Chase Now Lead Ad Spender in Shrinking Sector
YORK, Pa. (AdAge.com) -- JPMorgan Chase will look to reassure Washington Mutual customers that their money is safe and rebrand all WaMu banks as fast as possible after snapping up its troubled rival for a bargain $1.9 billion. That should prove a short-term boon to its agencies and a handful of media owners but still means yet another consumer marketer has been eliminated in the crisis-hit and fast-consolidating sector.
The deal makes Chase, which uses New York shop McGarryBowen for most of its creative and ZenithOptimedia for its media planning and buying, the country's second-largest bank and largest marketing spender. Chase said through a spokesman that it's too early to say what will become of its agencies and marketing budget -- which, if combined with that of WaMu, weighs in at a hefty $1.51 billion, beating out current spending leader Bank of America, with $1.49 billion.
One thing is clear, however: Chase will be phasing out the now-stigmatized WaMu brand, which is represented by Omnicom Group's TBWA/Chiat/Day, Playa del Ray, Calif. In a welcome letter to the savings-and-loan's customers on its website, Chase wrote that changes will include branches being renamed Chase and the reissuance of debit cards with the Chase name, as well as the Chase name beginning to appear on statements, online and on new credit cards.
A Chase spokesman said while no definitive plans for marketing have been set, the bank is "looking" to do some advertising next week, in WaMu markets in particular. The message to WaMu customers so far: "Keep doing what you're doing. Just know that now you're part of a bigger and stronger bank." Both TBWA/Chiat/Day and McGarryBowen referred calls for comment to Chase.
Most experts agree the decision to jettison the Washington Mutual brand -- which ironically before its fall used a cheery "Whoo hoo" tagline to communicate the joy of banking with it -- is a good idea. The brand has some regional equity and helps Chase -- which had been touting its huge number of locations in advertising well before the merger -- expand in California, Florida and Washington. It also adds branches in New York, Texas, Illinois, Arizona, New Jersey, Colorado, Connecticut and Utah. But the flip side is that the WaMu name bears the stain of the mortgage crisis, as it came to symbolize the problems and excess of mortgage banking.
"The last thing a surviving company in financial services wants to do is taint their brand with something that has failed," said Roy Levitt, creative director and principal at Congdon & Co., Greenwich, Conn.
Moreover, it would benefit Chase to stress to consumers the information that its WaMu purchase was not opportunistic but rather an effort to help stabilize the overall economy, said Kevin Joy, VP-marketing and client services for BrandIntel. Mr. Joy, who researched the Bank of America and Merrill Lynch merger, found that consumers were more negative than the general media and Merrill customers felt Bank of America was getting too much control. Even so, the BofA and Merrill customers were much more worried about the overall economic fallout than the merger.
Chase might also be wise to buy ads around the search terms "WaMu" and "Washington Mutual." As of last week, it had not bought those or any of the terms you might expect it to buy to help reassure customers.
"It's a dangerous time to be too aggressive; you don't want to be a vulture," said David Berkowitz, director-emerging media and client strategy at 360i. "But there is definitely missed opportunity in terms of being a resource through search. Clearly you can't use search the same way you've always used it. If you Google 'WaMu' now, probably free checking isn't your No. 1 concern."
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Contributing: Abbey Klaassen