Many financial institutions find themselves mugged by circumstances. The recession has tried men’s souls.  In turn, those men have concluded “the banks” must be responsible for all their problems. Even long-standing customers have become suspicious.

Core deposits are stagnating. In some cases, a bank may have had to disclose bad news, bad earnings, bad loans and, shudder, even the dreaded ‘capital impairment’.

One way out of this is to re-brand the bank. Change the name. Change the look. Re-decorate the building, inside and out. For many financial institutions, this may be a really, really good idea.

But, before you pull the trigger and call in the design consultants, you should do four things first:

1. Survey your employees. You need to know where your institution stands with your employees. So, find out what they know about your customers you don’t; take the pulse of their concerns. Ask them “who is the competitor in the market you think is better that our bank, and why?

2. Survey your customers. Segment your best deposit customers, your best loan customers and your best commercial customers — the customers who pay you the most fees, or provide the cheapest balances. Find out where else they bank and why. Ask them, straight out, these three questions: (1) What is our institution doing that bugs the heck out of you? (2) What are we not doing that we ought to be doing? (3) Would you recommend our bank to your best friend? Close family member? If you would not recomend our bank, which bank would you recommend? Why?

3. Survey your competition. Take a long, hard look at all the banks, thrifts and credit unions that compete for your customers. Figure out where they are (literally and metaphorically). Make solid, sensible and realistic estimate of their strengths and weaknesses.

4. Do a SWOT. Now that you know all the above, figure out where you are Strong and where you are Weak. Determine your Opportunities and the imminent Threats to your success. Decide how you are going to change. Formulate a road map, a strategic plan and the implementing tactics to leverage your knowledge into a successful re-invention of your institution.

Now, and only now, after performing those four steps, can you re-brand the bank. Until you know (1) where you stand, (2) how you need to improve and (3) how you’re going to get there, re-branding isn’t going to be possible.

Oh, yes, you can do a new logo.  And, yes, you can come up with a catchy slogan.  You can also redecorate.  Even bring in a hot shot motivational guy to pump up the troops.  But, none of that is re-branding.  Customers won’t buy it — and it’s very likely they’ll be offended because you tried to fool them, putting a new dress on an old pig.

Lao-Tzu said it best, “The way to do, is to be”.  George Self says, “You can’t “brand” if you can’t “be”.

We know branding. We know SWOTs. We can help your institution re-invent itself. Call us, 800-521-0236.

Filed under: Bank Marketing & Advertising, Public Relations by George Self
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According to the Saturday, April 18 Wall Street Journal Delta Airlines is shutting down its use of India call centers.

In what I like to think of as a rare outbreak of common sense, Delta said “it stopped routing calls to India-based call centers over the first three months of the year. Customers had complained they had trouble communicating with Indian agents”

The article also quoted a certain Ben Trowbridge, chief executive of Alsbridge Inc., a Dallas-based company that advises on outsourcing.  Mr. Trowbridge delivers a Blinding Glimpse of the Obvious when he says, ”It is fundamentally cheaper to do it in India, but there’s also the question of whether it’s better to do it cheaper or better to do it better in terms of the relationship with your customers.”  Fortunately, it is now obvious to Delta Airlines.

It reminds me of the sign over the cash register in my grandfather’s shop (he was a gunsmith, knife sharpener and an expert on cheap bourbon) which said, “We’ll do it for you cheap, good and fast.  Pick two.”

OK, in our modern day, Indian call center iteration, the pitch to modern business space cadets (and their boards of directors)  is, “I’ll answer your customers’ phone calls for one-sixth the cost you’re paying now.  I’ll answer the phone on the second ring and if I don’t, nobody will have to be on hold for more than 90 seconds.  But, whether or not I know how to use your customer’s language, or whether or not your customer will have any idea what the heck my call center people are saying is (entirely) another matter.  And by the way, I can’t guarantee you my call center staff will know the difference between “idiom” and “idiot.”  But, don’t forget, I’m CHEAP and your company will SAVE A LOT OF MONEY.

Good grief, when you think about how much it costs to actually GET a customer you wonder just how much CFO Kool Aid it took to convince management that it would be a great idea to save money by letting a bunch of idioms talk to their customers and, worse yet, make decisions that have a big impact on how customers were treated.

Fortunately, for all those who fly Delta, somebody has finally concluded that some things are worth whatever they cost.

Of course, there is the whole political issue.   For banks — PARTICULARLY banks who have taken TARP money — sending jobs overseas, or keeping  jobs overseas, is a needless risk to its public and political reputation.  Just imagine the flack that would ensue if a bank, headquartered in a state where unemployment was north of 10% — and that’s a lot of states — had to announce some “employee cutbacks” and were later discovered to have a call center outside the US.  Ouch!  Truly, there are some things that are so cheap they can’t be afforded.  Period.

