Do ads featuring highly paid celebrities always translate into soaring sales? A closer look at the effects of advertising for major commercial banks featuring celebrities who were paid hundreds of millions of won to appear shows that this is not always the case, according to lawmaker Kim Jae-kyung of the National Assembly's Special Committee on Budget and Accounts.
Kim analyzed the endorsement fees banks paid celebrities.
Over the past year, Kookmin Bank hired figure skating champion Kim Yu-na and popular actor and singer Lee Seung-gi. It paid Kim W250 million (US$1=W1,111) for a three-month modeling contract and Lee W350 million for six months. Industrial Bank of Korea only paid veteran actor Song Hae W300 million for a one-year contract.
But when it came to boosting consumer awareness of the brand, the ads featuring Song were far more effective. IBK has ranked in the top spot since May in terms of brand impact measured by British advertising research agency Millward Brown.
The agency asked 230 Koreans in metropolitan areas which bank advertisement came to their minds first. In August, 44 percent said IBK and only 24 percent Kookmin.
Shinhan Bank hired musical director and conductor Kolleen Park and paid her W150 million for a one-year contract, while Woori Bank hired top actor Jang Dong-gun for a year for W750 million. But Shinhan also beat Woori in terms of brand impact, with 14 percent of the respondents in Millward Brown's survey choosing Shinhan and only 3 percent Woori.
Korea Exchange Bank paid actress Ha Ji-won W500 million for a one-year contract and soccer player Ki Sung-yueng W400 million for a year, while Nonghyup hired seasoned actors Choi Min-sik, Song Kang-ho and Sol Kyung-gu for W200 million each for a six-month contract. Both failed to get their money's worth when it came to brand impact, according to the survey.