UTS Library

The Best WAy Forward

Client: 

Bendigo Bank

PR Company: 

Brumfield Bird & Sandford

Award Category: 

Award Type: 

Call Number: 

2001 E 3

Year: 

2001

Executive Summary: 

On Monday 5 June 2000, <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Queenslands First Australian Building Society announced it planned to merge with Bendigo Bank.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

Headquartered in Ipswich, First Australian Building Society had a 120-year history in Queensland and there was a strong allegiance to this Queensland institution.

 

Furthermore, the law required that the merger could only go ahead if members and shareholders of First Australian voted 75% in favour of the union.

 

It was expected First Australian staff, the vast majority of whom were also members, would be concerned about job security. There were also fears state and local government leaders would mount a campaign against its closure.

 

In May 2000, a month prior to D-day, BBS initiated a comprehensive public relations strategy to persuade a wide variety of stakeholders and in particular First Australians 300,000 members and shareholders of the benefits of the merger.

 

Top-level local and state government briefings preceded the merger announcement, and following it, BBS rolled out an intensive member, shareholder, staff and media campaign designed to achieve the required positive vote.

 

On 27 September 2000, at a series of member and shareholder meetings at Ipswich Civic Centre, First Australian achieved a vote in favour of the merger of more than 95%.

Situation Analysis: 

<?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />First AustralianBuilding Societys proposal to merge with Bendigo Bank was entirely reliant on member and shareholder support.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

The Supreme Court had ruled that First Australians 300,000 members and shareholders be given the opportunity to vote on the union and the green light could only be given if the result was 75% in support.

 

But First Australian had provided a major financial identity for Ipswich and Far North Queensland for 120 years.

 

For members the greatest concern would be the future of their local branch, for shareholders the share price on offer and for staff the prospect of job losses.

 

The decision to merge therefore with Bendigo Bank, and surrender its long-standing Queensland ownership, presented a monumental challenge to convince stakeholders the merger was in their best interests.

 

In order to achieve the successful vote, First Australian needed to:

 


  • be open and accessible to members and shareholders and provide concise yet comprehensive information in a number of formats;
  • communicate openly with staff and bring them on side from the outset, as members themselves and the front line for other customers;
  • neutralise government figures and identify white knights; and
  • promote the positives of the merger and the benefits to Queensland at large.

 

Research: 

Research underpinning the campaign was comprised of a formal member survey, analysis of historical data, informal industry analysis, confidential government discussions and staff evaluation.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

Analysis of historical data

 

  • First Australians failed attempt in 1999 to merge with Heritage Building Society produced a number of pieces of evidence that were evaluated in terms of the prospect of a successful merger with Bendigo Bank
  • Existing feedback from members and shareholders was considered in preparing the approach for the new campaign
  • Media coverage was evaluated in terms of First Australians perception and a media position report prepared

 

Government discussions

 

  • A series of confidential discussions with senior government figures was established to identify issues that would arise.

Staff evaluation

 

  • A breakdown of staff allocation and history was considered in terms of potential changes to their positions.
  • Early identification of possible staff champions lead to the preparation of a hit list and appropriate approach.

Target Policies: 

Primary publics<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

  • 300,000 First Australian members and shareholders
  • First Australian staff
  • State Parliamentarians including Premier and Treasurer
  • <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Ipswich City Council
  • National Financial Media
  • Regional Queensland media

 

Secondary publics

 

  • Bendigo Bank members
  • Bendigo Bank staff
  • Queensland public
  • Victorian media

Communication Strategy: 

<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

The communication strategy was developed with First Australian and Bendigo Bank input to promote the benefits of the merger to a wide variety of stakeholders that were expected to be at the very least sceptical about the impact on them individually and as a group.

 

The strategy included the following key components:

 

  • issues management of potential opponents to the merger;
  • focus on consistent, transparent messages for stakeholder communication;
  • a comprehensive timeline in the month and final days leading up to the announcement;
  • strategy of open communication and involvement of staff with regular briefings;
  • establishment of a dedicated call centre for member enquiries; and
  • identification of new media angles during merger campaign to maintain momentum and support.

Implementation: 

Strategy and planning phase<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

In the month leading up to the announcement of the proposed merger, intensive planning of the public relations strategy was undertaken.

 

The sensitivity of the project required that it be conducted under a code-name, and all electronic communication encoded with a password.

 

During the planning stage, the following steps were taken:

 


  • preparation of documents clearly outlining aspects of the proposed merger;
  • identification of positive and negative aspects;
  • clear briefing document for shareholders in relation to the share offer of a special dividend and 2 First Australian shares for 1 <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Bendigo share;
  • preparation of key questions and responses in relation to anticipated concerns;
  • preparation of briefing papers outlining the benefits;
  • identification of key stakeholders;
  • list of government identities to be briefed in advance;
  • preparation of comprehensive timeline for rollout of announcement; and
  • development of catchphrase for campaign, The best way forward.

