industry spending on advertising increased by 1.5 times

In January-June, the expenses of microfinance companies (MFCs) on advertising increased by 1.5 times, to 10 billion rubles. Among the reasons, market participants cite business growth, an increase in advertising prices, a shortage of sites after the departure of international players, and increased competition for paying customers amid changes in industry regulation. But a quick payback of growing investments in advertising and attracting microfinancers should not be expected, experts say.

According to the financial statements for the first half of the year, the IFC has increased dramatically spending on advertising and marketing. In annual comparison, the indicator for the whole market grew 1.5 times and reached 10 billion rubles. Some companies spent more than 1.5 billion rubles on advertising.

Over the year, the cost of a targeted action to attract one client online has more than doubled and now it costs MFIs an average of 2.8 thousand rubles, says Elman Mekhtiyev, chairman of the board of SRO Mir, (see Kommersant dated April 19). The cost of attraction in terms of a client has grown by 15-20% over the year, Andrey Ponomarev, CEO of the online financial platform Webbankir, clarifies (its advertising and marketing costs increased by 50% in the first half of the year).

The cost of one click on lead generation sites in 2022 was about 70 rubles, but now it exceeds 100 rubles. for players from the top 10, which form 60% of the microcredit market, adds Marat Abbyasov, commercial director of the MigCredit MFC.

Market participants are confident that the figure will continue to grow. By the end of the year, it will increase by another 10-15%, Andrey Greznev, Marketing Director of Moneyman, is sure (expenses on advertising and marketing increased by 10%). “Companies are trying to work only with high-quality clients, they are also looking for new segments and directions for business development,” he explains (see Kommersant of February 27, June 22).

“MFIs have increased their requirements for clients, finally abandoning the strategy of quantitative attraction. Now quality has come first, and such a client cannot be cheap,” notes Elman Mehdiyev. “If in 2021 companies were ready to lend only on the basis of a risky policy, now they are forced to expend efforts to extract from this pool of customers those who are the least indebted at the moment. These mechanics are expensive,” confirms Marat Abbyasov. The deficit of the advertising platforms themselves on the market after the departure of Google also affects, he adds.

MFIs are also increasing traffic purchases due to business growth (see Kommersant of May 31) and increased competition for a client. “Our marketing expenses are increasing in absolute terms along with the growth in the volume of loans issued,” explains Yakov Romashkin, financial director of Eqvanta Group. The observed trend generally correlates with the plans of large companies for business growth in 2023, agrees Igor Alekseev, senior director for banking ratings at Expert RA.

But microfinanciers should not expect a growth in the number of borrowers proportional to the dynamics of advertising and promotion costs, as well as a quick return on such investments: the cost of attracting a client and the “throughput” of its scoring models may differ, emphasizes Igor Alekseev.

“People, as a rule, apply not to one, but to several companies at once,” explains Mr. Ponomarev. “The task of marketing in this case is to make sure that your offer is among these several. At the same time, as a rule, the more people you want to attract, the higher the price for each client will be. These investments certainly pay off. But you need to understand that since the first loan is issued free of charge, then the payback does not occur immediately, but only when the client becomes a repeat one.

Polina Trifonova