Financial brands belong to the category of service brands. Their owners are companies whose core business is to offer financial services. These include financial instruments (such as bonds, derivatives, and money market instruments), financing instruments, asset management, portfolio management, or financial consulting. Financial brands are often falsely reduced to banking brands.
In the past, insurance companies were also included in this category next to building associations, credit card companies, or investment firms. Since the emergence of the term insurance brand, it has been easier to differentiate.
Unlike companies who produce tangible products, financial services providers must etch their brand into customers' minds. Customer experience is particularly important. Employees are significant determinants of whether the customer decides to enter into a close, long-term business relationship or not. The closer the relationship, the stronger the effect on external brand perception.
This is why customer loyalty and new customer acquisition are essential for the success of a financial brand. Those who also manage to combine a pleasure factor with new technologies like mobile payment will charge their financial brand with a stable, emotional competitive edge. The greatest challenge, however, will be the adaptation of business models and services to the expectations of the new generations of customers, such as millennials.
Thus, differentiation potential for financial brands is not to be found in interest rates and cost leadership. Rather, it is all about relationship management (prerequisite: enabling employees), relevance (What is most important to the customer?), an integrated consultation approach (fees instead of direct debit?) and regaining trust.
Book: Brand Future – praktisches Markenwissen für die Marktführer von morgen