Banks versus Brands

Global Insights Magazine
Issue 12 - Edited by TANGRAM Widnau/ Switzerland
July 2013
e3 insights
Banks versus Brands
Inside this issue
The change in the finance industry
as a challenge for the brand.
2 6 8 10
Reputation
Change
New Thinking 1
New Thinking 2
Where are we now?
The bank of the future?
The Jyske Bank case
The Fidor Bank case
Where are
we now? Reputation
This question is being posed not just by David Bowie
in his latest song, but by a whole industry. Financial
institutions around the world are finding themselves
in a process of change. Legal earnings, dirty money,
executive salaries, responsibility in and for the
financial crisis, equity ratio or so-called tax havens.
There is almost no subject which has been left uncommented on in the worldwide financial media.
What is left is a certain loss of trust in banks –
“Here we are now!” = and the question of how
we would like to position ourselves in future
with our brand. As a marketing expert it could
be said that it was now time for an image campaign. This however would be very insufficient.
Evidence of being able to adapt to market
changes must be demonstrated by action.
What do customers expect of me as a bank?
Where are our strengths? Do we need to
alter anything in our behaviour? Is our business strategy still appropriate for the time?
All questions which are of a general nature
and must be broken down to the individual situation of retail banks, private banks
or investment banks.
New thinking is required. New concepts
and a clear and credible positioning to
be optimally positioned in the future
with one’s own bank brand. We would
like to inspire you on following pages
with our thoughts!
and Branding of the financial industry
Every year the Emnid Institute carries out the “Image Profile”
study in Germany. In the process about 2,500 board members,
CEOs and managers were surveyed.
Even if the German result with its pride in the local car industry
cannot be adapted to all European countries, it is still surprising that banks and financial service provides are ranked again
second from last.
RankCategory
1
Car industry
2
Electrical industry
3
Computer/Software
4
Automotive suppliers
5
Transport/Logistics
6
Chemicals/Pharmaceuticals
7
Power industry
8
Reproduction + Media
9
Retail- and mail order trade
10
Insurance
11
Internet economy
12
Telecommunications
13
Banking/financial service providers
14
Construction industry
Reputation
743
701
689
663
662
645
644
642
641
621
614
610
594
545
No financial service providers are among the so-called “Brand Champions”.
Banks are chasing after the stars from other industries. Unfortunately it also
needs to be realised that no bank brand anywhere in the world is among the
10 most valuable brands.
Willy Tanner
TANGRAM
for Brands & Communication
Widnau, Switzerland
1
2
3
4
5
Coca-Cola (+8 %)
Apple (+ 129 %)
IBM (+8 %)
Google (+26 %)
Microsoft (-2 %)
6 General Electric (+2 %)
7 Mc Donalds (+13 %)
8 Intel (+12 %)
9 Samsung (+40 %)
10Toyota (+9 %)
Interesting: 32) J.P.Morgan, 33) HSBC, 48) Goldman Sachs
Source: Interbrand “Best global Brands 2012”
3
Where does the shoe pinch?
Reasons for the negative reputation of banks
In a current study from Switzerland those in charge of communications in 28 Swiss banks
were surveyed about the most sensitive influences on reputation and problem areas.
Those surveyed basically considered the critical media coverage as the main reason for
the negative image of banks. This attempt at explanation should however be viewed as an
insider’s view, not that of an outsider. This is because, as is well-known, the various inputs
used by the media come mostly from the banks and to a degree also from politics.
Surveyed on the subjects which have most influence on reputation, an overwhelming
majority cited the tax problems in Switzerland.
If subjects specific to Switzerland are removed, then questions such as bank-client confidentiality, performance, the problem of the Euro, bonuses and management salaries or even
equity-to-assets ratio remain important subjects in international financial media.
28
18
Bank-client confidentiality 13
Performance, results 12
Euro/debt crisis 11
Restructuring, jobs10
Bonuses, rewards 10
Capitalisation 5
Regulation & Basel III 3
TBTF, government assistance 3
Libor
3
Asset management fees 2
Tax optimisation
Tax agreements
Source: Publicom/Switzerland, “Banking communications in the reputation trap”, February 12/2013
4
“The opening up
of differentiation potential has only
just begun”
Like any well-run company, a bank too must reassess its business model if the markets, customer perception or even technical capabilities are changing. Soft factors
such as trust, sympathy and emotion are also components for a strong customer
focus and contribute to differentiation. Future-oriented business models are
dependent on these soft factors. A large part of the poor reputation is based on
emotional perception and the way back to a good image will follow via action.
A customer tests every day whether a bank is delivering performance. Brand
loyalty only arises when customers continually experience what is promised
them in communications. At the same time it should be observed that a
financial institution should not jump on every bandwagon and use Shiny
Happy People to lead customers to believe in a healthy financial world.
