By John Clark, Planning Director at brand design agency Coley Porter Bell
The profile of the traditional private banking customer has changed dramatically. Whether it’s increased competition from fin-tech start-ups, or the rise of crypto currency, traditional institutions steeped in heritage are no longer automatically on the wish lists of young entrepreneurs and agile investors.Not only do private banks need to engage a whole new set of millennial customers, they need tore-evaluate their traditional approach to brand strategy and design to capture the imagination of the next generation.
Despite this, the more traditional values of stability, personal experience and judgement are still important and new, digital challengers will struggle to replicate these attributes. While research from Merryl Lynch on high net worth millennials shows there’s a need for guidance,(as few consider themselves knowledgeable about financial products and investments), it means banks and wealth managers will need to push beyond both the traditional clichés of wealth, and the misconceptions of millennial stereotypes. They will need to build brands with relevance and durability. With this in mind, we’ve identified six ways in which private banks could begin to think differently about building their brand.
Be easy to live with
Shaped by their experience with non-financial digital brands like Google and Amazon, on-the-move millennials expect to always be ‘always on’ and have control. Brands need to fit into their life; not the other way around. For private banks, using new technologies could free the relationship from being purely face-to-face in an office setting; advice and interaction could be provided wherever, to whoever and however it is needed. For instance, taking a leaf out of Babylon’s book – the subscription health service provider – private banks might consider offering a service that allows video calls at any time of the day or night instead of face-to-face meetings. This means someone on a business trip abroad, can get the advice they need without waiting to get home.
Work with me, not for me
At work and as managers, millennials tend to spend more time inspiring and empowering their colleagues than previous generations. This style of professional relationship is likely to extend to their expectations of their wealth manager. Indeed, when it comes to their investments, research from Deloitte found millennials want to remain in the driver’s seat: they want to understand and feel empowered to make investment decisions, fully understanding what is involved.In response, private banks may wish to shrug off their reputation as sages, and position themselves not just as partners, but as coaches or companions that are there to develop and grow with their customers.Again, taking inspiration from outside the category, in the world of beauty products, new skincare umbrella brand, Deciem, has achieved category-disrupting growth not by formulating the best creams, but by putting ingredient decisions into the hands of the consumers. With a portfolio of 200 products across 10 brands, Deciem taps into the millennial desire to both understand and be given permission to do what they think is right.
The wisdom of my peers
Millennials grew up immersed in online communities where the wisdom of the group, the ethic of crowd-sourcing, and a learn-it-yourself culture are valued. It’s not surprising the same behaviors can be seen when it comes to their finances. According to Deliotte, when making an investment decision, millennials are more likely to seek out and collate opinions and views from multiple sources. So, while private banks are there to provide expert advice, they shouldn’t expect millennials to take it at face value. Instead they can facilitate the conversation and provide platforms for investors to share their knowledge. UK based online investment service, Wealthify, is a good example: investors can create investment “circles” to share their investment experience and receive a discount on their annual management fee as they grow their owncircle.
Do good and make money
When it comes to money, millennials don’t want it to compromise their personal values: they are less likely to measure their success in terms of wealth alone and they care about their personal impact on the world. For example, HSBC research with millennial entrepreneurs found they are motivated to go into business to both better themselves, and have a positive impact on their community.
This sense of purpose is likely to extend to their approach to investments, with millennials seeking out banks that share their personal values.Private banks will need to demonstrate that they can help clients grow their wealth, while having a positive and visible wider social impact. In the mass market, newer financial players are already building purpose into their business and brands. For example, US insurance provider, Lemonade, donates what’s left from annual unclaimed premiums to causes you care about, and Abundance Investments uses funds under management in projects and businesses take an active role in creating a better future.
Understand my personal goals
The long-term financial goals of millennials have shifted and may feel unfamiliar to private bankers. According to Merrill Edge, they are the first generation to plan for financial freedom or to afford to live a desired lifestyle, rather than the more traditional goals of say a comfortable retirement. They also don’t want to be treated as a homogeneous segment: they want advice that is unique to them and tailored to their life and aspirations.
To attract new millennial customers, banks will need to adapt their brand and communications to show they understand what their next generation of investors care about. The stuffy, clichéd visual language of wealth is unlikely to be appealing. With clients, private bankers will need the emotional intelligence to help balance what could well be the conflicting and confusing financial goals of a millennial investor. Technology can also play a role in helping clients not only understand but explore and feel the consequences of decisions. For example, MeetInvest has designed a fantasy football approach that allowed investors to select and build an investment team, and Merryl Lynch created an app that aged photos of their customers to help them build empathy for their future needs.
Old world values with new world relevance
There is a tendency for private banks to either focus on themselves – their heritage, expertise or track record – or the functional, more transactional side of their business in their branding. This is then reflected in a visual identity that uses traditional, stuffy imagery or has a clinical style that feels more‘big bank’ than ‘personal banker’. While it’s key to create meaningful changes in the brand experience, the visual identity also plays a big role in convincing the conscious and seducing the subconscious of both prospects and clients.
If millennials care about convenience, inspiration and openness when it comes to their investments, then these values should be visually expressed through every touchpoint: from the welcome letter, to the welcome desk, every interaction is an opportunity to express your point of view and create the seamless, modern branded experience that millennials expect. At the same time, it’s important for banks to stay authentic and build on their strengths and DNA while making them relevant to a new generation of investors. Lombard Odier is a great example of this. Having survived 40 financial crises and emerged stronger each time, Lombard’s brand is now built on a core idea of “capacity for reinvention”. In a fast-changing modern world, the brand now speaks to the banks’ ability and desire to constantly rethink to bring about financial stability.
Ultimately there is a need for private banks to balance innovating their experience and brand to reach new audiences, while reinforcing their reason for being. Private banks can draw on the learnings from brands that are already succeeding with millennials to help redefine their client relationships, while also restating their purpose as modern-day beacons of trust within the banking industry.