A new report from Kantar Media in association with IAB Canada has provided a comprehensive picture of the online advertising activity of Canada’s leading financial institutions.
The report, “Financial services: Canada IAB report,” shows that Canadian financial services companies spent $151.2 million on digital advertising in 2012, an increase of 18.6% from the previous year.
TD Bank led all companies with a $19.2 million investment in digital advertising, a 34% increase from the previous year. Capital One ($18.9 million, a 24.4% increase) and American Express ($13.5 million, a 21.3% decline) were ranked second and third respectively in total digital ad spend.
While Bank of Montreal was fourth in overall spend, it increased its investment in digital advertising by 80.7% to $11.7 million. Another firm, Experian Group, increased its digital investment by an industry-leading 98.7%.
Market conditions also produced notable shifts in marketing strategies for the financial services sector, with significant increases in advertising for the lending, insurance and credit card portions of the business – which grew 121.8%, 81.6% and 45.1% respectively – compared to a modest 5.7% increase in advertising promoting consumer banking.
The report notes a variety of marketing tactics within the consumer banking segment, from providing consumers with direct incentives to switch, such as cash and gift certificates, to emphasizing product differences and focusing on service quality.
An example of this strategy is TD Canada Trust’s “Reason to switch” campaign, which used cash incentives and touted better service through extended branch hours and quality customer service.
Canada’s largest bank, RBC, showcased its diverse product offerings with consistent messaging. Ads touting student loans, interest rates and VIP banking, for example, all used the same typography, background and the company’s Arbie mascot.
The report noted that Scotiabank “puts itself outside the competitive fray” with marketing promoting its charitable outreach through initiatives like the “Richness Project.”
The report also noted a decline in digital ads promoting online/mobile banking, which it attributed to its increased prevalence among Canadian consumers (a 2012 study by the Canadian Bankers Association found that 67% of adults now use online banking).
Online/mobile banking comprised 3% of digital ad spending on banking services last year, most of which came from TD Bank, the National Bank of Canada and Bank of Montreal.
Credit card advertising, meanwhile, surpassed consumer banking as the biggest digital marketing segment within the financial services industry in 2012, growing 45.1% to $41.5 million.
The report notes that the category is characterized by slow growth rates for cards in circulation and sales volume, competition among card issuers for high-value customers, and a wide variety of card products – all creating a need to differentiate through marketing.
American Express was the leading credit card advertiser in 2012, investing $13.05 million (a 19.6% decline from the previous year). The category also saw significant variations in the amount of marketing investment, with the Bank Of Montreal increasing its investment by 1,615% to $2.1 million and Visa decreasing its investment by 13.6% to $1.9 million.
Credit card marketing tended to use tried-and-true approaches, with an emphasis on rewards programs, cash back, interest rates and rebuilding credit, the report noted.
Investment and retirement product advertising accounted for $31.4 million in spending in 2012, comprising 20.8% of the total financial services digital ad investment.
The segment also produced several noteworthy fluctuations in spending, with companies like Fidelity Canada and Bank of Montreal significantly ramping up their marketing investment – increases of 755.4% and 471.9% respectively – and other companies such as the Bank of Nova Scotia (-48.1%) and TD (-46.2%) reducing their spend.