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HSBC, UBS AND 3 PRINCIPLES ICONIC BRANDS

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Uri Baruchin

Two of the world’s most prominent financial brands have recently gone through very different rebrands. The changes introduced by HSBC and UBS have been very differently received and the jury is very much still out of whether either will make a difference for their respective organisations. But a common word shared between the two efforts is the word ‘iconic’, which is an opportunity to pause and consider the efforts of both brands in the light of what could be their long-term ambitions.

All brands aspire to become iconic, but very few achieve it. Iconic status is something that is achieved throughout an evolution of a brand, it’s like an Olympic medal achieved after years of rigorous training. And just like in sports, there’s very little room at the top.

Branding alone cannot make you an iconic brand, only consistency over performing across multiple aspects of your brand can help you get closer to that goal.

However, providing your brand with a powerful meaning system that helps it better engage with the market is a key aspect conducive to eventually being permitted into the exceptionally exclusive club of iconic brands. And because that system is intertwined with the overall behavior and performance of the brand in the market, there are useful lessons to learn from it.

Here are three of the patterns we’ve identified at The Partners.

1. Iconic brands are single minded

There are two ways the word iconic can be defined. On one hand it can mean worthy of great respect – which is how we want the brand to be perceived – but it can also mean a representative symbol of that which is respected. When we talk about brand identity, these two definitions intertwine. Of course brand identities are built of many elements and it is in their interplay that the deep strength lies. But the identity of a truly iconic brand makes a hero of a singular point of focus that becomes instantly recognisable, uniquely ownable and encapsulates the broader brand story in a moment – a literal icon.

The Ralph Lauren Polo crest, Tiffany’s exclusive use of Robin Egg Blue (Pantone 1837), or IBM’s palette of colourful illustrated symbols used for their Smart Planet Campaign are all examples of iconic singularities that form the central point of a broader system.

2. Iconic brands are consistently as well as diversely creative

Once the fundamental single mindedness is achieved, it actually gives a brand more expressive freedom, rather than limiting the range of expression under the policing force of a set of guidelines.

All brand identity systems require careful management of standards if they are to be successful and most young branding efforts start with an emphasis on consistency and focus. However, iconic brands take this to interesting new levels.

There’s an inner confidence to iconic identities that allows more flexibility of expression than for lesser brands. Iconic brands are more concerned with consistency of intent than consistency of how individual elements get applied. Look at how Louis Vuitton allows its own logo to be adapted on products, breaking always from their own iconic pattern to use the word in different ways, Coca-Cola using free-flowing illustrations, or how Nike switching visual styles from campaign to campaign without ever losing the unmistakable attitude.

3. Iconic brands suggest a richer story

The crest on a Mont Blanc pen is a snow-capped mountain top – a pinnacle of accomplishment. Breitling imagery tells a story of intrepid aviators whose survival depends on their wristwatch. The Apple logo would be entirely generic if it were not for Eve’s bite of temptation taken from the right side. Iconic brands don’t just create well-crafted identity systems; they create visual narratives that wordlessly convey a message about the brand.

It’s not about branding it’s about meaning. 

So what about the HSBC and UBS rebrands?

The surprising thing is that judged by the measure of truly iconic brands both banks have merely started their journey. HSBC ruled against rebranding and reviving the Midland name, and instead simply became HSBC UK, in essence, no major branding change. While that name still retains the original strength and connectivity associations, it means that to make a difference in the market HSBC will have to bring a greater focus on creative actions that bring new stories and experiences to life.

UBS, on the other hand, has already made a big step forward: it recently rolled out its most major rebrand since 2009. A digital focused campaign, with work by renowned photographer Annie Leibovitz and heavyweight media partners such as LinkedIn, Bloomberg, FT, the Economist, Monocle and Forbes. In the process, they dropped the ‘We will not rest’ tagline, supposedly as it was seemed as too ‘we’ focused. Instead the ambition is to be more customer focused, that famously differentiated theme that no other brand has ever claimed before.  The campaign expresses that ambition by a simple yet effective rhetoric of asking ‘deep questions’ that are relevant to the audience. Followed by a promise that, together, UBS can help them find answers to the questions that involve a financial aspect.The look and feel of the entire design system is fresh and different. The logo is actually the only visual aspect left alone.

