Brand Power: Playing the Name Game

1,068 words
4 March 2002
Financial Services Marketing
6
Vol. 4, No. 2
English
Copyright (c) 2002 Thomson Financial, Inc. All Rights Reserved.

As the name game goes, financial firms aren't as prominent as they think-or would like. There are only a handful of institutions recognized among the nation's most well-known firms-if even a handful, according to a new survey from Harris Interactive. The survey, done in conjunction with the Reputation Institute, tries to quantify and rank the best-known companies in the U.S. based on their reputations.

The final results do not flatter the financial services industry. Only three firms made the list of 60: Citigroup weighed in at number 36; State Farm Insurance Co. at 42; and Bank of America at 57.

The final list was predictably dominated by big, household name companies, with 20 of the 30 companies that comprise the Dow Jones Industrial Average hitting the charts.

Jack North, an evp at State Farm, attributes his firm's recognition to the value it places on customer relationships. Even in 2002 in the age of technology and the Internet, a lot of financial companies have not done a good job with customer relationships, he says. Branding has multiple dimensions with advertising being just one part. Customer interaction is still necessary, he says. Citigroup did not return phone calls, and Bank of America could not be reached for comment.

The list has a surprising absence of credit card companies, notably because of their dominance in the consumer culture. But North says credit cards have become a commodity to a great degree, not having distinct images in the minds of consumers.

As for big investment banks, while they channel billions of dollars through the system and dominate New York's economy, they really do not have a high profile for the average person, notes Jay Lorsch, professor of human relations at Harvard Business School. They can be fine companies, but still it takes at least an upper middle class person to identify with names like Merrill Lynch or Goldman Sachs, Lorsch says.

A Harris Institute spokesperson says the lack of financial firms on the list need not sound an alarm in the industry. The nature of banking does not leave an emotional impact, which is typically the key to a ranking of this nature, says Joy Sever, svp and director of Harris' reputation practice.

While the list may not constitute a full-out alarm, some people think it can serve as a viable guide for banks in building better images. Banks can use this and other tools to help them take a step back and look at their various business practices the same way customers look at it, says Tracey Mills, senior manager of public relations at American Bankers Association.

Banks are faced with a good opportunity to help themselves with an image campaign, Mills says. With investors nationwide concerned about the safety of their portfolios, many have increased the level of the safest investment of all: bank deposits. So with people interacting with their banks now more than ever, whether it's in a bank lobby or over the phone, banks can use the opportunity to build better customer relationships.

As a point of comparison, European banks have been more successful with this, says Tanya Azarchs,a bank analyst at

Standard & Poor's. Individual investors are more accustomed to conducting non-traditional bank transactions in their banks-buying bonds, for example-because that's the way they've traditionally handled such things.

The strategy of selling new services and cross marketing other financial products, however practical it may be for business, could further hamper banks in terms of brand recognition in the public eye because diversifying the business further dilutes the image, say industry analysts.

Financial companies rarely rank in these types of lists for the most respected, says Jeff DeJoseph, global evp and chief strategy officer at Doremus. Partly it's a function of being so diverse. You have investment banking and personal checking under one roof in some cases.

Since they can offer more services than ever before, now is a good time to ratchet up customer service and act more like a community bank, Mills says. Each employee in the bank should have a touch of salesmanship, not just the sales staff, and help promote the bank.

Azarchs says geography traditionally has been an obstacle against the industry in surveys like this. With banks historically locked into a certain area, they haven't been compelled to create nationwide marketing until recent years.

The list also was devoid of e-commerce companies, a fact that did not surprise most people. Mills says physical companies resonate more with consumers, which is certainly evidenced by the fact that not one financial Internet company made the list. The only Internet companies at all were Yahoo at number 32 and Amazon.com at 34. The list is dominated by the traditional, storied brands. There are no new companies, DeJoseph says. I think that's the story really.

While a lot of consumers may not necessarily think of Unilever or Johnson & Johnson by name, the survey combined any brand-name responses under the parent company. So well-known brands like Lipton and Ragu pushed Unilever to number 37, while names like Band-Aid and Tylenol powered Johnson & Johnson to the top of the list. Microsoft ranked second with Coca-Cola, Intel and 3M rounding out the top five.

Seems a far cry from the days just two years ago when most people were gushing over young tech companies for fear they'd be chided as a Warren Buffet. However, this same survey two years ago-conducted at the height of the Internet craze in the second half of 1999-sported only a handful of tech and dot-com companies and not a bank was to be found. The list ranked 30 companies that year.

Surveys like this are important if for no other reason than to point out that banks have not done a good job since winning the hard-fought regulatory battle to offer an array of financial services, Azarchs says.

While the survey may not cause bankers to worry, it should prompt them to consider the role that a brand plays in representing a diversified financial services firm. Sources contend that ignoring such concerns could exact a far greater toll.