Hargreaves urged not to imitate the clickbait nature of scam ads

Hargreaves Lansdown’s marketing team had an embarrassing moment last month when Monzo reached out to them asking them to stop running a social media ad encouraging people to “sign up for IPO alerts. of Monzo ”.

The announcement caused confusion. While some competing banks, such as Starling Bank, have made their voices heard on their listing plans, Monzo, who is currently under investigation by the Financial Conduct Authority for potential violations of money laundering rules. money, has been much calmer.

A Hargreaves spokesperson confirmed that the basis for the ad came from a Wired magazine interview with Monzo CEO TS Anil in April, where he said: as early as 2023. The so-called “team investment ”from Hargreaves polled various sources about the IPO rumors, drawing attention to those they believe may be of interest to his clients.

Monzo contacted Hargreaves to tell him he had no imminent IPO plans and asked Hargreaves to change the language of the ad to be around “rumored” or “potential,” but Hargreaves has decided to suspend activity until Monzo publishes further information on any proposed list.

In an age of social media teeming with misinformation and unregulated ‘investment’ opportunities, established regulated vendors find themselves trying to balance the need to compete for attention while differentiating themselves from more gamers. capricious. Sam Richardson, analyst at consultancy Platforum, says: “Platforms need to appeal to clients by promoting some of the more glamorous aspects of investing, while simultaneously trying to encourage them to adopt a mindset to longer term.

Hargreaves’ marketing and distribution costs amounted to £ 28.3million for the year ended June 30, 2021, up from £ 23.9million the previous year and £ 12.7million for the fiscal year ended June 2019. In its latest results, the company said, “Our increased focus on digital marketing has been key to winning new customers and engaging with existing customers, ensuring that that we become part of their lives in terms of saving and investing for the future.

Mike Barrett, consulting director at Lang Cat, says established vendors can play a role in warning of the dangers of high-risk and fraudulent investments, and also in highlighting a smarter approach to investing.

“I would encourage companies to take this approach, rather than trying to mimic the click-bait nature of scam ads,” he says.

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