Today, banking services look very similar to each other. While comparing various products, a customer has often no idea which one is the best for him and he does not even know how they differ from each other. In order to understand the difference between them, it requires a thorough analysis, for which a potential buyer does not have enough time. In most cases, the choice of customers is based on irrational considerations.
By observing recent advertisements in banking sector, I came to conclusion that most of them are becoming less informative and more focused on creating a positive image of the bank and its product. This creates an impression that the product or service is essential to the customer and its possession or use of service means that the buyer belongs to a group of “the wise” or “better ones” who are “well chosen”.
Further observations has shown that it is becoming increasingly popular to use celebrities in advertisements of well-known banks, as public has sympathy, respect and trust towards those people. These advertisements include actors, successful athletes and popular personalities from the media world. The common feature of these various industry representatives is their universal recognition.
Therefore, the subject of this work is to look at how banks are creating a positive image though their advertising campaigns by using celebrities. The goal of my work is to present the role of the brand, the essence of advertising, as well as to demonstrate the specific marketing activities with the use of recognition of famous people. The first part provides information on the purpose of advertising, its functions and types. The second part shows how branding is done with the help of famous people in Russia. Lastly, I will conclude the research by evaluating advertising activities in banking sector and their effectiveness.
Advertising is usually presented as a message that aims to increase demand and thus sales of a certain product. However, this definition is incomplete and should be supplemented by two important elements. The first one concerns the creation of advertising in order to reduce demand. An example could be an anti-smoking or anti-alcohol campaign. The second element is to present advertising as a combination of information and persuasion, prompting the customer to buy the product with better selectiveness.
Since advertising is a broad concept, it is understood in many ways. Philip Kotler says that advertising is a measure of information and propaganda, designed to increase the level of knowledge of brand, product and company of its customers or potential customers. However, Belch & Belch write that advertising is any form of communication about a product, organisation, ideas or services originating from a distinct source, facing the environment.
The most common purpose of advertising is to create customer awareness of the existence of a company, product or brand. The customer should spontaneously recall the advertised name, and at the same time be encouraged to re-purchase. Another objective is to maintain positive beliefs about the image and to create the best possible relationship with the client. These objectives could not be achieved only by using advertisements, as an integrated marketing plan is required for those purposes.
Another function is related to the issuing of competitive messages in response to competitors’ advertising messages. The main objective is to increase the attractiveness of their products. Another way is to weaken the position of the competition by presenting their products from a weaker side.
There are also two major function of advertisements. Consumer advertising – targeted at specific customers. A significant number of advertisements on television, radio or newspaper is consumer-based. A characteristic feature of these ads is that it is financed by the manufacturer or dealer who sells the product. Advertising to the companies – also known as industrial, commercial and so-called business advertising. The vast majority of advertisements related to consumer is located in all types of media. Business advertising presents in specialised publications or professional journals.
The objectives and functions of advertising divide them into two more elements: Advertisement is designed in order to stimulate demand for the product, such as American cigarettes, fruit from Morocco, Polish chocolate. It is used in one of two situations. The first is part is when a product is getting launched. It is called pioneer advertising. The creation of such advertising is associated with the implementation of the following three objectives:
1) To introducing a new product to market. 2) To affect selected markets, simplification of the contractors carrying out the tasks. 3) To inform the pioneer. The second element is connected to advertising to maintain the demand. Such advertising is used throughout the product life cycle and seeks to maintain or stimulate demand.
It is also important to mention, that the selective demand advertising is different from the main demand advertising which is designed to stimulate demand for individual brands. It is a competitive advertising that appears in the second product life cycle, when there are already competitive products on the market. The company is trying to gain an advantage through the promotion, so that customers remember those product. This is usually done by highlighting the advantages and unique advantages of the product over a competitor. Another form of selective demand advertising is comparative advertising.
