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This month the UK’s Investment Association announced that the industry has seen five consecutive months of net outflows. Investors are concerned about Brexit, the on-off US/China trade talks, and the risk of major countries (notably Italy and Germany) possibly heading towards recession.
But is this the time to stop advertising? Several pieces of research published over the years would give an emphatic no, although as agents working in the advertising industry, we would say that, wouldn’t we?
Almost as soon as the ISA season stopped earlier this month there was a marked decrease in asset managers advertising within the national press. But, given there are peaks and troughs in the UK and global economies, it is exactly now when investment into advertising could - and should - benefit companies. This will happen for several reasons:
• Inactivity will start eroding market share – doing nothing for two years, research shows, has a massively detrimental effect
• As markets improve and the advertising market becomes more active, the re-entry cost becomes higher as demand is greater
• The share of voice of the advertisers who are active within relevant media will be greatly enhanced.
• One can buy market share at reduced spend levels
• A feel-good factor is created; this can only enhance brand recognition and a greater propensity to buy
Even with the gradual decrease of readership of the national press - albeit last month both the Mail on Sunday and Daily Mail recorded circulation increases - there is also still demand for separate, personal finance supplements.
Within the quality and mid-market press and, even with the fall in circulations of the more established PF monthlies (What Investment, Moneywise and Money Observer), some – like MoneyWeek – are bucking this trend for the hobbyists out there.
The key point though is that advertising works if done well, regardless of concerns about the global or domestic economy. A good example of this is from FE/Trustnet. They have identified a significant upturn in factsheet downloads by investment management companies who have run product specific advertising campaigns. This shows the speed at which intermediaries have reacted to adverting aimed at them.
Mike Richards, founder of Capital City Media