The welfare state’s gloomy future has boosted interest in personal
finance. Robert Gray looks at the sector’s media
The impending collapse of the welfare state is a popular, if depressing,
subject of debate at the moment. The media is full of doom-laden
predictions that the state will provide scant protection for our
The government, whatever its political complexion, simply will not have
enough money to look after an ageing population. The message is clear:
make your own arrangements.
‘Anyone who says ‘I’ll leave it to my employer and the state to look
after me in old age’ is stupid’, says Ian Cowie, editor of the Money-Go-
Round section in The Daily Telegraph’s Saturday edition.
Not surprisingly, financial services marketing has tapped into the ever-
growing demand for pensions, savings, life assurance and investment
products. Consumers are urged to make their own financial provisions to
be assured of a comfortable retirement, a private education for their
children, first-rate healthcare and whatever other life goals they may
Many of these consumers have been looking to the media for information
and advice. Reacting to demand, personal finance coverage is growing
apace. The growth of the personal finance sections of the national
newspapers testifies to that.
‘The downfall of the welfare state and a lack of trust in financial
advisers has meant that more and more people have had to look after
their finances,’ says Andrew McQueen, publisher of monthly personal
finance magazine Moneywise.
The Daily Telegraph (together with the Daily Mail and, to a lesser
extent, The Times) has led the way in personal finance coverage among
the nationals, drawing on middle-class, middle-England readers who take
a strong interest in what to do with their money.
For financial marketers, targeting prospects such as these are
essential. That is why in the run-up to the end of the tax year, The
Daily Telegraph is understood to attract more than pounds 1m a month in
personal finance advertising revenue.
However, almost all the nationals have boosted their personal finance
coverage as a service to readers and as a means of generating extra ad
The great challenge for newspapers is to relate to a readership that,
for the first time, sees personal finance as vital to their future, says
Will Ricketts, financial sales manager of The Observer and The Guardian,
who is also publisher of the Guardian Media Group’s monthly personal
finance title Money Observer.
The nationals, then, have to balance their coverage to serve readers who
are turning to the pages for the first time with those who already have
more than a passing knowledge of the personal finance minefield.
Although newspaper coverage has grown substantially, the nationals are
still unable to devote as much space to personal finance as the
specialist consumer titles. Moneywise, supported by extensive promotions
and tie-ins with its owner Reader’s Digest, has by far the biggest
circulation at approximately 130,000.
The other key titles in the marketplace are What Investment (and, some
may argue, its less-established sister title Personal Finance), Money
Observer and the FT-owned Investors Chronicle.
The latter has a cross-over readership that takes in the City
institutions as well as private investors. The others are targeted
squarely at consumers, a minority of whom may be described as investment
The demand for information suggests that personal finance publishing is
a healthy market. But this didn’t hold true for Centaur Communications’
Inside Money, launched at the beginning of last year only to be closed
six months later. What went wrong?
Although the product was relatively popular with advertisers, Centaur
appears to have over-estimated the short-term consumer interest. Faced
with falling sales, the publisher chose to cut its losses rather than
hanging on in the hope of reversing the decline.
‘Perhaps they should have stuck with it for a bit longer,’ says Mike
Richards, director of specialist financial media buyer Capital City
Media. Moneywise publisher McQueen agrees: ‘I suspect they closed Inside
Money a little early.’
At one stage, BBC Magazines was giving serious thought to entering the
market but has put its plans on ice. The Consumers Association similarly
investigated a launch but changed its mind when a membership survey
showed that the majority of respondents felt there was already enough
coverage given to finance in Which? A dedicated title was therefore
The consumer personal finance magazine market is characterised by a
dearth of news-stand sales. Most copies are sold through subscription.
It is also a market where circulation does not always have a direct
bearing on the advertising rates. Moneywise trounces all-comers with its
subscription sales but for advertisers the most important yardstick is
quality of response.
‘The numbers of magazines you sell is almost irrelevant,’ says What
Investment publisher Geoff Gamble. ‘A magazine is sustainable in this
market on 10,000 units as long as the conversion rate and number of
responses is good.’
McQueen adds: ‘If you come in the top five in terms of cost per response
or conversion, advertisers will come back and use you again and again.’
Edinburgh Fund Managers is a frequent advertiser both in personal
finance pages of the nationals and in the dedicated consumer press. Its
marketing manager Deborah Findlay actively analyses the response rate
from each. She says: ‘It is difficult sometimes to know whether you’re
getting the same people as all the others, those who trawl round the
companies. The perennial coupon-cutters.’
This is a problem faced by all marketers in this sector.
The issue for all financial advertisers is one of advertising stand-
out’, says David Fletcher, director of media buyer CIA Medianetwork,
whose clients include TSB. ‘You have to work very hard to differentiate
in that market. Not only because there are so many advertisers but
because of the small print you have to put in the ads under the current
‘Because it is so data-rich, the financial services market is one of
those areas where electronic media should score. Web addresses could
retail information for people. The new media has been under-utilised so
Time will tell what effect the digital revolution has on personal
In an effort to stand out from the pack, some personal finance marketers
have also turned to direct response TV. Virgin’s TV advertising for its
PEP is probably the most notable example of this so far.
However, it should be said that, because of its particular brand
strength and values, Virgin has campaign execution options that would
not be nearly as effective if used by most of the other players in the
At the end of 1995, a Datamonitor report showed that national newspapers
were the most cost-effective medium for financial services advertisers,
with special interest magazines ranked second, and television third.
DRTV’s time may come but, for the moment, marketers in the sector feel
safer with newspapers and magazines - especially as the advertising
often works most effectively when it includes relatively complex
financial comparisons, such as performance tables, which potential
investors need to study at their leisure.
For unit-trust specialist M&G, the marketing strategy is to advertise
across a broad array of national newspapers and special interest
magazines to ensure it is in the forefront of consumers’ minds.
‘We need to get to a broad range of people so that when they get to the
stage where they want to make an investment decision they think of M&G,’
says marketing manager Roger Jennings.
M&G has also been experimenting with placing some of its national press
advertising within the general news sections, based on the premise that
most of the readers of the City pages will read the general news pages
as well. It hopes to make an impact on non-City page readers in this way
and is currently analysing the effectiveness of such an approach.
Interest in personal finance issues is unlikely to subside, particularly
if the demise of the welfare state remains on the news agenda. National
newspapers may be reluctant to introduce even more finance sections
while newsprint costs stay high, in turn providing an opportunity for
consumer finance magazines to consolidate.
The absence of another launch on the horizon to threaten their share of
the market leaves the existing personal finance magazines well placed.
Charterhouse, publisher of What Investment and Personal Finance, is
often criticised for not providing audited circulation figures.
Yet this deliberate decision has not done it any easily apparent harm:
the company put its ad rates up by 20% last year, now turns over about
pounds 4m a year and is considering flotation.
Circulation of the main titles in personal finance sector
Title Publisher Frequency Circ. Circ.
Moneywise Reader’s Digest M 130,081 130,239
Investors Chronicle FT Magazines W 56,507 59,727
Money Observer Guardian Magazines M 28,577 29,005
What Investment Charterhouse M 30,000 est No ABC
Personal Finance Charterhouse M No ABC 25,000 est
Source: The Magazine Business