevant again.” 

Westlife has had 14 number one singles in the UK, while Collins has won a Golden Globe. If they can help to save the antiquated, but much-loved Post Office, it could be their biggest achievement yet.

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