Brand Aid for Financial Services Firms
Most prominent companies have long understood that a corporate brand is a valuable—albeit, intangible—business asset that must be carefully managed. There is no doubt that Coca Cola, IBM, CitiBank, Travelers and a host of other major corporations have been minding their brands for decades. Smaller financial services firms, however, have only recently begun to recognize the importance of developing a strong financial services brand.
What Is A Brand?
While positioning determines the mental and market space that a firm, product or service should occupy, branding delivers the unique perceptions that reinforce that positioning in the marketplace.
- A brand is the face that a company projects in the marketplace. It encompasses organizational attributes, corporate personality and brand symbols, as well as the perceptions held by the company’s different constituencies.
- A brand represents a company’s reputation in the marketplace. A strong brand engenders trust. It conveys the quality and reliability that people look for in a financial services provider.
- A brand is a company’s badge of distinction. A strong brand can help create a differentiated corporate persona that enables a company to stand apart in an increasingly cluttered and competitive market.
Business literature has recently devoted a considerable amount of ink to the discussion of the significant benefits that a strong brand can impart to a corporation. At the macro level, a strong brand can help a firm achieve a leadership position within a market segment. On the micro level, a solid brand can impact customer familiarity, preferences and loyalty.
A strong brand communicates the corporate value proposition that helps an organization create relevant marketplace differentiation and competitive advantage. It can also help to significantly accelerate the sales process. Prospects who recognize and trust a brand will often set aside their routine skepticism and caution. They will, for example, forgo their normal due diligence, do less comparative shopping and act more quickly and confidently to make a positive buy decision.
Measuring the Value of a Brand
Brand equity is a measure of the predisposition of various constituencies to purchase or recommend a given brand. It consists of the audience’s awareness of and familiarity with the brand and the images and perceptions they form by synthesizing the opinions, images and information available about the brand. Brand equity is, in effect, the power of a brand to create preference, satisfaction and loyalty, and the association of the brand with successful products and services.
Since brand equity is highly qualitative, there is no single definitive measurement approach. David Aaker, one of the thought leaders in the area of brand equity, used the principles of consumer psychology to develop an approach that measures brand equity on four dimensions: Brand Awareness; Perceived Quality; Brand Associations; and Brand Loyalty.
Brand Development and Management
Branding—the ongoing tasks associated with the creation and a strong market image and the effective management of market perceptions—is both an art and a science. Research studies, academic white papers and a robust branding agency industry are continually providing different approaches and new branding techniques to the marketplace.
There are, however, some basics that apply equally to branding a new company or revitalizing an existing brand.
Brand Definition. What perceptions does the company want to create and maintain over the long-term? What brand attributes would it like to have associated with the firm? For example: Does the company want to position itself as a specialist or have universal appeal? Does it want to move its brand up market or down market? Would brand extensions enhance or deteriorate its marketplace reputation?
Brand Elements. If consistently and continually used, carefully developed visual and verbal “symbols” can reinforce the chosen brand attributes and serve as the company’s marketplace signature. These elements include names (for the company and its products and services), benefit-driven marketing messages and a powerful design system that begins with a logo and color palette(s) and then addresses all visual subjects and symbols, as well as graphic style and format.
In a cluttered environment where financial products and services are screaming for the attention that has become harder and harder to achieve, a strong brand provides a shorthand for marketplace recognition and a corporate badge of distinction that paves the way for more immediate acceptance. With so much at stake, it is important to manage your brand to leverage your assets and gain the maximum value that branding can provide.
The Bottom Line
Financial services firms of every size should now understand that their brand is a strategic asset that has a significant influence on long-term performance. The benefits of effective brand management accrue to an organization even though such branding concepts as trust, reputation, loyalty and emotion don’t appear on the balance sheet.
Firms that do not make the effort to create a strong brand are missing the opportunity to take advantage of a powerful marketing tool that can help them effectively communicate with the marketplace and create long-term marketing success. However, careless branding is sometimes as harmful as no branding at all. Far too many firms create brand confusion by using verbal and visual brand symbols that send mixed messages to the marketplace.
Any firm that is not focused on managing and maximizing the value of its brand is missing an important opportunity.