Most of you won’t know Pogo, nor will you know his creator, Walt Kelly.  But, you will readily grasp this famous proverb, penned by Mr. Kelly: “We have met the enemy.  And, he is us.”

SIDEBAR: want to know more about Pogo and Walt Kelly?  Go here.

Filed under: Bank Marketing & Advertising, Public Relations by George Self
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I recently spent a few hours with a one of my “occasional friends.” You know the type. Somebody you like quite a bit, have a lot in common with, but for one reason or another don’t get to see that often. During that visit, we got to speculating about what the future holds.

I had just finished a three hour marathon ‘catch up’ session of a week long accumulation of my newspaper addiction (in which the Wall Street Journal and the New York Times are prominently featured). No doubt I was heavily influenced by my recent readings.

Here’s what I think the next few years will be like in two words: the sixties.

Few people will be wealthy. More and more people will learn to “make do.” The stock market will be moribund. The number of people who work for real estate brokers, builders, mortgage brokers will shrivel into mere shadows.

More people will drop out of the economy and ‘live off the land’, or whatever the 21st century equivalent will be.

Life as we know it, including the daily newspaper, is simply going away, taking many of our cherished aspirations with it. For example, retiring at 65, living 6 months of the year at the beach and traveling the other 6, is not going to happen for 99% of the population.  Working longer, much longer, into our 80s perhaps, will be a fact of life.  In fact, the definition of “retired” will change drastically.  Even Webster’s will notice.

And, it may become even grimmer. One real casualty will be living to a ripe old age. It’s not likely we can afford for millions of us in the US to live into our 80s, much less 90s. Why not? Because it simply will be come uneconomic to spend the money it takes to keep old people alive. It will be a Darwinian decision in economic terms: who will get the lion’s share of resources? People who have 15 years to live, or, those who have the potential to live 30, 40 or 50 years? You may not like the answer, especially if you’re older than 65, but, as you are soon to discover, what old people like, will increasingly matter less and less.  The economy will make it so.

The implications of all this are huge. People like me who do marketing for a living are going to have a big job on our hands. First of all, we have to convince our clients that the world has changed. It’s a done deal. Things simply are not going back to the way they were for the past twenty years.

Next, we’re going to have to help them reinvent their company and their products so that they are relevant to the way people will be living … in the new sixties.  If you’re in the banking business, I think you have to concentrate on making it easier and more rewarding for people to SAVE money.  You’re going to need no-nonsense, no-frills products that COST LESS.  You’ll need to lower your costs to acquire deposits by using the Internet.  Ditto delivering loan products.  People will be willing to give up some warm and fuzzy time with your bankers in return for a product that costs less.

Despite the jolting changes that are coming, remember this:  Hard times produce the need for escape.  A need for hope.  Those are times that are tailor made for advertising, which is nothing more than a promise of something better.  The sixties were the golden age for advertising because people needed the promise that things could be better.  The media available for advertising will change.  But the NEED for advertising will not.

And finally, speaking of the sixties, I recommend you download a song from the sixties and listen to it a few dozen times. The song title? Don’t Think Twice it’s All Right. Why you ask, am I telling you to buy and listen to this song? Two reasons: (1) Since we’re headed back to the sixties, I thought this song would be a great theme (positioning statement for you marketing geeks) for the saga we’re all about to embark upon; and (2) the song helps you get your head around the fact that life can be unpredictable and mess with your plans. Don’t let it get to you. When you get nailed, put yourself back together.  Don’t think twice about it, it’s all right. Or, in the words of my occasional friend, “Stop talking  Stop asking questions.  Just get on with it.”

SIDEBAR: Some of you will remember the song’s author, a Robert Allen Zimmerman, born in Duluth, Minnesota. Mr. Zimmerman, who released this way-cool song in 1963, became one of the most popular singer/song writer/performer (even poet) of all time. You may know him as Bob Dylan.

Filed under: Bank Marketing & Advertising by George Self
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There has been a lot of heat, and very little light, about the “bailout of banks.”  What is clear to me is that almost nobody understands how banking works.   That’s too bad — for bankers.   Less than .001 percent of people understand (1) how banks make money, (2) how federal policy regulates what banks can do to make money, and (3)  what the heck a bank is and isn’t. And, whose fault is it that banks are so widely misunderstood, if not actually reviled?  Here’s a clue: banks spend less than 1 percent of their assets telling customers what is good about the bank.  Why is that so?  Because banks don’t think their shareholders want them to waste money on frills, like PR.

There’s a maxim in the PR business: spend some time every day making sure your customers know why you are important to them.  Even if your products are very similar to your competitor, never, never, never stop convincing your customer that your bank is better than any other bank because of WHO you are.

So, now that the proverbial excrement has hit the fan, banks everywhere have to endure a public scourging mostly because the public doesn’t understand anything except what they read in the paper — or see on the internet.

