Axa Direct's big marketing bill for 2008

The domestic division of French insurer Avanssur, Axa Direct, spent zł.78.4 million on advertising in 2008, according to estimates from Expert Monitor, which monitors the domestic advertising market.

In the same period the company managed to collect a sum of zł.81 million in contributions. It has emerged, though, that in the case of Axa Direct, which sells car insurance via internet and telephone, its marketing expenses could have exceeded its revenues. Axa Direct director general Ryszard Bociong did not disclose the exact figures. Parkiet estimates that the insurer could have thus generated a net loss of at least zł.43.6 million last year.

Analysts are skeptical about the company's strategy and claim that the advertising budget should not exceed 30-40% of revenues, even in the beginning phase of business development. In Q1 this year Axa spent zł.12.4 million on advertising, which means that it may spend 40% less in 2009 than last year in this area.

Source: Parkiet