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Spanish Competitive Market Overview

Presentacion sobre el mercado Bancario Español
by

Estrella Moya

on 30 September 2012

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Transcript of Spanish Competitive Market Overview

Spanish Market Competitive Enviroment Marketing Intelligence and Control Unit - August 2012 There have been many mergers and acquisitions in the Spanish market, changing the landscape dramatically since 2009. SPANISH MARKET Spain, with around 900 branches per 1MM people doubles average european number. Population is used to have branches in every main street. What we would like to show you :

1) An overview of the Spanish Banking System
2) Summary of the advertising environment
3) Main players: key Marketing information

From a Marketing perspective .... Let´s start with some numbers 2009 : 352 competitors


2012 : 334 competitors 18 Financial Institutions have disappeared 1. Spanish Financial Institutions
- Banks
- Saving Banks
2. Foreign Financial Institutions
3. Other Institutions MEMBERS OF THE MARKET In 2012 the cake is divided : 57% for Spanish competitors, 26% for foreign and 17% for Other financial institutions Saving Banks : from 45 Institutions in December 2009, 43 have participated in some kind of acquisition, merger or integration. The value of the operations means 99.9% of balance sheet. Source : CECA Still working to complete Integration Operations 1,4% of working population works for a Bank. We can observe four groups in the financial institutions, depending on their balance size (volume of the bubbles), number of employees and number of branches. The number of employes have decreased an 11% since the beginning of the crisis. This means 32.000 employees less than in 2008. We have chosen 7 Financial Institutions to make a deeper analysis.

The 2 largest Banks: Santander and BBVA
The 2 largest saving banks: Bankia and La Caixa
2 of the most relevant medium size players : Barclays and Bankinter
And ING as example of an online bank Analysis of the main players from a Marketing Perspective 1. Positioning, Vision and Values
2. Advertising Strategy : Tagline, Creative Idea and Sponsorships
3. Advertising Implementation
4. Examples
Tagline : "Queremos ser tu Banco" (We want to be your Bank).

Creative Idea: Leadership, winning team, customer focus.

Sponsorships: F1, Universia, Fundación Santander.

Advertising Implementation: Positioning : Leader and global financial group. Ambition to become one of the best world wide banks in profitability an efficiency. It is the largest bank of the Eurozone.

Vision : Santander wants to establish itself as a major international financial group giving growing profits to its shareholders and financial needs satisfaction to all customers. To do this they count with a strong local market presence which combines with corporate global capabilities.

Values: worldwide, customer focus, leadership, strong. POSITIONING, VISION AND VALUES In Spain we have UNIVERSAL BANKING, this is, most of the banks offer products and services for a full range of customers.

They deal with private customers, non residents, personal banking, private banking and all kind of companies, from SMEs to Corporations.

They have independent units normally for Private Banking and Corporate but the rest of the customers are served in the branches by the same RMs.

Regarding products, they also cover the full range, from liabilities and investment to financing products and business products as leasing, renting, factoring or international commerce. Credit cards are served in the standard branches.

They even offer complementary services as tickets, online shops or even telecommunications services. PRODUCTS AND SERVICES SOME EXAMPLES
When facing great challenges, confidence is the most important.
Self confidence, in the people around you, knowing that whatever happens they will be there, taking it all in every moment, at every opportunity, confident that the road to success goes through a job well done, confident that together we are the best team.
Come to Santander.
We want to be your bank.
This is how sounds the 4,000 million euros that Santander makes available to SMEs and exporters.
A large exceptional financing conditions to activate the economy.
Santander Credit activation.
Come and activate ADVERTISING STRATEGY The value of the ideas POSITIONING, VISION AND VALUES Positioning: One of the Spanish leader. They are positioned as a strong financial group with a clear focus on customers and other stake holders (shareholders, employees) and a strong commitment with the society. They are perceived as a professional and business-like bank.

Vision: BBVA wants to be perceived as a Bank that helps customers in their life, not also through products but also with services and channels. They summarize their vision as : "We work for a better future for persons".

Values: Leadership, close, people oriented, customer focus, innovative, professional and consistent.
Tagline: "Adelante" (Forward).

Creative Idea: present in your life, innovative, customer focus, rewarding.

Sponsorships: Professional Football League (Liga BBVA) / NBA , WNBA in USA, Spain and Puerto Rico.

