Earlier this month, The Financial Brand conducted the “2009 Strategic Brand Challenges Survey for Financial Institutions.” The findings? Retail banks and credit unions are — not surprisingly — worried about a tough economy, and will be concentrating their energies online to retain, attract and acquire relationships over the next three years.
64% said their number one business priority was to retain existing relationships. Half said acquiring new relationships was their most pressing business objective, and an equal number are concerned about attracting a Gen-Y audience.
When asked “What are the biggest obstacles holding your financial institution back?”, 53% said the overall state of the economy. The next most-common answer was “too many initiatives,” cited by 29% of respondents.
The study also found some of the fears financial institutions held earlier in the financial crisis have subsided. Only one in four felt their capital position was an issue. Most surprising is that only three of the survey’s 112 (or 2.7%) participants said that rebuilding trust among consumers was a top priority at their financial institution. This seems to contradict almost all other studies in the financial industry that say the financial industry’s reputation is in the toilet. For instance, one study earlier this year found that banking is now on par with the tobacco industry.
Foggy about the brand, but branding important
“Creating meaningful brand differentiation” is the number one brand challenge holding financial institutions back, a problem shared by 39% of respondents. Meanwhile, another 30% said their organization lacked a clear brand strategy.
In order to successfully build their brands, one in every five respondents felt it was critical that their organization:
- Build a consensus around the brand and its importance
- Deliver a unique, branded experience
- Establish a consistent identity and experience
- Develop signature products or services
More than a quarter of respondents said their organization needed to focus on implementing their brand internally, specifically through employee training. This trend is something more and more supplies to the financial industry are noticing.
”Many financial institutions are shifting to supporting the brand at the staff level,” observes Jim Haack, President of Momentum, a firm specializing in the design and construction of facilities for banks and credit unions. Haack says financial institutions are increasingly curious about the ways in which they can use their branches and other buildings to support the brand.
When asked which attributes are the most important to compete successfully, 65% said be easy to do business with and products that are simple to use.
“There’s a major shift towards investing in simplicity and ease-of-use,” Haack adds. “Financial institutions that can make the staff’s job easier will be better positioned to retain and expand your existing relationships.”
“Eco-green” was the least important attribute, cited by only 18 respondents, or 15.8%. Equally surprisingly, “being innovative” ranked near the bottom.
The online experience is where it’s at
Moving forward, the most important touchpoints will all be online. When asked which delivery channels will receive the most attention over the next three years…
- 70% said online banking
- 59% said their website
- 51% said email
- 49% said online marketing
71% said they will have mobile banking deployed within the next three years, while one in five planned on developing an application specifically for the iPhone.
68% plan on using online social media tools like Facebook and Twitter if they aren’t already.
Interestingly, word-of-mouth marketing was mentioned by more than half of the respondents, while non-traditional and guerilla tactics were only cited by 17.4%.
About the study
Answers were supplied by 29 banks and 91 credit unions. Five respondents hailed from banks with more than $100 billion in assets. 55% of all respondents came from financial institutions with $500 million in assets or more.
75% of the answers came from people in marketing-related functions. 10% came from CEOs. One CEO from a bank requested the survey questions. He wanted to give them to his board, then compare with his answers. Good idea. You should give it a try.