Do Financial Brands Add Up?

The global economic meltdown has been bad news for financial services brands, straining the media of marketing communications as much as balance sheets.  The fundamental question is whether branding can overcome the rational as well as emotional reactions of depositors, investors, and policy holders.

For instance, WaMu, the largest failed savings & loan in U.S. history, suffered a massive run during the final week of its tumble into insolvency.  The withdraw rate stabilized when Chase bought the bank, and then ran ads that declared "We love Chase.  And not just because they have a trillion dollars."

So what mollified frightened customers?  Was it the cute branding, or the news of the buyout?

Conversely, Bank of America has run no branding directed at Merrill Lynch account holders.  Investment portfolios are a different animal than bank deposits (Merrill's liquidity crisis didn’t necessarily touch the value of stocks and bonds it held on customers' behalf), yet BofA's recent earnings announcement was greeted with a massive stock selloff.

Was the lack of branding an issue?  Or is there simply no way to overpower the news, so why throw good money after bad?

The efficacy of branding requires some level of authority, and today's chaotic circumstances challenge that credibility...so I think the fundamental question remains unanswered: what can the financial brands say in a broad marketing sense that will add up to mean something to consumers?

Maybe Charles Schwab has the right idea.  The firm seems to have forsaken the branding ads and opted to focus on direct communication to account holders, effectively telling them "we feel your pain, and we're willing to talk about it."

Is the best approach for financial brands to simply acknowledge the questions instead of declaring answers?  Or does it matter at all?

Are the financial firms running branding ads bright lights, or dim bulbs?

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