Advertising Implementation: ADVERTISING STRATEGY forward SOME EXAMPLES

Adelante is to start, Adelante is to grow, it is to move forward, Adelante is to talk, to listen, Adelante is to build, is to add, is a dream, is to be here, is to be worldwide, Adelante is to choose, to trust, to do, Adelante is to seek, Adelante is to seek and find, is a step forward, Adelante is to live.
BBVA adelante.

A fan can do anything for their idols: not going to an exam, making a nice souvenir, eating seafood with them, waiting for them every time is need until they finish their training or wait for them into a roundabout although they don’t stop and pass them really fast.
But what can do the idols to be with their fan?
The sound of the video is confusing but shows Iker Casillas and Iniesta embracing fans saying things like:

•Wait, wait, please. Sign an autograph for me. Can I take a picture with you?.
•Customers asking if it is a hidden camera.
•Expressions as I cannot believe it, how I am going to give you an autograph if you are the popular person.....

I cannot ever give you even the 35% of all what my fans have given me.
Insurance BBVA give you back 35% into your account. A whole future together POSITIONING, VISION AND VALUES POSITIONING, VISION AND VALUES POSITIONING, VISION AND VALUES POSITIONING, VISION AND VALUES Positioning: From its origins Bankia is dedicated to universal banking, this means serving all types of customers by a variety of channels. It is the bank around the corner where all the family holds accounts

Vision: Offer the best financial service for its clients by segmenting their value propositions.

Values: Socially responsible, bank for everybody, customer oriented. Positioning: Offer the best and more complete financial services to the broader number of customers.

Vision: Leading financial institution that generates value for the overall society.

Values: Trust, social commitment, customer focus. Positioning: Foreign bank, specialized in service to customers and serving personal banking.

Vision: Barclays Group in Spain offers innovative financial services for those client segments in which it is specialized (premium, personal, and international customers) to whom it offers differentiated value proposals which are adapted to its financial reality, professionally advice and personalized attention.

Values: Traditional, exclusive, foreign, professional. 1. Positioning: The leader of online banking. The bank for the savers.
2. Vision: They express their vision in the "Fresh Banking Manifesto"







3. Values: Customers focus, simple, transparent, win-win, innovative.
Tagline : A whole future together

Creative Idea: Commitment, experience, confidence.

Sponsorships: Obra Social Bankia.

Advertising Implementation :
Tagline: "You are the star". Changed in September 2011 (Before it was "Let´s talk" that lasted for 10 years)

Creative Idea: Trust, social commitment, customers proximity.

Sponsorships: Obra Social La Caixa

Advertising Implementation :
Tagline: Fresh Banking

Creative Idea: customer centric, no fees and commissions. Saver as a people category.

Sponsorship: None

Advertising Implementation : ADVERTISING STRATEGY SOME EXAMPLES SOME EXAMPLES

In Bankia we believe so much in the future that we have opened an account
An account to which if we all contribute with the best that we have, we will be the owners of what is to come.
And, what is true is that if you give your best, you make possible a bank that wants the same as you, a better future and together.
Bankia, a whole future together.

Manuel runs a small business, is a barber, but here everyone calls him "Boss".
His employees call him boss, his clients call him boss, he even have a card with his name where it says boss.
Manuel has today made a decision that will make people call him not only boss but also be call him "banker".
Be a banker from 1,000 €.
Participate in the IPO of Bankia, a unique opportunity to join a leading financial institution.
Bankia, together we make the new banking. A great bank that does Fresh Banking SOME EXAMPLES ADVERTISING STRATEGY THE FRESH BANKING MANIFESTO You will not be another client. Nor I am another bank.
I reduce costs. You earn more.
I give more. I ask less.
The good, if simple, three times good.
Forget negotiate! It is not necessary.
Come in, come out, leave it. You are the owner of your money.
Un-invent fees and commissions!
Test, check, recommend.
We have to win ... All of us.
Have we done everything? No. We have just started. You have to learn to later unlearn. ING Direct. Fresh Banking ING has changed its approach to the market. It has gone from and online single product bank to a model with 32 branches that offers transactional accounts, investments and financing products. But who I will cheat if as the time goes I am more as my mother. Because when you call us, there is always an answer of a professional.
Savers of the world, this is saving.
ING direct Cuenta Naranja.
Call or come to your office. AN EXAMPLE
Tagline: "You are first"

Creative Idea: Clean, elegant, aspirational.

Sponsorships: None.

