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National Australia Bank Group Employee Share Plan

Client: 

National Australia Bank

PR Company: 

William M Mercer Pty Ltd

Award Category: 

Award Type: 

Call Number: 

2000 E 10

Year: 

2000

Executive Summary: 

The communication program for the National Australia Bank Employee Share Plan is a major global campaign where employees within <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Australia, New Zealand, the US and Asia are offered the opportunity to participate. Planning for the program began in April 1999 culminating in the launch of the offer in September 1999.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

The communication strategy and campaign was built on previous focus group research, past experience of running the share plan, and executive interviews specifically analysing the 1999 objectives and situation.

1999 was the third year since the program was successfully re-launched and re-branded using the cartoon character SPIB (from the Share Plan Investigation Bureau) to help explain the offer.

This in itself presented some specific issues, requirements and challenges. In particular was the key message to employees:

its worth your while to participate in this years offer, and in each offer, with a view to long-term investment

A creative high impact approach was taken, playing on the theme from the film Casablanca. Results were generally very good and the campaign was a great success.

Situation Analysis: 

This was the third year running that the share plan had been offered to employees. Although the basic format was previously established and successful, the third offer presented its own set of challenges which made the campaign considerably different to previous years.

Single largest threat to take-up rates

The single largest threat to take up rates in 1999 was the fear of taking on a larger loan. The possible cause would be a lack of understanding of how the plans operate on a longer term basis and lack of investor knowledge. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Positives

Focus group research shows that NAB employees have an excellent recognition of the share plan branding and a fair understanding of how the offer works.

The Challenge

  • To make it a fresh look this year while capitalising on strong branding
  • To gain member interest in the share plan
  • To demonstrate the value of members shares in dollar terms
  • To increase member recall by differentiating the 1999 share plan from the previous years by making it distinctive and high impact
  • To provide educational but light information that is easily absorbed
  • To encourage share retention rather than taking up the three year selling option

Research: 

Focus Group Research

National Australia Bank launched newly designed share plans in September 1997. The plans were offered in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Australia, New Zealand, the United States and several Asian countries.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

As part of the initial launch of the share plans, Mercer undertook focus group research in each jurisdiction to establish what employees wanted from the share plans, why they were or were not taking up the existing share plan, and how employees would like the materials communicated to them.

The focus group input was invaluable in designing the overall image of the share plans and the specific communications items.  Focus groups were also conducted at the end of the project to measure the success of the strategy and to hear employees suggestions for improvements to the 1998 offer.

The focus group research findings showed that understanding of the basics of the plan were high and that the print materials were well received. SPIB was shown to be a familiar character, easily identifiable in his association with the share plan.

Sponsors were also a popular communication channel, as employees wanted face to face communications and a central point for their questions and concerns.

Executive Interviews

The 1999 share plan communication strategy was informed by previous focus group research. Key issues for the third offer were researched through interviews with senior members of the Human Resources Department. The main issues identified were:

  • generating interest for a third year running ie. a fresh approach, while leveraging off the existing branding,
  • employees concerns over the perceived outstanding amounts owing on existing loan shares (from previous years offers),
  • some employees now had the option to sell their shares as the three-year holding restrictions were up there was a need to address their perceptions of employee share holdings as short-term rather than longer-term buy-in to the organisation.

Target Policies: 

The following audiences were identified:<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

1. Employees:

The project reflected the global structure of the National Australia Bank. The nature of the different taxation, legal and informational requirements meant that it was most appropriate to divide employees into four key audiences as follows.

  • <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Australia:              24,000
  • US:                        6,000
  • NZ:                        4,500
  • Asia:                     300

With the US in particular, the style of plan offered by the National is quite different to what US are familiar with. The differences range from structure through to terminology and attractiveness in terms of taxation. Therefore the information and approach needed considerable tailoring.

Branding was kept similar across the board global branding with minor alterations to terminology eg. stocks in US versus shares in Australia.

2. Sponsors:

These were our local share plan champions helping NAB get the message across within particular localised segments of the business.

Sponsors were provided with special kits which contained posters, training pack including common questions and answers and a presentation for the sponsor to make at a designated times to reinforce the messages and information.

