What Does Good Credit Mean To Citigroup?

In the wake of September 11th (and the burst of the dotcom bubble), Citigroup started an ad campaign they hoped would capture the spirit of the times. Out went 90s exhortations about value and money; in came reminders about values and what’s most worthwhile in life:

“Don’t wait” Citi told audiences, “until someone says ‘Your money or your life’ to remember that they are two different things.”

The ads must have struck a nerve because the campaign still runs years later. Citigroup, like other organizations, pays attention to the benefits and costs of advertising and brand building. Whatever metrics they use to gauge consumer response must be positive.

Another interesting question, though, is this: What’s been the impact of the campaign on employees at Citigroup? (When I write ‘employees”, I include executives.)

Thousands of people work for Citigroup. And, like all of us, they bring some blend of values to the office each day. On most days, most of the time, they must be good folks who seek to do reasonably good things – like, for example, providing good credit to others.

The Citi ad campaign, though, raises the bar on what ‘good’ credit means. 

Citi employees are making a promise about ‘good credit’ when their ads tell customers:

“Be independently happy”.

If the brand promise in this ad is to be matched by the brand experience, Citi employees must hold themselves accountable for building consumer independence – a corollary of which means assisting their customers in avoiding dependencies that drive out happiness.

Credit is a source of potential dependency.  Potential. Credit need not lead to dependency. Half of cardholders, for example, pay their bills on time and in full each month.

There are millions of Americans, however, for whom credit is a dependency. For some, the dependency derives from financial necessity; for others, from inadequate skills and knowledge; and, for others still, it is an addiction.

Hence, this question for Citigroup employees: Why and under what circumstances do you provide credit to these Americans?

One answer could be: Because it is profitable.

That is consistent with the governing orthodoxy of capitalism. It also matches the first first part of the following Citi ad:

“People make money. Not the other way around”.

But it’s the second half that reflects Citi’s current brand promise:

Another response could be about opportunity and freedom. While money does not ‘make people’, it surely helps provide the material basis for happiness in a market economy. Citi and other credit card providers assist customers in climbing the economic ladder.

To match brand experience with Citi’s current brand promise, though, Citi employees need to take steps to make certain they provide ladder climbing credit assistance only to folks who use it to achieve independence.  Citi has a variety of business practices that help their employees succeed at this.

In addition, like other credit card companies, Citi has sophisticated statistical modeling and data techniques that predict with stunning accuracy consumer credit card usage and behavior. Citi uses these tools to price different cards to different groups. Some get credit at 10%, some at 16% — and some at just under 30%.

That’s right. 30%.

It’s that number that raises the curtain on whether Citi employees’ shared values match the brand promise in their ads. Because the same models instructing Citi to charge 30% to higher risk consumers predict that consumers who pay such high rates are headed into dependency instead of financial independence or happiness.

Which takes us back to the initial question about what ‘good’ credit actually means to the employees of Citigroup. For those who are sincere, ‘good credit’ must mean credit that is both profitable for Citi and ‘good’ for their customers.

30% rates don’t meet that test.

Citi employees have a choice every single day they show up to work: match brand experience with brand promise by ceasing to offer consumer credit at 30%.

When they make that choice, they will surely take a huge step toward fulfilling yet one more promise in their ads:

“Human decency is up a point and kindness is making a rally”.

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