Mark Ritson: From branded house to house of brands, RBS’ strategy is both ambitious and radical
Following a rebrand in Scotland, a new brand and repositioning in England, and a revitalisation in Ireland, can RBS successfully transition from a branded house to a house of brands?
When it comes to major marketing moves there is a clear and enduring hierarchy of pain. At the bottom of the hierarchy are the mundane, everyday tactical moves that cause barely a whimper of concern from even those strategically responsible: a change in distributor, a new spokesperson or the introduction of new segmentation. In the middle come more challenging marketing executions like changing ad agencies, implementing a CRM system or launching a new product.
And then, at the very top, above all others, is the scariest prospect of them all – rebranding. It’s actually a catch-all concept for many different approaches to brand change. In a pure rebranding the company leadership decides to rename the brand and overhaul what it represents in the market – think Accenture (formerly Andersen Consulting). In a repositioning the name stays the same but what the brand stands for is radically changed – think Ryanair. In a revitalisation a formerly successful positon is reintroduced for a new era – think Burberry. Each of these individual strategies represents an enormous organisational challenge and a career-defining moment for those responsible.
It’s only with a full understanding of the size and scale of each of these different brand challenges that you can appreciate the degree of difficulty attached to RBS and its announcement of a new brand strategy this week.
The company has announced not one, not two, but five simultaneous alterations to the RBS Group and each represents its own separate, enormous marketing challenge. In Scotland, RBS becomes Royal Bank of Scotland. In England and Wales, more than 300 RBS branches are to be rebranded as Williams & Glyn and divested from the company. Meanwhile, NatWest – which retained its identity despite significant back-of-house integration into RBS – now becomes the group’s major retail banking focus for England and Wales. Ulster Bank remains its Irish offering. Finally, RBS survives but now as a corporate brand, like Google’s owner Alphabet, designed to achieve an Alphabet-style separation of parent company sins from consumer brand perception.
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So there you have it. A rebrand in Scotland, a new brand and a repositioning in England, a revitalisation in Ireland and a new brand architecture at HQ. So will it all work?
First off you must remove Williams & Glyn from the equation. The new brand is born not of strategic intent but regulatory requirements. According to the European Union, RBS must sell 316 branches as a consequence of its bail-out by the UK Government. The Williams & Glyn brand is simply a holding position for some 1.8 million customers and their £25bn deposits while a seller or a flotation is hastily arranged. It’s the Flying Dutchman, the Hotel California, of the financial sector and for now it sails on.
But if the group can offload its ghost brand and then create a perceptual firewall between RBS and all of its surviving retail brands, the strategy suddenly becomes apparent. With decent, well positioned brands in Scotland, England, Ireland and Wales plus Coutts as its private bank (which is also shorn of any overseas obligations having sold the international business last year), RBS is emerging as a British bank of brands.
RBS is going in exactly the opposite direction from the one it took 15 years ago. Back then it was all about the RBS brand, a branded house approach and the quest for international expansion. Ever so briefly, during a few heady months in 2008, RBS became the biggest banking group in the world. Then, suddenly, the champagne turned to piss and the RBS dream of global dominance became a nightmare for the British taxpayer.
David Wheldon, the group’s laconic CMO, talks openly these days of rejecting that path. It’s becoming apparent just how ambitious and radical Wheldon’s brand strategy actually is. Where once it was all about RBS, today it is a brand to be mentioned as little as possible. Where once it was about a branded group, today it is very much a disconnected house of brands. And where once the world was the target, the parameters for success these days begin and end with the UK and Ireland.
Whether he and RBS can pull this off is another matter. First will come the immediate requirement to offload Williams & Glyn. Right now nobody is buying. Then will come the longer-term challenge of conjuring a disappearing trick in which RBS trades infamy for invisibility. And finally there is the hardest challenge of all: ensuring that four distinct brands can adopt independent, equally successful positions in the market against much bigger, more established international rivals. Bank on the next few years being very interesting at RBS – or rather, at NatWest and its other sister brands.
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Don’t see any genius in distancing a toxic brand name, real genius would be overhauling a banking industry in serious need of disruption and re invention. But while the industry even the challenger banks continue to staff themselves with previously employed bankers, I don’t hold out much hope.