That means forgetting that differentiation derives its origin from identity
and competence fused in the brand essence. The opening up of differentiation potential for banks of tomorrow has only just begun. Brand strength
can arise here – the best means against lack of profile, interchangeability
and the well-known thesis: All banks are the same!
The most frequent misunderstandings in branding banks:
Brands do not play any significant role in the banking industry
Brands are mainly used to influence customers
Brands are generated through advertising
Brands characterise today’s success
Brands are controlled creatively, not analytically
Brands are the responsibility of the marketing department
Brands can be controlled technocratically
The chain of perception – an ideal case:
The ideal case of a chain of perception which goes beyond
the use of financial services:
Yes, I know this bank.
Yes, I find this bank good.
Yes, I trust this bank.
Yes, this bank keeps its promises.
Yes, I have been working with this bank for a long time.
Yes, I recommend this bank.
6
Change
The bank of the future?
Changes are at the door. Building sites will not decrease even in the next few years.
Predicting the future is certainly always difficult – nevertheless some trends can be
observed that will certain become more significant in the next few years.
“We are the people”
There is a public mood, accompanied by the media that disagrees with certain bank
practices. That certainly includes the financial industry’s reward system common in the
western world. A system that is based on performance bonuses and in the public perception is ranked as short-term thinking. These are warning signs that financial institutions
should take seriously. Certain practices in the area of investment banking are also no
longer to the general public’s taste. There is a growing clamour even from politicians to
separate investment banking from the bank’s core service.
“Economies of Scale”
Back-office functions are coming under pressure nearly everywhere. Services that
a customer does not see will in future be provided quite differently from today.
To counteract shrinking margins there may be further savings in this area.
These services may be taken over by specialist service provides who profit from
economies of scale and strong focus.
“Point of Sale”
Admittedly a thesis, but extremely interesting. Bill Gates, founder of Microsoft,
has said something to this effect about this: “In future we will need bank
services. But whether we will need a bank for them is by no means certain.”
His idea: Bank services will in future be offered where they are directly
needed. At a car dealership that is selling the customer financing. Or it may
be a B2B business between two industrial companies, with the provider
supplying the financing for leasing at the same time as his product. It may
also be a retailer who finances the customer’s purchase by microcredit.
Source: Axel Gloger, Banks & Brands
New Thinking
1
case
in Private Banking with the
principle of balance
New and innovative thinking is deeply rooted in the corporate
culture in the second-largest purely Danish bank. Optimally positioned in Denmark as a retail bank, Jyske Bank concentrates on wealth
management as a private bank in its 5 foreign branches. The financial
organisation regards the current changes in the market as a genuine
opportunity for the future.
Jyske Bank’s principle
of balance:
customers
shareholders
Jyske Bank private banking is different. No integrated investment banking, no bonus system either for management or for employees. Therefore
with a corporate culture with high ethical and social standards. Namely,
the Danes live out the balance between customers, employees and shareholders. Because only if this balance does not shift in favour or to the disadvantage of one or more groups will a company enjoy sustained success.
employees
It is therefore no surprise that Jyske Bank lives out a no bonus system
and maintains open communication in which even the CEO’s salary can be
extensively discussed. The principle of balance also provides sustainability
and stability in the shareholder structure. With nearly a quarter of a million
shareholders the financial organisation stands on a broad foundation. At the
same time, without the bank’s agreement no shareholder can possess more
than 10% of the share capital - balance takes priority.
The principle of balance is also practised in daily customer contact. “Consultancy on an equal footing” is the magic word here. The customer is regarded as a
genuine and equal partner. Thus the clientele is optimally advised and taken care
of without complication, helpfully and with initiative. This makes for a short decision making process – because decisions should be made as closely as possible
to the customer. This is one reason why customer advisors are equipped with the
greatest possible decision making power.
Being different also means going new ways. So with jyskebank.tv the customer has
an in-house web TV channel at their disposal. The latest is reported daily on worldwide financial markets, trends and much more. Critical reporters and experts from the
fields of economics and investments deliver in-depth reports of a high journalistic
quality. So good that in October 2011 jyskebank.tv was honoured with the “Digital
Communication Award” for being Europe’s best web TV channel.
Brand values and the principle of balance are also reflected in private banking
communications. Jyske Bank calls a spade a spade and shows why they are thinking
differently.
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
13-137_Plakat_Sujet2_F12.indd 1
We focus on substance and sustainable solidarity instead of back-up
government guarantees.
We prefer to swim against the current instead of being driven by it.
06.05.13 13:52
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
TANGRAM Schweiz
Unser Bånkgeheimnis
seit über 40 Jåhren.
