In the final round of the TV gameshow Wheel of Fortune, contestants used to pick six letters. But almost everyone always picked the same six letters — S, T, R, N, L and E — and often in the same sequence.

It became so common that STRNLE grew into it’s own acronym, pronounced “stroonle” (sounds like “strudel”).

By 1988, the show’s producers changed the game’s format to address this predictability. Since then, those six STRNLE letters are gimmees. Now contestants get to pick four letters in addition to the ones provided.

The world of financial brands are way overdue for a STRNLE overhaul. Invariably, when you ask a financial institution what differentiates them, you almost always get the same answer: “It’s our caring, responsive and personal service.”

You know what acronym that makes? CRAP.

Reality Checks:

• Warm, friendly, personal service is the bare minimum in financial services. It isn’t enough to build a brand around. It just gets you to first base.
• “Service” may be one your organization’s core competencies, but it’s highly unlikely that it’s at a level much different than your competitors.

For most banks and credit unions, saying “service is what differentiates us” would be like Nike saying quality shoes is what differentiates them. Nike may be in the shoe business, but that isn’t what differentiates them. Similarly, if you’re in the financial services industry, you better have quality service because that’s what you’re selling.

The STRNLE reflex feels good because it’s totally safe. It doesn’t require an ounce of courage, so it never gets questioned — always lots of head nods, “That’s right! It’s our service!” The trouble is, it leads to CRAP brands. You simply can’t distinguish yourself by merely meeting people’s basic service expectations.

Besides, everyone is delivering CRAP service. At least that’s what they all say they’re delivering.

Key Takeaway: Avoid the pseudo-safety of CRAP traps. Find your own niche. Focus on a narrowly targeted audience and meet their specific needs. That’s how great brands are built.

Bank of America recently announced that it was introducing its first ever NASCAR-themed ad.

The 30 second spot titled “Who’s Your Driver?” features footage of a number of top NASCAR Sprint Cup Series drivers whose likenesses are available on NASCAR Banking check cards and credit cards. Dale Earnhardt Jr., Jeff Gordon, Kasey Kahne, Juan Pablo Montoya and Martin Truex Jr., are featured in the new ad and are among the most popular drivers featured.

This ad is Bank of America’s third major campaign this year focused on sports fans, including deals with the Olympics and Major League Baseball (press release here). The brand has been very focused on upbeat, uplifting messages like “America’s Cheer 2008” (previous coverage from The Financial Brand here).

This latest spot starts with the line, “This is America, and you have the freedom to cheer.”

B of A has a good promotional tie-in with its co-branded debit and credit cards. At a special section of its website called “NASCAR RacePoints,” the bank details how you can earn points and “burn” them using their plastic products. You earn one RacePoint for every $4 in net retail check card purchases, and can spend them on exclusive NASCAR experiences, race tickets, NASCAR licensed products and goodies like flat panel TVs, iPods and much more.

Use the NASCAR card, get NASCAR stuff. “Earn and burn.” It’s a nice, self-reinforcing promotion.

Bank of America first launched its NASCAR program in 2007. As the “Official Bank of NASCAR,” B of A can offer NASCAR themed checks, debit and credit cards. B of A calls it ‘NASCAR Banking.’

“Our affinity products are some of the fastest growing products we have at the bank. And the NASCAR products are in the top 10 of those,” says Mike Hargrave, an executive with Bank of America’s NASCAR program.

It’s worth noting that B of A is headquartered in Charlotte, North Carolina, the heart of NASCAR country.

The NASCAR Banking ads, produced by worldwide advertising behemoth BBDO, won’t be running nationally until July.

You can read the full script for the spot on page 2. You can read B of A’s full press release here.

Bottom Line: NASCAR is on-brand for B of A. They should be the sponsor of American traditions like NASCAR. After all, their name is Bank of America. They’ve sponsored the Dallas Cowboys — “America’s Team” — for over two decades. The Olympics. MLB. And this announcement from today: the U.S. military. All things American. This is a much better, much more believable brand direction than “Higher Standards.” Two thumbs up.

Key Takeaway: Affinity products are a great way to engage people with a financial brand and counteract the dull, stodgy and boring image associated with the average bank or credit union. What brands can you link with? (Note: You don’t have to be a major brand, nor do you have to pick a major brand to partner with to succeed with this strategy.)

A research company studied brands in 75 different categories to measure the degree of differentiation among competing companies. Banks were among the companies studied.

Guess what? Banks are viewed as having zero differentiation. The good news is that banks weren’t the only undifferentiated category:

“Banks, motor oil and 20 other categories – nearly a third of all the categories examined – did not have any differentiated brands. The products and services were ‘known,’ but not known for anything in particular.”

For some reason, soap manufacturers have figured out something most financial institutions haven’t. The study found that 100% of soap brands differentiated themselves.

It makes sense. Look at the six brands of soap to the right. All six are distinct. Most people could probably articulate something different about each of them even if they don’t personally use those particular brands.

• Dial works longer.
• Lava is for tough guys with dirty hands.
• Dove is smoother, and for women.
• Zest opens your eyes.
• Neutrogena is pure, simple and clean.
• Irish Spring leaves you “Fresh and clean as a whistle.”

One reader of the study blames hollow bank slogans and endless mergers for the lack of differentiation among providers of financial services:

“Take the category of banks. They produce one meaningless slogan after another. ‘Where money lives,’ ‘Embracing ingenuity,’ ‘The clean Swiss bank,’ ‘Here today. Here tomorrow.’ Slogans like these and endless mergers have commoditized the category.”

