Public Relations is often considered the art of subtlety. It’s not as in-your-face as advertising, and the goal is to get people talking about your message and advocating for your agenda - as opposed to making them aware of your existance or product. So upon first glance, it would seem as if some PR campaign somewhere along the line had failed in regards to the new debit card fees being rolled out by big banks like Bank of America. Everyone is wildly upset, and it seems like no one is advocating on the financial giants’ behalf. But I’m not writing about Bank of America’s PR campaign. This is a blog about the not-so-little PR campaign that could – one that slid under everyone’s radar but led to major change. Let me tell you a story.
The spark that ultimately resulted in the changes to a large part of the country’s debit accounts began in July 2010 when the Dodd-Frank financial reform bill along with the Durbin Amendment mandated that the Federal Reserve Board must begin bringing down the fee for swiping debit cards at retail outlets by July 2011. The PR teams of the banking industry responded by spending millions to delay the mandate and ultimately thwart the bill from passing in order to keep their revenues high without having to take free services away from their customers. They were not on the lookout for a PR pro named Tita Freeman who had recently joined the National Retail Federation (NRF) and was on a mission to fight for small businesses in America.
According to a quote given by Freeman in PRWeek‘s October cover story, banks charge retailers 44 cents on top of the cost of a purchase every time a debit card is swiped; however, studies show that the actual cost is less than 12 cents. In order to enable smaller retailers to continue growing their businesses, adding jobs to the economy and operating in the black, the NRF needed the new legislation to pass. Freeman joined forces with the NRF’s government relations team and set to work implementing a 60-day campaign to counterattack the big banks’ messaging and force the lowering of fees retailers owed to banks for swipes.
Stop the onerous costs for Main Street merchants trying to stay open and stimulate jobs.
Freeman spearheaded a true integrated effort in the name of PR with tactics including an interactive website where people were encouraged to tweet their senators about reform, viral video, social media, a press briefing, radio ads and an op-ed campaign – all working together to emphasize the Main Street message. Freeman and the NRF’s 60-day, six-figure campaign succeeded. As of Oct. 1, 2011, banks with assets higher than $10 million were required to fix debit card swipe fees at 21 cents per transaction, which wil result in an estimated savings of $10 BILLION a year for the retail industry.
And now we arrive at today – where Main Street retailers have been rescued, but how did big banks respond? Well, they passed those costs along to Main Street American consumers instead. And there’s public outrage. Except now they sit in a difficult position thanks to Freeman’s strategy. If they were to enact a new, big-budget PR campaign to lessen the impact of their new fees, who could they blame? They’re certianly not going to say, “This is the fault of Main Street retailers trying to provide jobs,” in the midst of this economy. What are they to do? Some large banks, like Laredo-based International Bancshares Corp. (IBC Bank parent), have decided to close branches instead. Which, to me, seems like taking jobs out of the economy and away from everyday Americans. So who really wins?
The moral of the story is that public relations, while subtle and often under the radar, is effective and far-reaching.