Unfortunately, not every financial institutions have understood why is branding important for banks. Branding is a relatively new concept within the banking industry, especially if you consider that banks have been around since ancient times. Back in the day, and as seen in old western movies, there was only one bank in each community. People used it because it was there, and not because it was a preferred alternative. Nowadays, millions of companies around the world rely on the power of marketing and branding campaigns to differentiate themselves from their increasing number of competitors. Banks should be no exception.
“As a result, when it comes to effective branding, the banking industry has been among the worst to achieve it. There are many who believe that bank branding just isn’t practical because, for the most part, banks are virtually identical, providing a similar range of products and services at equivalent prices in environments that are more or less the same. Yet that is exactly the environment in which strong brands have historically prevailed” – reports The Design Channel
Let’s clarify that branding doesn’t mean changing your bank’s name or designing a new logo, redoing your page or changing locations. Branding is all about demonstrating value and setting yourself apart from your competitors. Banks have always invested heavily in marketing, but surprisingly few spend much time contemplating or promoting their brand.
1. It builds trust with potential customers
With a strong branding campaign, you will gain your potential customers’ trust. It has been proven that customers perceive strong brands as lower risk and higher value. It can also fuel employee pride, reducing turnover and helping you attract top talent.
2. It helps simplify the decision-making process
If your bank has a strong brand, it will become easier for potential customers to make a decision and choose you as their banking partner. Also, a strong brand will help to reinforce a customer’s decision for years to come.
3. Fewer purchase barriers
Research shows that consumers are happy to pay a premium price for a strong brand. Apple is a good example. Its products are priced significantly higher than competitors, yet are almost always the leaders in their category. The same law applies to banks. A strong banking brand will trump size, location, and other advantages your banking competitors might have. Potential customers will be happy to partner with you even if your rates are slightly higher than your competitors.
Those banks that understand the need for branding will quickly take and most likely keep the lead in customer acquisition and satisfaction within their community.
It’s important to understand that ads promoting a product or an offer are not considered branding. Branding creative should simply show your true value proposition. A value proposition tells prospects why they should do business with your bank rather than someone else, why is your bank different from your competitors, and what customers can expect from you that they can’t find anywhere else.
Mobile marketing can be extremely effective in helping you launch a branding campaign. These types of campaigns are very easy to set up, don’t require many filters, and are highly beneficial for your bank. Setting it up won’t require data lists or defining a specific audience, and it won’t be necessary to carefully choose geographical areas you’d like to cover. Simply show your community you are the bank they’ve been waiting for.
Now that we covered some crucial aspects of branding, next time you question yourself why is branding important for banks, you know the answers.