THE ROLE OF BRANDING IN FINANCIAL COMMUNICATION

In financial services everything can be quantified. The amount of money you invest, the returns you get, the fee charged; everything can be neatly put into a P&L.So in such a cut and dried world; what role would branding have? After all; isn’t branding the fuzzy, subjective discipline ; the role of which cannot be quantified by anyone –the consumer or the business?

There is a strong role that branding plays in a financial services business. And it can be summarized in two words –Trustmarks & Choice Simplifiers.

Finance is extremely complex for the lay investor. And in more cases than not, financial products and advisors complicate things even more through the use of conditions, riders, etc. What's more; every financial product is different and works in different ways. It takes an expert to gauge one offering from another. Consumers inherently like simplicity. If they can get a single hook to evaluate/form a perception of an offering it helps them all the more. That's where Trustmarks come in. It gives the consumer a simple understanding of what he can expect from a particular brand. Be it transparency & ethics(Tata's), Knowledge based advise(Motilal Oswal) or Financial Supermarket(ICICI) you can trust the brand to deliver on that parameter due to its track record.You then evaluate the Trustmark on how relevant it is to you before taking a decision. The role of branding is in building solid trustmarks.

There are over 200 brokers who you can buy shares from, over 100 banks that you can bank with, over 25 life insurance policies, over 500 mutual fund schemes…..do you think in today’s ‘time poor’ lifestyles we will have the patience, bandwidth and knowledge to evaluate all of them? That’s where branding comes in. Based on your overall perception of the brand( how to build this perception is the focus of another post)you bring down this list of hundreds to a list that is manageable, one you can count on your fingers. You then evaluate this list one-on-one to choose the brand you want to park your precious money(and future) with. Brands act as Choice Simplifiers.

So the next time someone asks you how brands can add value to a financial services business ; you can summarise in two words - Trustmarks & Choice Simplifiers. Neither of these feature on a balance sheet or performance statement; but something tells me they are valued more than both !

Cheers.