Financial Services Advertising budget dropped

The ongoing downturn has forced firms to cut back on advertising expenses. The banking, financial services and insurance segment (BFSI) has cut advertising budgets by nearly 40 per cent.

An analysis of AdEx data, a comparison of the volume growth over the June-October period in 2007 with the corresponding period in 2008 , shows that bank advertising on TV decreased by 3 per cent, advertising for loans went down by 39 per cent and mutual fund advertising was down 84 per cent.

However, insurance grew by 74 per cent. So the decrease in advertising spend from the financial sector is countered to an extent by the insurance advertising increase to some extent.
BFSI sector contributes 5 per cent to the total advertising on TV. This financial year the estimated contribution is 350 crore.
Insurance has seen a drop in sales from 70-80 per cent to 30-40 per cent in the last quarter, but it hasn’t deterred companies’ spend on advertising. Debashis Sarkar, senior director and CMO, Max New York Life, says: “Insurance is a need rather than investment. Who can do without financial planning? In a downturn, while advertising is the first thing to bear the brunt, I believe otherwise. Brand building is a strategic investment.” Max’s advertising budget for this year is around Rs 60 crore.
Insurance sector advertising is growing for a host of reasons. Three new players entered have the sector this year: AEGON Religare, Sahara India Life Insurance and Canara HSBC Oriental Bank of Commerce Life Insurance.
Chandradeep Mitra, president and head, Mudra MAX (media buying arm), Mudra, says: “Earlier insurance companies used to advertise in the tax saving period of January to March. Now the ads run throughout the year. Companies have also added a slew of new products.”
Sarkar adds: “Tax-saving period does not need advertising, it just requires a more aggressive sales force. Advertising is done to attract people ltowards real saving from a long term perspective.”
Max alone contributed half of the total insurance advertising on TV, which is a very unusual spend from an insurance company. Max was the exclusive telecast sponsor of the IPL.
Sujit Ganguly, senior vice-president and head-marketing, ICICI Prudential, says: “For us the trend is not new. We have always been communicating that insurance is not a tax saving tool, it’s a long-term saving goal. On the back of strong advertising, we have reached a market share of 13.5 per cent from the last year’s 12.7 per cent. Our advertising budget is intact this year.”

SBI to launch new services from its Dubai center

State Bank of India (SBI) is set to expand its footprint in the Gulf, with an offer of brand new services for its clients in the United Arab Emirates (UAE). Armed with a Category 1 licence from the Dubai Financial Services Authority (DFCA), SBI will now be in a position to accept deposits, provide credit, arrange credit for investments, and offer advice on financial products. The bank will launch its new operations from its branch at the Dubai International Financial Centre (DIFC), a rapidly growing global hub for banking, capital markets, insurance, asset management and other financial services.

“Our services are open to all nationals as we are determined to acquire a more prominent niche as a global player in international banking circles,” said A. J. Vidyasagar, Chief Executive Officer of SBI’s branch at DIFC. He added that SBI, ranked fifty seventh globally, already had a natural advantage of servicing Indian clients involved with trading activity or investments in the Gulf.

Mr. Vidyasagar pointed out that the branch would provide working capital as well as trade finance, both fund based and non-fund based, term loans and project financing.

Finance minister constitutes a group to assess liquidity requirements

The Finance Minister, P Chidambram on receiving a large number of representations from banks, other financial entities/intermediaries, corporates and small businesses has expressed that the issue of liquidity must be addressed in a comprehensive manner. These institutions have constantly pressing that intermediation of credit must take place smoothly and efficiently.

The Finance Minster has therefore decided to constitute a group to make a quick assessment of the requirements of liquidity and advise the Government. The group will be headed by Shri Arun Ramanathan, Finance Secretary and Secretary (Financial Services). It will consist of:

(i) Representative of RBI

(ii) Shri T.S. Narayanaswamy, Chairman, IBA & CMD, Bank of India

(iii) Shri U.K. Sinha, CMD, UTI

(iv) Shri Y. M. Deosthalee, CFO, L&T & Director-in-charge, L&T Finance Limited

(v) Shri R.M. Malla, CMD, SIDBI

The group has been authorized to co-opt any more members, if necessary.

The group has been requested to begin work immediately, also visit Mumbai, and submit an interim report within a week.

Respond Acquires Wiseradvisor, Strengthens Financial Planning Market Presence

Respond (www.respond.com), the leading online lead referral service that connects purchase-ready buyers with local sellers in real time, today announced that it has acquired WiserAdvisor.

WiserAdvisor, established in 2003, is the pioneer in offering an unbiased, objective and sophisticated matching service for potential investors searching for financial advisors who best fit their unique needs.

Acquiring WiserAdvisor will strengthen Respond’s presence in the financial space, which has been Respond’s fastest-growing sector. The acquisition enables Respond to provide its high-quality and real time investor leads to qualified financial advisors. This complements Respond’s current relationships with most existing firms in the financial planning leads market such as Paladin Registry, a registry of five star financial advisors who are acknowledged fiduciaries.

“This business consolidation helps Respond’s ability to serve financial planners and positions Respond and Paladin Registry as the leading providers of financial planning leads in this marketplace,” said Jack Waymire, Founder and CEO of Paladin Registry and author of Who’s Watching Your Money.

“Financial planning presents tremendous opportunity for lead generation service providers, such as Respond, and this acquisition further strengthens our presence in this space,” stated Atul Jain, Chairman and CEO of TEOCO, the parent company of Respond. “This acquisition and Respond’s track record of providing verified and qualified referrals enable us to provide significant value to our clients,” exclaimed Jitin Ahuja, Director of Respond.com.

“Respond combines superior technology with deep knowledge of the lead generation industry to offer a world-class service,” said Thomas Murcko, founder and CEO of WebFinance Inc. “This acquisition will accelerate their progress toward becoming the clear leader in online lead generation.”

Since 1998, Respond has been helping consumers find qualified service providers in over 300 categories such as wedding photographers, home contractors, accountants and numerous other professions. Today, Respond has narrowed its strategic focus to several, select industries – including financial services – to ensure they provide quality, verified leads to service providers and establish a strong reputation and market presence in their chosen markets.

ABOUT RESPOND

Respond is the leading online lead referral service that connects purchase-ready buyers with local sellers. Since 1999, over three million consumers have used Respond to find everything from banquet facilities to business loans. Today, Respond covers over a hundred types of services and delivers quality leads to entrepreneurial small businesses. Respond has been a line of business of TEOCO Corporation since 2002.

TEOCO is widely recognized for its commitment to Principled Entrepreneurship with a particular emphasis on alignment of its core values with employees, clients and the community. See more at www.teoco.com.

ABOUT WEBFINANCE

Founded in 1996, WebFinance Inc. is a financial Internet company which designs, builds, and nurtures business opportunities where technology and finance intersect. WebFinance Inc. is the parent company of a thriving family of financial websites whose goal is to help empower individuals to make better financial decisions. Our properties include InvestorGuide.com, InvestorWords.com, and BusinessDictionary.com.