Advertising Implementation: ADVERTISING STRATEGY ADVERTISING STRATEGY

There are many customers, employees, volunteers and beneficiaries who have the put their soul to make the social work of the social work "La Caixa" the largest of our country. To encourage social initiatives to facilitate the labor insertion of the most fragile, promoting the active role of our elders, provide support to the patient in the final phase of his life and figth child poverty. Because only so we can continue helping millions of people.
Social work of La Caixa, we continue giving our soul.

Life is full of changes, new illusions, unforgettable moments. So we entrust our payroll to La Caixa.
With the Multiestrella payroll program you have multiple advantages that help you in your day to day. La Caixa, you're the star. Te payroll account presents :
(in different languages) :
My love / I love you
My life / Sweet heart
I love your more than my life
The account that gives you a lot and ask for little.
Change to the payroll acount of ING direct. Fresh Banking Note : popularity increased on 2000 with the launch of the remunerated Mortgages with a TV campaign and later on with the acquisition of Banco Zaragozano. There is a lot of avenues but only one is THE AVENUE.
There is a lot of Markets but only one is THE MARKET.
There is a lot of books, but only one is THE BOOK.
the is a lot of footprints but only one is THE FOOTPRINT.
The is a lot of race, but only one is THE RACE.
Also there is a lot of payroll accounts, but only one is THE PAYROLL ACCOUNT.
New account PREMIER LIFE of Barclays.
Personal RM - 4% Cash Back - 2% on saving account
Free cards -No fees - Free ATM withdrawal.
And many other added services, thinking on an account where you are the first.
Conditions : payroll over 2.500€ or investment over 30.000€
Hello. Have you ever thought in banks?. I wish it would exist one that would think more on people. Right? Who obtains benefits and distributes them, especially among those most needed. Among our elders, those who want to integrate, among those who have never set a foot in a bank. A bank that worries about the forest and how clean the water is. A forward-looking bank that brings culture to the last corner and use it to communicate with people. Source :. Bank of Spain. Boletín Estadístico. 1Q2012 The Banking sector in Spain is one of the world most competitive markets. Employees : 250.000 Branches : 40.000 There are 8,5 branches for each 10.000 people Source: Banco de España. Dec 2011. EMPLOYEES BRANCHES MAIN COMPETITORS In Spain main competitors have networks of thousands of branches, so consumers are used to have almost a branch ( and an ATM) on each corner. An example : La Caixa has 453 branches in Madrid DIVISION OF THE MARKET 1 2 3 4 Bank of Spain. Boletín Estadístico. 1Q2012 A VERY COMPETITIVE MARKET Let´s go into the detail THE MAIN PLAYERS STRUCTURE 5+7= (cc) image by anemoneprojectors on Flickr SOME BRAND TRACKER RESULTS In the Brand Tracker results we can see how the big 4 have scores above 90% (ING is in the same level due to the level of advertising investment) ING is the better positionated bank with the highest scores in general impression, in the foreseen evolution of the bank´s position and in the consideration to purchase products and services. DISTRIBUTION OF THE MARKET 7 Saving Banks 7 Saving Banks CHANGES IN THE SAVINGS BANKS Banco Popular Banco Pastor Banco Sabadell Barclays Bankia SOCIAL WORK OF SAVING BANKS POSITIONING, VISION AND VALUES Positioning: A fundamental part of its strategy is service to customers. Quality constitutes its pillar from which the success of the company have been achieved. The common goal of employees are to create sustained value, guaranteed stability and continuity of the company and maximize its value in the medium and long term.

Vision: Create value in the long term for shareholders, clients, employees and society in general.

Values: Innovation, technological, transparent, originality, agility.
Tagline: Tagline by campaign (In your life you do not pay with TVs).

Creative Idea: If you think that all the banks are the same...... we would like to meet you.

Sponsorships: None.