On the surface, those two efforts could not be more different. To be fair, one has barely started.

But when judged against the ambitious behaviour principles driving iconic brands, the journey for both HSBC and UBS has barely started. Both still need to win back the respect of a sceptic market, filled with distrustful, vigilant customers who feel like financial brands are happy to take advantage of them whenever possible. Both want to protect their status as representative of the best of their category – but is there even a positive concept of the category left?

A new alliance between financial brands and customers needs to be forged. Both brands have yet to excite creatively and tell richer stories over time across their entire ecosystem. While UBS’s most recent step might be more substantial, one step beyond the campaign’s microsite and you will find yourself deep within a generic bank website. And while the deep questions are appealing, do customers even believe that a financial brand can be on their side or have financial brands are all grudge purchases now?

The story is a campaign story; it’s yet to become a brand story. The bigger drama is still playing out. And a deeper narrative is yet to emerge and reopen the path to iconic status.

Uri Baruchin, Strategy Director, The Partners

Banking

Over 60’s turning to digital banking up by 90% during pandemic

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Over 60’s turning to digital banking up by 90% during pandemic 1

More than 90% of people aged over 60 have used online banking for the first time during the Covid-19 pandemic, according to a poll by iResearch Services, highlighting the importance of banks getting digital right in 2021.

In comparison, 17% of people aged under 30 said they were accessing services via an app or web browser for the first time.

The findings show how banks must adapt to help service the influx of new digital users and gain their trust, accelerated by the Coronavirus pandemic. With 97% of 18–24-year-olds trusting their bank with their data, compared to only 33% of people aged over 66.

Commenting on the findings, Gurpreet Purewal, Associate Vice President, Thought Leadership, at iResearch, said: “Our study demonstrates the lasting impact of Coronavirus on how people will access banking services from now on. Banks will be required to refocus on really understanding customer needs in order to engage with the different requirements of each individual customer.

“More than half (54%) of respondents said they are less likely to attend a physical branch after the pandemic. This demonstrates a seismic shift in the way people will access banking services now and into the future.”

In other findings, 63% of respondents said their bank acted in their best interests during the pandemic, but a third said they would consider switching their bank for better, more personalised communication.

Purewal added: “On the whole, High Street banks have emerged with great credit from the pandemic for the way they have supported their customers. As the economy rebuilds, it will be more important than ever that they communicate in the right way to help consumers through 2021 by leveraging digital platforms and understanding their needs fully.”

Asked how banks can improve their communication with customers, ‘connecting on a personal level’ ranked highest, followed by ‘more honest and open dialogue’, a ‘demonstration of how they are helping customers’, ‘more creative campaigns’, ‘consistent messaging across channels’ and finally ‘responsiveness to major events’.

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Banking

Banking on the cloud to create a crucial advantage in financial services

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Banking on the cloud to create a crucial advantage in financial services 2

By Rahul Singh, President of Financial Services, HCL Technologies

Once considered a revolutionary technology, cloud is now at the heart of agile and innovative businesses. The financial services industry is no exception, and has been a major adopter of cloud-based Software-as-a-Service (SaaS) for its non-core applications. Functions such as customer management, human capital management, and financial accounting have progressively shifted to the cloud. Several banks have also warmed up to using cloud for services such as Know your Customer (KYC) verification. IDC analysts say that public cloud spending will grow from $229 billion in 2019 to almost $500 billion by 2023, and a third of this will be spent across three industries: professional services, discrete manufacturing, and banking. The time is ripe for an increasing number of financial services providers to consider moving more of their core services to cloud.

