Now that I have your attention, let’s talk about the power of branding. Would you consider naming your bank “Pepto Bismol?” Based on what you know now, of course not, but consider this – until 1919, “Pepto Bismol” wasn’t even a word. It had no meaning, positive or negative! Today, the name is unmistakably linked to what it represents.
Proctor and Gamble created the name in the full understanding that the most powerful communication doesn’t have to be literal. How do you feel when you hear the word “Snickers?” What about “Häagen-Dazs?” If you’re starting to feel hungry, then you understand that a brand name can be an important trigger in communicating meaning. Does your bank name do the same for you? When people hear it, do they know who you are and what you stand for?
As you consider whether re-branding your bank is a good strategic move, or as you consider what to name a new bank, there are lessons that can be learned from a bottle of pink over-the-counter stomach medicine — the issue is not having a familiar name, but rather a memorable and recognizable brand.
A brand name can be an important trigger in communicating meaning. Does your bank name do the same for you?
Why is this important to bankers? De novos are beginning to pop up again, and existing banks are finding reasons to rethink their current name. Perhaps they have a geographical name like Colorado Bank, but they are expanding into Arizona. Perhaps they are changing from a national to state charter, or the new market they are expanding into already has a competitor with the same (or similar) name. We’ve all seen the “Community First” and “First Community” in a market….Confusing? You bet, especially to your customers.
Rebranding your bank is very personal, and I’ve known bankers to agonize over it for months. It’s a hard decision for many reasons: fear of losing customers or brand equity, director resistance to change, sentimental feelings about the old name, and trademark issues, to name a few. And, my favorite reason, “All of the good names are taken!”
Here are six things to consider when naming or renaming your bank:
1. Can you use the name and/or protect the name?
It might be obvious that a new name is necessary if you enter a market where another bank has the same (or similar) name. Federal trademarks make it even more difficult. In our digitally connected world, a bank in California can claim rights to a trademarked name in South Carolina because they can argue that with internet banking, they could have customers in South Carolina, and it would create confusion. If you think you can ignore a trademark just because it is across the country, think again. It could be a very costly mistake.
Before you design your new logo and put your signage up, do the due diligence. Check for trademarks and hire an intellectual property attorney to advise you. There are circumstances where trademarks may not prevent you from using a name you like, but you need to know what you are up against and what the risks are. If you choose to use a trademarked name – which we don’t recommend – do it with your eyes open.
2. Avoid customer confusion and a brand identity crisis.
Re-branding without a clear strategy can create confusion in the marketplace. Or even worse, customer apathy. Here’s a practical example: A “First National Bank” switches from a national to a state charter, and as they can no longer use the word “national” in the name, they decide to rename to “FNB.” That’s allowable. They make this decision based upon the assumption that customers will leave their bank if they really change their name, which, in truth, doesn’t happen. And what’s to stop another bank from coming into your market using your old name? Not a thing.
And think about this: If you run an ad using interchangeable wording like “First National Bank” and “FNB,” you need to be aware that customers don’t pay as much attention to the nuances of our marketing as we bankers do. It’s far more important to us than it is to them. As a result, your switch campaign may have just helped someone open a new account with your competitor, and you didn’t even know it! This scenario can and does occur when names are similar or interchangeable, as in my example. There are plenty of other examples, such as Bank First, First Bank, Community First, First Community and so on. Familiarity and similarity of brand names in a market means that you and your competitor end up sharing ownership of the brand in prospective customers’ eyes which ultimately dilutes the equity of your brand. Is that what you want?
3. Think outside the box with rebranding.
The brain is wired to remember things that are DIFFERENT. When a bank finds a “real” word with positive attributes (like “integrity” or “prosper”) not already in use or trademarked, that is good news…and good luck! It is becoming increasingly difficult to find existing words that convey attributes that bankers identify with that aren’t already taken.
I had one client who had to consider a new name for their family-owned 100+ year old “First National Bank” because they had acquired a bank in a nearby market with the same name. They toiled over what to name the bank, and they ultimately coined a new name using the two last names of the original founders to create a new name that is unique and memorable. There isn’t another bank in the nation that can use their name because they were able to easily trademark it. The bank’s customers, employees and directors embraced the new name even though the word didn’t previously exist!
4. A new name is only part of the story.
What is your story? A successful name change involves many steps and details. One of the most important steps is to thoughtfully construct a strategic message: a story defining the meaning of your new name and what you want people to believe about your bank. Positioning statements are short, concise words or phrases that – when dropped into advertising and other collateral materials – reinforce your new brand’s identity. But also, creating a short story about the name and what it stands for is critical to give it meaning, facilitate early customer acceptance and employee ownership of the new name.
The previously referenced client who coined a new bank name out of the founders’ names took the opportunity as part of this process to build a back story – sharing the founders’ original vision for the bank’s future, the bank’s long history, and the name’s development. The story gave substance to an idea, and suddenly, a non-word became a meaningful word that the employees, customers and the entire community could embrace. Not only was this a powerful way to convey meaning to their name, but it allowed them to grow strategically in new markets without concerns about the name. They even received national coverage in American Banker for their unique rebranding strategy.
5. Never underestimate the positive power of change.
I have never known of a bank losing customers because of a name change (when nothing else is changing). In fact, the opposite usually happens. Employees become energized, and customers buy in to that excitement, especially if you’ve communicated your story well. Everyone likes to be a part of something better, and a new name symbolizes a vibrant and bright future – certainly what most people want from their bank, right? Sure, sometimes there may be short-lived sentimental sadness among long-time employees when the old name goes away, but by the time the new signs go up, it is a reason for celebration and a fresh new beginning! And the younger and future banking generation…the ones we scratch our heads about? They will LOVE it!
6. The bottom line: A new name can facilitate growth.
Several of our clients have made the decision to rebrand with a unique and memorable name in order to grow organically in their existing markets and penetrate new markets. During the first year following the name changes, these banks experienced on average a 14.8% increase in deposits and an 18.6% increase in loans, excluding any growth through acquisition. As they continue to prosper, each has found that even operating as a small community bank in large and highly competitive markets, their unique brand helps them grab attention and market share. Despite initial apprehension about changing their bank names (many of them were family-owned and decades old) – without exception, the decision was a game changer for them, and they are happy they did it.
Change is inevitable these days, especially in banking. If you are contemplating a change in your bank name, repurposing a bank charter, or are considering a de novo, understand that your name will embody the spirit and vision of your bank. If you think made-up names must be strange, think again. In the 1950s, a Japanese electronics company had plans to expand to western markets and needed a name that English-speakers could pronounce. “Sony” was chosen because it was simple and sounded friendly. It’s up to you to make certain the brand delivers on the promise implied by the name.
As you consider a new name for your bank, don’t shy away from something unique and memorable. Consider the way a name sounds and any positive associations you can take advantage of. Make sure you have a compelling story to tell and plan your strategy for a seamless implementation. If you do those things, you’ll be pleased with the bottom line.