With government regulation coming next month, lenders are scrambling to find ways to make up the money they used to charge credit card customers. This comes on top of a year in which:
- Fees went up (generally).
- Services were kept to minimum acceptable standards (at best).
- Most of the best-known financial services brands either disappeared, merged, or received zillions in loans from taxpayers.
- Banks were slammed for not writing loans with the very money they'd been given to make loans (and it appeared that executive bonuses were given instead), and
- The marketing communications from the industry effectively told consumers "don't worry, be happy."
The disconnect between financial brands and the reality in which they operate is huge, yet you wouldn't know it from how most companies in the sector are behaving; it's business as usual, as if they think consumer trust and transactions are somehow givens in the marketplace. Remember what happened to the Detroit automakers when they started thinking like that.
This makes me think that the top brand names in financial services are sitting on an emerging crisis.
The trick is seeing this reality for what it is, and I'd argue that many of the typical marketing approaches are almost purposefully blind to it. Polls and focus groups are notoriously qualitative and defined by the questions that are asked; further, the very act of polling (or conversation in front of a two-way mirror) is itself a communications event that influences the substance of what’s discussed. Asking people what they think about brand names has no direct, causal connection of past or subsequent action. Worse, people rarely do what they say they'll do (or admit to the reasons why they acted in a certain way retroactively). It's less dishonesty at work than the simple shortcomings of our imperfect human consciousnesses.
So it's very possible that the leading financial brands think things are just hunky dory, or at least unaware that the context of consumer media consumption is far more important than the creative content intended to intrude on it. This context for financial services is not good, as the past year or so has revealed that:
- They're not in control of their own businesses (balance sheets are still tainted by toxic assets).
- Not necessarily looking out for the best interests of their small customers (see mortgage foreclosures), and
- Operating in a marketplace that has possibly changed fundamentally, not just cyclically, in terms of how capital is committed and/or acquired.
Banks can promise to listen, have wise counsel, be committed to their customers' success, or offer any other contrivance with which we’re all too familiar, but doesn't it fall on deaf ears? Doesn't the context of reality render these messages moot, at best, and disingenuous (and disconnected) at worst? How much of their customers' patronage is simply habit or inertia that comes in spite of this brilliant branding? What happens when local, more transparent and trustworthy competitors emerge (a resurgence in local credit unions, for instance)?
No, they simply must have no idea what’s really going on, or wed see fundamentally different responses from these institutions -- whether you call it "marketing" or simply "smart business practices" -- like:
- New policies: Since consumers know that the decision-making processes used to invest mortgage money were, er, flawed, shouldn’t we learn how banks have changed the policies? What has been fixed, and why should we believe it's better now?
- New relationships: I know that my bank is only a click or IVR phone call away, but I don’t really feel like I have a relationship with it (despite all those glossy posters in the bank lobby intended to suggest otherwise). How about defining it via something other than a cross-selling strategy?
- New transparency: Imagine if your bank didn't announce a fee hike or charge without explaining how it was attached to an added benefit for you? No other brands get away with charging more for less (except maybe cable operators), and detaching cost from value is a recipe for reputation failure.
- New communities: You and I need a financial brand page on Facebook like a head cold, yet that’s one place they’re wasting their money and our time. What if your bank was substantively involved in your community (lending, employment, charity) and both told you about it and gave you ways to participate as well?
None of these approaches are novel, nor are they beyond the pale of existing communications processes and vehicles. They're just invisible to brands that are locked in old, outdated ways of seeing themselves (and not particularly adept at seeing the context in which their customers live).
And doing such stuff requires that the institutions actually do things differently versus just buy schmarty-pants creative marketers to talk about stuff, which could be another reason why we're not seeing any of it. It's a scary thought because it means that things really are business as usual for them.
I say a new approach to brands could be a great opportunity for visionary financial services brands; more so, doing things differently is all but required by the present context...and not doing so all but ensures that the crisis continues to emerge...
Image source: http://www.flickr.com/photos/aaronescobar/2178776113/