Today, we’d like to discuss targeted bank branding. We enjoy this topic because the concept is simple and often inexpensive to implement. The outcome, however, can be very effective and powerful. Targeted bank branding involves taking a suite of banking services that the bank already offers, identifying a niche market, and tailoring the existing products to this specific niche market. Let’s look at a couple of examples of this.
You may be familiar with this first example – Bankers Lender. Located in West Texas, they offer banking services and products for other bankers. This may sound a little funny, but it makes a lot of sense because not every employee who works for a bank wants their loans and deposit accounts with the bank that employs them. We think this is a great idea. One of the more entertaining examples you may also be familiar with is Redneck Bank out of Mustang, Oklahoma. Take a look at their website and you may understand more of what we’re talking about here.
HOW TO GET STARTED
A bank will find a deposit account, a loan product, and some payment services and then tailor these products in a way that makes sense to a particular industry, set of professionals, or set of consumers. If you take a look at your existing customers and the people who walk in the door, you can identify market segments. These market segments often have particular needs that may not fit with your regular, cut-and-dry banking product or service. They don’t quite fit within the normal bucket. By shifting your deposit loan structure and/or the underwriting structure, and shift these structures a little bit within the normal credit quality standards, you can offer a product that fits much better within that targeted industry, demographic, or industry group.
PERSONAL EXAMPLE
The easiest example of target industries for me to talk about is attorneys. The following is a personal example. When I graduated from law school, I wanted to buy a home. I approached several different lenders to shop around a little bit and see what might be available. The bank that got my loan offered a very flexible product where they were willing to rely on an offer of employment. They offered a low down payment with flexible sorts of repayment terms. I think it was an adjustable-rate mortgage at the time. It wasn’t the lowest rate, but it was competitive and imade the most sense for us at that time. The lending institution was willing to work with us. It might not surprise you, but later on, whenever I had a credit need, deposit account, or any other banking product, that bank would get the first bite at the apple. I didn’t always go with them on every product or service, but frequently I did.
PROGRAM AND BANK NAMES
One other strategy to discuss is naming or branding your new program. If you were targeting attorneys, you might name it your Attorney Lending Program or the Attorney Division of the bank. If you really wanted to go to the next level with branding, you could even establish a trade name for the bank. That’s right. A bank can operate under a trade name just like other businesses. You may even run a suite of banking services under a very specific name that’s different from the bank’s normal branding. This is what you’re seeing see from organizations like Bankers Lender or Redneck Bank. Remember, there are banks behind those names, but they use a different set of branding on the front end because it makes more sense for that particular demographic.
SUMMARY
In conclusion, the following is a summary of targeted bank branding that you may follow:
- Take a look at a specific market segment in your community.
- Get to know that industry’s banking needs and understand their challenges when working with banks.
- Make some reasonable and prudent adjustments to your existing banking services, ensuring that the products fit their needs.
- Name the products or a division of the bank to target that specific industry.
Targeted bank branding can be very effective and powerful. We believe that you may succeed with this strategy, particularly because it doesn’t take a huge technology investment or a lot of lead time. It just takes some careful thought, placement, and planning. I hope you found this topic interesting and will take a minute to see if it makes sense for your bank or financial institution.
Farley Law specializes in working with both community banks and small businesses. If you are interested in learning more about these or any other income-generating activities for banks, please feel free to contact us at Farley Law, where we help our client financial institutions develop new products and financial services. Have a question or a comment? Send us a note at business@farleylawpllc.com, or set up an introductory call using our bookings service.