Banking brands battle to stand out from the crowd

In the traditional, stuffy and exclusive world of private banking, wealth managers have started investing across multiple channels to modernise their brand, swapping old-fashioned imagery and language for a more friendly and colourful style of communication, to portray themselves in a way that feels warmer, more personal and accessible. 

By rebuilding their battered images from the financial crisis, they hope to gain loyalty of existing clients and resonate with a new breed of tech-focused individuals. These younger members of society have grown up using brands with a digital-friendly style of communication and are more likely to be environmentally and socially conscious investors.

Those players able to get their branding strategy right may gain significant rewards in a hugely fragmented wealth management market, where UBS, the largest private bank, has less than 5 per cent of the global wealth market share. 

But despite progress in their ability to communicate and fulfil brand promises, it remains difficult to differentiate between private banks and understand their added value, particularly as a new client. With the biggest wealth transfer in history on the horizon, business models can blow up very quickly.

“Many banks and wealth managers have got an ageing client base,” states Caroline Burkart, director at wealth think-tank Scorpio Partnership. Scorpio’s research shows most firms have two-thirds of clients aged over 65. 

“Banks have a two-track problem of continuing to serve existing clients and appeal to them, but at the same time developing a different look, feel and even parts of the proposition for a younger clientele.” 

‘Hard’ factors such as personal connection, assets under management and fund performance have proved most important to clients in the past, says Helen Westropp, managing partner at London-based global branding agency Coley Porter Bell. “But with the expansion of greater impact communication, and more sophisticated and changing clientele, softer brand factors are becoming more important, particularly in banking, a sector inherently distrusted by people,” she adds. 

Shifting attitudes

Private banks’ shift in attitude towards branding is evident in the way UBS has depicted itself since relaunching in 2015. This followed its repositioning as primarily a wealth management business, having de-risked its investment bank. Its brand strategy has projected the image of a touchy-feely bank, eager to help clients find answers to life’s big questions.

 “The most important piece for a brand campaign is to convey the message that humans and brand are not that different,” says Jonan Jervoe, chief marketing officer at UBS, who joined in 2013 after building his career in consumer brands, including US fast-food giant McDonalds and technology company Intel. 

“You want to be with someone that is warm and relatable, that can connect with you and has empathy. It is much the same with a brand.”

The bank’s client research indicated the importance of portraying real people with real issues. “There are certain times in one’s life when the role of banking becomes more important,” says Mr Jervoe. 

“These include getting your first job, buying a flat, setting up a company, getting married, having children, getting divorced or deciding how much money you should leave to kids when you die.” 

It is when going through these key life events that people are more likely to feel emotional about banking and develop an attachment to a brand. What they need in these situations, says Mr Jervoe, is a wealth manager that can relate to the client, have a conversation and present scenarios of how other clients have tackled similar challenges.

A legacy of the financial crisis is that “people want a more active role in their financial future than ever before, and this goes hand in hand with client advisers offering a personalised service,” he adds, even though banks such as UBS promote digital interaction.

The Swiss bank, which manages more than $3tn in client assets and markets itself as the “only truly global” wealth manager, has been increasingly vocal in communicating its brand values, using a mix of channels and celebrity testimonials for campaigns around diversity, sustainability and impact investing, reflecting the firm’s business focus on these topics, particularly dear to the younger generation. 

Staying relevant

Banks also develop a brand to create relevance to target clients. In the case of Credit Suisse, these are individuals “with an entrepreneurial mindset, who want to drive progress and move forward, not just for themselves but also for society,” explains Francesca Krist, head of branding at Credit Suisse.

Branding is about more than slapping a logo on a business card, she says. “It is about finding your unique selling proposition, how your clients benefit and then connect all that to the company’s core values. If you succeed in doing that, you will start to see branding and marketing not just as a cost factor but an investment.”

Employees are all “brand ambassadors”, and providing internal training is key. “Brand is very closely linked to culture and reputation, it’s something you have to foster within the organisation, especially because in wealth management products and many services are intangible, so it’s your people that have to deliver. If it is not part of your DNA, it is going to be very difficult to build up a brand,” adds Ms Krist.

The entire definition of brand is evolving, states Kelly Mannard, chief marketing and communications officer at US bank Northern Trust. 

“It’s now becoming more of a client experience definition. We focus on how audiences perceive and value their interactions with us, from their initial contact with Northern Trust through the entire life cycle of their relationship as a client. Every touchpoint with our clients and prospects is a reflection of our brand promise, and every interaction helps build brand loyalty.”

