While the big spenders-brokerages, mutual funds and credit cards-have cut back sharply, smaller players and categories are increasing ad spending. The smaller players are focusing on Main Street consumers who are still refinancing homes at a record rate and are increasingly concerned about their financial stability.
"If you look at the broader picture, home loans are one area that has continued to prosper," said David King, national advertising manager of Washington Mutual's Home Loans and Insurance Services Group. The group launched a campaign for its home-loan products from Interpublic Group of Cos.' Sedgwick Rd., Seattle, which includes print, radio and outdoor in up to 40 local markets.
a bright spot
In fact, finance and mortgage companies were one of the few financial-services categories to increase advertising in the first half of 2002 over the same period in 2001. Lenders spent 3.7% more in media, according to Taylor Nelson Sofres' CMR.
Spending by banks and savings and loans was only down 3.1%, thanks to additional spending by regional banks. While large bankers such as Citigroup and J.P. Morgan Chase Co. have reduced their marketing spending, smaller competitors such as KeyCorp and Washington Mutual have stepped up efforts. KeyCorp this month broke a campaign from Snell/Weisheimer, Columbus, Ohio, in both national and local media.
Increased competition among banks has led players to increase marketing budgets, and the weakness in the securities markets have made them more attractive to consumers, said Brenda Marlin, associate director of the ABA Marketing Network, a unit of the American Bankers Association. A new ABA marketing survey estimates banks and savings and loans will spend $4 billion in marketing this year, up 4.5% from 2001 and even edging the $3.9 billion spent in 2000, and ad budgets among regional banks will grow 10%, faster than other segments of the industry.
Insurance companies-which have shown strong sales of life and property policies in these uncertain times-are also active marketers, either holding budgets stable or increasing them.
"People are beginning to realize that they have to protect their assets," said Carolyn Martin Buscarino, senior VP-corporate communications at New York Life Insurance Co. This month, it launched its first campaign in two years via WPP Group's Berlin Cameron/Red Cell, New York.
The insurer will spend $43 million in the next 15 months, about the same budget as it had before, but it expanded its media buy to add print ads focusing on the company's status as a mutual company that doesn't have to satisfy shareholders in the short term. The company has always promoted that message, but Ms. Martin Buscarino acknowledged it's very timely in the current market.
"It's the same message we've always had. [But] I think it's going to fall on more receptive ears," she said.
Even in the battered investment-management category, activity is perking up. Mutual-fund and investment-management companies such as AXA Financial have launched efforts recently.
AXA launched its first campaign from Interpublic's Martin Agency, which won the account last summer. The $20 million spending is a slight increase from previous campaigns, said Deanna Mulligan, exec VP-marketing and product development. But she noted the environment did not dictate the increase, but rather it was due to a mandate from management to focus on promoting financial planning.
"We feel it's a good time to advertise because consumers are looking for advice," Ms. Mulligan said. But she added "this is really about [it being] the right time for our strategy."