Can Mastercard make the most of Access?

Despite denials from Access and a resounding “no comment” from the more involved parties, there is no longer any doubt that the four UK clearing banks are in talks in New York to sell the brand to Mastercard for more than 100m. Lloyds, Midland and NatWest all own a 30 per cent stake in Access. The remainder is held by the Bank of Scotland. But it is believed that any deal only needs the support of two of the major shareholders.

The question is not whether it will happen, but when. According to sources close to the company, Mastercard intends to replace the Access brand name with its own.

Last year Mastercard began its first UK TV advertising through Publicis with the “Ah Mastercard” theme. The company has always seen a conflict in its own global branding ambitions and the existence of a separately branded UK product.

The Access brand has been gradually downsized by banks such as Midland and NatWest, which have increased the size of their own logo and reduced Access’ on the card. An observer says that this is as much a reflection of overcompetition in the banking sector, as the banks’ intention to offload the brand.

Though it was late to market when it launched in 1973 – seven years after Barclaycard – it quickly established itself as an authoritative brand. Over the years it has invested more than 50m in branded advertising. Along with Barclaycard it now has over 7 million users.

Interbrand chairman John Murphy believes the move to drop Access is based on sound reasoning. “Access is a strong brand in a small market. Mastercard is a global company. As people travel more, the rationale for replacing Access becomes overwhelming,” he says.

Access has also built loyalty among sentimentalists in the marketing community, who rail against US companies which “globalise” UK brands for the sake of economies of scale. “First there was Marathon, then Andrex and now Access,” says one financial services marketing director.

Though Marathon’s transformation into Snickers confounded the sceptics by proving relatively successful, Access is more complex. Unlike chocolate and toilet roll, credit cards have had a very bad press. Trust is crucial, and building trust takes a long time.

Quite how well established and trustworthy the brand is, will be one of the key negotiating points in New York. According to Pauline Amphlett, a partner at DDG Brand Guardians: “Access is a brilliant name, if we had come up with it we would have been very pleased,” she adds.

But it is not a universally held view. One brand analyst, who has worked with credit card companies, says: “The concept of ‘access’ is outmoded. It is a Seventies concept, introduced to try to get consumers used to the idea of credit cards. All that money versus credit cards stuff is way out of date. The Access brand has not moved on.”

But there are barriers to replacing Access with Mastercard in what is already a saturated market. To make any impression, a new card would have to steal cardholders or encourage existing ones to carry more. The challenge for Mastercard will be to hold on to the existing 7 million Access customers. It is expected the card will trade as Mastercard Access for at least two years.

Though the total number of credit cards in circulation has remained static at about 28 million, the number of different cards has mushroomed, leaving Access with a smaller proportion – 25 per cent – of the total market. In the past two years, hundreds of new credit cards have been launched by everybody from Vauxhall, to newspapers such as The Sun, universities, trades unions and charities.

New products have intensified competition. Debit cards, such as Switch and Visa’s Delta now outnumber credit cards. Credit cards have been using incentives such as Air Miles, discounts and profile points. Price is driving the market. When Amex entered the market with its credit card in February it undercut Barclay-card by six per cent.

The fact that the market is trading on price, rather than easily identifiable and strongly positioned brands, means it is much more difficult for a new entrant with mass-market aspirations to succeed. It also makes the value of a 22-year-old established name all the more important.

However, Mastercard will give the product more of a sense of direction. Arguably, Access’ rule-by-committee structure has restrained its development. It has been beaten on innovations. Barclaycard beat it to market in 1990 with insurance and more recently in launching specialist cards such as Gold and Sense. Visa also beat it to the debit card market with Delta.

Director of CLK Irene Inskip says Access was positioned in the Seventies and Eighties as a democratic brand which invited mass-market participation in the credit card boom. But its association with that boom is also its biggest failing. “The ‘flexible friend’ made a tremendous contribution to the credit boom of the Eighties,” she says, “but it became associated with excess, rather than access.”

Nevertheless, Mastercard believes the positive aspects of the brand outweigh the negative. Access will not be instantly replaced. It is likely Mastercard will milk its “flexible friend” for all the brand equity it can before delivering the final blow.