Charles Schwab is looking for a new advertising partner, issuing a request for information from ad agencies. This is the first time that the San Francisco-based discount brokerage has conducted a formal review since 2009.
AdWeek reported that The Charles Schwab Corporation (SCHW) periodically evaluates its advertising agency portfolio and is doing so now with the request for information. "This due diligence helps ensure we are making the most effective use of our firm's marketing investment. As part of this process, we are currently inviting media firms to share with us their capabilities through their response to an RFI," a Schwab spokesperson told Adweek, noting that the brokerage has a lot of opportunities ahead and is looking forward to working with its agency partners to tackle them. The report noted that the agencies invited to pitch to Schwab include incumbent Universal McCann. While Schwab is leading the review process, it has tapped an unnamed third party to conduct the review.
[Ally Invest offers powerful charting tools and $4.95 trades. Read Investopedia's Ally Invest review to learn more about this low-cost broker.]
"We have a very productive and strong relationship with Universal McCann – and they have set a high bar as our media partner. We expect to hear from them as well as other firms who may have an interest," said Schwab, according to AdWeek. The report noted that Schwab has kept its advertising spend around $100 million, spending $127 million in 2016 and $106 million in 2017. The company is expected to spend around $100 million again this year, noted the report.
The advertising agency review comes at a time when DIY, low-cost investing is growing in popularity, even with the malaise in the stock market in recent weeks. With fintech competition growing and all of the discount brokerages slashing costs and melding hand-holding with DIY investing, using ads to stand out is imperative. Rivals E*TRADE and TD Ameritrade have launched new advertisements in recent months, and Ally Financial Inc. (ALLY), the parent of Ally Invest, is looking to launch a new campaign this year.
In mid-March, Crain's Detroit Business reported that, after using global advertising firm Grey for the creative side for more than six years and Spark Foundry as its public relations firm for around a decade, Ally has sent out requests for proposals to other ad agencies and PR firm and is paying the agencies that are pitching for the business, which includes the two incumbents. Ally has focused its marketing in the past on its business-to-business products. But last year, the company got into the mortgage, credit card and online investing segments of financial services, and Ally wants to get the word out about those products as well.
Meanwhile, TD Ameritrade Holding Corporation (AMTD) tapped Lionel Richie earlier this year to promote its 24-hour trading services, while E*TRADE Financial Corporation (ETFC) used a Super Bowl spot to depict seniors working well past retirement, urging consumers to save for their golden years via the E*TRADE platform.