How Wall Street Celebrates Its Deals
Deal toys were the result of the banking industry’s need to create a lasting memento of its achievements. Previously, banks would place tombstone advertisements in newspapers to publicize their achievements. Unfortunately, the newspapers were not visually appealing and were often discarded. The deal toys were in response to the need to develop a more lasting and attractive means of celebrating the completion of a deal. The ads were placed into Lucite blocks and eventually evolved into more complex designs. When the financial industry was at its peak deal making, deal toys were highly popular.
When the economy was doing well, the deal toy industry did well. At one point, some businesses were spending hundreds of thousands of dollars annually on the tombstones. When the financial crisis occurred, spending on these toys decreased. In 2007, JPMorgan Chase no longer commissioned deal toys. The hard times faced by the financial industry also affected the deal toy industry. Both industries struggled to survive during the financial crisis.
It has taken several years, but Wall Street is starting to rebound. The industry that was rather sluggish on deals seems to be making a return to investments. Mergers and acquisitions are at its highest levels since 2007.
In 2014, the banking industry made $1 billion in fees just from initial public offers (IPOs). By March of the same year, Blackstone Group & KKR & Co. negotiated $19.6 billion dollars in transactions. With the market on an upswing, will this mean that there will be a resurrection of the deal toy?
The Corporate Presence is one of the major toy deal companies. Despite the market doing better and an increase in deals, David Parry, director of digital strategy at The Corporate Presence, does not believe that the use of deal toys will return to pre-crisis levels. Parry believes banks are slowly returning to using deal toys to celebrate their accomplishments. In 2014, The Corporate Presence saw a 23 percent increase in revenue. Deal toys may not have the prominence they once had, but they are making a comeback. Deal toys do not only publicize mergers and acquisition. They also highlight the accomplishments of the firm involved in the acquisition.
Deal toys are making a comeback. However, it is unknown if they will return to the level of use they were at before the financial crisis. While the banking industry may be returning to using deal toys, they may not spend as much money as they had in past years. However, there is something to be said about that intangible element that deal toys bring that is worth more their actual cost.