The FIRST BANK of Difference
Achieving Brand Differentiation in a Commoditized Industry
The First Bank of Difference doesn’t actually exist, and in most consumers’ minds, a clear difference between banks doesn’t exist either. The common perception is that retail banks, in general, provide the same basic range of products and services. Banks might differ in vision, mission, and purpose, but those differences are more of a nuance than a clear point of distinction.
Citi’s mission is to serve as a trusted partner to their clients by responsibly providing financial services that enable growth and economic progress.
Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially.
Bank of America’s purpose is to help make financial lives better through the power of every connection.
While these are all admirable claims, they are, nonetheless, what all banks would aspire to. They clearly don’t differentiate any one bank brand from another. So, what are the opportunities for distinction? One answer comes from the multi-national financial giant ING:
With little to differentiate one bank’s products from another, we believe it is customer experience that will set us apart.”¹
ING set out to create a unique customer experience by focusing on the most important touchpoint in that experience — people. Teaching people banking skills is one thing, but teaching attitude and behavior is another. ING recruited people based on cultural fit and behaviors that would reflect and live out their corporate values: be honest, prudent and responsible. While these may not seem very differentiating on the surface, when ING put them into action, it made a positive impact on their brand perceptions. This proved to elevate ING Australia to the top of the Customer Experience Index for 2015 and 2016² and ING was the only bank listed in the Reputation Institute’s ranking of the top 100 most reputable companies in the world³.
Today, banking continues its transformation by virtue of nontraditional service providers on the fringe or outside the banking industry. Digital financial services provided through FinTech apps like Apple Pay, Venmo, Quicken Loans, and other innovative companies are all competing for a share of customers that value service and convenience.
Businesses, whether digital or legacy brands, know how elusive differentiation is in an already highly commoditized industry.
From ASPIRATION, a financial firm with the belief that banking should be built on fairness:
It is not about choosing the ‘closest branch,’ now it’s about choosing a brand that speaks to you and your beliefs.”⁴
How the brand is defined and what it stands for can shape a point of difference to be more than just about features, products, services or convenience. Brand distinction can be achieved relative to how people engage with brands that share similar values. The experience with one brand, or family of brands, can influence preference with another brand in an entirely different category. The affinity to a brand like Starbucks, for example, might influence preference for a financial services brand that could be seen as more of a lifestyle fit. The sense of community built through a Starbucks experience might strike a stronger chord with a community bank than a national institution.
It’s tech companies like Google, Facebook and Amazon that are setting the standard for how people interact with the brands they love. To remain relevant and continue delivering a differentiating experience for customers, ING has to be where they are: on the digital platforms where they are shopping, socializing and doing business.¹”
At Diverge Branding, we believe that defining true differentiation is crucial to building brand sustainability, value and loyalty. Differentiation is not just about being different, but more about your brand can own something special that no one else can claim. It needs to be meaningful, relevant, memorable and enduring. That means understanding who your audience is, what their beliefs are, what they value, and what keeps them loyal. It also means that those responsible for delivering the brand (employees) need to believe in the brand as much as they expect their customers do. Building a brand starts from the inside.