Banking’s shake-up creates opportunity

The banking world is reeling (again). European Union bods have demanded the break-up of RBS and Lloyds, with both forced to sell off prized brands to alleviate competition concerns. The Government is adding another £40bn worth of taxpayers’ capital to the balance sheets of our “nationalised” banks. HSBC is losing 1,700 UK jobs.

By sheer coincidence, my diary had me addressing the Financial Services Forum this morning. In a panel discussion in front of 150 top banking marketers, I argued that a combination of factors means good marketing has the potential to revolutionise the banking industry in the next few years.

Examine those factors for a moment – the growing feeling of empowerment among consumers thanks to digital technologies and social media, allied to a shift in the importance of peer-to-peer influences and word of mouth marketing; diminished trust in traditional banks; and the fact that consumers are still a long way from the central focus when it comes to doing business in this sector. This leaves room for vast improvement in the banks’ customer experience.

As Stuart Smith outlines in his column on page 10, the EU carve-up alone will offer huge opportunities for marketers with the creation of three new high street brands. Add to those the branded entrants to the sector – still not taken seriously from within banking if this morning’s event was anything to go by. The response to the likes of Tesco’s banking plans from the floor could be summarised by “seen it all before” and “inertia might disappear for a year or two but it will return”.

Such an attitude smacks of an opportunity for change about to be wasted. If I was going to build a new retail banking brand, it wouldn’t be hard to find the necessary point of difference – consistent and exceptional customer experience across all channels. Innovation should be based on consumer needs as opposed to being based on new technologies (read our profile of Philips CMO Geert van Kuyck on page 14). True hearts and minds stuff.

Whether it be a new brand or an old one such as Northern Rock with new owners, let’s see the new managements take bank marketing from the “here is our latest campaign” level to the heights of consumer engagement we see in every other sector. Banking marketers who are only ever allowed by the structure of their organisations to achieve satisfactory customer experiences could soon face competition from those who intend to exceed customer expectations.

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