Key briefings

 

BBS advised First Australian and Bendigo Bank on the best approach to government briefings which resulted in the following steps:

 

The day before D day briefings:

 

  •        Premier Peter Beattie
  •        Treasurer David Hamill

 

D day briefings:

 

  •          Queensland Liberal Leader and Shadow Treasurer David Watson
  •         Key adviser to Coalition Leader Rob Borbidge
  •         Ipswich Mayor John Nugent
  •         Ipswich Councillor Paul Pisasale

 

Briefing kits couriered to:

 

  •         Cairns Mayor Kevin Byrne
  •         Cameron Thompson Member for Blair
  •         Bernie Rippoll Member for Oxley
  •         Warren Entsch Member for Leichardt

 

Informing 300,000 members and shareholders

 

Of greatest consideration in the campaign were the 300,000 members and shareholders who would ultimately decide the fate of the merger.

 

This member communication was conducted in 2 phases:

 

1. At the outset

 

Making information accessible was paramount. BBS actions included:

 

  • drafting of letter from First Australian CEO David Jeffries to be posted to all members and shareholders the day of the announcement;
  • drafting of letter from Bendigo Bank Managing Director Rob Hunt reassuring members of the banks plans;
  • establishment of a call centre to be operational from the morning of the announcement; and
  • preparation of scripts for call centre staff including anticipated questions and responses.

 

2. During the campaign

 

Once D day had passed, a number of further actions were taken including:

 

  • securing of third party endorsements from community leaders, members and staff supporting the merger and their approval for use in collateral;
  •  production of a user-friendly DL brochure to be distributed to all branches and members seeking further information;
  • production of posters for First Australian branches with key message The best way forward;
  • design of button badges for staff to wear on a voluntary basis with message, I support the merger;
  • drafting of short, sharp messages for inclusion on members bank statements; and
  • design of banner sticker to be attached to all posters later in the campaign, declaring Vote here now.

 

Media

 

The media relations campaign was conducted in three phases:

 

1. The announcement

 

Key financial media were alerted that there would be a major announcement on the eve of D day and the following actions taken:

  • simultaneous media conferences held at The Heritage Hotel Brisbane and First Australian Building Society headquarters at Ipswich this was to engage Ipswich media who would be a key influencer on a large proportion of the membership;
  • preparation of letterhead and media kit folders incorporating both First Australian and Bendigo Bank logos, media release, fact sheet and Bendigo Bank history;
  • one-on-one briefings with Queensland Times, The Courier-Mail, Australian Financial Review, Cairns Post.

 

2. During the campaign

 

The critical period of the campaign was after the merger announcement on 5 June and before the day of the vote on September 27.

 

A number of milestone announcements and strategies were actioned including:

  • national media release on Supreme Court approval for the member vote;
  • photo call at the distribution centre the day documents were being mailed to members; and
  • encouragement of white knights to submit letters to the editor to local press in particular

 



The vote

 

The day of the vote required careful media handling including:

 

  • maintaining telephone contact with key financial media during the series of 7 member meetings;
  • encouraging media attendance at member meetings most likely to be positive;
  •  focussing media on key positive result of 97%;
  •  delivering swift media release regarding successful vote; and
  •  follow up with release in relation to Supreme Court approval of merger.

 

Staff

 

While First Australian management handled the logistics of staff briefings, BBS advised that as the media conferences began, staff should also be informed at a series of meetings. BBS also advised that simultaneously, letters from David Jeffries and Rob Hunt along with other briefing materials should be uploaded onto the staff intranet.

 

BBS drafted:

  • Letter from David Jeffries, CEO First Australian Building Society
  • Letter from Rob Hunt, Managing Director Bendigo Bank      

 

Major challenges and obstacles

 

  • A small number of vocal opponents to the merger from within the shareholder and member groups required special handling. The campaign provided regular access for these antagonists to First Australian Chairman Neal Axelby and drafting of frequent favourable Letters to the Editor from white knights.
  • As managers of the public relations process, BBS was required to liaise daily with both First Australian and Bendigo Bank and ensure the agendas of both organisations were catered to.

Results: 

  • On 27 September 2001, the members and shareholders of First Australian Building Society voted more than 90% in favour of the merger at a series of 7 meetings at Ipswich Civic Centre.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
  • In several of the meetings, the vote was more than 95% in favour, well over the 75% required.
  • Proxy votes received prior to the meetings had indicated support for the union, but the final result was considered well beyond expectations.
  • A positive media campaign had bolstered the intense member and shareholder campaign to ensure the result.
  • Media coverage achieved included, but was not limited to:
    • Coverage in major financial press including The Australian Financial Review
    • Positive coverage in key markets including <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Ipswich and Far North Queensland
    • Extensive radio coverage across Australia
  • Bendigo Bank was positioned well in the hearts and minds of shareholders and members and the Queensland public at large

 

Evaluation: 

BBS had worked towards achieving a 75% vote in favour of the merger. The 97% result was achieved against the odds and has been used since as an example for a successful merger in the Australian company landscape. The role that public relations had in the merger and its resultant acceptance by the members and business community cannot be understated.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

 

The campaign can be measured by:

 

  • the resounding vote of support from members and shareholders;
  • an improvement in the Bendigo Bank share price;
  • the positive media campaign;
  • feedback from staff; and
  • endorsement by the law firm handling the merger which lead to BBS now being contracted to provide public relations services to the law firm itself and several of its financial services clients.