Building Bank Brands

By Tom Dougherty


Building Bank Brands. American Banker

Building Bank Brands Marketing or Anthropology? It should come as no surprise to the banking community that building a more robust brand…

Building Bank Brands: Marketing or Anthropology

From American Banker


Building Bank BrandsBuilding bank brands. It should come as no surprise to the banking community that building a more robust brand has more value now than ever before – because distinguishing one bank from another, or even from another financial entity, is impossible. All banks offer the same services and. at least from the point of view of the customer; all have similar levels of capability.

When building a bank brand, banks can’t talk about having many more services than another bank. The only battleground is the brand. A brand that is meaningful to the lives of customers and gives them a reason to choose is more valuable than improving service, updating online banking, adding locations, or extending hours. It is the only way banks can attract new customers. The fact that banks have had to tighten their belts makes the brand even more valuable.

Banking Problems. Building Bank Brands

Banks have closed unprofitable locations or asked more from a leaner work force. Those steps were necessary, but they have threatened the business model banks once followed. Now banks often force customers to meet them through electronic relationships – either at the ATM or through the Internet rather than personal ones. (Read our bank market study here)

The good news for building bank brands is that they can make that connection in business initiatives with measurable outcomes. The bad news is that banks have yet to realize they are not getting full value from their brands. T

he reason for that is because some banks believe brand is an advertising strategy. It’s not. It’s also not a unique selling proposition, a “promise to the customer” of efficacy or a litany of corporate or business differences. It is not about the business of banking and it has very little to do with traditional finance. It is not your company’s personality, not your logo, nor your theme or tagline.


building bank brands

The Banking Market is Fractionalized


Building bank brands is more akin to anthropology than Marketing 101. It’s more about your customer than about you, the bank. Any of those marketing descriptions and values, such as the unique selling proposition, are designed to tell the market why your business or product is a rational and concrete choice.

They pinpoint your processes and purposes, and they shed light on cognitive selling arguments. They reinforce the brand but are not how your customer chooses.

These do not dictate preference. Competitive rates, free checking, convenient locations, multiple ATM locations, online banking, friendly service, experienced loan officers, expert investment advisers, full-service capabilities, and extended hours are all descriptors of “Bank.”

But claiming that you have some of them does not give the customer a reason to choose you. Your competition can claim the same thing. Indeed, both you and your competition must claim them to be considered part of the competitive set. These are the foundations of the business of the bank, but they are not the foundation of your brand.

Think of building bank brands this way: marketing lactic tells the customer why you are here (because we have online banking, extended hours. etc.). But brand tells customers who they are when they use the brand. They are successful. Customers believe the world is a place to be explored. They believe you earn success. And so on. The essence of a robust brand is a highly polished mirror that reflects to the customer an image of who they believe they are when they use your brand.

Look outside the banking category for answers when building bank brands

The customers own the brand, and the more ownership you give them, the more defensive they will be when others try to take it away from them. Remember the cola wars of the 1970s? Coca-Cola became concerned because it believed it was losing share to Pepsi. In truth, Pepsi had simply discovered that, no matter how much soda customers brought home from the supermarket each week, it was consumed before the next shopping day.

building bank brandsPepsi also realized that arch rival Coca-Cola kept track of its market penetration by the number of bottles sold, not by fluid ounce.

The opportunity for Pepsi was simple: Sell its soft drink in 64ounce bottles, and leave the 7ounce and 16-ounce market to Coke. So Coke woke up one day to find that its share had plummeted. It immediately commissioned focus groups to conduct blind taste tests on Coke and Pepsi.

The tests scared the company, because the groups preferred Pepsi. Enter “New Coke.” As you all know. New Coke failed miserably. Coke retested the original Coke against Pepsi.

This time, however, the tests were not blind. When participants were able to see the familiar red can. Coke was far and away preferred. Why? Because the meaning of the brand was more important than taste. For Coke, its brand – which is about consumers who are connected to heritage, nostalgia, America, and childhood – is more valuable than having a “new” taste. The lessons here are important to banks.

Service, rates, and locations are to banks what good taste is to sodas. They are table stakes that do not form the foundation of a brand. Your brand is only valuable if it is a reflection of your customers. If so, they will choose you, cling to you, and use you even when something fundamental fails them – like when taste failed Coke. Be much more than a bank. Be a brand with value. Start building bank brands.

Bank marketing needs upgrades

Banking Category Marketing Study