Sixty Seconds on Differentiation Between Brands in Financial Services

Felix Thomson

Content Executive

The Financial Services Forum

Branding amongst financial services companies is still in its infancy and suffers from not being taken seriously.
Brands in financial services still have a long way to go
While many financial services brands are poorly differentiated, I don’t believe that there is no differentiation at all between brands. Financial services brands do exist in their proper sense, albeit few and far between. The role of a brand in any market is to create identity and to influence choice. A true brand represents something distinctive in consumers’ minds and a promise of consistency. In the financial services market trust is a key factor in consumer decision-making.
But the problem with financial brands is that they’re messy. They don’t depend on neat boxes sold in a controlled way, but on the staff, intermediaries and technologies which represent them. This creates a far greater challenge for branding. Unless all these ‘purveyors’ of the brand’s values are absolutely consistent, and that’s a massively difficult thing to achieve, the brand will be at best diluted, and at worst, confused. It only takes one person to have a bad day for the whole brand experience to be blown apart.
The other factor to take into account about brands is that image adds value to the reality of the ‘product’ and vice versa. Ultimately consumers will not keep on buying products or services that don’t live up to expectation or their billing. Yet financial services products are notoriously intangible, infrequently bought, and often nothing more than a promise to be realised at a later date. This has led financial brands to differentiate through service values, fraught with the problems described.
Many financial services brands have taken refuge in attempting differentiation through the easy route of advertising or marketing campaigns, but have failed to deliver the promises that make these stick. It’s not surprising that consumers feel that many financial services brands are ‘the same’ and that they consistently let them down when the advertising and marketing messages don’t reflect reality.
Ironically, technology is coming to the rescue, because as more business is done direct, the more the consumer experience can be controlled to deliver the brand. ING is a good example of a brand that has successfully differentiated itself with the help of technology, and is now reaping the benefits as it moves into new product areas.
ING is built on the simple promise of a good deal on savings for all its customers, irrespective of savings power. It offers competitive rates but without any of the usual myriad ties and terms and conditions – and it is very easy for anyone to buy. The brand message for its savings account has been consistently and clearly communicated in broadcast media, and ING has since added mortgages and ISAs to its portfolio, all with the same simplicity and sense of fairness for consumers. The ING brand is a seamless experience.
But there are other, more complex financial services brands that have also succeeded in differentiation. NatWest is one of these and again, its brand genuinely lives in the consumer experience. NatWest has recognised that many consumers like the reassurance of a bank branch and don’t want to deal with overseas call centres. So it has bitten the bullet and bucked the trend and is building its brand on this stand.
In short, there are differentiated financial services brands, and they have themes in common. They understand what consumers want, they deliver this simply and clearly and they ensure that the brand lives right the way through the customer experience.
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