By telling insightful stories, the banking industry emerged from an angry bear market in 2008 to regain customer trust and reinstil confidence in the world economy
Vienna, September 15, 2008 — I’m at SIBOS, the world’s largest financial services summit, staged in Austria’s capital. I’m reporting on behalf of TFR for day-one of the four-day event.
More than 7,000 attendees from all corners of the world have descended on the city. It should be a monumental experience for all. Yet there’s an unnerving buzz on the exhibition floor. Rumour has it that Lehman Brothers is about to go under.
A few days earlier, a meeting between Wall Street bosses and the Securities and Exchange Commission took place, an 11th-hour attempt to prevent what we will later learn is the largest bankruptcy in history.
Day-one of SIBOS is usually the event’s highlight. Bank executives spend months planning client meetings and polishing their sales pitch — preparing too for a slew of cocktail parties staged every evening. It’s a joyous affair, accompanied with more than a touch of harmless financial hubris.
This year however, the closing plenary of day-one is conspicuously quiet. Something is up. Before the session ends, Blackberry handsets are beeping and buzzing. Like everyone else, I leave the plenary hall early. I stop at one of several empty exhibition booths serving wine to ask what’s happening. “Lehman filed for bankruptcy,” someone tells me.
More than 25,000 people are instantly made redundant. The bank’s liabilities are financial Armageddon: about US$619 billion worth of debt. Everybody is going to feel this, I fear, including me and my London-based employers.
While the wine is palatable, the overt panic isn’t. Everywhere, bank executives are calling colleagues to understand their exposure to Lehman. Ties are loosening, shirt collars are widening. People look deeply troubled.
A 40-person team from a renowned American investment bank is trying to arrange flights back to the US that evening. “If we don’t get on a flight, we might not get back at all,” a banker tells me, explaining that they may not have the funds to settle outstanding travel expenses, and get everyone home. A cruel irony for those in the business of financing.
Crisis of confidence
The immediate fallout is horrific for banks. Global equity markets lose US$10 trillion the following month. Trust in the financial services industry hits an all-time low. “Clients hate us,” one Wall Street investment banker tells me.
Surveys conducted in Europe and North America during this time consistently find public approval of financial firms at record lows. Only 7% of the population believe the financial services industry is fit for purpose.
Plunging trust in the financial system quickly becomes a crisis of confidence in the global economy. Banks stop lending to one another. Companies cease borrowing. A credit crunch lands, and the world is plunged into a deep recession. Banks eventually lose US$4.1 trillion, and millions of jobs are lost.
Luckily, central banks bail out the financial system, and liquidity returns. Yet the global economy is far from out of the woods.
Hubris to humility
Thinking back to that time, a significant contributor to the lack of trust in banks stems from how the industry typically marketed its services. Back then, most banks would invest in large-scale branding campaigns, describing themselves as leaders in their respective field, and paying comparatively little attention to addressing customer needs.
Display advertising was king. It cost US$10,000 for a full-A4 page, US$30,000 for an outdoor billboard and US$120,000 for golf tournament sponsorship. Branded content, by contrast, was seen as a luxury, not a necessity. “Nobody reads it”, a marketing executive at a UK merchant bank once told me.
When asked to elaborate on this viewpoint, no solid argument was given. The executive was either disinterested in his own bank’s stories, or perhaps didn’t understand the term ‘branded content’. Either way, data has since proved otherwise, with branded content proving 22 times more engaging than display advertisements.
Don’t get me wrong. There will always be a time and a place for display advertising, whether in magazines or at sporting events. Yet as studies show, the age of brand stories has arrived.
Fortunately, the financial services community was quick to come around to this thinking — mostly prompted by developments occurring in financial markets. Equally, regulators cracked down on a few bad apples that had mis-sold products in the run up to Lehman’s meltdown.
Increasingly the branding hubris showcased by a select few players struggled to convince customers that they were worthy of their business.
Tell don’t sell
To promote increasingly complex financial products, stories are the best way to stay helpful to the customer, while still remaining compliant.
When China launched the offshore Renminbi (RMB) in Hong Kong in 2009 for instance, the market needed strong factual storytelling. Transacting in RMB is a complicated topic, and not something easily expressed in a brand advert. Asia-based banks lapped up the opportunity, discussing helpful case studies, and providing practical (and tactical) information on how the RMB can work for customers. It was a refreshing approach.
Likewise in the US, the Dodd-Frank Wall Street Reform and Consumer Protection Bill was passed a year later, prompting American banks to go beyond their brand focus, and zero in closely on thought leadership, helping the market to move the reforms forward.
