Banks: The Worst At Brand Marketing


By Tom Dougherty

Banks have the worst marketing. Full Stop.

It is, of course, easy to pile on banking these days, but let’s continue that trend anyway. You see, when it comes to brand, the banking industry has been flat-out the worst.

Let’s examine the ways in which you would measure such a thing by examining the banking industry through the list of economies a brand trades in when gaining preference (and, therefore, stealing market share):

Worst at brand marketing because they think the message is all about them
Banks do not know who they are

1. Thrust. The positioning must demonstrate an active competitive advantage. This advantage answers the question of “why should I care?” from the perspective of the end user.

How banks rate (On a scale of 1-10, with 1 being the worst): 1. The main reasons bank marketing is the worst is that there is little to no differentiation between the industry’s players. All talk about the same things: Free checking, good rates, low fees, reward programs, good service, etc. What makes it doubly bad for the banking industry is that those values, which are simply the definitions of a bank, is all they market. Therefore, even those most likely to switch don’t.

2. Gravity. The positioning must have a powerful relevance to the target audience, and their interest and receptiveness must be piqued.

How banks rate: 2. The only reason that banks don’t get a “1” here is because target audiences believe the choice of banking is important. However, the messaging is not, which is why so few people actually switch their primary checking account. Only about 3% actually make the move each year, even though five times that number consider doing it.

Consider this. When the economy took a nosedive, the banking industry marketed, “safe,” even though research demonstrated that the public felt its money was already safe. Even those who banked at a failing bank knew it was federally insured. To be important, banks needed to consider the highest emotional intensity in the category: Anger.

3. Definition. The positioning must be distinctive. It must set the brand apart from the competitive set.

How banks rate: 2. This depends on the individual bank brand, of course, but very few of them are emotionally different than their competitors. Most follow the market leader, Bank of America, both in terms of messaging, brand face (reflection of the target audience) and even in color palette. Ever notice that the color palette of most banks is dominated by blue?

4. Density: The positioning must be single-minded. It must have clarity, simplicity and must illuminate the target’s main precept.

How banks rate: 2. The banking industry does not deal in precepts (belief systems that drive behavior) because there is very little emotional or strategic play in its messaging that suggest it understands why target audiences choose. Except in rare cases, it is also not very single-minded. The players in the industry are all over the map. Quick Question (as a test): What is the single-minded message of, let’s say, Wachovia? (Waiting.)

5. Synthesis. Fuse the positioning together in an emotional bond with the target audience. It must grab them in the gut.

How banks rate: 1. If there were a zero, we’d use it here. The only attempt at emotion is either “dream your dream” kind of emotion, which is overused, or is about the bank itself. Rarely, if ever, is there marketing in which the target audience says, “They get it. They know where I’m at.”

Trusting the Bank Brands

6. Integrity. The positioning must be believable. If the message raises suspicion – even if it is true – it raises barriers.

How banks rate: 3. Target audience may be distrustful of banks, but the messaging is so benign that it is generally believable on a very simplistic level. (We believe that, yes, you have a reward program.) However, what is not believed is that any bank is better than another.  If you are fed up with your current bank, do you really believe it’s any better over at Citibank or BB&T or TD Bank or anyone else? That’s the reason why audiences don’t switch. They don’t believe there’s a true choice.

7. Precision. The brand message must speak to the target audience best positioned to make a choice.

How banks rate: 1. For most, this is about segmenting the market. In banking, it’s about speaking directly to those most likely to switch. Therefore, banks need to ask what those are looking for? The banking community gets this significantly wrong because it often markets the things target audiences believe they already have, like free checking. In most cases, banks seem to be talking to those who have already chosen them.

8. Convergence. The positioning must convey the same message in all the ways the consumer touches the brand.

How banks rate: 5. Consistency is one of the few things the banking industry gets right. The problem, however, is the “brand” is usually just the category benefits of banking, not the brand of the bank itself.

The News Gets Worse

9. Momentum. The present positioning must build upon (but never mimic) the equity of past communications to leverage any residual positioning equity.

How banks rate: 2. We’d give banks a better score here if they had any equity to leverage. Bank of America has some (and even does a better job than it had before), while Chase and Wells Fargo do make some attempt. However, the positioning and messaging those take has almost no relationship with the equity.

10. Acceleration. The positioning must keep pace with the changing markets to evolve constantly, making itself increasingly effective day.

they are the worst at brand marketing because they all look alike
Why are they so confused

How banks rate: 1. Oh boy. The most shocking thing about bank marketing is how little it changed after the economic collapse of which banks are blamed. Looking at a before and after, even among smaller banks, is to see mirror images of each other. Research has shown that consumers believe they themselves have changed, but financial institutions have not.

Without trying to be flippant, this is case closed. It also serves as a way to measure the effectiveness of your brand and how you can know its value. Bank marketing is simply the worlds worst. They never develop a brand message of meaning.

The banking industry is the one in most need of repair. It spends billions of advertising dollars (Bank of America actually spends more than Budweiser) and wonders why so few switch their primary financial institution.

It’s simple. It’s because they all say the same things, feel the same in terms of tone and attitude, and completely ignore what is most important to the target audience they are trying to reach. Overall score: 2.2.

That’s the reason so few switch banks.

(Read our bank marketing study here)

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