By Chelsea D’AmoreThe last two years challenged brands across industries to identify their “X factors” to maintain a stable revenue stream. In trying times, reputation, trust and strong branding keep customers engaged and dedicated. This is when loyalty can be cemented or broken.
The care that banks and other financial institutions showed customers throughout the pandemic helped bolster trust and reputation, as documented by the 2020 American Banker/Reptrak survey of bank reputations.
But as the post-pandemic glow banks experienced begins to recede, banks must consider how to maintain this momentum. Focusing on the issues that most concern consumers with their banking needs and beyond will serve as differentiators among competitors large and small.
Connect your brand to ESG values
The pandemic, social and racial justice movements, the climate crisis, #MeToo activism and new leadership in Washington have made consumers acutely focused on where the companies they patronize stand on social issues. This includes their financial services providers. These environmental, social responsibility and governance-related topics can no longer be addressed with simple corporate social responsibility initiatives or charitable donations. A bank’s values must be embedded throughout its work culture and business strategy—and visibly woven into all its customer interactions.
Financial institutions already play an important role in showcasing ESG factors How money moves and who has access to financial tools and resources drives everything from social progress to investments in green technology to access to quality healthcare. This is especially true for community and regional banks with close links to their hometowns. Consumers are watching how banks distribute resources among their neighbors—not just to themselves or shareholders.
As Gen Z continues to enter the financial field, these young adults are paying the closest attention to how all the brands they interact with support the causes that matter most to them. According to PwC, consumers ages 17 to 38 are almost twice as likely to consider ESG issues when making a purchasing decision than older consumers. With the expectation that this trend will continue, investments in ESG are likely to be returning in increased brand recognition and loyalty.
Build reputation by supporting how consumers want to manage their finances
Banks often want to be the first out the door with a new piece of technology to advance innovation in the industry. Digital capabilities have only become more imperative after extended lockdowns and quarantine periods prevented in-person visits to branches. Yet research shows consumers want the best of both worlds.
Consumers are split between when they desire an in-person banking experience versus when they want to manage their finances digitally. In a recent survey, our G&S Insights team found 40 percent of consumers still prefer to visit their local bank branch to deposit checks. The same percentage wants in-person engagement when opening a new account. Consumers are more likely to conduct other banking needs fully remotely, such as transferring funds and applying for credit cards.
This data shows that banking is not one-size-fits-all. Not every consumer has the same digital needs or demands. Socioeconomic status, income, age, location and other factors can all impact a consumer’s ability to leverage digital and mobile banking tools. Consumers who still rely on tools such as physical checkbooks and paper statements need to feel they won’t be left behind, while digital natives who want real-time capabilities will expect their financial tools to keep pace with the digital transformation curve.
By meeting consumers where they are and providing the tools they need to succeed, your banking brand will build a reputation for strong support across every channel.
Trust is still the bedrock
Certain values don’t change, especially when it comes to choosing a partner for something as sensitive and vital as personal finances. Nearly one in four consumers rank trustworthiness as the top attribute they consider when choosing a financial institution, outranking factors such as security, size, branch proximity and digital capabilities.
Banking during the past two years demonstrated why trust is especially vital for small business clients. The Paycheck Protection Program rollouts required banks to quickly process complex applications from clients to submit for approval. These loans were crucial to thousands of businesses trying to stay alive and pay their employees through the early months of the COVID-19 pandemic. Banks needed to be swift, clear and communicative with clients on how their loan applications would be handled to ensure businesses had the best opportunity to receive funding. The financial institutions that succeeded demonstrated their commitment to supporting customers beyond their day-to-day needs and established them as true financial partners. This level of trust goes a long way in keeping customers for life.
Brand, reputation and trust remain constant through worldwide crises, tides of social change and tech revolutions. Taking care to build and maintain these values drives business for banks when the future of the market is murky and banking consumers are navigating challenges—right along with all of us.
Chelsea D’Amore is client service manager for G&S Communications.