Mail in the loans sector

Following the credit crunch, confidence is low, but people are still taking out personal loans for major purchases and to consolidate debt.

Direct mail is the best route to the market, and there are opportunities to gain share of voice with younger loan holders. Personal loans advertising saw a 15% increase in spend to £23m.

This 2011 MMC report uses data from Ebiquity, Mintel, Nielsen Ad Dynamix, TGI and the Royal Mail Consumer Panel to examine the strengths and weaknesses of the UK's personal loans sector and consumer responses to different media.

It also provides a snapshot of the competitive landscape, revealing Lloyds Banking Group and Barclays as the market leaders, based on both customer share and outstanding balances.

Other key findings include:

• Loan mailings enjoy the highest open rates – 95% – of all financial sector mailings.
 
• Long-term loan holders are more likely to be high responders to direct mail than to be heavy users of any other media.

• There is a missed marketing opportunity to target loan holders aged 25-34  and ABC1s.

• Direct mail is a key route to the loan market with 55% of advertising budgets supporting it as a medium.

• Mail is the best channel for generating word of mouth in this sector, with high responders more likely than heavy users of other media to influence others about a financial services brand.