NS&I spend £2million advertising Pensioner Bonds- the most popular bonds in recent history...

28 January 2015

pensionsSome people say the best kind of advertising is free, and with the widespread (good and bad) media coverage of the launch of the new NS&I Pensioner Bonds, you could be forgiven for thinking that you must have been living under a rock to have not heard about them. However, it seems the boffins at NS&I have developed an alternative view, and have spent millions advertising these bonds that were, even before launch, already expected to sell out. Genius.

The eagerly anticipated  market-leading Over-65 Bonds were launched two weeks ago, to a flurry of media attention, including complaints over a website that couldn’t handle the high traffic generated. Already, more than 10% of the £10bn Treasury funding has been allocated, and the rest of the bonds are expected to be snapped up over the next few months. Why then has NS&I spent £2million trying to direct even more visitors to the creaking website?

It sounds madness but NS&I do have their reasons- although whether these reasons are worth £2m is perhaps debatable. NS&I said part of the advertising spend was to direct people to the website as the easiest method of investing- presumably despite the problems- as people might otherwise think postal or telephone investment (which presumably costs NS&I more  to administer) was the only way to do it.  NS&I are also looking to attract those who wouldn’t normally be an NS&I investor with their adverts. While wanting everyone to get a piece of the high-interest action is perhaps a noble aim, those with thousands of poundsof spare cash to tie up for three years are likely to read the paper and/or be on the lookout for market leading rates anyway, surely…

A spokesman for the state-owned savings bank said it had spent "about £2m" on marketing the bonds adding insult to injury by saying: "The launch of the Pensioner Bonds has proved hugely popular, with the biggest opening sales of any retail financial product in Britain’s modern history.”

However, the bank went on to say that it is “keen to ensure that potential customers, including non-NS&I customers, are aware of the market-leading rates on offer.”

£2 million well spent then…

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