Lisa Merriam

Bank Brand Names ABA Bank Marketing–Banks: The Name Game

Originally published by Lisa Merriam in ABA Bank Marketing, February, 2005

bank-marketing-magazine-name-game“A good name is more valuable than great riches.” So says the ancient book of Proverbs. In business, a good name is a prerequisite to great riches. Nowhere is that more true than in a trust-based industry like banking.

Your name is the foundation of your bank’s reputation, or brand. It’s the one thing no competitor can copy. A good name gives you an edge to maximize market share and profitability. As the banking industry consolidates and becomes less local and more competitive, a good name is imperative. But what constitutes a “good name”?

What Is a Good Name?

  • Unique: The first mark of a good bank brand name is that it be distinctive. There’s only one Cher and there’s only one Wachovia—or Crazy Woman Creek Bancorp. An inimitable name is memorable and sets you apart from your competitors.
  • Expressive: A good name supports the values, personality and objectives of your bank. Horizon Bank says a lot more than the old name First Tennessee did. A strategically valuable name furthers your bank’s future aspirations.
  • Limitless: A good name does not impede expansion. Geography isn’t the only potential limit. Your name should be flexible enough to extend to new products, businesses and market segments. It should empower unlimited growth.
  • Functional: Your name should be easy to say, spell and use. It should fit on the side of a building as easily as it does the face of a check. It is promotable and attractive both in sound and appearance. It doesn’t hurt if the name suggests a visual representation either—it makes for a memorable and powerful logo.
  • Ownable: A good name is one that enjoys trademark status—not just at the state level, but nationally. Owning your domain name on the Web is a must. If your institution doesn’t own its name, it doesn’t truly own its reputation.

Name Trouble Areas

Not every bank has a good name. A number of bank brand names are less than ideal for a variety of reasons:

Anonymous names: Venerable name traditions that worked before deregulation and convergence are too generic today. “Some banks have condemned themselves to anonymity with names that are too generic,” says Denis Riney, a brand expert and Partner at Prophet, a brand and business strategy consulting firm. Over used words include:

  • First, 1st and One
  • Colonial
  • Banc (in all its permutations)
  • Community
  • American
  • Bank of (fill in the blank)
  • Capital
  • Center or Central
  • Citizens Commerce or Commercial
  • Financial
  • Farmers, Merchants, or Manufacturers
  • Fidelity
  • National
  • Peoples

Names that tie you down. Names with a specific regional reference need special consideration. If the strategy of your bank is to build a reputation as a local, neighborhood bank, a regional name is workable. La Jolla Bank can stake a claim in its community that Bank of America cannot. Regional names, however, are intrinsically limiting. Pacific Financial Corporation could not take that name to Miami and Northeast Bancorp would not work in Topeka. Augusto Medelius, the financial services industry specialist at FutureBrand New York sums it up: “You need a name that will travel and take you where you want to go.”

Names that can’t grow.As banks expand into insurance, asset management and other lines of business, old style names can be limiting. BB&T, for example, has been remaking itself into a one-stop shopping financial services company through acquisitions. “While BB&T has been transforming itself as a company, it hasn’t transformed its brand name,” says Medelius. The BB&T name is too strongly associated with retail banking to stretch to the other businesses. BB&T has taken the expensive and strategically undermining approach of supporting over 50 different names.

Naming systems that confuse. Maintaining multiple names can interfere with your ability to maintain a relationship with customers. Synovus pursues a local bank strategy with over 40 individual bank names. When a First Commercial Bank customer wants trust services, a commercial lease, or other more complex products, however, they are suddenly dealing with a new name and entity Synovus. The customer doesn’t know why they face a new and unrelated name. The Synovus naming system inhibits seamless cross-selling and one-stop shopping. The inconsistency is confusing.

Initials. Alphabet soup names are all too common among banks. Names that are a jumble of initials are almost impossible to convert to brands. They aren’t distinctive or memorable, and they do nothing to convey personality or a value proposition. What does is different about PNC, UBS, CIBC, HSBC, ECB, EFC, ESB, ESL, DCB, DNB, FNB, LCNB, LSB, and so on? Some banks with good brand names slip into using initials and undermine their own names. North Fork, a bank with a strong brand name, sometimes uses NFB instead—diluting their brand and confusing their customers.

