11 of Nigeria’s largest banks spent a total of N37.4 billion on adverts and marketing promotions in the first 9 months of 2020. The Ad spend for the banks fell short of the N43.2 billion recorded over the same period in 2019, according to data compiled by MoneyCentral.
While for some of the banks, cuts on ad spend and marketing promotions served as a means to reduce cost, others boosted their ad spend as they used the marketing materials to pass caution, safety and solidarity messages to customers who had to deal with a once in a lifetime health pandemic.
The 11 banks who spent an accumulated N37.4 billion in 9M 2020 include Access (N6.77b), UBA (N6.1b), Zenith (N6.01b), FBNH (N5.13b), GTBank (N4.26b), Fidelity (N2.18b), FCMB (N2.14b), Sterling (N1.39b), Stanbic (N1.34b), Wema (N1.17b), Union (N0.86b).
Tier 1 banks had spent an accumulated N28.37 billion as at Q3 2020, representing a 10 percent decline from the N31.44 billion they recorded during the same period last year.
All the decline among tier 1 banks came from FBNH who shrunk their marketing budget by as much as 56 percent from N11.8 billion as at Q3 2019 to N5.13 billion as at Q3 2020. All four other tier 1 banks which include
Access, UBA, Zenith and GTBank increased their marketing budget by around N3.58 billion with GTBank recording the biggest growth in marketing budget as it increased by as much as 50 percent year on year.
While Tier 1 banks were expanding their marketing budget, Tier 2 banks were shrinking theirs. Among the Tier 2 banks, all but Wema reduced their spending on adverts and marketing promotions so far this year. The biggest drop among the Tier 2 banks was recorded by Sterling who shed 45 percent off their marketing budget year on year. Others include FCMB (-27%), Stanbic (-27%), Fidelity (-18%), Union (-15%). Wema expanded their marketing budget by as much as 52 percent year on year.
All 6 Tier 2 banks recorded an accumulated spending of around N9.1 billion as at Q3 2020, less than the combined spending of GTBank and First Bank who had the smallest marketing budget of the tier 1 banks.
The accumulated spending of the 2 banks was N9.4 billion as at Q3 2020. As at the same time last year, the Tier 2 banks had spent only about N11.79 billion, thus representing a decline of around 23 percent as the banks sought to drive cost efficiency during a difficult financial year by cutting marketing expenses.
While the banks may have achieved their strategic objectives this year on their marketing and communication plans, the Ad market will certainly have felt the painful pinch of financial recession this year as the 11 banks as a whole saw their marketing budget shrink by N5.76 billion in the first 9 months of 2020.