Interestingly, by the time I left TFR in 2010 — just two years after SIBOS 2008 — we earned more money from branded content than from traditional advertising. At this time too, SIBOS had matured as well — becoming more about solving industry challenges collectively than just individual banks pushing their services.
Market consolidation
Fast forward to 2018 and after almost a decade in Asia, I am now co-running a Singapore-based content consultancy. Content is still king — but the game has switched up again. Values and authenticity are under the microscope now. Brand trust has never fully recovered, and today’s consumers increasingly look to socially-enabled leaders to drive purpose into their organisations — and use their brand strengths to further the causes they believe in.
This is also an age of personalisation. The market has been flooded with data, yet brands are not consistent in their response to its opportunities. In some sectors, the leaders are the new disruptor brands, who’ve cornered the market with clean and simple propositions, and a powerful sense of customer experience. Despite the transformative efforts of several legacy brands, the rise of the virtual disruptors — and their pitch to a younger investor audience in particular — is eagerly anticipated.
Among the financial services brands, the emergence of the content hub seems to be responding to many of these market push factors. It’s no coincidence that some of the most successful names in the hub space are banks — which have the resources, the complexity and the need to tell impactful stories. ANZ boasts Blue Notes; Standard Chartered has Beyond Borders; HSBC leverages Global Connections; and DBS is shooting its own TV series, named Sparks.
Front and centre on these platforms are calendars of brand stories that provide customers with insightful information, while promoting their leaders with credibility. These sub-brands are journalistically robust, firmly on-brand, and allow the banks to project their values and brand personality to an increasingly savvy customer.
But still, it’s not all plain sailing. As with most waves to emerge with great fanfare and heightened expectation, interest in branded content and content hubs have a tendency to wane, as the industry experiences the proverbial Gartner Curve. Left unchecked, a surge of disillusionment can emanate, not just in banks, but in large brands in general.
Many businesses have thrown serious investment at content, yet their effectiveness in delivering brand awareness and leads seems at best questionable. Plus, every player in the agency universe has joined the content bandwagon — some of which have neither the knowledge, experience nor skillsets required to create great brand stories.
On the brand-side, frustrations build. In some cases budgets are reduced, or projects put on hold. Other brands bring content teams in-house, often with mixed results. As the “big waves” pass by, opportunistic agencies and sales people move away from branded content. The market consolidates. Thank goodness, those remaining say.
Beyond the bug
Skip to 2020. A pandemic is in full flow, and an economic crisis has begun. Initially, marketing plans, including content creation, have stalled. No one knows where the financial fall out from COVID-19 will take us, nor when or how we can begin to talk recovery.
Now however, we can start to draw up plans again — drawing inspiration from how the banking sector reinvented itself in the wake of the Global Financial Crisis (GFC) of 2008. This was achieved by talking to customers about the issues forced upon them, and by providing solutions and opportunities that consider challenging circumstances.
Just as companies were short of confidence in the financial system back then, today there is a similar sense of economic annihilation. Except this time, there is a difference. Particularly in Asia, there is far more cash in the financial system than was the case 12 years ago.
While there are and will be many hardships experienced during this ongoing crisis, there is also an opportunity for large businesses to lift their game on financial advice and moral support for customers. Plus the current range of content amplification and monitoring tools are light years ahead of then.
Unsurprisingly, many banks are already doing this. Nonetheless, there is an opportunity to do more, even with the encouragement of a sharp economic rebound predicted from Q3 of this year.
Upping the ante
The current lockdown has brought about an unusual opportunity for everyone to truly thrive in an online-driven world. And what a social experiment it has been — a digital transformation by necessity. In response, brands are seeking to up-the-ante in terms of digital customer experiences, while customers seek a continued, seamless user experience.
At CP5, we’ve developed a suite of solutions that speak to today’s business realities. These solutions reflect today’s technologies and trends, helping brands engage with customers in new and innovative ways. Like the banks that in 2008 ‘told’ their way out of the GFC, today’s offerings seek to identify gaps caused by this recent rush of changes — once identified, our focus lies in strategic storytelling — proven journalistic muscle, working alongside a host of today’s marketing tools and techniques.
Put simply, we keep our fees reasonable by being focused. We are consultants: and that means huddling to listen carefully before we speak. Then once we have established a host of insights that point towards a sound focused strategy, only then do we recommend our tactical assets.
We’ve been here before — and just as it was then, this is a powerful opportunity. By telling insightful stories, the banking industry regained customer trust and instilled confidence into the global economy. Today’s digital-first world presents a far greater opportunity for this sector and numerous others to create richer end-user experiences — and help ensure that everyone prospers as our economies recover.
To learn more about our digital sales solutions, talk to us.
Image: Shutterstock. Image license 1062694967.