Merger Challenges

Mergers create their own naming challenges. While companies merge, brands cannot. The merging brand names represent two different histories, cultures and values. You will need an identity that transcends existing reputations, taking the best from the past and opening new potential for the future. Consider the four basic options:

1. Keep both names. Some banks keep the brand names they acquire. The Bank of Montreal recognized the value of the Harris name in the Chicago market and the limitations of the specifically regional (and foreign) Bank of Montreal name. The benefit is that you lose no brand equity. You keep what both names always stood for and have the freedom to position each bank name around a different strategy. You do lose, however, an opportunity to create a new image for the future. Another negative: Maintaining two names is easily twice as costly as one.

2. Keep one name. An alternative is to keep the strongest name and transition the others. Nations Bank/Bank of America and First Union/Wachovia handled their merger name issues this way. A one-name approach focuses resources on building the remaining brand name and creates a communication opportunity for promoting merger benefits. On the negative side, the one-name strategy can feel like a takeover. Also, adding new qualities to an existing name is difficult.

3. Combine two names. Some merging companies have tried to merge their names. A recent example is JPMorgan Chase. The problem is combination names tend to be long and ungainly. The 1954 merger of Chemical Bank with the Corn Exchange Bank Trust Company created the Chemical Corn Exchange Bank–an unlikely choice today. These combined names cost as much as an entirely new name, but without the benefits a new name would bring.

4. Create a new name. When the Aid Association for Lutherans and the Lutheran Brotherhood merged in 2002, the short-lived alphabet soup combination of AAL/LB was renamed Thrivent. The company sent a clear signal of its redefined value proposition and used the new name to help with the transition and integration. Mergers create customer confusion and a new name can be risky. In addition, putting your new name on everything from signs to stationery is very costly.

The naming challenges created by mergers and acquisitions have no easy one-size-fits-all answers. Each situation requires a careful weighing of pros, cons, opportunities, costs and risks. Dr. Joanna Seddon, Executive Vice President for Millward Brown, specializes in providing strategic brand advice based on financial modeling. “It helps to dimensionalize brand decisions,” she says. “You need to understand the value of the brands in question and get the facts and figures that quantify and define the risks.” Numbers don’t just make name decisions clearer and less risky, they can short-circuit politics and emotions.

Name Changes: Accounting for All the Costs

A new name does not come cheap. The cost starts with the new name itself, escalates with implementation, and climbs over the years as you invest in building your bank’s reputation under that name.

  • Cost of the name: Many companies hire professional naming consultants to recommend and test new names for a cost between $5000 to $500,000. Sometimes the cost to research, trademark, and obtain the Web domain is included in the fees, otherwise be sure to include those items in the budget.
  • Cost to redesign: A new name almost always means a new logo. Design costs can run from a few thousand to hundreds of thousands of dollars.
  • Cost of implementation: Your bank name appears everywhere—from the business cards carried by every employee to the checks, credit cards, and bank statements in the hands of every customer. If your bank sponsors parks, stadiums and community centers, you’ll need new signs for more than just your buildings and ATMs. Implementation costs can easily dwarf name and design costs.
  • Cost to build the identity: The real value of your name isn’t what you pay for it, but what you make it over time. Years of flawless service and performance, and investments in advertising and public relations begin fresh with a new name. Your good name ultimately is earned more than it is created.

The days of stodgy bank names are coming to a close. Banks on the grow know that a good name can give you a competitive edge, obviously with customers and potential customer customers, but also with investors, the press and employees. Such things as trust, integrity and performance matter—and they are embodied in your good name. A good name is a foundation for success. Say’s Prophet’s Denis Riney, “The name doesn’t make the company, the company makes the name.”

Update 4/30/2009: The recent meltdown in the financial services sector has had a huge impact on brands. Check out two videos:
AIG Name Change to AIU
Best & Worst Wall Street Brands

More naming resources:

Naming How-To:

Naming Mistakes
Six Factors for a Memorable and Motivating Name
History of Best Known Brands
Styles and Types of Brands
Choosing a Name
Try a Recycled Name
Web 2.0 Naming Considerations
What is Brand Architecture
Approaches to Brand Architecture
Brand Architecture and Business Strategy

Companies and Products:

MSNBC vs. and The Bigger Naming Problem
Macy’s Blunder with Marshall Field’s Name Change
Banks and the Name Game from Bank Marketing Magazine
AIG Name Change to AIU
Breaking Up the Motorola Brand
Google’s Speedbook Disaster
Renaming a Small Business
Proxios CEO Talks About Renaming Process
Naming a Green Sportswear Company
Unintentionally Funny Names-BARF
Unintentionally Funny Names-Putzmeister
Unintentionally Funny Names-Bimbo
Renaming a $2 Billion IPG Agency
Renaming Iraqi Freedom
Selected Naming Portfolio