When you hear the names Charles Schwab® or Fannie Mae® it brings to mind a vision of a huge financial institution that has been around forever.
It’s true that both have received their share of press time, and “word-of-mouth” buzz marketing has also worked in their favor. However, the fact that they are well-known household names didn’t just happen. For the most part each built their brand name over the years, and advertising was the catapult.
It’s the advertising that makes their name so familiar; and whatever descript words are associated with their “name” also helps to solidify the positive triggers and perceptions the company wants customers to think of their product or service.
It works time and time again.
This automatic response does not come instantly or naturally over time. Many companies that have been around for over 30 years have relied on word-of-mouth because they are smaller in size or regional and haven’t yet built their brand through high profile advertising. Given how expensive traditional advertising media is, why should any company spend money on branding?
Beside the fact that they have received press and word-of-mouth, for the most part they’ve had to build their brand name through years of advertising so that their name triggers a positive association. This automatic response does not come instantly or naturally over time. Many companies that have been around for over 30 years have relied on word of mouth because they are smaller in size or regional and haven’t yet built their brand through high profile advertising. Given how expensive traditional advertising media is, why should any company spend money on branding?
The answer is to gain recognition, which will lead to new business. Some people may not be aware of the company. Some may not know what is offered. These answers are illustrated further in a tale of two banks in on city—competition in the national’s capitol, Washington, D.C. The financial institutions of Chevy Chase Bank® and PNC Bank both try to build brand awareness in the D.C. market, but for two different reasons: local brand building and new market entry.
Chevy Chase Bank, a local bank with headquarters and roots in Washington, D.C. dating back to 1892, has full market saturation in a constantly changing environment. Washington, D.C. is always in a state of motion with a population change of 9.72 percent from July 2000 until July 2006, Chevy Chase Bank has discovered it must advertise to gain brand awareness to those who have recently migrated to the city and who are looking for a new bank, because their bank doesn’t have representation in the area.
Chevy Chase Bank found that despite having a deeply rooted history in Washington, D.C., there were several new entries. So their challenge was trying to decipher how they would position themselves as the choice leader for new customers.
The first thing they did was to analyze their unique position in the market. Besides being a local bank with history in the area, they had acquired a lot of real estate. Through marketing research, with help from a local marketing firm LM&O Advertising, they discovered that consumers wanted convenience in a bank more than anything else. Taking this knowledge they crafted an integrated advertising campaign using print ads and television commercials to illustrate the fact that they have: the most branches, the most ATMs, and Sunday hours in some locations. They perfected this campaign with their new tagline of “The Leading Local Bank.” The historical figure Benjamin Franklin was featured in the ads as well, which, despite no one alive having ever met Ben Franklin, gives Chevy Chase Bank some level of credibility and instant likeability. The campaign was hugely successful in 2004 and the television ads still run today.
Unlike Chevy Chase Bank, PNC Bank® has—roots, headquarters, brand recognition, and a branded baseball stadium in Pittsburgh, Pennsylvania; however, in 2005 PNC Bank entered the Washington, D.C. market through the acquisition of Riggs Bank and its 51 branches. This presented PNC Bank with a new-entrant-branding challenge because despite migrated Pennsylvanians and Pittsburgh Pirates® baseball fans, most people in the Washington, D.C. region were not familiar with the brand. Realizing this challenge coupled with a market spoiled for selection, PNC Bank created an aggressive ad campaign making one of its first initiatives a sponsorship of the Washington Nationals, D.C.’s newest baseball team that was formed that same year.
PNC Bank, focused in the Pennsylvania to Virginia region of the East Coast decided to do a brand advertising blitz over the entire area in the earlier part of 2007 beginning with their new tagline Leading the Way. With high profile television ads at the Super Bowl and several other television spots surrounding this new tagline, they positioned themselves as the self-proclaimed, “East Coast powerhouse.”
Both Chevy Chase Bank and PNC Bank compete in the Washington, D.C. area, but have very different branding ideas. One is shown as the convenient, local bank, the other as a major competitor that offers several perks that the other banks cannot. Do they compete against each other? Absolutely, but whichever can gain the trust of newcomers will be the one that succeeds. Trust is gained by building brands through advertising.
As a financial institution that hasn’t done much brand advertising in the past, the world of advertising may seem daunting with questions like: which media should I choose? How can I reach my target audience? Which publications are they reading? How do I know if I’m receiving the best deal? These and other questions are very difficult to answer, but key to having an effective campaign.
Below are some guidelines to help any financial institution feel more secure about their brand advertising decisions:
#1. Research, Research, Research: First and foremost before even asking for rate cards from the media, a financial institution must know who they are marketing to. More than simply the target age and income of the consumer, it is important to gather market research to know what their interests are and what are their specific wants and needs.
#2. Brand Based on Research: Once the results of the market research have returned, usually, there will be one or two things that stick out that consumers want. In the case of Chevy Chase Bank, they discovered that more than anything else, their customers’ desired convenience, so they positioned their brand to illustrate themselves as the most convenient in their ads. PNC Bank found that ATM fees were the biggest issue/concern of their market, so with certain deposit accounts they offer no ATM fees worldwide. Creating the brand around what the customers’ unique concerns are will give anyone the edge.
#3. Look at Demographics: Once the brand has been created, the integrated marketing plan can start. This requires the demographic of the target market. During the research phase, it is important to ask what the target market reads, watches, sees, and hears. Gathering information on which publications they read, which programs they watch on TV, where they drive by everyday, and what radio station they listen to will help a company jump start their advertising campaign so that they don’t waste money on something their target audience isn’t paying attention to.
#4. Analyze the Media Kit: There are so many options out there for anyone looking to advertise that sometimes companies can get caught up in the net and not the total impact. It is important to look at the cost per thousand (CPM), calculated by dividing the cost of the ad by the total readership divided by 1,000. This will give the company a bar from which to measure the real cost of the ad. Too many times, companies that are new to the world of advertising will suffer sticker shock and will begin looking at the less expensive publications, but not necessarily the reach of that publication. A common mistake in the Washington, D.C. area is advertising in the free publication called Express that is put out by the Washington Post as opposed to advertising in the Washington Post display ads. Although a 1/4-page ad in the Express costs a fraction of the same size ad in the Washington Pos daily paper, its reach is limited to those that ride the metro, but misses the a significant portion of the commuters that either drive or take the bus or train lines into the city. These mistakes may be avoided by creating a CPM analysis.
#5. Negotiate Ad Rates: Rates are flexible. Most companies will look at the frequency discounts and determine how they want to proceed from there; however, negotiations are more than just the frequency discounts, they can also include a package deal comprising of print or television and online, or there are sometimes last minute cancellations that come available. Letting the account executive at the media know that you are interested in deals and last minute rush ads will open doors to rates at a fraction of the cost of placing ads in advance. If you have a standard brand ad, these are money saving deals that will allow you to stretch your marketing budget dollars further. Discounted rates are often available for nonprofits and sometimes prepayments, so ask about any possibility of a discount.
#6. Ask for Help: If the financial institution is small and doesn’t have a marketing department with the time or industry knowledge to run a branding campaign there are many marketing agencies that can compile a campaign and place ads accordingly. Oftentimes these agencies receive a discounted rate from the publication because of all the business they send to them, so sometimes it’s more profitable to allow someone else to do it for you.