Kein Bønus für Mitårbeitende
und Månågement.
TANGRAM Schweiz
Wir setzen åuf Quålität
im Privåte Bånking,
ånstått åuf Quåntität
im Investment Bånking.
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
06.05.13 13:50
13-137_Plakat_Sujet3_F12_L.indd 1
Wir båuen åuf
entscheidungsfähige
Beråter,
ånstått åuf beråtende
Wåsserträger.
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
Our banking secret for over 40 years. No bonus for employees or
management.
TANGRAM Schweiz
We focus on quality in private banking instead of quantity in investment
banking.
Wir beråten gånzheitlich
und åuf Augenhöhe,
ånstatt vøn øben heråb.
In Dänemark verwurzelt, seit über 40 Jahren in der Schweiz zuhause.
Fast akzentfrei. Denken Sie im Private Banking neu und sprechen Sie
mit uns. jyskebank.ch/info
Jyske Bank (Schweiz) AG . Private Banking . Wasserwerkstrasse 12 . Postfach . 8021 Zürich
13-137_Plakat_Sujet4_F24.indd 1
We rely on consultants capable of making decisions, not on consultative
dogsbodies.
06.05.13 13:53
We provide holistic consultancy and on an equal footing instead of
from on high.
06.05.13 13:55
TANGRAM Schweiz
13-137_Plakat_Sujet1_F12.indd 1
Wir schwimmen lieber
gegen den Strøm,
ånstått uns treiben zu låssen.
TANGRAM Schweiz
TANGRAM Schweiz
Wir setzen åuf Substånz
und nåchhåltige Sølidität,
ånstått åuf rettende
Stååtsgåråntien.
10
New Thinking
2
case
Social Banking Fidor Bank AG makes it possible
“Banking with friends” is the slogan of the German Fidor Bank. Where it’s almost difficult to
find a traditional postal mailing address. Because Fidor Bank’s home is in Web 2.0. The magic
word here is not retail banking, private banking or investment banking, but social banking.
Here the customers are completely tied into the business model. Fidor Bank is more than a
bank - it is a platform for exchange which allows questions of money to be discussed at any
time. The community networks customers to one another with the option to ask questions
about money, give saving tips, evaluate products or advisors or suggest new product ideas.
Fidor Bank rewards each customer for evaluating a financial product and adviser or for
answering a question. Part of the concept is consequent communication via social media.
The time is ripe for
a new self-concept for banks and customers
New concepts, new products
The most innovative bank
Some interesting and frequently award-winning product innovations are based on the community concept. For example the
“Like Interest Rate”. The more “likes” are clicked, the lower the
interest rate becomes. But Fidor Bank has even more to offer.
What about crowd finance. In this process users get together
and promote creative investment projects in pioneering
companies or regional communes. The customer then has
various Crowdfinance app partners in the account to choose
from. This way various projects can be supported by clicking a mouse. In return the customer receives an attractive
return.
There is nearly no end to the list of awards.
International experts rank Fidor Bank’s
business model as one of the most innovative in the world. Here is just a selection of
prizes and awards won.
Bank Innovation Award 2013,
San Francisco / USA
The community also works in marketing
The current image brochure was not only put together
by bank employees but also by community members.
BAI Global Banking Innovation
2012 “Disruptive Innovation
Award”
Banking IT-Innovation
Award 2011
Best Marketing Company
Award 2011
!
Fidor Bank is an interesting example
of the direction that the financial industry can develop in with creativity,
courage and new business strategies.
E3 Network
www.tangram-agentur.ch
Adsmith / China
Advertigo / Romania
Aloft Group / USA
Ansel-Möllers / Germany
Audacity / USA
Base One / UK
BBC / Belgium
Bernstein / Germany
BMLab / Russia
C&COM Advertising / Czech Republic
Café Design / Hungary
DAG Communications / Italy
Epoka / Poland
Igriega / Spain
Kirnauskis 2.0 / Finland
Maitri Advertising Works / India
Mandate / Singapore
Media Consulting / Portugal
Netural / Austria
OZ Branding / Israel
Preferendum / France
Quarry / Canada
Rainfall / Romania
Recommended / Finland
Recommended / Sweden
SPS Marketing / Austria
SanderWerbung / Germany
Schindler Parent / Germany
TANGRAM / Liechtenstein
TANGRAM / Switzerland
Truly Deeply / Australia
Van Heertum Design VHD / Netherlands
E3 network
Banks versus Brands?
TANGRAM Switzerland
The E3 Agency Network is a closely integrated
A large number of customers from the
This issue of the E3 Global Insights
coalition of independent brand strategy and
financial industry feel at home in the E3
Magazine was published by TANGRAM.
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