No surprise: majority of those who upped spending grew sales in 2009
Industry group also critical of members who treat ad spending as a commodity expense

Separate studies indicate that 70% of those that spent more on marketing last year increased sales, and those who treated marketing as a commodity expense performed a disservice for employers.

The Leading National Advertisers (LNA) survey was compiled by Advertising Age, while the second study was carried out by the Association of National Advertisers (ANA), representing 400 companies that collectively spend more than $100 billion in marketing communications and advertising.

“Among the Top 100 advertisers, one in four spent more, betting on opportunity in the Great Recession. While there is no easy way to prove cause and effect, the sales gains at spending boosters should help reinforce the idea that advertising delivers. The stats surely will give ammunition to those struggling to prove advertising’s return on investment to CEOs, CFOs and procurement departments,” Advertising Age reported.

Curiously, ANA’s study found 84% of procurement executives among their ranks believe advertising is merely an expense to be cut. More interesting, only 49% of procurement’s marketing co-workers believe their peers are knowledgeable about marketing, and only 54% believe they are communicating honestly with (advertising) agency partners.

“It’s a surprise and, quite frankly, it’s a little disappointing because we haven’t made much progress,” said ANA’s Bill Duggan. 

JPMorgan Chase gives away more, wins more business

Yet another study by J.D. Power & Associates, as reported by American Banker magazine, found that JPMorgan Chase bucked a trend in the banking sector by giving away more gifts and cash incentives and grew a “disproportionate chunk of business.”
 
“Among more than 3,000 bank customers who had recently opened new accounts, 41% of those who opted for Chase did so primarily as the result of a ‘promotional gift/cash award,’ a rate that was more than triple that of Bank of America Corp. and five times greater than that of Wells Fargo & Co. and Citigroup Inc.,” American Banker reported.

Similarly, Chase increased advertising spending 12%, while Citigroup cut 54%, and Bank of America cut 5% during the same period.

ANA recommends advertisers adopt several best practices. Among them:

• Share goals with advertising agencies

• Determine whether “value” means maximum savings or maximum growth, and share the definition with vendors

• Realize ideas are not commodities and the difference between a superior idea and a common idea will have an impact on business results

• Send procurement officials to meetings with agency partners to better understand what agencies contribute

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