I didn’t need a new Nielsen study to tell me that a financial institution can improve customer confidence through advertising. It only makes sense. If the bank has the money to advertise, the perception will be, that it has the money to pull through hard times. Could be a totally false perception, but there it is.
The study shows that,
When asked about their own banks, insurance companies and investment firms, 55% of respondents who said they had seen more advertising for their financial institution reported having “complete confidence” in the financial health and soundness of their financial company and only 18% said they had “little or no confidence” in their company. However, among those who said they had seen less advertising, only 18% had “complete confidence” in their financial company and 45% said they had “little or no confidence” in their company. Overall, a minority of respondents said they had “Complete Confidence” in their financial institutions.
So, you see, not advertising leads to the reverse perception that you are on the way out of business. Again, it may not be true, but perception becomes reality.
For a PR guy like me, the best news is that editorial coverage is more important than advertising in communicating the health of a financial institution. Here’s what the study found about factors that would increase confidence in the safety and soundness of their financial institution:
- Reading positive stories in the press about that institution (44%)
- Seeing regular advertising for that institution (25%)
- Receiving regular mail or email offers from that institution (25%)
- Regularly seeing internet offers/advertising from that institution (21%)
This holds true for any business, not just financials. So, when looking at cutting expenditures during tough times, leave your communications budget until last.