The Hindu Business Line : Beware the branding

YET ANOTHER BANK — and this time a long-in-business public sector bank — has roped in a celebrity to endorse its products. While it is heartening to see public sector banks venturing into the contested arena of corporate brands, a health warning is in order. There can be dangerous assumptions on how to build such a service brand and what a celebrity can achieve for a bank, against competition. One, more than one bank can easily claim some of the attributes such as `steady' or `reliable' performance, as the PSB in the instant case. Two, it is unclear how the bank proposes to distinguish the service content, of which the ambassador is the outer package. Lastly, it is still an open question how far the culture of what is still a government-run bank will enable it to enjoy the benefits of a high-profile promotion.

It is understandable that public sector banks should be embracing, rather too readily, what is fashionable in business. After all, their current top management has spent a lifetime within a hothouse of a sheltered financial sector, with very little strategic independence, led as they are by the Finance Ministry. With nothing much to choose amongst their offerings, they were until quite recently rarely tested against free market norms. The senior managers, like the institutions they manage, are elderly, sedate and solid, yet newcomers to the competitive pursuit of customers and investors. They are now told to focus on the customer; find new means of raising capital, create a stronger technology base and so on.

But the boards of these new entrants into brand marketing would be well advised to contemplate the lessons from experience the world over. First, they should forget the notion that they can dictate what the brand is. A brand is, in the end, an overall perception in the minds of the bank's customers. Brand image in banking is largely driven by the customer's experience of the front end, the service. And that depends largely on the kind of staff. There are still thousands around who have grown up with just one Customer Week in the year! Second, just because a brand is about perceptions, you cannot try to change them first by glitz and glamour. Competitive advantage is expressed by the perception but the latter is not its origin. The effort has to start at the opposite end, from the relationship with the customer, by concentrating on delivering the right quality every hour.

Emotive advertising is all very well for trivial products with intrinsically nothing much to sell them anyway; but to employ matinee idols and cricketers just because the American fizzy drinks do is to court disaster — apart from wasting the depositor's and shareholder's money. Similarly, event managers, brand ambassadors and their expensive agents can never give an organisation a make over, and thereby create a new corporate brand. That would be utterly simplistic, putting the cart before the horse and therefore unwise. However, such an approach deserves a serious health warning to top management. Beware the me-too spirit.

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