3. Other key stakeholders

HR managers, Share Registry and Group Human Resources were also identified as key audiences. They required advance briefings on the communications strategy and approach.

Communication Strategy: 

The overall communications strategy was to build on the successful style and key communications items of the past two offers. <?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

The key message in 1999 was:

its worth your while to participate in this years offer, and in each offer, with a view to long-term investment

The strategy combined print with face-to-face employee briefings and video.

As in previous years, share plan sponsors played an important role in briefing employees on the plan and providing the face to face communications.

Overall design - communications theme and treatment

There were several new and distinct elements that we wanted to introduce in 1999. In the past, the use of SPIB as a cartoon character had been a strong enough visual link with the themes deliberately underplayed ...

ie.

the all new extraordinary employee share plans (1997)

the return of the employee share plans (1998)

We felt that SPIB was now an established brand. However, as 1999 was the third year, it would be a good idea to build on our brand equity by strengthening the theme. This would help to inject some freshness into the campaign and create some new interest among employees.

Proposed Design Treatment and Theme

Play it again SPIB- the 1999 Employee Share Plan (The music from the movie <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Casablanca is As time goes by)

This theme would be ideal because it used a well-known movie and theme song with a number of memorable lines. It also carried on in the general character of SPIB allowing the theme to be linked to both the print material (with clever plays on headings and design) and the video.

The theme would traverse the print materials, the video and face to face communications. The idea was to introduce a new dimension, music, to add a bit of fun but to also help create interest and member recall.

In the video ...

This year SPIB would be interacting with people and places in real life situations rather than cartoon situations. For instance, we could place SPIB at the stock exchange actually talking to an expert.

In print

We would introduce a photographic element. This would help make the materials fresh and different while building on member recognition already established.

Implementation: 

The implementation strategy was divided into three key phases.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Phase 1: Pre Launch

Employees:

  • big-picture promotional brochure

  • news item inregional newsletters

  • Vision Network (NAB internal TV) mention of offer coming

Share Plan Sponsors:

  • email notification of role
  • pre-launch awareness posters and stickers for each work-site
  • welcome letter outlining roles and responsibilities

HR Managers :

  • HR lotus notes or e-mail bulletins (by NAB)
  • HR manager training (slide presentation template design)           

Phase 2: The Offer


Employees:

Offer package:

  • offer form
  • detailed offer booklet
  • tax guide <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" /><?xml:namespace prefix = u1 />Australia, US, Asia and New Zealand
  • covering envelope
  • reply envelope
  • employee briefing session with share plan sponsor
  • prospectus and financial reports for US employees

Share Plan Sponsors:

  • sponsors notes script for conducting sessions (this year to include additional information such as tips on what they should and shouldnt do and tips on presenting)
  • Q&A Guide
  • wall chart (plus overhead transparency)
  • video or link to Vision Network program

Phase 3: Post Offer


Employees:

  • employee share ownership certificate
  • ongoing share registry information
  • employee newsletter article re take-up rate, November dividend etc.

Share Plan Sponsors:

  • thank you letter

Employees::

  • follow up tax information to go out May/June

Logistics for responses

All countries except the US used a mail back system with the NAB Share Registry for employee responses. In the US it was decided that interactive voice response was a more efficient way to get responses. This was legally approved and scripting was drafted and agreed to.

Results: 

Evaluation: 

Overall, the 1999 campaign was a success and all the goals were achieved. Results included good participation in both the share plan offers, the inclusion of tangible (real dollar) examples in print material such as investment graphs and plain English explanations of share investing in general and the share market. The print material took on a more educational approach to investor information. Excellent participation rates were achieved generally. in Australia and New Zealand were 94% and 93% respectively of employees accepting the Staff Share Allocation Plan option. For the Staff Share Ownership Plan (the Loan Plan), takeup rates were 85% for Australia and 79% for New Zealand. Asia was also on target, although slightly lower than Australia and New Zealand. US results were down on expectations. Some factors which would have had an influence on the results were the volatile share price at the time. During the year it had been up to $30 per share. During the offer it was in the mid $20s. This may have created some uncertainty. Also, the US offer is far less attractive because of complex taxation issues and the fact that this type of offer attracts tax in the US even though shares have to be held for a certain period of time.