Adoption is already on the rise

Earlier reluctance to move core activities to the cloud has softened, and many banks have put strategies in place to migrate services, including consumer payments, credit scoring, wealth management, and risk analysis. This significant change is driven by factors such as PSD2 and open banking, which require secure and cost-effective data sharing.

Regulators too were once cautious in their approach to cloud technology, but this is also changing. The Australian Prudential Regulation Authority (APRA), for example, whilst acknowledging the risks associated with cloud, also recognised the risk of sticking to the status quo. ARPA trusted the enhanced security offered by the cloud, and updated its cloud-associated risk advice. Wisely, APRA recommended that banks must develop contingency plans that allow cloud services to be provided through alternate means if required.

Rising pressure from new challengers

The other pressure for incumbent banks is from next generation fintech firms. These are cloud-native organisations, and are able to onboard customers remotely in minutes, roll out new services in days, and meet compliance requirements at lower costs.

As a result, the need for traditional banks to upgrade core systems and integrate the latest technologies is stronger than ever. The COVID-19 pandemic has been an additional driver, highlighting the importance of upgrading and migrating core systems to the cloud. Financial services organisations have been forced to rethink their approach to digital transformation, and pay special attention to a cloud-aligned culture. The industry is recognising how the cloud can address new and ongoing regulatory changes, meet different demands from customers, support the roll-out of emerging technologies, and enable incumbent providers to respond to the relentless competition from fintech firms.

New year, new priorities

As we enter 2021, financial services providers will need to reset their priorities, and go beyond using the cloud for scalability and cost efficiency alone. The new areas to focus on will include:

  • Creating a robust digital foundation: The cloud market is expanding fast, and there is an ever-increasing number of services on offer. Whilst the big three hyper-scalers are the obvious choice, various other players are also gaining traction, such as IBM, Oracle, and Alibaba Cloud. Organisations will need a robust digital foundation to adopt cloud at scale in a secure and compliant way. A well-architected digital foundation, supported by resilient operations, ensures that organisations have continued access to their systems and data, regardless of where employees are located, or what device they are using.
  • Adoption of technology platforms: Enterprises are finding ways to reduce complexity by embracing a platform approach, and increasing the speed of business IT consumption. Physical infrastructure is being abstracted into cloud-based platforms, with data consolidated into data lake platforms. Software products like Apigee are being offered as capability platforms to drive better analytics and intelligence.
  • Enhancing IT security: Cloud offers organisations greater security than on-premises servers, if implemented correctly. Financial services organisations have relied on control and compliance-based security for years, but these practices are increasingly vulnerable to cyber threats. Whilst service integrators create robust cybersecurity solutions for financial services organisations, cloud providers are also looking to provision industry-specific security and regulatory measures like end-to-end data encryption – making it easier for financial services organisations to be compliant whilst migrating to cloud.
  • Driving innovation: Cloud is the fundamental factor behind the ability of fintechs to innovate rapidly. Using cloud, financial services can leverage new technologies and tools like augmented reality (AR), virtual reality (VR), natural language processing (NLP), machine learning (ML) and the Internet of Things (IoT) to unlock new processes that improve customer interaction and experience with portable real-time services. Whilst fintechs have led the way in cloud-based innovation through open banking platforms, some of the leading banks are also adopting cloud to simplify their business processes, including KYC as a Service, to enhance customer experience.
  • Enterprise synchronisation: Effective collaboration, both internally and with external partners, is crucial to success in the ever-expanding financial services ecosystem. Cloud allows businesses to integrate collaboration through shared tools and platforms. This is a critical ability as it leads to faster decisions and improved innovation cycles.

Legacy systems hold banks back from improving revenue generation and restrict their ability to build a responsive and resilient business. Cloud is a key factor in the success of challengers: traditional banks have no time to waste in migrating their core systems to cloud and building a secure future.

