Starling’s brand chief says that its combination of strong built-in purpose and product innovation are driving its organic growth in the often undynamic retail banking market.
In its last annual report (FY ending March 2021), Starling said it had 2.14 million open accounts. What continues to distinguish Starling is the average balance per customer, which is now up to £2450 for retail accounts and £14045 for business accounts. meaning that a significant number of users are using it for their primary account rather than as a siloed pot for specific purposes.
This represents something of a coup in a market that has remained dominated by the four biggest banks despite the introduction of the current account switching service and a host of new players arriving in the market. New research shows that digital challengers have accrued around 8% market share in the personal current account market.
Rachel Kerrone, Brand Director, (pictured, left) tells the Financial Services Forum that the bank has seen a big uplift in customers during the pandemic as people became more comfortable using digital banking. The company’s brand recognition and trust are higher than they’ve ever been.
During this time, she says the company has focused on its “brand stature”, leading on the key metric of trust. The company has pursued premium slots on TV, such as must-see movies and premium sport. All of this will continue throughout 2022 as Starling moves towards an IPO, expected in the next 18 to 24 months.
“TV has been hugely successful for us,” she says, citing brand awareness, trust and stature as well as the all-important “eyeballs on ads”.
Less in favour at Starling HQ is Meta, the umbrella company of social media sites Facebook and Instagram. Facebook is one of the three biggest digital advertising giants, controlling the majority of the market alongside Google and Amazon.
Starling began reducing advertising via Meta back in December and has now pulled ads from the platforms completely, which were predominantly used for performance marketing. CEO Anne Boden explained the reasoning in a blog post in January, citing Meta’s lack of action on fraudsters on the platform.
“It’s very important for us to be aligned with our brand value – in terms of brand integrity, wanting to protect our customers, we felt we couldn’t advertise alongside scammers who were going after the savings of our customers.
“From a values view it didn’t align with our views. We made it clear to [Meta] but nothing has changed. For the time being we’ll continue to suspend that.”
She says that there has been very limited impact from the decision. She highlights again the fact that brand awareness is higher than ever, noting “a little bit [of impact] on the traffic side.”
Rachel notes that Starling “one hundred percent” wants to continue in other performance channels, however. She contrasts Meta’s approach with that of video sharing app TikTok, which she says has been “really receptive to views on fraudulent advertising and transparent on their plans. Meta hasn’t – it’s been really non-committal on its intentions.”
Building brand and Starling’s staying power
“You have to build a brand to have a sustainable business,” says Rachel. “Starling isn’t a company that has come into the market and will quickly sell out to someone and move on. We are here for the long term.”
She says that a start-up always has to maintain a balance between growth and brand.
The Here to Change campaign, shown on TV and on-demand platforms, expands on the theme of flight which has been explored in previous adverts. The first ads included starlings flying, moving onto an advert featuring a female entrepreneur flying in her office shed.
The latest ad features the employees of a dog grooming salon lifting off from the ground.
“The creative direction is that optimistic metaphor of moving upwards and moving forwards.
“It’s about that feeling of freedom that banking with Starling offers. You don’t have the ticking clock while you wait in the queue in a branch, or the piles of paperwork you have to have scanned – all these things people have had to put up with for years.”
She argues that Starling is in a “category of one”, offering this better customer experience alongside stature, trust and credibility.
Asked why she believes Starling has stood out from other neobanks, she cites product and purpose.
“Monzo was slightly quicker out of the gate with the prepaid card – they got a lot of customers onboard very quickly. It really appeal to millennial and Gen Z customers, on the younger end.
“From the brand point of view, Starling has always been more of a grown up approach in our banking, in our tone, and how we talk to and treat customers,” Rachel says, citing the fact that founder Anne Boden has been in banking for many years.
“We haven’t gone after that young audience based on having a cool card. We have gone more for the lifetime value.”
She says that overcoming the inertia that people typically face in switching their retail bank is “the biggest challenge”, citing the fact that many banks are offering huge incentives. For example, HSBC is currently offering customers £150 to switch.
Rachel says Starling “regularly tops the switching tables without any incentives at all.”
She says the company has deliberately eschewed such incentives in favour of putting product at the centre of its marketing pitch.
While the mainstream banks have copied many of the features of the digital upstarts, Rachel maintains that Starling’s ability to move quickly still differentiates it.
“When we were building Here to Change, we went all around the business, talking to different teams. The thing that came up was this theme of change. People like working at Starling.”
She says “change” underpins everything at Starling, with continuous updates to the app rather than longer development cycles.
The other key element to Starling’s success, she says, is having a strong brand built around a strong purpose.
“We were built from Day 1 with the purpose to help customers manage money better and more easily – being purpose-led right from the beginning rather than making one up down the line.”
This purpose gives Starling a platform to champion wider social causes in its sponsorship, such as its partnerships with Instavolt and the Women’s Euros in July.