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Advertising Can Boost Consumer Confidence, Study Reports

Mar 19, 2009  •  Post A Comment

Consumer confidence in the long-term health of companies is influenced by the amount of advertising and marketing for the companies, a Nielsen IAG study reports.
Fifty-five percent of respondents who said they have seen more advertising for their banks, insurance companies and investment firms indicated that they have “complete confidence” in the health and soundness of their financial company. Only 18% responded that they had “little or no confidence.”
Meanwhile, only 18% of those who has seen less advertising reported having “complete confidence.” Forty-five percent said they had “little or no confidence.”
A minority of all people surveyed had “complete confidence” in the health of their financial institutions.
The study underscores the correlation between reduced spending and lack of confidence at a time when total ad spending decreased 13.4% from 2007 to 2008, according to the Nielsen Co.
Respondents said that seeing regular advertising, receiving regular mail and e-mail offers, seeing regular Internet offers/advertising and reading positive stories in the press would help increase confidence in their financial institutions.
“This research shows that ‘out of sight’ can mean ‘out of business,’” Richard Khaleel, executive VP of Nielsen IAG’s financial practice, said in a statement. “The current economic climate makes it more important than ever for financial institutions to bolster confidence among their clients, and this study clearly demonstrates the link between advertising and confidence levels. With constant scrutiny on the industry, it’s clear that taking control of the message in advertising and press can make all the difference for a brand.”

14 Comments

  1. If you don’t advertise your business, advertise it for sale!

  2. This is true, and it’s important to remember that, while companies look at cutting marketing / advertising as a gut reaction, it’s the one channel that really alerts prospects and connects clients to a business. Imagine for a moment that your main method of communication with the world is your cell phone. What if your boss said, “things are slow, so we’re going to cut out cell phones. We’re not going to replace it with anything else, you’ll just have to not call your clients.” That’s what you’re doing when you cut your marketing budget—cutting your connection with your market.

  3. It helps if the advertising has some connection to reality, though. AIG advertised “the strength to be there” incessantly, right up to the moment they weren’t there.
    Just because they say so, doesn’t make it so.

  4. Agree with Andy S.
    Look at Washington Mutual before they tank.
    I say advertise wisely. No need to bombard the audience with messages (especially false hopes). In the end media will pick up what the status of their banks/financial institutions are.

  5. I absolutely agree with this article. It is very important that you have a trusting relationship with your clients so as to be able to advise them at a time like this. Now is the time that yes, businesses must spend their advertising dollars wisely but, they must not stop. Now is the time to capture the market. Their competitors are scared and cutting back and loosing business. I advise my clients now is the perfect time to move in and take the market.

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