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No Joke: How Money Talks Now

In wake of scandals and bear market, financial firms' spots get more serious 4/25/2004 08:00:00 PM Eastern

Once, not too long ago, financial-services companies' TV commercials were all about old men wearing green eyeshades and stiff tweed suits. They spoke with an air of lugubrious sobriety about making money "the old-fashioned way. We earn it."

That gave way to chimpanzees throwing darts at ticker symbols. But, since the dotcom bust and the market's downturn, financial-services marketers are speaking soberly again, but in softer, friendlier tones. Even the humorous ads have become a little more buttoned-up. Zaniness is out; gravitas and fellowship are in.

Companies that survived the boom—such as Ameritrade, E*Trade, and Harrisdirect— often went for laughs and have inspired their established rivals to loosen up a bit, while experiencing a kind of maturation themselves.

The investment scandals—Tyco, Martha Stewart, Salomon Smith Barney, Merrill Lynch, et al.—have brought up a lot of trust issues, says Rachel Barnard, a stock analyst at Morningstar, Chicago. And so several fund companies are starting to play that up in different ways.

In a campaign that broke in late March, Hill, Holiday spots for Boston's Putnam Investments feature different executives and bring up the subject of performance, albeit gingerly and by praising the virtues of long-term investing. Putnam was in the spotlight last October when the Securities and Exchange Commission charged it with so-called market-timing transactions, a procedure that can dilute long-term returns for investors. It paid $100 million to settle charges and lost 12% of its assets when disgruntled customers cashed in $31 billion.

Although Putnam ran print ads in March acknowledging it was changing, its new TV commercials don't even refer to the past problems.

"In separate spots, we show three executives who represent the face of responsibility and accountability," says Gordon Forrester, managing director and director of marketing for Putnam Investments. "And as opposed to the days of promoting instant high returns, we note that, if you'd invested $1,000 in 1937, it'd be worth $360,000 now. Right now, it's about focusing people on the long-term, not the short-term gain."

Barnard notes that "ads used to talk about performance and strong returns. This issue goes beyond numbers, though we're starting to see more numbers now versus last year as the stock market has come back around. But the trust issue will last for quite a while, at least until the economic rebound has been more entrenched."

Humor is still occasionally part of the advertising, Barnard and others observe. But, with memories of the bursting stock-market bubble still fresh, the wacky ads of the mid to late '90s have given way to a more sober message: You can take us seriously when you trust us with your investment money.

Menlo Park, Calif.-based E*Trade's example is a good case in point. Its most famous ad was its snarky 2000 Super Bowl spot, created by Omnicom's Goodby, Silverstein & Partners, San Francisco, showing a chimp and the text, "Well, we just wasted 2 million bucks. What are you going to do with your money?"

At the height of the boom, E*Trade was spending $140 million annually on advertising. The company's ad budget collapsed with the economy two years later. But, in an effort to capitalize on a stock-market upswing while using a more conservative, product-centered strategy, E*Trade has doubled its marketing budget from last year, putting $90 million into an ad and direct-marketing effort that broke earlier this year from Omnicom Group's Martin/Williams, Minneapolis.

"The times have changed, the company has evolved, and our messages have evolved with it," says an E*Trade representative, referring to one comical spot that shows a couple deciding to move as they watch unsavory neighbors arrive next door. A mortgage-transfer program offered by E*Trade allows them to leave easily. The campaign ends with the calmer tagline "Why on Earth wouldn't you?"

Ameritrade, E*Trade's Omaha, Neb.-based rival, plans to significantly boost its ad budget, spending $95 million to $140 million this year versus an estimated $90 million last year.

And Ameritrade is quick to note that it hasn't lost its sense of humor either. "We use humor to make the brand more approachable," says Director of Brand Management Tim Smith. "We wanted to break down barriers and have more of an eye-to-eye relationship with clients."

Part of Ameritrade's "Good idea. Bad idea" campaign via Ogilvy One, New York, leverages humor to focus on various benefits that wouldn't be applicable elsewhere. In the five-second guarantee spot, a maitre d' says, "If it doesn't arrive in five seconds, it's on us." Patrons are shocked when the lobster arrives alive and the steak is frozen. Ameritrade's tagline: "Five-second guarantee. Bad idea for dining. Good idea for online trading."

Says Peter Neiman, senior vice president of account management for Grey Worldwide, New York, "There was a saying a long time ago 'Money isn't funny.' But the E*Trade guys and the other online-trading companies blew that notion away and made investing seem like fun. And, in trying to find ways to differentiate themselves, old, established names like Morgan Stanley and others have begun to lighten up and get softer as well."

One established name showing its softer side is St. Louis's A.G. Edwards. In its first national marketing initiative in its 117-year history, the firm wanted to emphasize the quality of its client relationships. In one spot, created by Carmichael Lynch, Minneapolis, the client is seen handing his financial consultant the shirt off his back as a token of gratitude. In another, the client is so enamored of his adviser, he calls him late at night just to thank him. Both end with the tag "Fully invested in our clients."

Most marketing executives for financial-services firms try to avoid calling attention to the external events that have negatively impacted the securities industry over the past few years.

Several advertising execs and industry observers cite a campaign by San Francisco-based discount broker Charles Schwab & Co. and its ad agency GSD&M, Austin, Texas, last year. In the contentious spot, a manager at an unnamed brokerage exhorts his team to push a lame stock on customers. "Let's put some lipstick on this pig!" he declares, in words similar to those attributed to disgraced former Merrill Lynch Internet analyst Henry Blodgett.

The ads were roundly criticized, and CBS at one point refused to air it. Over the past few months, Schwab, which spends an estimated $70 million on advertising, had its agency target financial advisers rather than individual investors. The message has become softer, with current spots featuring the tag "Seeing the market from a different perspective: yours."

But as the market comes back, companies are testing the waters of focusing on performance, so long as it's couched in human terms while making sure the message isn't overheated, Grey's Neiman says.

"I think the stronger performance of the stock market over the past few months will have an affect on ad messages. It will and it should," he says. "I think you're going to see a greater spirit of optimism reflected in the ads later this year. There's going to be a renewed enthusiasm and performance become part of the dialogue."

November