Note – Occasionally I write on topics unrelated to the museum sector. This is an article about banking and brand equity.
One of an organizations most valuable assets is its brand equity. It takes years for a brand to build a level of trust, loyalty, and community respect that equates to industry leadership, ultimately positively impacting revenue. It’s the reason Gucci is worth over $22 billion on annual revenue around $10 billion a year, and Google is valued at over $200 billion or revenues under $150 billion. It takes years of focused, deliberate effort to build a well-known and trusted brand.
While brand equity is important in all industries, its importance in financial services cannot be overstated. One of our most critical decisions is who we trust with our money. Issues of money directly trigger our limbic brain as financial security relates to overall safety. We feel safety in established brands as they have stood the test of time and are trusted by millions of clients. More people do their banking and/or investing with known global brands such as Bank of America, USBank, 5/3rd bank, Meryl Lynch, and Fidelity than all local and regional, and online providers combined.
In 2019, two highly respected national brands merged. BB&T, which opened its doors in 1872 and SunTrust, which opened its doors only 26 years later in 1892 merged to become a bank they decided to name Truist. Both brands that made up this merger were well respected, handling the banking and investing needs of millions of customers. Considering the value of their combined brand equity, it is difficult to see how abandoning this history and changing to a brand-new company name was a good strategic decision. Truist is a brand-new brand identity with no history and no brand equity.
There are several things to consider here. First, the most important attribute of a banking brand is trust. By throwing away both brand names, they are communicating to their customers that they have no trust in their own identities. To a customer that has put their money in either of these institutions, this is a moment for pause. By throwing away these trusted brand names, they are essentially communicating that they do not stand for the values these brands communicated. A brand loyal customer is left to asking why this change occurred. If bank leadership does not see value in their own respective brands, and chooses not to stand behind these brands, why should a customer trust these brands with some of their most valuable assets.
So how did this happen. We will never know what conversations occurred internally, but we know a few things that have been made public. First, both sides saw their brands as ‘the bigger and more respected’ brand, as such, neither was willing to have their brand be dissolved in favor of the other brand name. I know this sounds silly, but it is basically like saying, (1) we are better than you, (2) if we can’t have our brand name become the new companies brand name, then we will not accept your brand name becoming the brand, (3) the only thing we will accept is a third new name regardless of if this is a good business decision. It is negotiating for the worst result. Secondarily, it has been communicated that hundreds of people had input into the decision to choose a new brand. Allowing this type of high level strategic discission to be significantly influenced by hundreds of opinions will not result in the best outcome. The more voices you allow into this discussion, the more you ultimately attempt to appease each voice by coming up with a solution everyone can live with instead of coming up with the right solution.
As Truist is a new brand, we will have to wait and see what happens, but from a brand equity standpoint, they just gave away over a century of hard-earned brand equity for what appears from the outside be a combination of ego appeasement and group think winning over good strategy.
Article by Frank Bennett, originally published at WorldClassMuseum.com