Robinhood Will Air Super Bowl Ad Amid GameStop Saga

On Sunday, the company is expected to air a 30-second commercial during Super Bowl LV with the message that anyone can invest. The ad features a montage of ordinary people going about their lives—a young man going for a jog, a dad taking care of his infant, a woman dying her hair.

“We make short-term investments, long-term investments, we diversify our interests, realize our gains and losses, and try to keep the big picture in mind,” the narrator in the ad says. “You don’t need to become an investor, you were born one.”

Robinhood purchased the Super Bowl ad time, which has been selling for roughly $5.5 million for 30 seconds, in December. Amid the recent controversy, executives at the Silicon Valley startup discussed pulling out of the big game or creating a new ad, according to a person familiar with the matter. The company decided to move ahead with the commercial after seeing a surge in interest in the service—even with the negative publicity—the person said.

“We wanted to remind people who’ve heard about Robinhood in the last few days and weeks about what we stand for,” said Christina Smedley, Robinhood’s chief marketing officer. Ms. Smedley said the ad would help counter some of the negative sentiment surrounding the brand.

Robinhood, with its free trades and easy-to-use app, was among the online brokerages whose popularity rose during the pandemic, as many stuck-at-home consumers turned to stock market investing. Last week, its platform was at the center of a trading frenzy as amateur investors—propelled, in part, by sentiment on online forums like Reddit’s WallStreetBets—flooded Robinhood with orders to trade hot stocks, including gaming retailer GameStop.

Wild price swings prompted the clearinghouse that processes and settles stock trades to demand more cash to cover potential losses on the transactions. Robinhood, fearing a string of big increases that would strain its finances, raised billions of dollars from its backers and restricted trading in a number of talked-up stocks.

Users were outraged, accusing Robinhood of restricting buying to protect hedge funds that were losing money on bets that the stocks would fall. Lawmakers have called for hearings on the matter, and individual investors have filed purported class-action complaints against Robinhood. Almost 80% of the social media comments being made about Robinhood over the past few weeks have been negative, according to Brandwatch, a social-media monitoring company.

Robinhood has since loosened its trading restrictions on GameStop and several other stocks.

Although the Super Bowl ad doesn’t address the situation directly, Robinhood is rolling out other ads that explain its actions.

“We have to educate people about what happened because people don’t understand the back end, about why the decision was made,” Ms. Smedley said.

On Tuesday, the company ran full-page ads in several publications, including The Wall Street Journal, Washington Post, New York Times and The Hill. “Simply put, Robinhood limited buying in volatile securities to ensure it complied with deposit regulations,” the ad said. It also said the company was committed to continuing to improve.

Robinhood said it would also roll out testimonial ads in the coming weeks featuring real customers discussing what the service has done for them. One TV ad features two Black women talking about how they have always been interested in the stock market but that investing seemed unattainable before they began using Robinhood.

Although other online brokerages like Morgan Stanley’s E*Trade Financial Financial Corp., Webull Financial LLC and Interactive Brokers Group Inc. IBKR 4.29% also restricted trading of some of the stocks, Robinhood has taken the brunt of the heat for the move because of how the company has worked to bring investing to the masses.

E*Trade will also be advertising during the Super Bowl.

Despite the criticism, Robinhood continues to draw users. Between Jan. 25 and Jan. 31, users downloaded Robinhood’s app more than 1.3 million times.

Ms. Smedley said the startup will be able to handle an influx of new users if the ad spurs a wave of sign-ups.

“We’re equipped to look after the customers we have currently, and we are investing all the time in new technology and new resources to make sure that we provide the best experience possible,” Ms. Smedley said.

—Marie Beaudette contributed to this article.

Write to Suzanne Vranica at [email protected]

On Sunday, the company is expected to air a 30-second commercial during Super Bowl LV with the message that anyone can invest. The ad features a montage of ordinary people going about their lives—a young man going for a jog, a dad taking care of his infant, a woman dying her hair.

“We make short-term investments, long-term investments, we diversify our interests, realize our gains and losses, and try to keep the big picture in mind,” the narrator in the ad says. “You don’t need to become an investor, you were born one.”

Robinhood purchased the Super Bowl ad time, which has been selling for roughly $5.5 million for 30 seconds, in December. Amid the recent controversy, executives at the Silicon Valley startup discussed pulling out of the big game or creating a new ad, according to a person familiar with the matter. The company decided to move ahead with the commercial after seeing a surge in interest in the service—even with the negative publicity—the person said.

“We wanted to remind people who’ve heard about Robinhood in the last few days and weeks about what we stand for,” said Christina Smedley, Robinhood’s chief marketing officer. Ms. Smedley said the ad would help counter some of the negative sentiment surrounding the brand.

Robinhood, with its free trades and easy-to-use app, was among the online brokerages whose popularity rose during the pandemic, as many stuck-at-home consumers turned to stock market investing. Last week, its platform was at the center of a trading frenzy as amateur investors—propelled, in part, by sentiment on online forums like Reddit’s WallStreetBets—flooded Robinhood with orders to trade hot stocks, including gaming retailer GameStop.

Wild price swings prompted the clearinghouse that processes and settles stock trades to demand more cash to cover potential losses on the transactions. Robinhood, fearing a string of big increases that would strain its finances, raised billions of dollars from its backers and restricted trading in a number of talked-up stocks.

Users were outraged, accusing Robinhood of restricting buying to protect hedge funds that were losing money on bets that the stocks would fall. Lawmakers have called for hearings on the matter, and individual investors have filed purported class-action complaints against Robinhood. Almost 80% of the social media comments being made about Robinhood over the past few weeks have been negative, according to Brandwatch, a social-media monitoring company.

Robinhood has since loosened its trading restrictions on GameStop and several other stocks.

Although the Super Bowl ad doesn’t address the situation directly, Robinhood is rolling out other ads that explain its actions.

“We have to educate people about what happened because people don’t understand the back end, about why the decision was made,” Ms. Smedley said.

On Tuesday, the company ran full-page ads in several publications, including The Wall Street Journal, Washington Post, New York Times and The Hill. “Simply put, Robinhood limited buying in volatile securities to ensure it complied with deposit regulations,” the ad said. It also said the company was committed to continuing to improve.

Robinhood said it would also roll out testimonial ads in the coming weeks featuring real customers discussing what the service has done for them. One TV ad features two Black women talking about how they have always been interested in the stock market but that investing seemed unattainable before they began using Robinhood.

Although other online brokerages like Morgan Stanley’s E*Trade Financial Financial Corp., Webull Financial LLC and Interactive Brokers Group Inc. IBKR 4.29% also restricted trading of some of the stocks, Robinhood has taken the brunt of the heat for the move because of how the company has worked to bring investing to the masses.

E*Trade will also be advertising during the Super Bowl.

Despite the criticism, Robinhood continues to draw users. Between Jan. 25 and Jan. 31, users downloaded Robinhood’s app more than 1.3 million times.

Ms. Smedley said the startup will be able to handle an influx of new users if the ad spurs a wave of sign-ups.

“We’re equipped to look after the customers we have currently, and we are investing all the time in new technology and new resources to make sure that we provide the best experience possible,” Ms. Smedley said.

—Marie Beaudette contributed to this article.

Write to Suzanne Vranica at [email protected]