The Hindu Business Line : Change needs to retain the past

Banks are about people, solidity, dependability and service and not about youthfulness. The new, revamped image may be appealing to youngsters, but how many of these youngsters do actually save?

Mere cosmetic changes will not suffice. What’s really in it for the customers?

Yesterday I went to Varthur, a place in the outskirts of Bangalore to be the witness in a registration of a new flat that my wife is buying. As I am fond of repeating, in my family, like in most others in India, the assets are in the wife’s name and the borrowings are in the husband’s name. But that is not the theme of this piece as I want to remain married.

Back to Varthur and the Canara Bank branch that I drove past which had the old logo of a hand holding up a flower. No this is also not about whether all the 2,600-odd branches of the bank have been painted with the new logo in one go and how much longer it will take.

Knowing the logistics nightmares that this country presents, I am not even going in that direction. But what I am going to write about is the 101-year-old Canara Bank, one of the 14 banks to have been nationalised in 1969 and one of the most successful of the older generation banks, suddenly deciding to forget its illustrious past and deciding to change its identity and advertising to depict someone who is young, vivacious and has no relationship to what it has been till last week.

Oh, to remain young!

Brands want to remain young. They keep reinventing themselves, creating new identities and a look and feel for themselves that belies their age and vintage and the justification for that usually is “59 per cent of the Indian population is below the age of 24.” Marketers seem to love this youth segment (and don’t seem to mind dumping older customers like me) and immediately start feeling defensive about their heritage or believe their image is not for this young generation and start working overtime on their imagery and imagery alone as Canara Bank seems to have done right now.

But one wonders whether they have thrown the baby out with the bath water like lots of other marketers who too seem to be extremely unhappy with their current positions and images and make wholesale changes.

Yes, all of us want new customers and we believe rightly or wrongly that all our new customers are going to be young, urban and upwardly mobile. And for some strange reason we believe that the quickest way to change our image is to do a new campaign, revamp our identity, put some snazzy young people in our commercial and lo and behold, we will have a new image! Young people who were shunning us till yesterday will suddenly find us attractive and come to us in hordes! Oh, how I wish it were true!

Banks and imagery

Banks as a category are not advertising-dependent. People still bank with the branches of the bank that they have chosen years ago, primarily because of the proximity of these banks to their residences or places of work and because they enjoy certain facilities from these institutions or because they get superior service at a personalised level from some of the bank’s employees and not because of the advertising.

Nor do people own accounts with banks because the logo is contemporary or the advertising cute. Nor, as I suspect, are they particularly thrilled when their trusted 101-year-old bank suddenly decides to become one-fourth its age in its imagery.

Banks to my mind are about people, solidity, dependability and service and not about youthfulness. And I did mention in my earlier column the advertising for Bank of India that seems to be removed from reality and just a creative expression eulogising the bank’s service. Service is all about delivering expectations and in my opinion hype or projecting something that a bank is not promises to be a sure recipe for disaster.

Old or new, only time will tell

A strategic choice banks have to make is whether they need more younger customers who are not high net worth or older, more mature customers who are already high net worth individuals. If my young sons are anything to go by, today’s kids are living on the edge of poverty, so quickly do they go through their pocket money or their monthly salaries.

The new, revamped image of Canara Bank (assuming that identity is an important factor in brand choice) may be appealing to youngsters, but how many of these youngsters do actually save? Of course, they all borrow, but one thought the focus of marketing was to get ‘deposit customers’ which in turn enables the bank to lend more and hopefully make more money.

And let’s assume that the bank succeeds in getting a whole host of young customers across the length and breadth of the country, then what really happens?

The bank ends up with thousands of low-value accounts whose account holders’ do not even maintain the minimum balance, accounts where cheques are returned … you get the picture.

Obviously, this set of customers will not receive the best of the bank’s service or attention, and many of these youngsters once they get more affluent will move to greener pastures, read new generation banks. Banks would be well served to understand the fact that customers have lifetime value and that will be maximised only when its customers bank with it for their entire lifetime and that happens only with consistent, superior service, day in and day out even if it means updating the passbook on Sunday or receiving a call from the manager to say that there is a shortfall in the account. Yes, this is service that is dull, monotonous and repetitive that does not fail. The image of the bank is its people; the teller, the officer who passes your cheque, the manager who greets you in the New Year. So the key task for banks is to ensure that its customers stay with them for life and continue to entrust their savings to them.

Sadly many of us started out with nationalised banks but today have more of our savings and portfolios with new generation banks even though we may still hold accounts that are less important with the bank we started out with. Did we do this because the newer banks had a better identity or because they were more responsive to our needs? Think about it.

So are you saying I should not change? Hardly. Brands are like people. They need to progress and keep abreast with the times. They need to modernise and on occasion reinvent themselves lest their customer think they are dated, fuddy-duddy or not worthy of dealing with.

But it is not only about the cosmetic things like identity which are important for products that are sold on imagery, but perhaps less important for banks which are our financial custodians and the people who can play such an important part in our lives. And as a customer, I would still like to know what’s in it for me.

What has changed? Yes the logo has changed and the facade is freshly painted, but if the person who gives me my passbook is the same grumpy old lady then “How have you changed for me?”

Build on the past or break away from the past

Normally, identity exercises start with a careful evaluation of the present and an honest understanding of the strengths and weaknesses that the entity has. What do people remember of the brand, its identity and associations? Is there any brand property that can be continued or modified?

It is very rare that a brand that is over 100 years old has no associations worth carrying forward other than the name. It seems that a large, successful, service-oriented bank that has millions of customers is completely diffident about all its achievements and all the goodwill that it has so painstakingly built over the years, that it has chosen to be something completely new and barely recognisable to existing customers like me.

Nothing has changed, Sir, only the logo!

Being a customer of Canara Bank for the last 25 years and being a bit concerned about the ‘core banking services’ which I was told meant initial hardship of adjustment for customers, I called the manager of the branch that I deal with and asked him what has changed. He was polite, friendly as ever and said, “Nothing sir, we have a new logo.”

I rest my case.

More Stories on : Brands | Public Sector Banks | Third Umpire

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