It is trying to right that wrong now relative security has returned with a multimillion brand campaign that attempts to reclaim what the Co-op sees as its USP – the ethical bank. The “fightback”, according to its interim marketing director Guy Herrington, is on.
The “For All the Right Reasons” campaign is led by an Arc London created TV ad that features a man talking passionately to camera about how the bank has turned down £1bn in business because it does not deal with companies or regimes that do not demonstrate ethical credentials.
It is an attempt both to put its recent past behind it. The bank suffered a tumultuous 2013 that saw the exposure of a £1.5bn shortfall in its finances that pushed it to the point of collapse, a legacy of the 2009 merger with Britannia, since described as a huge folly for both.
Its problems were compounded by news of the arrest of its former chairman Paul Flowers on drugs related charges last year. The perfect storm of financial stability and scandal sent brand reputation scores for the once lauded brand spiralling southward.
The Co-op Bank’s financial saviour also raised eyebrows. Many questioned whether the ownership structure it was forced to adopt to secure its future, which saw the Co-op Group’s stake reduce by about 20 per cent and majority control passed to bondholders, meant it could describe itself as ethical as it had when a co-operative.
The passing of time and its relative financial stability have, however, led to an improvement in brand perception. According to YouGov BrandIndex its Buzz – a net balance of the positive and negative things people have heard about the brand – is -6.9 as of today (2 October) but that is a vast improvement on the -31.1 it scored 6 months ago when it was rock bottom of a list of 27 high street bank brands.
Elsewhere, its Index score – an average of how consumers rate it in terms reputation, satisfaction, value, quality, whether they would recommend it and their general impression of the brand – has also enjoyed a similar turnaround. Its score is currently -0.8, up from -12.5 six months ago.
With the brand’s health improving, the bank believes it is the right time to remind people of its historical stance on ethical investment, a message it believes will resonate as strongly today as it did when it launched the first ad trumpeting its ethics – Townsend’s House (see below) – in 1992.
Herrington, who will soon stand aside when former Nationwide and Npower marketing boss Alastair Pegg takes over – told Marketing Week the campaign followed a comprehensive survey of the bank’s customers and some non-customers that returned the overwhelming message that there was a place for a bank that could credibly described itself as ethical. Eighty per cent of customers said they would be more likely to stay at a bank that had an ethical lending policy while 50 per cent of non-customers would switch to a bank that had one, he says.
“The work we have done tells us there is a place for a bank that goes about its business in a principled and values driven way. There’s only one bank that can occupy that space and that might be us.”
Co-op Bank chiefs will be hoping the campaign arrests the rate of customers moving their banking elsewhere since last year’s scandals. Latest TNS switching data shows of those switching their current accounts 6 per cent moved from Co-op Bank to rivals and it attracted only 1 per cent of switchers, a pattern of net loss seen throughout 2014. The bank admitted in August it had a net loss of 28,199 current accounts in the six months to 31 June.
Despite the survey indicating it could attract customers, Herrington insists the campaign’s main objective is not acquisition.
”It is about reinforcing who we are and what we stand for. Signalling our intent to be true to roots remind people of our intent to develop ethical policy.”