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NASDAQ, that feisty and fast-growing exchange for over-the-counter stocks, is spending big on broadcast spots to wound the Goliath of the world's stock markets, the New York Stock Exchange.

The National Association of Securities Dealers exchange, a computerized trading system, fired the opening volley in the challenge-the-big guy assault three years ago with one of the first-ever TV campaigns by a stock market.

NASDAQ is on the march to attract companies, and the accompanying fees for stock listings and commissions from shares sold, with TV spots appearing on shows like "This Week With David Brinkley," spot radio and print ads that proclaim: "NASDAQ. The stock market for the next 100 years."

Industry sources say NASDAQ will continue to market itself aggressively via print, TV and radio, including buying commercial time on TV broadcasts of golf and tennis tournaments.

"In its print advertising, NASDAQ emphasizes its performance in the growth of stocks like Apple. The New York Stock Exchange emphasizes prestige. It is the Apple vs. IBM scenario," said Bennett Stewart, senior partner at Stern Stewart & Co., a New York consultancy. The challenger entered the fray with relatively young hot-shot stocks including Intel Corp., Microsoft Corp. and MCI Communications Corp., in contrast to companies listed on the Big Board like Eastman Kodak Co., IBM Corp. and General Motors Corp.

NASDAQ's total ad spending in the first nine months of 1993 was explosive when compared with the NYSE or the American Stock Exchange. NASDAQ spent nearly $7.19 million during the period vs. the NYSE's $828,400 and Amex's $502,600, according to Competitive Media Reporting.

NASDAQ poured nearly 90% of that total, nearly $6.35 million, into TV, more than 100 times the $61,500 the NYSE spent. The Amex spent $218,500 on TV commercials.

Spot radio numbers are just as revealing: NASDAQ spent $591,700 during the first three-fourths of the year.

"In 1993, after lobbying National Public Radio they began running NASDAQ market reports every hour around the country," said Robert Ferri, director of media relations for the exchange. The NYSE and Amex spent nothing in the category, the reporting service said.

However, numbers from Media Monitors, Indianapolis, indicate that in December, the NYSE began to aggressively leverage radio commercials across the country. In October, the NYSE ran about 150 radio spots nationwide and another 120 in November. In December, that number rocketed to about 6,900, according to Media Monitors. By comparison, NASDAQ ran about 6,900 radio spots in October, 5,520 in November and dropped to 1,720 in December. The Amex ran no radio during the period, according to the largest radio spot monitoring company in America.

The NYSE concentrated on morning and evening rush hours in markets like New York, Chicago and Los Angeles, using taglines like, "The stock market that puts the investor first. The New York Stock Exchange. Not just a place, a way of doing business."

Media Monitors tracks radio spots one day a week in major U.S. cities and then uses a multiple of 5 (number of weekdays) to come up with an average number of spots that ran in a week. To get an approximate flight for a month, the number then is multiplied by the number of weeks in the month.

"I observe a lot of cam paigns, and whatever agency did NASDAQ's advertising, I truly com mend," said Michael C. Krauss, division head at Chicago-based OmniTech Consulting Group.

The credit goes to NAS DAQ's agency of record, Messner Vetere Berger McNamee Schmetterer/ Euro RSCG, Pittsburgh.

"As a business-to-busi ness marketer, I think what NASDAQ has done, in terms of marketing communications, is sheer brilliance," Mr. Krauss said. "The tone, the ap proach of their advertis ing, its targeting, its imag ery, is phenomenal. I think, in many ways, NASDAQ has left the other two exchanges in the dust, although I think the Amex and NYSE will try to catch up.

"But I think it is a sig nificant case study to see what NASDAQ has done with advertising and com munications to bolster and position itself as the exchange of the '90s and the era beyond."

To fight the massive name recognition of the NYSE, NASDAQ has marketed itself to the trenches in an outreach program, Mr. Ferri said. NASDAQ sponsors business reports on local TV news programs on 80 stations nationwide, including the top 10 TV markets and 40 of the top 50. The report announces the day's closing numbers on the NASDAQ and NYSE, and then goes on to spotlight local companies listed on NASDAQ.