Advertising Implementation: SOME EXAMPLES ADVERTISING STRATEGY

The advertising shows models with a tag next to them saying :
Blouse : 1 game station
Jeans : 1 portable DVD
Blazer : 1 laptop
Shirt: 1 flat screen
Life is not paid on game stations, computers or flat screens.
Payroll account Bankinter : 5% 1st year (2% second year) Welcome to Bankinter Labs, your laboratory of ideas.
In Bankinter labs we work every day to grow ideas.
Planning, designing, devising and especially co-creating with our users.We evaluated all your ideas of 2010 and we are already preparing some output. The most valued ideas.
Ideas like the dashboard broker, a shared idea where you control the details of your portfolio.In short, you will see how we go from prototype to reality from theory to practice. This applies to the idea locator visa payments, so you will not miss any. Geolocates payments by credit card.Or the OFX proposal data processing, an idea also 100% yours. Thus, designing, testing and evaluating together, as the laboratory is continuing. Happy 2012 I wish there were a bank whose shares were quoted on life. These banks have existed for over 170 years. Social work of the Savings Banks. Our shares are traded in life. The evolution of the financial institutions market has been unequal among the different categories:

National FI :-20.68% Foreign FI: +64.15% Other : -39.58% Note : Employees and Branches data obtained from Bank of Spain. Balance sheet information on individual basis, not consolidated obtained from Bank of Spain and CECA. Market share calculated from balance sheet weights. THE ADVERTISING MARKET WHO ADVERTISES WHAT PRODUCT ADVERTISING : PAYROLL ACCOUNT BRAND ADVERTISING ON INTERNET ( YOUTUBE CHANNEL) - BANKINTER LABS SOME INTEGRATION EXAMPLES INE : Data of Total Population ( 47.213.000 at 1/1/2013) and data about working population (17.433,2 at 31/3/2012). Data of relations with banks from Brand Tracker and Data Monitor. 846 BRANCHES This is a real street, site is on C/ Osa Mayor, Aravaca. Madrid 28043. For more examples we recommend to visit C/ Alcala, C/ Bravo Murillo...etc. SPECIFIC Santander, best bank of the world 2012 Combination of product and brand : They combine larger brand advertising with some concrete campaigns of products. Examples: Payroll account ( with no fees), activation loan for SME.
Marketing Expenditure: It is the 4th in 2011 with 11.3MM€ (5.14%) and the 2nd in 2012 with 10.8MM€ (11.24%). MEDIA DISTRIBUTION 2012 BRANDING ADVERTISING PRODUCT ADVERTISING BRANDING ADVERTISING PRODUCT ADVERTISING BRANDING ADVERTISING PRODUCT ADVERTISING (BANKIA IPO) BRAND ADVERTISING PRODUCT ADVERTISING Combination of product and brand: Most of the investment goes to specific brand actions. They mixed sponsorships with specific products and services as Payroll account and insurance that gives cashback.
Marketing Expenditure:It is the 2th in 2011 with 14.6MM€ (6.6%) and the 4th in 2012 with 5.5MM€ (5.79%). Total investment on advertising has been of 221 MM€ for 2011 and 96MM€ for 2012 ( run rate states 231 for 2012). August is the month with the lower amount with 12 MM€ in 2011, being march and October the highest expending months. TOTAL SPEND FINANCIAL SECTOR FINANCIAL SECTOR SPEND BY MEDIA Distribution of investment among different media has followed the traditional path in 2011 ( TV 39%, print media 22% and radio 14%). Internet is opening its space among the different channels, with a 17% on 2011 and 20% on 2012, well over the average of the spanish distribution where the spend on internet is 9%. TOTAL SPEND SPAIN SPEND BY PRODUCT TOP ADVERTISERS The spend on advertising in Spain has been 4.718MM€ for 2011 and 1.735MM€ for 2012 ( data up to May). This means a 15% decrease from last year (Data for Jan-May 2011 is 2.054MM€). Seasonality is not very high with a drop in the summer months. TOTAL SPEND BY MEDIA IN SPAIN TOTAL SPANISH SPEND DISTRIBUTION BY MEDIA 2012 Ratios of media distribution are maintained constant from 2011 to 2012, with a slight increase in the Internet presence from advertisers The advertising expenditure for financial sector represents a 5% of the total advertising (4.68% in 2011 and 5.55% in 2012). Distribution by media is similar (large weight of TV) but financial sector is turning more towards internet and lowering expenditure on traditional media as magazines. The top advertisers ( 27 of them) cope the 81.5% of the advertising expenditure. We found the following :

