Industry bellwethers look for ways to maintain their lead and aggressive contenders vie to shift brand loyalties. Both are confronted with hurdles for market relevance and for the need to craft new-business and marketing strategies for continued existence. Nowhere is this more obvious and complex than in the financial-services industry.
The industry started with individuals who actually had their names on the door. They were the brands and their personas defined their firms in the marketplace.
Fast forward to the 1990s. Huge global firms began to dominate and market the same services in the same way. Very little differentiated them, and branding became sanitized. Changes in banking and regulatory legislation allowed firms to offer the same things. This was a great opportunity -- and a branding conundrum: How does an established brand in one market morph into one that means everything to everyone in all markets?
Firms that once had a defined image and service offering found themselves in a mosh pit; in addition to banking services, now insurance, annuities, IRA's, financial planning, mutual funds, etc., were offered.
Pre-eminent brands soon lost their identities. Research we conducted shows that by 2005 even people inside the industry couldn't match the financial behemoths to their taglines.
Today, many firms are dismantling; some disappearing altogether. Investment banks are becoming retail banks. The definition of what a "bank" is and does has become a gray area.
In a recent Doremus/Financial Times global survey, senior-level executives were asked about their relationships with investment and commercial banks. Results showed that trust has been eroding and, not surprisingly, took a nosedive in 2008. Executives once felt they could go to certain banks for certain services. Now there's confusion. They want "best in class" in a particular area, not to be beholden to one institution for everything. They are asking banks:
1. What are your products and services?
2. Will you be around to deliver them?
In other words, who are you, and can I trust you?
Research also reveals that when all companies within an industry are being tarred with the same brush, people tune out. For the financial-services industry, this can be a hidden opportunity because every brand has become, of sorts, a challenger brand. Everyone is equal.
The first brand to change the game has the best chance to become the leader. In that, it's time to return to basics; to reconnect with key stakeholders by adhering to core tenets of successful marketing. And the first step is to determine what space your brand should occupy. A firm can't be all things to all people, but must be true to the brand promise.
Messages should be conveyed clearly, consistently and credibly through all touch points with stakeholders. Without this, the media or competitors will certainly interpret your messages for you -- and most likely, not in your brand's interest.
Paramount is to be transparent, show the good and the bad. Acknowledge problems with a plan to address them -- this suggests control, a sure sign of strength.
There's never been a better time for financial-services brands to carve out a new niche. The opportunity, however, won't be around forever. Center stage is there to take for gaining share of mind, voice and wallet. The brand that's able to gain control of the dialogue has an opportunity to move from "challenger" status to "category leader."
~ ~ ~
Carl Anderson is CEO of Doremus