Monday, March 23, 2009

Financial Institutions Build Confidence With Advertising

Troubled financial institutions need to advertise more to have a chance of building consumer confidence.

According to a recent study by Nielsen IAG, 55% of TV consumers who have seen, on average, more advertising from financial institutions over the last six months have "complete confidence" in the health of those companies. On the flip side, only 18% of those consumers have confidence when they have seen less advertising on average.

Nielsen says that when financial companies go "out of sight," they can possibly go "out of business."

Last year, financial institutions--financial services and insurance companies--started pulling back on their ad spending. They ended the year down 13.4% versus 2007, spending $8.4 billion. When most of the troubling economic news started in the fourth quarter, financial companies cut even bigger pieces of their media spending--down 23.3% to $2.1 billion in the fourth quarter of 2008 versus the same period in 2007.

On average, older consumers 55 plus with assets of over $100,000 generally have more confidence in financial institutions than younger consumers.

Consumer confidence is derived from financial institutions having the wherewithal to advertise themselves, as well as strong overall marketing efforts. For example, consumers said they would have increased confidence from seeing advertising via TV, regular mail, email and/or Internet offers.

But the biggest factor for consumers comes from non-paid marketing efforts--reading positive stories in the press about those institutions.

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