And, where, you ask, are the banks now?  You’d expect them to be out there explaining why they aren’t part of the problem.   You’d expect them to be running ads, hitting the rubber-chicken circuit, writing letters to the Editor making their case about why they are victims of the economic crisis, not the perpetrators.

The answer is, they are nowhere.  Their excuse for not getting the word out is a variation on the theme.  Now it is “Our shareholders don’t want us to spend money we don’t have on advertising.”

And, what is the result of all this?  More people hate bankers this year than last year.  More people hate banks than hated them 60 days ago.  Nobody can think of one reason why their bank is one bit better than any other bank.  Nobody can think of even one example where their bank has demonstrated a willingness to help be part of a solution.

Except the credit unions.

I know bankers hate credit unions.  I know all those reasons.  But, the simple fact is that credit unions are winning the PR war.  When you read the news, you read lots of stories where customers praise their credit unions for working with them. Politicians, reporters and editors alike praise the cooperative spirit they find in the local credit union. And those same worthies seem to take delight in damning the bankers. 

Here’s a recent example: Arianna Huffington, writing in the Huffington Post  has fulsome praise for small banks — except she’s mostly talking about Credit Unions — read it for yourself here:  http://www.huffingtonpost.com/arianna-huffington/heres-a-switch-some-good_b_186455.html.

So, whose fault is it that the press seems to love Credit Unions and hate banks?   Who’s responsible for the fact that there are virtually no stories about what a bank has done to help anybody (but themselves)? Who has done virtually nothing to move public opinion the other direction?  (Editors Note: There was, actually, a sort of positive story in the May 12, 2009 NY Times about community banks.  It said they were “dull, but profitable.”  Not exactly fulsome praise.)

Do I really have to answer that question?

Filed under: Bank Marketing & Advertising, Public Relations by George Self
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Customers punish banks that don’t communicate with them.  At least, that’s the conclusion I come to when I read a bank customer survey that is just out from Crain Communications.

In other words, if you’ve got good news, say so.  If you don’t have a good story to tell, then, by all means, get one!

Whatever the case, DON’T LET THE MEDIA control what your customers (and your community) think about YOUR bank.

http://adage.com/article?article_id=135391

Banks Went Mum as Trust Dropped: PR Survey

Advertising Age | Published: March 19, 2009
By Michael Bush

Only 8% of Consumers Have Full Confidence in Financial Service Cos.

NEW YORK (AdAge.com) — Only 8% of American consumers have full confidence in banks and other financial service companies, according to an alarming new study from independent PR shop Waggener Edstrom Worldwide and RT Strategies.

Whether it’s all AIG and Bernie Madoff’s fault, the entire industry has been painted with the same brush and labeled as greedy and indifferent to the daily struggles of everyday consumers. And part of the problem is that these companies aren’t communicating with their customers.

The study shows that most people have either heard nothing from the industry or don’t really like what it is they are hearing.

Almost half (44%) of the 1,000 consumers polled between Feb. 28 and March 2 said they have heard something from the industry, either through traditional or new-media outlets, but felt more negative about the industry after hearing it. Another 38% said banks and financial institutions haven’t communicated with them at all. A mere 11% said they actually heard something from a bank or financial services company that made them feel better about the industry after hearing it.

“They are clearly in the midst of what has been a fairly negative media environment,” said Torod Neptune, senior VP-global public affairs at Waggener Edstrom. “Americans are listening to what banks have to say right now there’s just not a lot being said.”

Mr. Neptune said the study revealed that there was actually a window of opportunity for the industry to earn back the trust of consumers. That window, however, is closing fast he said.

“It’s an extremely hostile environment and it’s very unique in the midst of such hostility that consumers are still giving the industry somewhat a benefit of the doubt,” he said. “There are actually some pretty hopeful signs here they just need to take advantage of these opportunities.”

He’s referring to the study’s finding that not everyone thinks that the banks and other recipients of federal funds were using that money for bonuses. More than a quarter (28%) of those polled said they felt “banks are using the recently acquired federal funds to make consumer loans,” another 23% said “they were using the funds to make business loans” while 27% felt “they were holding the funds in reserve.” Only 21% said they thought companies were using those funds to pay salaries and bonuses.

So just who exactly do consumers think is doing the best job of addressing the current financial crisis? An overwhelming majority (69%) believe President Barack Obama is doing more to address the situation, while only 12% think the industry is taking the lead

Mr. Neptune said he still thinks the industry has a chance to do right the ship.

“The industry hasn’t been written off entirely,” he said. “But in the absence of their doing something and engaging in some type of dialogue their opportunity is going to disappear pretty quickly here.”

Copyright © 1992-2009 Crain Communications

Filed under: Bank Marketing & Advertising, Public Relations by George Self
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