Dianomi are experts in financial services advertising & marketing – since 2003 we have run thousands of campaigns for well known banks and financial services clients. Our clients include Goldman Sachs, J.P. Morgan, DBS, Citibank, PIMCO, ASX, Nomura, BlackRock, Charles Schwab, HSBC and abrdn.
Our finance ads are only seen by users already reading about business and money on 350 premium finance sites including WSJ, Reuters, CNN Business, MarketWatch, City AM and Sydney Morning Herald.
Dianomi’s Financial Services Marketing 2024 event in Sydney
Financial services advertising for marketers
How important is context for financial services advertising?
The context in which an advertisement for financial services advertisement is viewed is very important. Trust is an absolute necessity for users when dealing with financial services companies and, therefore, it is essential to appear alongside high quality content whilst avoiding low quality websites (especially MFAs) or environments where an advertisement for a trustworthy client may be viewed alongside fraud or low quality content. Some regulators may take into account the context of the advertisement and your distribution obligations (see below).
The “tsunami” of fraud is to be avoided
In recent years there has been a tsunami of digital fraud on social media and on poor quality sites. This has been widely documented but shows no sign of slowing down.
Victims speak out over ‘tsunami’ of fraud on Instagram, Facebook and WhatsApp (The Guardian)
Martin Lewis (Money Saving Expert) gives evidence to the UK parliament about fraud: “I am very disappointed at how many scam ads still happen on Facebook … the torrent of scams”
Audience
There are broadly three types of investors:
Retail – most investors are ‘retail’: non-professional investors who do not meet the criteria for wholesale. Popular products for retail investors include stocks & shares, ETFs, pensions, savings and property.
Wholesale – investors who meet criteria set by the regulator in their jurisdiction can have access to more investments, which may be more risky. In Australia these investors are referred to as “Sophisticated” (a gross income of AUD $250,000 or more per year in each of the previous two years, or net assets of at least AUD $2.5 million) and in Singapore as “Accredited” (Minimum income of SGS $300,000 in the last 12 months (or its equivalent in a foreign currency); or net personal assets exceeding SGD $2 million, of which the net value of the primary place of residence can only contribute up to SGD $1 million; or net financial assets exceeding SGD $1 million (or its equivalent in a foreign currency); or hold a joint account with an Accredited Investor, in respect of dealings through that joint account.)
Professional: Institutional – professional investors generally investing on behalf of others and Financial advisors – advising others where to invest.
To reach these three audiences you can use Dianomi’s premium finance and business sites including WSJ, MarketWatch, City AM, Market Index, Dollars & Sense, Reuters, CNN Business, BBC, South China Morning Post, Forbes and many others.
You can also combine our premium sites with Dianomi Cohorts which include Self-directed investors, Financial advisers, Institutional and professional investors, Traders, HNWI & Affluent and Commodities-interested users (full Cohorts list).
Type of product
Rules vary by type of financial product and by regulator / country. Some examples:
There are severe penalties in Australia for offering inducements to sign up to CFD trading (ASIC – CFD product intervention order takes effect) whereas in the UK CFDs on crypto assets cannot be marketed by anyone “acting in, or from, the UK” (FCA bans the sale of crypto-derivatives to retail consumers).
In Singapore (MAS), crypto services cannot be marketed to the public: “Digital Payment Token (“DPT”) service providers should not promote their DPT services to the general public in Singapore” – MAS Guidelines on Provision of Digital Payment Token Services to the Public [PS-G02]
Compliance
Compliance with applicable law is essential for financial services advertising.
Guaranteed returns, over-optimistic advertising or incorrectly targeted advertising can attract substantial fines or prison terms.
Understanding local markets is also essential – what is perfectly legal in Singapore may be illegal in Australia or vice versa and what is legal in Australia may not be legal in the UK or vice versa.
Regulation
Regulators will require advertisers offering most financial services to be licensed if operating from their jurisdiction or offering services to potential clients in their jurisdiction.
For example: Any financial services advertiser targeting Australia will generally need an Australian Financial Services Licence (AFSL) from ASIC.
Any financial services advertiser targeting Singapore will generally need to be licensed by the Monetary Authority of Singapore (MAS).
Penalties for unlicensed provision of financial services or breaching the terms of a licence can be very severe, including fines and prison sentences.
Updates from regulators
Regulators often publish updates on marketing of various financial products.
Australia – ASIC
Advertising financial products and services: obligations and ASIC’s expectations – Sep 2020
Hong Kong – HKMA
Singapore – ASAS
Updated Guidelines on Advertising of Investments – Aug 2015
Singapore – MAS
FAQs on Fair and Balanced Advertising and Other Advertising Restrictions – Mar 2019
United Kingdom – FCA
New screening checks required to approve financial adverts – Sep 2023
Financial promotions and adverts – May 2024
FCA warns firms and finfluencers to keep their social media ads lawful – Mar 2024
United States – SEC
Marketing Compliance Frequently Asked Questions – Feb 2024
Product design and distribution obligations
Some regulators require that certain products must be advertised to only relevant consumers / investors so context of advertising is essential, for example, some products should be advertised on financial websites and not at a football game.
For example, ASIC the regulator in Australia, states “issuers and distributors must take ‘reasonable steps’ that are reasonably likely to result in financial products reaching consumers in the target market defined by the issuer” [RG 274 Product design and distribution obligations]
This could be achieved using Dianomi’s premium finance sites, audiences and Cohorts.
Disclosure and Risk Warnings
Risk warnings will be required for many products and to be prominently displayed on advertised websites. Some regulators will also require these to be within ad creative for certain products, perhaps CFDs or other risky products.
Disclosure (the sharing of relevant information with potential clients prior to them buying or investing) is common practice across the world and the Australian Securities and Investments Commission’s Good Disclosure Principles set out that disclosure to retail investors must be timely, relevant and complete, promote product understanding, promote product comparison, highlight important information and have regard to consumers’ needs.
The Hong Kong Monetary Authority (HKMA) describes one possible issue involving both risk warnings and disclosure: “In general, due to the limitation of certain marketing channels or means (e.g. limited space or words of online banners or dark posts 3) and thus limited marketing information to be displayed in those channels, customers are usually provided with a hyperlink which can bring them to the AI’s (Authorised Institution’s) promotion or product landing page where further details of the marketing campaigns and the promoted product are made available. However, we noted that some of the AIs’ digital marketing channels (such as online advertising banners, dark posts on social media and posts / articles / blogs published by third parties engaged), which contained only limited information about the promotion and product, would bring the customer directly to the AI’s mobile app for immediate application for products or services. Such practice may prevent customers from getting access to and understanding necessary information before submitting an application.”
Social media influencers who discuss financial products – “finfluencers”
It is widely agreed by regulators that social media influencers who discuss or recommend financial products (or “finfluencers”) must be licensed.
Australia – ASIC
Discussing financial products and services online – Information Sheet 269 (INFO 269) – Mar 2022
Singapore – MAS
Reply to Parliamentary Question on complaints against online finfluencers – Nov 2024
United Kingdom – FCA
FCA cracks down on illegal finfluencers – Oct 2024
United States – FINRA
Finfluencers: New Marketing Strategies Meet Existing Compliance Obligations
Further information
In this video “Finfluencers! How Good is Popular Personal Financial Advice?” , Patrick Boyle describes some of the potential issues with finfluencers’ (“a person who by virtue of their popular or cultural status has an outsize impact on investor decisions through social media influence”) advice and compares it to the financial advice of academics.
More
Made For Advertising websites (MFAs) – what are they?
What does a fraud investment advertisement look like?
Should you pause your financial services advertising over Christmas and the New Year holidays?