The Adgenda: "Lemonade" ads are a smart move from HSBC

Although the music is kind of creepy.

HSBC has put a cheery face on banking with a grade-school entrepreneur in their ads Lemonade and Lemon Grove.

The first video starts with the all-American summer image of a kid earning some pocket money from her home-made lemonade stand. Suddenly trouble arises when her latest customer doesn’t have any American change. Not to worry, turns out not only does our littelest businesswoman cover all major currencies, she also speaks Cantonese. Cue a bus full of new customers and an emerging local lemonade monopoly for international customers.

This raises some questions though. Does the dad get a cut of the profits? Is her home-made sign a lewd marketing campaign playing on the “innocent small business” image? Does she skim a few percentages over the exchange rate for herself? She’s obviously put a lot of thought into this. Fast forward to the next video and the situation has escalated wildly. She now has a lemonade empire stretching at least from America to France. She has also shown her true colours as a hyper competent polyglot with revenues large enough to fly to India to expand her supply routes.

What are the fathers thinking throughout all this? Are they really as naïve as the video leads us to believe and just play along with their daughters little game of merchant? Seems so as when the girl storms off for her next corporate adventure her dad is completely out of the loop. Did she only bring him as a cover story for border controls? If the story and her business follow this exponential growth the next video will feature a global mafia-like organisation, run entirely by twelve-year olds, with complete control of the world’s lemonade trade. The slogan of the ads confirm this: “In the future even the smallest business will be multinational.” Imagine the money she saves alone on using nothing but child labour. She has definitely not filed the official paperwork and who would prosecute a kid working at a street side lemonade stand? The rest of us will simply have to pray she doesn’t turn her attention beyond lemonade.

On a more serious note this is a smart move from HSBC’s side. Bankers have not exactly enjoyed a great image in the last decade, or for that sake, ever. A positive spin and a loveable character are standard for defusing blame and shifting attention. But it seems to focus a bit too much on presentation and too little on outcome. How did the advertisement team picture this play out? An executive wondering which bank could best suit his new takeover and bam his mind flies to HSBC because of an ad which seemed more suited as a storyline for one of his kids’ tv-shows?

Andrea Newman, global head of advertising and marketing communications, HSBC, said the purpose of HSBC’s “In the future” campaign aims to: “bring a sense of warmth, simplicity and optimism to inspire growth.”

The choice of music is terrible and kind of creepy though.

HSBC Photograph: Getty Images
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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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