No, you are not seeing double. We just need to get caught up on tracking how our predictions for 2011 are doing. Today gets us through April.
In early December, 2010, Lairig Marketing predicted the following for April, 2011:
“As the economy mends, for real, the trade press starts to notice how the smaller banks and credit unions are growing through mergers, spending on all kinds of traditional and innovative marketing services…”
Just like we said yesterday for our March prediction, dead wrong. But unlike yesterday, where we were happy to be wrong given the “reverse psychological” outcome we were hoping for, here we are deeply saddened.
The economy is not on the mend. With GDP 70% consumer driven, the U.S. economy is on hold for at least another six to nine months due to the lack of a shred of improvement in:
- The housing foreclosure tsunami
- The price of gasoline (and soon, of home heating oil)
- The “new normal” of unemployment
We know where the big banks like Bank of America and JPMorgan Chase stand. Keep on pillaging the consumer, and stuff the cash into the vault. So the small banks are waiting for the dust to settle.
Talk about trickle-down theory.
The lack of M&A and lending among community banks has stunned even those who work in that industry. Here are some choice quotes, from various American Banking Association articles:
- Expectations had been high that 2011 would bring some serious moving and shaking among community banks.
- "You haven't seen [M&A rise] because nobody is sure what they will make in 2012," said Rusty Cloutier, the president and chief executive of MidSouth Bancorp.
- At June 10 banks had announced only 65 whole-bank acquisitions in 2011…an 18% drop from a year earlier, according to SNL Financial…the second quarter has been off 43%.
= Mark Fitzgibbon, an analyst at Sandler O'Neill & Partners LP who once forecast that deal activity would be double what has taken place so far, said he was surprised by the decline.
And, for overall sentiment on just how unfavored banks are, here is Jim Cramer:
“I continue to believe…that the underinvestment in banks by [investment] managers has reached levels that I have never seen before.”
Although we still see a marketing opportunity for on-their-toes agencies when community banking heals, Lairig Marketing missed the timing here, badly. April of next year might even be too soon.
There is a bigger message here, other than Lairig Marketing taking another “0 for 1” in 2011 predictions. It is that the second half of this year could see a step back for marketing – articles about marketing budget cuts and staff layoffs could be fairly common come late September.