The entrance of fintech firms into the financial markets has jolted the bigger conventional financial institutions in Nigeria. As a result, the biggest banks are investing more in advertisement amid rising competition from fintechs, as reported by Legit.ng. The activities of some of the fintech firms such as KudaPay, PalmPay, MoneiPoint, Opay, among others has created competition for customers of the bigger banks.
In the first nine months of 2023, according to available data, Nigerian tier-1 banks have spent over ₦56.86 billion on advertising and branding. This amounts to an increase of 55% year-on-year, compared to ₦36.67 billion in the corresponding period of 2022.
The large expenses are meant for creating awareness for their products and brands, essentially targeting potential customers.
Five banks surveyed are,FBN Holdings,United Bank for Africa,Guaranty Trust Holding Company,Access Bank and Zenith Bank.
FBN Holdings,in the first nine months of 2023,spent about ₦20.23 billion,far above ₦7.59 billion in the same period of 2022.
United Bank for Africa (UBA) increased her advertising, promotions and branding expenses to ₦11.61 billion in the first nine months of 2023, while it was ₦10.44 billion in the same period of 2022.
Guaranty Trust Holding Company(GTCO),for adverts,promotions and corporate gifts during the first nine months of 2023,increased her expenses to ₦5.38 billion from ₦4.4 billion in the same period of 2022.
Access Holdings, the parent company of Access Bank expenses on advertisement and marketing rose to ₦12.06 billion in the first nine months of 2023, an increase from ₦8.08 billion in the same period of 2022.
Zenith Bank also has not spared a dime in advertisement expenses. For the first nine months of 2023, about ₦7.57 billion have been spent compared to ₦6.16 billion in the same period of 2022.
One thing that is very clear and deducible from the above scenario, is that those bigger financial institutions are not sparing any effort towards creating brand visibility and positioning their products, amidst the rising competition for potential customers and maintenance of existing ones.