ING direct expends 25% of the overall amount, with a constant amount for 2011 and 2012.
The following ones are the big banks ( note Banesto is part of Santander), Santander, Banesto la Caixa and Bankia.
There are some insurance companies expending money on advertising (in the table in green). They sell insurance as well as investment products (but they advertise mainly car insurance and health insurance)
Related to Cards, Visa, Mastercard Europe and Euro6000 hold the 2.5% of the spend.
There are also some Government Institution (ICO and the national treasury) promoting their products ( financing for companies and T-Bills) From total expending roughly 50% is directed towards product specific actions while the rest is address to branding, sponsorship and services advertising. Current accounts represent 31.14% of total advertising. (68.6% of this amount is covered only by ING).
Regarding branding, 36% of investment corresponds to insurance companies.
It is amazing how a company can spend 1MM€ in 2011 advertising their ticket sale and reservation services. ( Out of the scope of financial services, Serviticket from La Caixa 675.000€ in 2011)
The shares advertising is due to the IPO of Bankia.
Investments : 50% of this category is made by advertising of Spanish sovereign debt by Treasury.
The wealth management is made mainly by IG Markets, BBVA and Self Trade. The main players overview on the spanish financial advertising market is quite diverse, with banks, saving, banks, insurance companies and personal loans companies. SPLIT OF THE SPANISH FINANCIAL SYSTEM Relations of customers Average 2 relations with banks
Average 1.5 credit cards
Mass affluent 2 relations in personal banking The Big Four Source : Infoadex. 2012 data up to May 2012. Source : Infoadex. 2012 data up to May 2012. Source : Infoadex. 2012 data up to May 2012. Source : Infoadex. 2012 data up to May 2012. FINANCIAL SECTOR SPEND DISTRIBUTION BY MEDIA 2012 Source : Infoadex. 2012 data up to May 2012. Source : Infoadex. 2012 data up to May 2012. Advertising Spain and Financial Sector ... small Product split : 25% of investment is address to branding, while another 44% to sponsorships. 11% goes to finance products for companies. Source : Infoadex. 2012 data up to May 2012. Source : Infoadex. 2012 data up to May 2012. MEDIA DISTRIBUTION 2012 Product split: 22% to payroll account, but only 6% of investment is address specifically to branding, while another 30% to sponsorships. Combination of product and brand : Due to the name change (from Caja Madrid to Bankia) and the Government intervention they mainly address brand issues.

Marketing Expenditure: It is the 6th in 2011 with 11.1MM€ (5%) and the 7th in 2012 with 4.2MM€ (4,3%). Product split : 68% of investment is address to branding, 18% was invested in promoting the Bankia IPO, and 7.5% goes to sponsorships. Combination of product and brand: Most of the advertising relates specific products in combination with branding and social action. Examples: Payroll account, TDs with gifts instead of monetary returns.

Marketing Expenditure: It is the 3rd in 2011 with 14.3MM€ (6.5%) and the 5th in 2012 with 5.3MM€ (5.7%). Product split: 27% of investment is address to branding, while another 27% to sponsorships. 24.6% goes to payroll account and 3% to credit cards. Combination of product and brand : the focus mainly on specific products and campaigns. Examples: Payroll account (with high interest rate), brokerage promotions.
Marketing Expenditure: It is the 136th in 2011 with 74.000€ and the 29th in 2012 with 377.000€ . Product split : 38% of investment is address to financing products for companies, 27% to sponsorships, and only 12% goes to branding. Investments advertising means 17%. Source : Infoadex. 2012 data up to May 2012 Combination of product and brand: They do little advertising normally centered on product. Example : Payroll account Premier Life.

Marketing Expenditure: It is the 36th in 2011 with 827.111€ (0.38%) and the 111st in 2012 with 35.757€ (0.04%). Product split: 85% of investment is address to current accounts (Barclays Premier Life Account), while another 13% to sponsorships. 100% Magazines and Sunday supplements. Source : Infoadex. 2012 data up to May 2012. MEDIA DISTRIBUTION 2012 MEDIA DISTRIBUTION 2012 MEDIA DISTRIBUTION 2012 MEDIA DISTRIBUTION 2012 Combination of product and brand: They almost always combine their branding campaigns with a concrete product as they have little range of them. Examples: Saving account and no fees.
Marketing Expenditure: It is the 1st in 2011 and 2012 with 54MM€ and 25MM€ (Up to May). This means 25% of total advertising spend of financial market. MEDIA DISTRIBUTION 2012 Product split : 88% of investment goes to current accounts ( saving accounts) with long campaigns composed by variations of spots and press announces. Note : Social Work of La Caixa has been 500MM€ in 2011 Data: Data from Brand Tracker GFK- Retail Banking April - May 2012
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