Financial services companies are going to have to work harder to connect with their customers—and being the first to roll out new technology just isn’t enough, says a recent study.
The 2018 Brand Intimacy report, conducted annually by brand consultancy, MBLM, revealed that out of 15 categories, the financial services industry dropped to tenth place this year from sixth place in 2017.
What accounts for the drop?
“Eroding trust and technology advancements are two of many forces driving us towards a cashless future,” says Mario Natarelli, managing partner at MBLM. “Financial services need to see their brands through the lens of the bonds they are forming with their customers. They need to credibly build more emotion and better nurture these bonds to change attitudes and leverage benefits.”
Holding from 2017 as the most intimate brand in the financial services industry is PayPal, followed by Chase and American Express. Rounding out the top ten most-intimate financial brands in the 2018 study are: Bank of America, Visa, Wells Fargo, MasterCard, Capital One, Citibank and U.S. Bank.
The term “brand intimacy” quantifies consumer connection to a brand and is used to suggest ways that companies can improve a consumer’s emotional bond with their brand. The financial services industry had an average Brand Intimacy Quotient of 21.8, well below the cross-industry average of 27.1.
PayPal (which is also the most intimate brand among women) is doing something right. The report has PayPal not only ranking the highest as far as brand intimacy, but shows PayPal also ranked 30th overall, among all brands studied across all industry sectors. PayPal’s high brand intimacy is due in part from its performance when it comes to “ritual”, which is one of the six main archetypes that drive brand intimacy, along with identity, nostalgia, ritual, enhancement and fulfillment.
MBLM’s report revealed other insights that financial services brands should consider:
- Cutting-edge technology isn’t enough. From mobile banking apps to biometric security and chatbots, new features help deliver information, convenience, and peace of mind, but they are not enhancing the emotional connection that consumers have with financial services brands.
- Millennials are harder to pin down. Millennials are more likely to switch banks for better deals or services than older generations, and they are not intimidated by a cashless future — in fact, they are 41 percent more likely to see cash as inconvenient. Brands can capitalize on these shifting attitudes if they offer services and features that empower or reward the cashless lifestyle.
- Status, trust and security are essential. In the wake of financial crises like the Great Recession, customers of financial services brands need to view the brand as one of integrity. At the same time, customers also want to see brands as dependable and safe, considering the modern fears of fraud and identity theft. These factors have strongly affected people’s willingness to form close relationships with financial services brands.
The bottom line: the growing indifference to financial services means, above all, that brands must differentiate themselves by finding new ways to connect emotionally with consumers.