In a report by Nairametrics, Nigeria’s tier-1 banks spent a combined total of about N44 billion on advertising and sales promotions in the year 2019. These banks include Guaranty Trust Bank Plc., Zenith Bank Plc., First Bank of Nigeria Ltd, United Bank for Africa Plc, and Access Bank Plc.
Giving a break down of the advertising costs, First Bank incurred the most out of all the banks last year. A total of about N18.4 billion was used for advertisement which is significantly higher than the N7.8 billion that was recorded in 2018. The huge advertising expenditure is linked to the company’s celebration of its 125th year anniversary which required enough money for publicity and event planning.
Zenith Bank which is a highly-profitable bank spent the second-highest on advertising and marketing communications. A total of about N7.9 billion was used in 2019 which grew the bank’s revenue and profits for that year. As the third-highest spender on advertising and marketing, the United Bank for Africa popularly known as UBA spent a total of about N7.4 billion.
Coming in Fourth place, advertising and marketing cost Access Bank N6.3 billion in 2019 which is more than the N4.9 billion the company spent in 2018. Spending the least on advertising in 2019, Guaranty Trust Bank spent about N4 billion was spent on advertising and sales promotion. According to its Chief Executive Officer, Segun Agbaje, GTBank’s low advert cost is part of the company’s overall cost control strategy.
Advertising, social media engagements and Public Relations are some of the most powerful tools utilized in the business world to communicate brands’ benefits and create awareness about new or existing products. The commitment to advertising more often than not translates to companies’ profits. According to Ron Shevlin “the ability of advertising to create awareness and influence consideration” is different for each bank that is why they all take different methods to publicize their products. Shevlin reiterated that there is a connection between return on the advertisement which translates to more deposit and loan growths for banks.
Operating in a saturated market where competition is rife, most Nigerian banks turn to advertisements in order to remain relevant as it holds the key to attract a large reach of potential customers. Advertising helps banks to stand out by profiling their individually tailored products and services to their target audience. Consequently, Advertising defines the whole essence of a bank’s marketing strategy which is to adequately communicate the benefits of their products and services to customers for consumption.
