Branding and brand development through direct marketing in the consumer financial services sector: Evaluating financial services

Evaluating financial services direct mail against models for building brand strength

Brand presence or familiarity Interviewees, with a couple of notable exceptions, on the whole denied that direct marketing could build a brand alone, spontaneously supporting the Brand Dynamics Pyramid view that a certain amount of brand presence, or familiarity with the brand and what it stands for, is required before consumers can be encouraged to try something new.


Brand relevance in financial services DM has implications for database marketing, personalisation and the development of customer acknowledgement systems, through attention to detail, such as the way Citibank or the National Trust display on their card how many years a card-holder has been a customer. The success factor behind relevance in direct mail is uniformly perceived to be maintaining a small amount of quality data and developing strong information infrastructures.


High ‘core’ quality performance outcomes, or ‘technical quality’, as opposed to warmth or empathetic service delivery, or ‘functional quality’, were felt to matter more when it comes to long-term investment products, and interviewees believed that there may be a segment for whom ‘technical quality’ is more important than softer or emotional brand values. A higher level of education and confident experience of purchasing financial services were thought to be likely in the ‘technical quality’, more rational segment, variables that could be targeted by DM.

Distinctiveness, differentiation or advantage In terms of achieving distinctiveness or salience in DM executions, providers should experiment, instead of using the same tried and tested formulae as competing brands. An example of best practice was considered to be a major credit card provider who allows up to three DM tests per year to be a flop, in order to increase the entertainment value and distinctiveness of mailings. It is also recommended that ‘on-brand’ mailings use the same brand proposition but not the same creative as other media.


This paper suggests that by allowing customers to feel greater control over the frequency of contact, or relationship closeness, organisations will increase the relevance, esteem and bonded dimensions of brand strength, as customers feel their views are being respected and valued by the sender. Stone and Gamble (1999) recommend a questionnaire approach in direct mail at specific stages in the financial services customer relationship. There is little evidence, however, to suggest that Pearson’s (1996) detailed recommendations for giving the customer more control by using DM communications for activating customer dialogue have yet been implemented, at least among large corporations.


Views were divided on the usefulness of adding emotional warmth to financial services branding. Interviewees, however, suggested that even companies who have achieved a certain level of distinctiveness on performance merits, like First Direct, may need to add emotional warmth to the brand equation in order to build up the esteem and knowledge pillars of brand strength and to protect themselves further from imitation. Brand personality and the emotional aspect of branding is currently perceived by these interviewees to be neglected by the financial services sector. It is also seen as difficult to achieve in DM because of: superior effects of drama, music and humour on screen; less consumer patience with print; intangibility of services; negative consumer attitudes towards financial services providers; and a low interest in some financial products, such as insurance. Despite these views, a number of financial services brands are described as coming close to having a brand personality (CU, RAC, Virgin, Scottish Widows and Goldfish) and are analysed in the brand personality section of the Appendix.

Figure 2 The three Cs model of brand objectives in financial services DM

DM brand objectives as three core Cs

The bonded or relational dimensions of branding, however, could not be separated out from interviewees’ discussion of other brand-building components as suggested by the pyramid model, although the term was helpful for ensuring that this dimension was analysed in the findings.

Since neither brand-building model covered all dimensions discussed in the interviews, an alternative model of building effective branding in consumer financial services direct communications emerged and is proposed diagramatically in Figure 2. It positions four key brand- strength components around three central objectives for brand development in DM. The latter are three core ‘Cs’, or desirable customer outcomes, which are: consistency, credibility and brand commitment. The diagram also summarises some of the key findings for consumer financial DM next to each of the four key brand-strength components.


Representative APR 391%

Let's say you want to borrow $100 for two week. Lender can charge you $15 for borrowing $100 for two weeks. You will need to return $115 to the lender at the end of 2 weeks. The cost of the $100 loan is a $15 finance charge and an annual percentage rate of 391 percent. If you decide to roll over the loan for another two weeks, lender can charge you another $15. If you roll-over the loan three times, the finance charge would climb to $60 to borrow the $100.

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