Creating brand by using the image of famous people
A company that wants to effectively advertise its brand, should not reserve funds for advertising campaigns. Power of the media is unbelievably huge these days. Media is considered as a “fourth power” in terms of influence on public. Regarding the banking sector in Russia, it is becoming increasingly popular to use images of famous people in advertisements. It comes to media operations, whose primary objective is to create the brand advertising, where the actor or another person from the world of politics, business, etc. represents the business and associated with the product. Mechanics of this advertising method is simple: “This famous person uses the services of the bank N. So it’s a good bank and you can trust it.”
This advertising method has several advantages: 1) The fame of celebrity and his character is applied to the brand. 2) If a customer feels confident towards the celebrity, this confidence will be applied to a brand. Increased brand loyalty among fans of celebrities. 3) The client is more prepared to use products and services and has positive attitude towards the brand reduces attention to the price.
An example of a effective application of such a strategy is the brand image advertising campaign of VTB 24, which began back in 2008. The campaign was built on attracting celebrities to advertise the bank as a reliable, stable institution that can be trusted. Those celebrities where: a coach Tatiana Tarasova, actresses Ingeborg Dapkunayte and CHulpan Hamatova, composer Igor Sharp, etc. “Shall I call a few celebrities – this is the safest option, because you can work on different audiences at the same time” – believes the managing director of BBDO Branding Olga Konovalova. However, some experts pointed out that a participation of an actor Konstantin Khabenksy was not entirely successful the campaign . Usually his characters have unpredictable personality: they do not represent the stability that people are willing to see in the bank.
Overall, Young & Rubicam advertising agency believes that this strategy seems to be justified. This campaign helped to create an image of VTB 24 as one of the most stable and popular among celebrities banks. Moreover, the brand recognition of this bank increased from 34 to 45%.
But not all advertising campaigns became successful. “At the first glance I thought I was imagining things” – that was the reaction of most passers-by when they first saw the billboards of the bank “Trust” with an image of Bruce Willis. For the first time on the territory of the former Soviet Union such a global megastar was participating in the Russian advertising campaign. Vice-President of “Trust” Communications Dmitry Chukseev binds him choice of Bruce Willis with the results of studies that have shown that he is an absolute leader in the aggregate index of perception of the target audience.
The use of celebrities in advertising has serious drawbacks, such as: 1) The risk choosing a wrong celebrity. “Money down the drain” if a celebrity is not popular among target consumers. 2) The risk of damaging the brand image in the case of a celebrity scandal. The risk of damaging the brand image in the case if celebrity is advertising some other brands.
According to sociological research, advertising by using celebrities will be less in demand over time. In 2010, the American edition of Ad Age found that the modern public wants to get as much information in advertising as possible and it is this, rather than the popularity of the characters which is taken into account when banks are thinking of the next marketing move. A study of Ace Metrix found that advertising of financial services with celebrities does not generate high consumer confidence, besides celebrities distract the consumers’ attention on a product.
Advertising is created to promote the product. It is designed to convince customers to accept the product and purchase it. A form of advertisement should represent advantages of products and services promoted and show the benefits of the product to the customers. Advertising should involve means and methods that will effectively allow the transfer of your content to consumer. Today, advertising has almost the status of art. The advertising message is often intended not only to promote the product, but also to shock the customer and cause him to experience the product emotionally. Effectively formulated advertising message not only encourages the recipient to purchase a product, but also allows to encode in his mind, which in tern affects consumer’s preferences.
The aim of this study was to show how the banks influence the decisions of customers through the use in advertising of the services of trusted and widely accepted celebrities. People pay attention to such features as sympathy and trust in the “star”. This confirms that the bank’s branding through advertising campaigns by using images of famous people has a positive affect on the overall brand awareness.
Nowadays, due to the continuous changes in the market, the importance of quality and quantity of information is significantly increased. Information overload makes today’s buyer is no longer in a position to observe and analyse the changes. A more developed market, more products and forms of distribution, increased competition between companies means that the role of information significantly increases. Celebrities are no longer needed to raise confidence in the banks. Therefore, banking sector needs to change the trend in the commonly used types of advertisements, which will be characterised by greater efficiency than those involving identifiable persons. Therefore, creating brand by using the image of famous people is no longer perspective. However, this is still a matter of debate.