Heroes Beyond Robin Hood

One of the grim facts about financial services is that by and large it is an industry highly reliant on selling.

This isn’t to say that people who are sold a product or take-up a service, such as financial advice, are taking on commitments they either don’t need or would be better off without.

On the contrary brandmanagement research indicates those individuals who have a plan – be that through a planner or otherwise – tend to be better off both financially and emotionally than those who don’t.

However the crux of the matter is that financial services is driven more by push rather than pull marketing.

This is slightly different to conventional marketing, which involves both push (e.g. selling face to face and direct selling) and pull (building a brand people flock to) techniques to develop and grow businesses.

Historically this meant the sales force of men and women in the offices, on the streets, out on the road and in the golf clubs actually selling have been the heroes of many financial services businesses to date.

Then about 10 years ago this started to change as more companies began building consumer brands aimed at simply pulling the punters in – especially in areas that are relatively simple to buy, such as mortgages, insurance and savings products.

The obvious ones have been the likes of ING Direct, Aussie Home Loans and Wizard, which all took the position of deconstructing and/or attacking the position of the expensive incumbents – with a proposition they are cheaper, clearer and more honest than other providers.

This is called Robin Hood branding – the metaphor being that these brands alone will save you from the big bad Sheriff of Nottingham brands.

Their success and the fact they have attracted billions of dollars at relatively low costs of acquisition has attracted the attention of every company in the Australian financial services industry, which means they are now looking at their own sales forces with a slightly jaundiced eye.

Sales staff after all are difficult – sure, they bring in the money and the large networks of the majors are money making machines, up to a point.

But the downside is that they are expensive, often complex to manage and these days increasingly difficult to recruit, so a brand which requires less of a sales force to achieve results, well, that’s attractive.

The ‘up to a point’ comment above relates to high net worth customers.

High net worth customers are curious beasts. Yes, they are valuable because they have greater assets, but they can often drive real value from having an adviser – routinely saving and making thousands through the relationship, such is the effect of compound interest.

Meanwhile, in recent months a new sales hero has started to emerge to threaten the ascendancy of both traditional sales force and Robin Hood driven brands – with the notion of a product being the hero.

In a pure sense, the idea here is that if your products are good enough, attractive enough and intelligent enough you don’t need either a brand or a sales force to sell them – they will simply sell themselves, or at least make the effort of selling and advertising significantly easier.

The interesting thing is that hero products are starting to emerge in Australia.

Hero products are not designed for the high net worth individuals (our bet though is these will arrive in the not too distant future), but savings and low level investment products designed for middle-class Australians.

The proponent of this new array of products isn’t one of the big four banks or even St. George, but the stranger riding in from the West, the eponymous named Bank West.

The group is in the process of not only rolling out a new bank network across Australia’s eastern states, but also a range of simple and cheap products, designed to attract the attention of the masses.

Others have attempted the hero product route – Virgin and SuperMax are to name but two – but so far they have not set the world aflame in the way that the sales force and brand heroes have.

Yet in the case of Bank West, it has distinct advantage over these players as it actually has all the elements to bring to the party – a Robin Hood brand, a distribution network and a sales force.

This puts it in the enviable position of occupying all the spaces in the market at once.