Robinhood to air Super Bowl commercial as brand crisis mounts

Robinhood, which has found itself at the center of the controversy after restricting trading in stocks including GameStop, will air its first Super Bowl commercial.

The ad, which will launch what the company says is its biggest brand campaign ever, features the message: “You don’t have to become an investor. You were born.” The company said the advertisement for Sunday’s game was meant to highlight people from all walks of life who invest “time in themselves and in the people and things they love,” which he said. is starting a business or changing the color of their hair.

The stock trading app faced a public relations slump as angry clients fought back last week’s restrictions on trading some high volatility stocks.

A Robinhood user filed a class action lawsuit Thursday and Friday afternoon thousands of investors were using an online service called DoNotPay.com to automatically join the lawsuit. The lawsuit alleged that Robinhood was restricting trading in the shares of video game retailer GameStop “willfully and knowingly to manipulate the market.” Robinhood on Tuesday revoked further its trading limitations, allowing clients to purchase up to 100 shares of GameStop.

Robinhood denied the allegations and pointed to an increase in capital requirements for the Depository Trust & Clearing Corporation due to the frenzy of retail investing in heavily courted names like GameStop and AMC Entertainment.

“To put it in perspective, this week alone our equity clearinghouse mandated filing requirements have increased tenfold. And this is what led us to put in place temporary purchase restrictions on a small number of securities that clearing houses had lifted their deposit. requirements on, ”the company said in a blog post on Friday.

The app appears to be benefiting despite the outcry: Robinhood largely dominated the app downloads industry last week, according to JMP Securities analysis using data from the SimilarWeb app. The app saw over 600,000 downloads on Friday, up from 140,000 on its best March day during the 2020 pandemic market rout. Robinhood has also raised an additional $ 3.4 billion from investors over the past two years. weeks to support its record customer growth, the company said. On Monday.

The Super Bowl spot does not refer to recent events. When asked how Robinhood plans to respond to customer claims that the company has broken its brand mission of “democratizing finance for all” and how Super Bowl advertising fits into the way Robinhood communicates with customers, Marketing Director Christina Smedley said the company is seeing customers joining the app and you want to know more.

“It felt like it was a great step for us to remind people of what we stand for and to remind people why the company was created in the first place,” she said.

The company worked with MediaMonks agency and director Nina Meredith on the ad.

2020 has been a huge year for retail investing, leading online brokers such as Charles Schwab, TD Ameritrade, E-Trade and Robinhood have seen new accounts and increased trading activity. Smedley said the app is meant to reflect the stories clients have shared, whether it’s buying stock while on the run or working a second job.

“We kind of created and built this narrative around stories that customers have told us,” she said. “We have seen, throughout 2020, more people come to our platform.” She said clients have embraced offers such as the ability to buy fractional shares on Robinhood.

Robinhood wouldn’t comment on how the company plans to insure existing customers and rebuild trust, or how it will handle any additional customer volumes that a Super Bowl ad might bring, but she pointed out recent blog posts. of the society. Among them was an article Tuesday on the two-day trade settlement period. The post said the period “exposes investors and the industry to unnecessary risk and is ripe for change.”

This week Robinhood also posted a Twitter post saying, “We want to share with you what Robinhood believes and stands for. Here is the full story of our CEO, Vlad,” with a link to an editorial on USA Today by Vlad Tenev . Many customers were responding to the tweet with negative memes or screenshots of their issues.

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