The latest wave of brand innovation is helping financial organizations attract new customers, stay updated with customer trends, and position themselves better in the market.
Banks are realizing that to attract customers, it’s no longer just about providing traditional financial services. They are delving deeper into the customer decision-making process to understand what truly matters to them. The new generation of consumers is prioritizing a company’s mission and purpose when making purchasing decisions. As a result, banks are striving to connect their brand with a stronger message, going beyond just focusing on regular financial activities.
Properly improving and innovating a brand can bring a competitive advantage for businesses
According to a recent Razorfish survey, 3 out of 4 Gen Z customers said that the brand they purchase represents a larger mission. For 6 out of 10 consumers across all age groups, brand value is highly important. The research also revealed that a brand’s purpose is even more crucial than factors such as innovation and price reduction in purchase decisions.
Juliet D’Ambrosio, a brand director at Adrenaline marketing company, said, “Consumers have changed. Brands need to be adaptive.”
D’Ambrosio added, “Honestly, C-suite executives are paralyzed by the importance of brand innovation.” “How is it really going to work? How can they prepare for it? How can they sell it to their organization?”
The new generations have different expectations for their interactions with brands, meaning the marketing cycle is getting shorter. Research from Adrenaline shows that only just over 1/3 of banks and credit unions have rebranded since the beginning of the pandemic in 2020. The results also indicate a noticeable trend in brands embracing the need for change.
Maintaining brand strength truly is good business. The practice should be evaluated about every three years. Every 36 months, companies should consider reaching out to customers through surveys about their preferences and values.
Understanding the psychology of the customer base
When it comes to brand rebranding, some forward-thinking companies are actually going back to textbooks. Based on the work of Carl Jung, archetype mapping is a way to connect with customers by using symbols to help consumers understand complex ideas. Jung focused on 12 encompassing archetypes that he believed have been used in storytelling across cultures and nations worldwide. D’Ambrosio mentioned that over the past two decades, some of the world’s most famous brands – including familiar names like Nike, Google, and Apple – have used this method to define their brand image.
Instead of asking organizations how they perceive their company, C-suite executives should look at the data. After looking for internal cues about brand identity, organizations should conduct market research to understand customers and the market in general.
Rebranding brings opportunities for differentiation
The need for brand innovation doesn’t necessarily mean that brand is outdated and often can be a result of a strong business model. Companies seeking renewal often have an increasingly expanding customer base, surpassing the initial message. Rebranding can also be carried out after an M&A deal.
According to data from Landor, nearly 3/4 of S&P 100 companies rebranded within the first 7 years of operation. D’Ambrosio also estimated the timeframe to be around 7 years. In a competitive environment where every bank and credit union sells checking accounts, credit cards, and mortgages, rebranding is also a way to stand out from the crowd.
The rebranding process typically takes several years to complete and can incur millions of dollars for organizations. Collecting prerequisite data and segmenting market research can take up to 18 months to complete, meaning rebranding should not be taken lightly.
Rebranding brings opportunities for differentiation
Banks should start with research
Prior to embarking on rebranding, it is important to conduct thorough research, assess potential risks, and develop a clear strategy that aligns with the bank’s objectives and values. Incorporate every decision and proposed branding into the data. Bank employees are data-driven, and rightfully so.
When the bank is ready for rebranding, prepare for surprises. This process will take anywhere from a year to 18 months and there are plenty of change management measures to consider.
A typical example is the recent regional bank crisis in early 2023. In this context, banks are having to rebrand, which requires patience and significant effort to navigate the risks in their volatile business environment. To maintain and grow their brand, banks need to invest heavily after implementing rebranding to support the strategy and continued reputation building. Measures that need to be taken include improving internally through employee experiences and likewise, focus on delivering excellent customer experiences.
Reference: The Financial Brand
Compiled by the DTSVN author team – The solution for the Digital Transformation Finance – Banking industry.
