T. Rowe Price went from spending $9.12 million on advertising in the second quarter to only $4.58 million, or 50% less, in the third quarter. Other big cuts came at State Street Corp., which spent $2.62 million on advertising in the second quarter, but a mere $359,000, or fully 86% less, in the third quarter. Bank of Americas budget declined 52% from $1.87 million in the second quarter to $891,000 in the third quarter. And, finally, Januss budget declined 53% from $1.12 million to $529,000.
The biggest spender in the third quarter was Franklin Resources, at $9.5 million, down only slightly from $10.1 million in the previous quarter. The only two major companies to increase their advertising, albeit slightly, were Massachusetts Mutual Life Insurance, which spent $2.99 million in the third quarter, up from $2.43 million in the second quarter, and Vanguard, which spent $3.81 million, up from $1.61 million.
Advertising is always the first cut because its a bloodless cut, David Swanson, managing principal at consultancy SwanDog Strategic Marketing told Fund Action. However, given the economic crisis, firms are likely to continue cutting their advertising spending throughout 2009, he predicted.
According to a survey Swansons firm conducted, two-thirds of firms plan to trim those cuts at between 10% and 20%, and only a third foresee them topping 20%.