“People have been sitting on their money, putting it into the safest vehicles such as fixed-time deposits and property,” says Sangram Sengupta, chief client officer, Y&R Singapore.
The infamy of September 2008 is not forgotten. Foreign banks, which precipitated the financial crisis, have suffered a great loss of prestige. In Singapore, the top two foreign brands were HSBC and Citibank, the latter recently applying for structured bankruptcy. Together, they comprised the city’s top five bank brands, along with locals DBS, OCBC and United Overseas Bank (UOB).
“OCBC was relatively unscathed,” says Y&R’s Sengupta, whose agency handles the bank. Interestingly, OCBC is the only of the top eight banks to have increased its adspend this year. Between January and August, OCBC spent S$13 million (US$9.3 million), a year-on-year increase of 44 per cent, according to Nielsen.
HSBC and Citibank, in contrast, have cut back drastically, both slashing S$4 million from their adspend. UOB and DBS followed suit, with reductions of a similar scale. For the rest of the top eight, however, spending was flat.
Total financial services adspend this year, based on the S$63 million spent up to August, could reach S$94 million, a drastic decline from the S$152 million spent in 2008. Of last year’s adspend, 45 per cent was for banking/finance, 36 per cent
for credit/charge/debit cards, nine per cent for insurance and 10 per cent for investments/funds.
The September 2008 financial crisis has caused a shift in spend by category. Sengupta says the drop is most pronounced for “wealth-based investment products”. Nielsen’s data supports this view, showing share of spend for investment/fund advertising dropping from 16 per cent in 2007 to seven per cent this year, while that of ‘generic’ banking shot upwards from 38 per cent to 46 per cent.
“Product-based” advertising dominates in Singapore, says Sengupta, while pure “brand communication” is limited. His client’s slogan, ‘Ask OCBC’ - a tag that appears at the end of print executions - has been in use for four years. Foreign giants HSBC and Citibank persist with global creative, but typically their ads, as do those of DBS and UOB, push product offers and brand them with a simple logo.
For all, print is the most used medium, due to the need for text to explain product details, and print’s share of newspaper adspend hovers around 50 per cent. However, HSBC has been looking at different media, recently securing an exclusive deal to advertise on Changi Airport’s aerobridges.
Post-crisis, Asian banks are considered safer than Western banks. Even so, the traditional perception of foreign banks as ‘premium’ and local banks as ‘convenient’ still exists, according to Prasad Shinde, research director at Synovate Singapore. Driving the perception of convenience is the ATM count of each bank. Years ago, all local banks shared a single ATM network. Then DBS bought BOSP, gaining a horde of ATMs, and the newly merged banking cousins pulled out of the system.
“It was a clever move,” says Shinde, as DBS has a decisive advantage in ATM locations. In theory, bank customers can use their bankcards in any ATM machine, though are charged a small fee for the service. “But you won’t see a DBS cardholder standing in line at the ATM of another bank.”
ATM count has long been a “stumbling block” for foreign banks, says Shinde. Citibank remedied this by negotiating a deal that allowed it to operate ATMs in the island’s metro stations.
Shinde foresees a return to normalcy for Singapore’s banks and their customers. “The people here are optimistic,” he says, “and they believe that when problems occur, the Government will solve them.”
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This article was originally published in 19 November 2009 issue of Media.