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Thursday, December 14, 2000|
TIAA-CREF Puts New Brand in the Fire
TIAA-CREF has an image problem: itself. Known as a provider of education pensions, the firm has been struggling to get the word out about its now broadly-available, expanded services. Efforts include a new branding campaign and the addition of an advisor Web site.
In August of 1997, a tax act made TIAA-CREF's pension business, previously protected because of its education mandate, subject to taxation.
"With $200 billion in assets, Congress saw a lot of tax dollars," said Mike Fegan, TIAA-CREF spokesman. "The irony is that they lumped TIAA and CREF together, but CREF is a 40 Act company and 40 Act companies don't pay taxes.
The new tax status opened the doors for the firm to bring out new products that are available to the general public, but few people are aware of the change. Since the mutual funds were opened in September of 1997, they have accumulated about $3 billion.
"Essentially, we've had a brand for years that really has reflected a limited scope of customers and a relatively narrow range of products," said Fegan. "We need to refresh the brand to reflect the products and services. We've been working on it now for the last two-and-a-half months."
The firm has extended its existing relationship with ad agency Ogilvy & Mather to shape the campaign. According to Fegan, print media ads will probably come out in the beginning of 2001, but expansion into TV and radio will hinge on market tests later in the year. In order to keep costs down by focusing advertising efforts, the firm aims to target the country's brain trust.
"We're not looking to become a household name," said Fegan. "We'll probably spend in the neighborhood of $10 million in 2001."
Following an industry trend, TIAA-CREF will go on-line with a secure advisor Web site in the first quarter of next year.
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