Funds' Advertising Message Shifted in 2001
January 7, 2002
In 2001, mutual fund ad campaigns looked very different than they have in recent years. In 1999 and 2000, bragging about performance was in. Last year, since most funds had horrible one-year performance, firms ditched the performance advertising and instead spread messages of the importance of a long-term, disciplined investment approach.
Advertising as a whole dropped in 2001, but equity fund advertising was especially low. Spending in that category was $62.9 million in the first half of 2001, down 17% from that of 2000, and those numbers have likely dropped further in the second half of 2001, according to Competitrak, a New York-based firm that tracks advertising spending.
One of the ad campaigns that stood out in 2001 was that of AIM Funds, winner of our 2002 MFMN Best Ad Campaign Award. Many growth-oriented fund companies played up their high returns in advertisements in 1999 and 2000 and then switched to promoting sound investing principles in 2001. However AIM, a growth-oriented shop, launched a disciplined investing campaign at the end of 1999 and was able to expand it in 2001 when other firms were scrambling to create one.
The television ads feature well-known athletes and portray the advantages of discipline over the long term in all walks of life. The original ads featured bicyclist Lance Armstrong and U.S. soccer player Mia Hamm. In the beginning of 2001, AIM added Michelle Kwan and Justin Leonard to the campaign and extended the athlete contracts into 2002.
"Discipline is a very positive concept and we wanted to bring in a fresh campaign that portrayed that, but we did some research and we realized that discipline meant something unique to each individual," said Marylyn Miller, senior VP and director of marketing, who's in charge of the firm's advertising.
While it's difficult to assess the effectiveness of television advertising, the ads have garnered a lot of attention and positive responses, which is why AIM expanded the campaign in 2001 and extended it into 2002, Miller said. The commercials have run nationally on CBS, ABC, FOX, CNN, CNBC and the Golf Channel. The firm would not disclose the cost of the campaign.
Another ad campaign of note in 2001 was that of The Hartford Financial Services Group. Like AIM's, the Hartford's two commercials, which began running in December 2000, emphasized the need for a long-term approach to investing and promote the firm's mutual fund and estate planning products. In the commercials, a man, who talks about his disdain for long-term investing, is set on fire and jumps off a 20-story building. It is then revealed that he is a stuntman, who lives dangerously in terms of his job and his investing.
The campaign, developed in conjunction with the Hartford's advertising firm Arnold Communications, cost $20 million, according to Cynthia Michener, a spokesperson for the company. The ads aired during "60 Minutes," "60 Minutes II," network college football games, golf tournaments, and on CNN and CNBC.
SunAmerica launched an ad campaign in June 2001, during the NBA Championships on NBC to promote its retirement plans. The ads feature Colin Mochrie, an actor and comedian from the television show, "Whose Line Is It Anyway?" Mochrie plays a character named "Retirement", who portrays typical retirement plans to demonstrate how many do not work for their participants or are neglected by them and are unsafe.
For example, in the ad titled "Working," Retirement is seen playing doubles tennis with the plan participant. When the ball is hit to Retirement, he doesn't move, but just lets it pass by. A narrator asks, "How hard is your retirement plan working for you?"
The ads, created by Los Angeles-based ad firm Deutsch, targets investors between the ages of 45 and 65 and financial advisors, according to the firm. In addition to the 2001 NBA Finals, the commercials aired during the French Open, the Belmont Stakes, the U.S. Open golf tournament, and Wimbledon. They also aired on national cable networks including CNN, CNBC, A&E, AMC. SunAmerica would not disclose the cost of the campaign.
The campaign was based on the results of a survey that the firm commissioned to gage the sentiment of baby boomers on their retirement plans, according to Sonia Fiorenza, a spokeswoman for the firm.