Sydney, Dec 15 (Asia Pulse) - Stockbrokers who operate discount services or via the Internet are emerging as one of the biggest spenders on advertising in an attempt to win over the "do-it-yourself" Australian investor.
The burgeoning industry is expected to pool more than $A20 million ($US13.06 million) into advertising its services next year - an increase of more than 900 per cent in two years, according to recent data by the advertising sector. Consequently, discount and on-line brokers make up one of the fastest growing advertising categories in Australia, the study said.
Service financial provider and discount broker TD Waterhouse Investor Services today highlighted the study to show that growth in advertising parallels the explosion in the use of discount brokers and on-line services within Australia. "In the last 18 months to November 1999, the discount brokerage industry's share of the value of trades through the Australian Stock Exchange has increased from 5.2 per cent to 12.5 per cent," the company said. "At its current level, and based on the value of stocks traded through the ASX this year, this equates to a market of at least $37.7 billion in stock turnover. "Therefore, TD Waterhouse is preparing itself for the battle that will erupt to win the do-it-yourself Australian investor." TD Waterhouse plans to spend at least $5 million on advertising its services in Australia over the next 12 months.
Managing director Ian Struthers said the move will raise the stakes within the industry. "We are number two in the world; we expect to remain in the top two in Australia and that this campaign will significantly grow our business, yielding an excellent return on out advertising investment," Mr Struthers said. Mr Struthers said the use of discount and on-line brokers is a world-wide phenomenon.
"It is partially about the democratisation of investment information that was once tightly held by the investment community, about the proliferation of the Internet, and about the growth number of investors who want to make their own investment decisions," he said. "But in Australia, as in the UK, it is also a consequence of the massive increase in private share ownership through government asset sales and demutualisation of life insurance companies." TD Waterhouse Group Inc services over three million customer accounts worldwide and has more than $US122 billion in assets under administration.