Was that on a Nintendo console? Also google says it came out in 2016. I knew 2 people who played that game, and if it weren't for them, I wouldn't have known who he was. I never saw it talked about on gaming sites/reddit pages, never heard it talked about in conversations.
I understand that Persona is popular, but only with a specific group. I would venture a guess and say that Persona characters are still nowhere near as known as any Nintendo (or even popular 3rd party Nintendo games) games.
Regardless of who gets in Smash, there's bound to be people who'll get touchy and exaggerate how well-known a character is whenever said character's image is questioned. In all honesty though, I don't think there are any DLC characters added in Ultimate who are close to being on the same level as Smash 4's base roster third-parties. I think most people can at least agree with that.
Even with all the GotY stuff, Joker is still relatively new, and I know quite a few people who never heard of him or Persona until Smash.
A lot of people outside Japan know what Dragon Quest is, but I don't think they'd actually be able to tell you the names of the four Heroes.
Banjo is mostly nostalgia. Those who didn't grow up with his game probably picked it up thanks to Smash speculation.
I myself don't know much about Terry or SNK games, but I know "Who is Terry Bogard" became a popular search on Google shortly after his reveal. Clearly I'm not alone.