"This is an effort to get local stations to recognize the NASDAQ stock market. The localized business report program really clicks with TV news directors," Mr. Ferri said. "The program has been extraordinarily effective. It is central to increasing the name recognition of the NASDAQ stock market around the country."

Like NASDAQ, which began print ads in November in The New York Times and The Wall Street Journal, the NYSE advertises in both papers as well as on "60 minutes" and radio. Ads take a subtle approach emphasizing the exchange's prestige and 200 years of existence.

"As a matter of policy the New York Stock Exchange does not comment on our marketing strategy," said Ray Pellecchia, NYSE news bureau manager. He said the exchange has never mounted a TV campaign and only advertised on TV once, in 1992, to mark two centuries of being in business.

Industry sources say the NYSE will continue to advertise its heritage in print and radio, while there are no immediate plans to advertise on TV. The NYSE may not want to get caught acknowledging NASDAQ's arrival on the playing field by producing TV commercials of its own. Wells Rich Greene BDDP, New York, handles print ads, and Margeotes Fertitta Donaher & Weiss handles broadcast.

NASDAQ traded 47% of shares changing hands in 1992 among the three exchanges, up 15 points from '82. In so doing, the computerized trading system is catching up with the Big Board, which saw its percentage of shares traded fall to 50%, from 63% a decade earlier.

In dollar volume worldwide in 1992, the NYSE was No. 1 by a roughly 2-1 margin over No. 2 NASDAQ. The Amex was No. 10, behind markets including London and Tokyo.

The Amex has positioned itself on the NYSE's side on the battlefield. This offensive against NASDAQ pits auction floor vs. computer auction. The NYSE and Amex trade stocks from a physical floor, while NASDAQ, an association of 472 trading companies, is joined by phone and computer wires.

Perhaps gearing up for a charge, the Amex switched agencies in October to McCann-Erickson Worldwide from DeVito/Verdi.

"I think our ads will be image building and educate the market about the strengths of the Amex," including high-quality trading, superior execution technology and personal service, said Joan Allen, VP-corporate communications at the exchange.

"We intend to use all the marketing tools," she said. "We are looking into everything, and we intend to be more aggressive."

However, Ellis Verdi, a partner at DeVito/Verdi, said the NYSE and Amex have "yet to hit the mark" in ads.

"NASDAQ went to a broader media choice and is very aggressive in its marketing dollars and communications," he said.

The Amex may raise its ad profile.

"It will be a more aggressive campaign in 1994, and it will target both the individual investor and the company listing environment," said Susan Irwin, senior VP-director of corporate communications at McCann.

The NYSE and Amex tout advantages to their centralized trading systems: better prices for customers, superior transaction monitoring and an open marketplace where dealers shout orders to buy and sell. NASDAQ's dealers exchange bids and offers over phone and computer lines.

"This is a very sensitive issue. [Public relations] at the NYSE and the Amex tries to justify their existence by touting smaller average spreads [difference between bid and selling price for securities] compared to NASDAQ," said Ted Aronson, partner of the Philadelphia investment management company of Aronson & Fogler. "It is a propaganda war between the exchanges."

"Both the Amex and the NYSE have a lot to say," Mr. Verdi said. "However, they are caught up in the politics of dealing with a number of constituencies, and this makes them less focused."

As the year began, investors continued to pour money into all major stock exchanges. Volume last week on the NYSE, NASDAQ and Amex exchanges was second only to the torrent of activity the week of Oct. 19, 1987, which began with the Dow Jones industrial average dropping more than 500 points that Monday.

Combined volume for the NYSE, NASDAQ, and Amex during the first week of 1994 was 3.4 billion shares, compared with the record 3.7 billion shares traded during crash week in 1987. Last week, the DJIA hit record levels, closing at a record 3820.77.M

Mr. Kimball is a reporter at Advertising Age's sister publication, Business Marketing.


NASDAQ's TV campaign showcases successful companies that chose to list on the upstart exchange.


Print ads for the NYSE trumpet its mammoth size, noting a market value more than quadruple all other exchanges combined.

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