Touting for business: British Banks and Building Societies in the twentieth century

This strand of research considers the marketing, advertising and public relations activities of the 'Big Five' British clearing banks from 1918-1970 and of building societies in the inter-war period.

British clearing banks formed a cartel and dominated the market for domestic financial services from the early twentieth century onwards. This cartel, combined with government imposed restrictions upon lending, meant that banks were severely restrained in their ability to offer new products and consequently to distinguish themselves from their competitors (such as building societies). It also meant that consumers had limited choices in terms of financial service providers. As a result, banks had to rely heavily upon building brand image and utilising marketing techniques in order to differentiate themselves and to attract customers. For many bankers such techniques were new and unpopular - they were unused to communicating with their customers.

Building societies, in contrast, underwent a spectacular transformation during the 1920s and 1930s. What had been a collection of local or regionally-based organisations in 1914 rapidly became dominated by a relatively small group of societies with national ambitions. Furthermore, the emergence of 'nationwide' building societies during this period occurred almost entirely via internal growth and territorial expansion, rather than amalgamation. The research (with Peter Scott) analyses case-studies of several societies that ranked among the top eight during the interwar period, including both rapidly expanding southern societies such as the Abbey Road and Woolwich, and major northern-based societies such as the Halifax.

Themes

From the perspective of British retail banks in the twentieth century, the work examines their relationships with, and marketing to, personal customers in order to build upon the growing literature concerned with corporations and their consumers. The work also examines attitudes of bankers themselves towards marketing. Bankers were relatively conservative professionals and were often reluctant to adopt new techniques but they were forced to embrace marketing concepts between 1918 and 1970 in order to compete in tightly regulated and tightly cartelised markets.

From the perspective of building societies, the work examines the role of advertising and promotion in the successful development of nationwide building societies and the market conditions that gave advertising a crucial role in the expansion strategies of the major societies. We examine the marketing messages used by building societies to promote the ideology of mass home ownership and to attract the funds of large numbers of small and medium-savers.

Overall, the work considers the marketing and advertising techniques adopted by banks and building societies and the success or otherwise of these methods.

 

Outputs

Peter Scott and Lucy Newton, 'Advertising, promotion, and the rise of a national building society movement in interwar Britain' Business History, forthcoming, 2012.

Lucy Newton, University of Reading Business School Discussion Papers, Economics and Management Series, 055, 2008, 'Branding, Marketing and Product Innovation: The attempts of British Banks to Reach Consumers in the Interwar Period' Download (PDF-955 KB).

Lucy Newton, 'A favourable impression of banking? British banks and their consumers, 1920-1970' Business History Review, forthcoming.