Built to Last: How to Make Brand Financial’s Long Term Power Source

Posted by: Steve Gardner
Thu 16 Dec 2010 11:12 a.m.

Tags: advertising, finance, jfam, merril lynch, steve gardner

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In his speech to the JFAM Conference, Steve Gardner, President of Gardner Nelson + Partners, addresses the broad issue of managing financial brands through the negative cycles of the financial markets. Gardner contrasts the behavior of the financial industry following the 2008 financial crisis with historical precedent to argue that the institutions that continue to communicate throughout negative cycles emerge with stronger brands, and with their leadership credentials enhanced.

Bill asked me to speak today on the topic of "Brand: Financial's Long Term Power Source."

When he first mentioned this to me, I wondered… who would debate the point? Who would say, "Brand? Not important. Who cares?" I think we'd all agree that brands are very important.

So where is the debate in Bill's assertion? What's the controversy?

I realized the real question in Bill's statement is that each of us are in a daily battle to assert the importance of our brands. You believe in the power of a great financial brand – you don't need me to convince you of that -- but the organizations we represent don't always share that conviction. They don't always back up our belief with the funds and resources we need to build great brands.

Financial organizations are different from P&G, Coke, and other consumer good organizations. In those places, marketers often have the final say.

Usually not so in financial services. In our world, marketers compete with financial types and credit experts who demand a detailed ROI before approving any marketing investments. Heaven help you if our media investment doesn't pay out within the quarter.

And, in August, 2008, a hard task turned downright impossible. After the global financial crisis, branding, marketing, and advertising were placed on starvation diets as top management tended to life-threatening crises.

There's an irony in this, of course.

One of the rock-bottom core principles of the financial services industry is that investors should invest for the long term; "stay the course," don't get shaken by short term fluctuation and the cyclical nature of the financial markets.

And yet, when it comes to their own brands, too many of the big names in financial services seem happy to invest when the bulls are surging, but in a downturn, there's no investing in the brand. And in a crisis, there's silence.

The issue, then, is not for me to convince you about the power of financial brands, but perhaps to give us all some fresh ammo as we fight the good fight – within your own companies -- for why investing in your brand is so important.

Toward that end, I'd like to start by talking about one of the greatest "brand building" case histories of all time, which happens to be a story of brand building in the financial services industry.

This story is set in very frightening and bleak period in the U.S. financial markets. Perhaps it wasn't as bad as the near collapse of the world's global economic infrastructure of August, 2008, but it was bad.

I am talking about 1971, when President Richard Nixon attempted to stabilize the US economy and combat runaway inflation by imposing a national 90-day wage and price freeze.

Hard to fathom, isn't it? A financial situation so bad, that the President of the United States issues an executive order to freeze prices and salaries.

Now it happened that while that economic crisis had been building, the management of Merrill Lynch Pierce Fenner & Smith was preparing a major new ad campaign,– indeed, the first time they would run television advertising.

The problem was that their new advertising suddenly seemed terribly risky, given the awful state of the economy.

The visual in the commercials was a thundering herd of bulls in a stampede.

And the copy? Let me read it to you.

"America. Merrill Lynch is bullish on America.

In the years ahead, we see America growing in many different ways, and we want you to share in America's growth. That's why we've moved into different kinds of investments – not just stocks, but bonds, mutual funds, real estate, and more. Merrill Lynch has a lot of different ways to put your money to work.

America. Merrill Lynch is bullish on America."

Merrill Lynch had long since bought air time in the 1971 World Series – literally, right in the middle of Nixon's wage and price freeze.

Wouldn't it look so dumb to be saying that you are "Bullish on America" in the middle of a wage and price freeze?

Wouldn't it have been more prudent to just cancel the ad time? Wait for an upturn in the markets? Or make new commercials that had a safer message?

Merrill Lynch debated the point… but someone – some powerful, visionary leader – said, in essence, "Hey, this is what we believe. This is who we are. We are not saying that we are bullish on America today but we are going to be bearish on America tomorrow. Let's run the campaign… and not change a word."

So, right, smack in the midst of a terrible economic crisis, was born one of the greatest advertising campaigns in history: "Merrill Lynch is bullish on America."

The footnote on this story, by the way, is the very best part.

On November 12, 1971, Richard Nixon was asked, as the wage and price freeze was coming to an end, what his advice would be to the American investor. And the President of the United States said, and I quote… "If I may paraphrase that television commercial, I am bullish on America."

A true story.

What does that mean for all of us, today, 40 years later?

It's easy, with 20/20 hindsight, to say that the lesson is that the brand that invested throughout the downturn reaped big rewards.

And it's easy to say that the brand that spoke out when all others were silent looked like the leader.

Yes, both true, but I hope to focus us all on a more subtle point.

Merrill Lynch went ahead and ran that campaign because the company and its leadership deeply believed in their message.

They believed it expressed exactly who they are and how they feel.

Not just that phrase, "bullish on America;" but a broader positioning idea: a fundamental optimism that the long-term vibrancy and power of the American economy would generate great value for investors.

They believed they had the exact right message.

From the top of their organization on down.

Do all of us, in this room, today, believe that our brands have as powerful a message as they can possibly have?

If you have the right message, it will work in good times – and in bad.