To resonate better with the next generation of wealth and acquire the flexibility to adapt to new communication channels, the US bank undertook a brand refresh in 2016 that included a review of its brand promise and redesign of its look and feel, including modernisation of its corporate logo. “The entire idea of our brand promise, ‘Achieve greater’, speaks to more than luxury and exclusivity; it speaks to doing more with your wealth: leaving legacies, giving back, building businesses and inventing more,” she says. 

This conversation will likely sound different according to the segment being addressed with a particular value proposition.

“Client segmentation is very important for us and we talk differently to these different client segments,” says Ruellen Bateman, head of marketing at Investec Private Banking, South Africa, pointing out that young entrepreneurs’ needs are very different to those of established families, for example. “What is critical is to know your clients and make sure you are relevant to them, at the right point in time.” 

The key differentiating factor of the South African bank with the iconic Zebra logo is its service model built around its One Place proposition, through the collaboration of Private Banking and Wealth & Investment, offering clients “integrated access to banking and investment services, both locally and internationally”. 

But banks can never rest on their laurels when it comes to branding. “Brands need to reinvent themselves all the time, have to stay with their core value-set but have got to get beyond just a functional relevance, it has to be emotional as well. Purpose-driven brands are critical to the future generation,” says Ms Bateman. 

People are becoming more critical about what a brand does and what it stands for, and brands need to spend more time linking their brands back to a purpose, believes Ms Bateman. As an organisation, Investec “strives to make a difference, living in the community”, but does not necessarily advertise it. Rather, it creates platforms, such as the one for entrepreneurs, giving clients the opportunity to work with the bank on community programmes.

New way of thinking

In a similar vein, Lombard Odier’s latest ambitious brand campaign attempts to look at sustainability and sustainable investment from both logical and rational standpoints, according to Fabio Mancone, the Swiss bank’s chief branding officer.

This represents the latest chapter of the bank’s Rethink Everything campaign, which started in 2016 and is a “crystallisation of the bank’s fundamental philosophy”, built around values of discretion and prudence, combined with evolution and innovation. The object of this multi-layered campaign is to encourage the target audience to recognise the “essence” of the 222-year-old bank, while thinking about key trends which may impact their investments.

These campaigns have driven “huge spikes” in traffic to the bank’s website and social media channel. Employees have also embraced the philosophy of the campaign and integrated it into their work, claims Mr Mancone.

This notion of using the brand to influence employees as well as clients is key to the thinking of many private banks, surviving amid a fierce and costly war for talent. Having a clearly differentiated proposition and clear sense of purpose gives private banks a major advantage in retaining staff. 

Private bankers increasingly move to boutique firms or join asset management firms where they are given stakes in the business. “But it is rare for a very successful private banker to leave a top firm for a much lower category institution, people tend to move up the quality ladder,” explains Kim Cornwall, founder of learning and development consultancy Cornwall & Co.

Continuous changes

In this highly competitive environment, where banks are squeezed by cost pressures, large international players such as UBS and Credit Suisse will continue to grow market share at the expense of smaller firms, unless the latter can point to a strong reputational record and brand, which will help boost market share.

To pursue this branding, banks need to allocate substantial, on-going resources, not just one-off spend, warns Mr Cornwall, a former private banking director at SG Hambros.

Although technology and artificial intelligence have reduced the cost of accessing brand engagement tools, some banks remain anchored to traditional communication channels, rejecting use of social media as “beneath them”, not realising this attitude compromises their ability to reach the younger generation. 

Many private banks are ignoring transformational changes in society, shoring up their existing positions and seeking scale as the only answer to their challenges, says Peter Matthews, founder and CEO at brand consultancy Nucleus. In this climate of decreasing loyalty and digital innovation, wealth managers have done little to give meaning to their brand. 

“Many leading wealth managers mistakenly believe they have unique propositions when, in fact, there is a widespread lack of differentiation in the sector and opportunities for competitive advantage are being lost,” he adds.

When comparing wealth managers’ strategies, visions, offerings, global footprint, and marketing materials, the same ‘unique’ value propositions are found across most. These include: a strong client focus, advisory excellence, global reach, and a broad and superior product offering, according to a 2018 study by Oliver Wyman and Deutsche Bank.

Private banks are going to have to address why they exist and find hard differentiators in their value proposition. These may include expertise in certain niches, or innovative products. 

“Private banks and wealth managers need to come up with unique products, or package and brand them in a way they are seen to be unique, because the next generation of wealth is looking for those differentiators,” says Mr Matthews. 

They also need to identify ‘softer’ values. These might include being better connected in specific markets or industries, or a focus on an agenda which millennial entrepreneurs identify with. 

Brands that lose sense of this purpose tend to diminish in influence and profitability. So revisiting why a bank should exist is a very useful process, believes Mr Matthews. 

“When you find you are just generic, or when you claim it is just about personal service, then an alarm bell goes off,” he says.