Rebranding Is Expensive, Time-Consuming – and Essential

The latest wave of rebrands is helping financial institutions attract new clients, stay up to date with customer trends and better position themselves in the marketplace.

By better understanding the decision-making process of their customers, banks are learning to associate their brands with powerful messaging that goes beyond traditional banking. That’s because new generations of consumers are prioritizing the purpose and the mission of companies over other factors when making purchasing decisions.

More than three quarters of Gen Z customers said brands they buy stand for a greater mission, according to a recent survey from Razorfish. Six in 10 consumers of all ages said a brand’s values are important to them. Brand purpose even trumped other purchasing factors in the research, including innovation and discounts.

“Consumers are different now,” said Juliet D’Ambrosio, chief brand officer at the marketing agency Adrenaline. “Brands need to be able to adapt.”

The right brand facelift also offers a leg up on competitors and gives financial institutions the ability to highlight services and core values that resonate with consumers. But, rebranding can also be costly and time-consuming. Most banks and credit unions see the potential impact of a rebrand, but some may not fully understand how a brand can speak to potential customers.

“Frankly, executives are paralyzed by the enormity of what a rebrand might look like,” D’Ambrosio says. “How would it actually work? How can they prepare for it? How do they sell it to their own organizations?”

New generations have different expectations about their interactions with brands, meaning marketing cycles are also becoming shorter, she says. Research from Adrenaline found that just over one-third of banks and credit unions have rebranded since the beginning of the pandemic in 2020. The results also showed a significant trend in brands embracing the need for change.

“Maintaining brand strength is really just good business,” D’Ambrosio says. The practice should be evaluated roughly every three years. Every 36 months companies should consider reaching out to clients and customers through surveys about their preferences and values.

“You’re not just talking to the people who already drank your Kool-Aid,” D’Ambrosio says. Instead, she suggests reaching out to the entire marketplace, including the customers of competing banks, and asking why they choose their institutions and what are the associations or perceptions that led them to make those decisions.

Understand the Psychology of Your Customer Base

When thinking about a rebrand, some forward-thinking companies are actually heading back to the textbooks. Based on Carl Jung’s work, archetypal mapping is one way to connect with customers by using symbolism to help consumers understand complex ideas. Jung focused on 12 overarching archetypes he said were used in the story telling from cultures and countries all over the world. For almost two decades, the most well-known brands in the world – including household names like Nike, Google and Apple – have used this methodology to determine brand image, D’Ambrosio says.

“Brand archetypal mapping is really the gold standard for determining brand personality,” D’Ambrosio says. “We see the way that brand expresses itself as a universal archetype or a person, a personality, that we can then relate to. There is a rebel, there’s a lover, there’s the citizen, there is the sage.”

Instead of asking institutions how they perceive their companies, executives should look toward the data. After looking internally for clues about the brand’s identity, institutions should do market research to query customers and the marketplace in general.

“We don’t just say are a lover or a rebel, because that’s a silly question,” D’Ambrosio says. “But by pulling together all of the data, we can uncover attributes.”

Rebrands Offer a Chance to Differentiate

The need for a rebrand doesn’t necessarily mean the brand is out of date and can often be the result of a strong business model. Companies looking to freshen up usually have an expanding client base that has outgrown the original messaging. A rebrand could also be in order after an M&A deal, D’Ambrosio says.

Almost three quarters of S&P 100 companies have rebranded within their first seven years of operation, according to data from Landor. D’Ambrosio also estimated the time frame to be around a seven-year cycle. In a competitive environment where every bank and credit union sells checking accounts, credit cards and offers mortgage loans, the rebrand is also a way to stand out from the crowd, she says.

“What you are seeking as a financial brand is really the idea of differentiation,” D’Ambrosio says.

The rebrand process often takes years to complete and can cost institutions millions of dollars. The prerequisite data gathering and market research segment can take upwards of 18 months to complete, meaning rebrands are not to be taken lightly.

D’Ambrosio says there are two primary factors that warrant the time and money of a rebrand. The first is attracting and retaining talent. A more visible and well-known brand will entice better talent to work at the company. Secondly, better managed brand names are attracting the right consumers that are more likely to become loyal, lifelong customers.

“Branding is not so superfluous to business growth or business success,” D’Ambrosio says. “Branding is actually one of the primary drivers of business growth and business advantage.”

Banks Must Start with Research

Before proceeding with a rebrand, it’s important to conduct thorough research, assess potential risks, and develop a clear strategy that aligns with your bank’s objectives and values. D’Ambrosio says to anchor every decision and brand recommendation in data.

“Bankers are data-driven people, they just are,” she says. “I could talk until I’m blue in the face and it won’t matter. Data will help.”

When you’re ready for a rebrand, prepare for the unexpected. The process will require anywhere from a year to 18 months and there is plenty of change management to take into account, D’Ambrosio says. “There will be unexpected hiccups that happen,” she says.

A good example was the recent Regional Bank Scare in early 2023. Banks that were in the middle of rebrands had to have the tenacity to stick through the process even in a challenging macro environment for banks. “Executive were asking me, ‘Do we need to pull the plug?'” D’Ambrosio says. “There is just a human element that is resistant to change.”

Brands will have to plan for significant investment post-launch to support the strategy and continue to build the brand. Initiatives will include building internally through employee experiences and likewise with outward facing customers.
 

Reference source: The Financial Brand

Compiled by the DTSVN author group - Digital transformation solutions for the Finance and Banking industry.

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