Thursday, May 01, 2014
Saga to float on the UK stock market
I have never been a great fan of Saga, which is odd considering that it is the largest and most successful company that is solely focused on the older consumer.
Why am I not a fan? To be honest I am not totally sure. I know they are a very difficult company to do business with (not as a customer but a supplier). I know a lot of people who found them incredibly difficult and inflexible.
But I don't think it that reason alone. The Saga brand represents something that I don't want to be. I have zero affinity with what it is portraying. Lots of people do so this is really a personal thing.
The news is that the company is floating for some astronomical sum of money. Read about it in This Money mag.
I will buy some shares because I suspect there will be a short term gain. However, my long term view on Saga has always been negative. Reasons:
1. I don't think it really made the jump from appealing to the older-old to the new-old (Not an easy thing to do)
2. It is in an incredibly competitive market (insurance) and likely to be more so. I think the travel business is a distraction because that is not where it makes the money.
3. It has been slow to build a product portfolio to sell to the wealthy older-old. It has been too busy paying its loan interest and trying to broaden its age range of customers.
It will be fascinating to see how it works out.
If anybody from Saga is reading this blog - please put your new TV ads onto YouTube since I was going to say some nice things about them. Dick Stroud