If you have the right message, it should explain why your company is unique – different – and why it is the right choice … yesterday, today, and tomorrow.

If you have the right message and hard times come, your management should want to run toward it… not run away from it.

Please know that I am not just talking about advertising! If you have the right message, it is even more powerful as an internal tool. Every single employee – from call center reps to branch personnel to brokers to sales – everyone is more powerful, and more effective… because they know what they are supposed to do, how they are supposed to act, and why their bank is better than the one down the street.

Imagine how different it would be to fight for money, resources, and prioritization – if the message was that powerful? If it was universally embraced inside the organization?

The truth is that if you really have the right message, you will spend less of your day trying to prove that branding matters.

It seems to me that in 2008, the brands that had the right message were the ones that were the fastest to get back on the air. When everyone else was paralyzed into silence, Charles Schwab's no-nonsense, down-to-earth "talk to Chuck" allowed the company to talk candidly about the impact of the crisis on investors.

And then there were other brands – brands that really, really, did need to be talking to their customers, but their message was simply wrong. I think it's fair to ask whether the people who came up with "Live Richly" ever stopped to consider how that message would play in a down market.

How do you know you have the right message?

Here at our company, we believe that there are three criteria by which to measure the power of your brand message.

  • Meaningful and powerful: is it the most important promise you can make to your customer?
  • Relevant in its context: is it differentiated from competition, and demonstrate that you are in touch with societal trends and realities?
  • Believable: by being wholly consistent with the core skills and capabilities of your organization.

Sounds simple, I suppose.

But what it means is that when you attempt to define your brand message, you actually need to complete three entirely separate analyses of your market.

First, you have to totally understand your customer to develop a promise is meaningful and powerful. This is table stakes. You have to understand the customer's hierarchy of benefits to know what is most important, to know which benefits are not being met, and to know what benefits are currently owned by competitors.

Second: you have to study the context in which you compete, to understand if your promise is differentiating, and in tune with the evolving changes in our society and culture.

Some of the greatest branding achievements were moments when brands latched onto a powerful societal trend, and articulated that societal shift in their message.

  • "Come alive, you're in the Pepsi Generation."
  • "Just Do It."
  • "e-Business."

Third – and here is where I climb out on a bit of a ledge – I think the most important ingredient in a powerful financial brand is the degree to which it reflects the unique culture and beliefs of the company.

At the end of the day, for all the ATMs and electronic tools, financial services is the essence of the service economy. People are trusting you –your people -- with their money. They want to know who you are. What you stand for. What makes you great.

Our job, as marketers, is to know that, and express it.

Find out why your company is better. Honestly. Don't rent some silly, superficial phrase from a branding company, or some pun on your brand name.

Find the words that truly fit you.

I find it interesting that some of the greatest, longest lasting campaigns in the financial services industry were those that focused primarily on the company itself… why it was different, and why it was better. Curiously, this would seem to fly in the face of conventional wisdom about being "customer focused."

Smith Barney… We make money the old-fashioned way. We earn it.

The Citi Never Sleeps.

Get a piece of the Rock.

There are some things money can't buy. For everything else, there's MasterCard.

You're in good hands with Allstate.

Visa. It's everywhere you want to be.

Talk to Chuck.

Like a good neighbor, State Farm is there.

The American Express Card. Don't leave home without it.

Merrill Lynch is bullish on America.

And yes, I would contrast those powerful promises with those of a more recent vintage, messages which to me at least seem to have far less power and edge.

"Live Richly."
"Your Chase, your Choice."
"What's in your wallet?"

I can hear someone selling these campaigns by saying they are "customer-focused…"

But I'm not sure the customer is all that thrilled by a financial services company saying, "hey, we'll do whatever you want, it's your choice."

Great financial brands have expertise. Experience. Sometimes they actually have to say "no" to their customers.

I would argue that it is precisely in these assertions of company identity that these companies convey the conviction, confidence, and permanence that make people want to trust them.

And, yes, it is these assertions of continuity and strength in tough times – when others fall silent -- that they show true leadership.

Let me sum up.

  1. A great financial brand should continue to invest in its brand through thick, and through thin.
  2. One reason why some brands can do this, and others can't, is because they have more enduring messages… messages that work in good times, and in bad.
  3. The best way to make sure you have an enduring message is to anchor it on the bedrock of your unique corporate culture. Find a message that makes a powerful statement about why your company is different, unique, and better than your competitors.

Financial services is a very crowded space, and it has always been true that many of the messages in this category could have anybody's brand name at the end; that the brand statement is often the compromise that everyone on the committee could agree on.

Or, worse, that whole brand positioning process was off-loaded to an ad agency, who didn't have the time, inclination, or expertise to find out why your company was really different from the competition. So they just started writing ads.

Digging into your company and finding out why it is different is a big undertaking. It is hard, complicated work.

Now, precisely because there are so many different media, so many different communications tasks, so many different audiences, so many different ways that your brand is communicated to the market… suddenly, once again, we find that the message is what is most important.

Merrill Lynch led this industry for decades.

They did not lead because they ran an ad campaign.

I think they led the industry because they were, truly, bullish on America. 

Launch commercial for "Merrill Lynch is bullish on America" campaign created by Ogilvy & Mather in 1971.