Add to this the many similar-sounding names endemic to banks and credit unions — 1st, First, One, Community, etc. — and you’ve got another major contributor to financial “blanding.”

Bottom Line:

• If you don’t clearly stand for something — anything! — consumers will think you stand for nothing. This is a recurring theme in financial services.
• Failing to create meaningful differences forces people to define you by their own criteria — usually quantifiable things like rates, fees and the number of your branch/ATM locations.
• You absolutely must distinguish and differentiate your financial institution from the countless bland options that already exist or risk reduction to a simple commodity.

Key Questions: Can your organization succinctly articulate a clear, unique and meaningful brand promise or position? Do key stakeholders in your organization agree on this brand position?

Reality Check: Is there anyone else in your industry who could credibly make your Brand Promise? (Hint: If you said anything about “friendly, personal service,” or something like being “the best provider of financial solutions,” the answer is most definitely “yes.”)

Note: The original study is available offline from Brand Keys.

“Aren’t you ready
for real differentiation?”

Financial institutions across the country are duking it out over high-interest checking accounts, the ones paying upwards of 6.25%.

These high-interest checking accounts were a differentiator for a brief while when they first came out. Today, there are multiple financial institutions offering the exact same account in every city in America.

Take Portland, where at least three different community credit unions are slugging it out. There’s Rewards Checking from Rivermark. There’s Remarkable Checking from Oregon Community. There’s Fusion Checking from Advantis.

Which one to pick? “Hmmm, I’ll go with this one. They’ve got the best rate.”

Fusion Checking was the latest to enter the market, so that’s probably why they had come in with a higher return.

All these accounts are identical in every way except the rate. They all offer a high interest rate and free ATM refunds, with no monthly fees. They all require 10-12 debit transactions, and you must access online banking and receive electronic bill payments every month.

There are minor variations with only slightly different requirements, such those that require direct deposit. Oregon Community offers a derivative it calls FreeTunes Checking, where you can get four free iTunes downloads each month in lieu of earning interest. At least that’s a little something different.

Reality Check: Trying to create differentiation around any financial product or service is tough. Once anything is successful, everyone will be doing it.

There’s one company behind this widespread high-interest checking phenomenon: Bancvue. They are the folks that first introduced Rewards Checking (as it’s commonly called), and they’ve been marketing it very aggressively. Earlier this year, Netbanker reported that there were over 400 Bancvue accounts, and that Bancvue adds 30 customers every month.

Bancvue’s website is a slick Flash tour that does a fantastic job selling the Rewards Checking solution. There’s language all over the place touting how Rewards Checking can “truly differentiate you from the competition,” and asking questions like “Aren’t you ready for real differentiation?”

The company’s “distinctive” claims were very true in the beginning — before everyone had Rewards Checking — but probably not anymore.

The folks at Bancvue shouldn’t take this the wrong way. Bancvue isn’t to blame. They’re doing exactly what anyone else would do in their shoes. They have a hot product and they are selling it to everyone who will buy it. But is it the best thing for their bank and credit union customers?

Key Questions:

• What would have happened if Bancvue had offered exclusivity in certain markets, as Currency did with Young & Free?
• Reverse-engineering a Rewards Checking account seems pretty straightforward, so what value does Bancvue provide? Wouldn’t an intelligent CFO be able to crunch the backend numbers to make them work?

Bottom Line:

• It’s not “differentiating” when everyone is doing it.
• If your financial institution deploys a Bancvue-style product, please, do yourself a favor and don’t use the generic name, Rewards Checking. There’s already way too many of those. Just Google it and you’ll see.

“In today’s business environment, the word ’same’ could be shorthand for ‘out of business.’” — Dan Clark

Never mind that the author of this blog post is only 21, this kid nails it:

“The best way to draw people in is to show how you are different from a bank; rate and fee changes aren’t going to do that.”

His step-by-step advice is elegant in its simplicity:

1. The first step is to figure out who it is you serve.
2. Once you know who exactly you are serving, you’ve got to figure out exactly what they want.
3. Once you have that information, change is required. Otherwise, what use is it to collect all this information if you just say you support your field of membership without actually shifting your position to serve those people?

Bottom Line:

“Don’t be afraid to be different. If you do something different in a way people can see, it will draw more eyes…to your credit union.”

Tip of the Hat: To Andy LaFlamme, employee of Maine State Credit union, publisher of The CU Loop, and author of this post. His succinct articulation of many ‘Fundamental Theorems of Branding’ is simple and straightforward.

“The challenge is that most banks have a long legacy of product-centric, ‘everything for everybody’ ways of thinking. This leads to decision-making and resource commitments that reinforce ‘better sameness’ rather than true differentiation.”

– Frank Capek

The Northwestern Financial Review ran a story back in 2004 on research conducted by financial consulting firm NewGround Resources. The study included 480 credit unions. From the article:

• Only 2% of those in the survey believed that there is “lots of differentiation” among credit unions
• 68% said they expect their member representatives to deliver a memorable experience over and above the basics of good service
• 78% of credit unions said they were in the business of “building emotional loyalty”
• 26% said they had outgrown and changed their name
• 38% were planning to change their name
• 21% said lack of creative thinking was their biggest challenge
• 69% said their main competitor was a local or nationwide bank
• 20% said their main competition was other credit unions

Key Question: How can you deliver a memorable experience when you don’t offer anything different from your peers?

Reality Check: Credit unions now compete with credit unions. More community charters means more competition. This could strain the cooperative spirit that has historically existed between peers.

Call it what you want. “A national campaign.” “A state league campaign.” “A credit union brand campaign.” “A credit union awareness campaign.” It doesn’t matter. Here are four things to consider before pursuing one.

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