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Banking

State of the Industry: optimism high in global financial services, although some key issues cause concern

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State of the Industry: optimism high in global financial services, although some key issues cause concern 3
  1. Exclusive research from Barclays Corporate Banking reveals the views of financial services leaders from across the globe on a range of key issues
  2. Recovery from Covid-19 is a key priority for FinTechs over the year ahead, however their number one aim shows the optimism in the sector: focussing on business growth
  3. Asia-Pacific may be the new focal point for expectations around Open Banking, with interest from Europe dropping year-on-year
  4. Firms confidence in their own cybersecurity fell 5% versus 2019, with less than half of respondents (42%) feeling satisfied with their own approach to the issue

Key players in the financial services industry are optimistic about the year ahead, according to a new ‘State of the Industry’ report from Barclays Corporate Banking, Alive to Opportunity.

Exclusive research from the bank also highlights regional differences in approaches to regulation, expectations for payment innovation and confidence in cybersecurity.

Optimism for 2021

As the official insights partner of last year’s Money 20/20 global conference series, Barclays conducted a survey of over 200 financial services leaders from across EMEA, the Americas and Asia-Pacific. From these senior executives, Barclays Corporate Banking found that optimism in the sector is high as it enters into 2021.

Whilst recovery from Covid-19 might be seen as a likely top priority for the coming year, it came in second place when respondents were asked what they would be focussing most on during 2021 – with 42% of leaders selecting it. Top spot instead went to ensuring business growth, with nearly three in five (57%) respondents picking it as their main area of concentration.

Commenting on this trend, Phil Bowkley, Global Head of Financial Institutions Group, Barclays Corporate Banking, said:

“Given that 2020 was such a tumultuous year, it is encouraging to hear FinTech businesses are confident and focused on future growth. Many firms have grasped the upheaval of the global pandemic as an opportunity. Covid-19 has driven a huge surge in ecommerce and cross-border business. This has significantly increased flows across FinTech payment providers, which have worked hard to enable cross-border trade, payments and ecommerce. At the same time, the industry has been collaborating with banks to ensure much-needed financial support from government flows to the real economy.”

Regions back themselves on innovation

In a continuation of a trend seen in 2019, respondents often rated their own region as the most likely source of future innovation. This ‘home’ bias was particularly strong in Asia-Pacific, where China, India, Japan and Southeast Asia together claimed over 83% of regional votes when considering the key sources of innovation over the next five years.

However, China’s reign as the most likely site of financial services innovation did not continue from 2019, with Barclays’ most recent survey showing that nearly one in four (24%) key industry leaders now view the United States as the most probable location for the rise of payment innovation over the next five years.

A shift eastwards for Open Banking?

Barclays’ research also suggests that Asia-Pacific may be the new focal point for expectations around Open Banking, with interest from Europe dropping year-on-year.

In 2019’s report, the impact of this key regulation was anticipated to be strongest in Europe – however, this time round just 38% of EMEA leaders now expect Open Banking to have a big impact on their business. By contrast, the majority (59%) of senior respondents from Asia-Pacific feel that the regulation will be key for their companies as we move into the remainder of 2021.

Security and resilience in a post-Covid world…

Firms’ confidence in their own cybersecurity dropped by 5% versus 2019, with less than half of respondents (42%) feeling satisfied with their business’ approach to the issue. Businesses in EMEA feel least confident about their security provisions, with one in three (33%) indicating that their own cyber security needs further investment.

The importance of resilience to customers was also a theme that many felt would rise in significance in 2020, given the recent growth in remote working as a response to Covid-19 – however just 5% of respondents viewed this issue as important when considering customer loyalty.

Steve Lappin, Managing Director, Barclaycard Business, said: “From remote working to e-commerce, coronavirus has meant that digital channels play a much greater role in working life. While this has undoubtedly presented new opportunities, it has also put additional pressure on infrastructure and heightened potential vulnerability to attacks. Therefore, it’s not surprising that confidence in cybersecurity has dropped, with many firms feeling that their rapid adoption of these new channels has left governance and control lagging behind. It’s critical that businesses remain vigilant – security may not be a key driver of customer loyalty, but cybersecurity issues are definitely a driver of disloyalty.”

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