How debt marketing works
We take a look at some different ways debt and borrowing have been represented in culture and marketing. And how that's changed over time.
Good and Bad Debt
Credit is an important part of the economy. If credit is used to purchase productive resources, or durable goods, it can improve standards of living, help in economic growth and add to income. A mortgage can be an excellent long term investment.
But unsecured household debt can cause problems if an individual has a change of circumstances, and can’t keep up repayments, or is spending that money only on things that lose value quickly. This can be magnified in a recession when it happens to many people at the same time.
And it’s not just individuals and families who are at risk from excess borrowing. In a 2018 ‘stress test’ by the Bank of England, consumer credit accounted for 40% of losses on banks’ UK lending, despite it being only 7% of their lending exposure – because people are more likely to default on credit than mortgages.
There has been a proliferation in the UK of expensive credit, often marketed at point-of-sale or ‘contextually’. There’s also been a big shift in the last few decades on how debt for consumption is framed. We asked our friends at Sign Salad - specialists in how images and language are used in communications - to look at some different ways debt and borrowing have been represented in culture and marketing. And how that’s changed over time.
Historically, debt was represented as a frightening financial problem which exposes the borrower to many dangers: debtor’s prison, ‘loan sharks’, psychological anxiety. The threat of losing everything. Ultimately debt is expressed as a vulnerability which can lead to poverty, ill health… even death.
Borrowing is now increasingly represented not as a restriction, but as a form of freedom. As the consumer credit bubble keeps on inflating, and many people will struggle with post-Xmas debt, we take a look at some of the conventions, themes and ‘codes’ that brands use to market debt.
Borrowing is represented as elemental and bold. Images of the natural world and outdoor life feature here.
Disney-esque fairytales, childlike fonts and animations signal credit as innocent fun, as easy and consequence-free as childhood.
Best friends forever
Loan companies are chatty, informal peers. We see overblown enthusiasm, formulaic ‘matey’ language and simple, relatable illustrations – like Klarna’s pizza slice. These guys are saying: borrow some money, we’re here to support and empower you.
HyperJar. Forward Thinking Money.
Credit may be the right choice for you in certain circumstances. It can help with the ebb and flow of life and money. But real freedom and empowerment comes when you have a plan. When you’re telling your money where to go, not wondering where it all went.
Research shows that children who talk about money and are given money regularly to spend and save tend to do better with money when they grow up. Because children are developmentally capable of saving from age 5, it’s important to start building good money habits as early as possible.