Companies around the globe are figuring out their response to the COVID-19 pandemic and balancing the needs of all their stakeholders: shareholders, employees, customers, and society as a whole. Perhaps it’s stating the obvious, but financial service companies need to keep a keen eye on their brand. Sooner or later we will come out of this crisis, and the brands that win will be the brands that successfully manage this balancing act.
As an example, last week there were some banks requiring SBA loan applicants have an existing loan relationship with the bank in order to get the guaranteed SBA loans. This is not a provision set out by the SBA or any other entity but the banks.
These banks probably had their reasons for this requirement but in the long term it is a very tone deaf response to a constituency in need. Even more, it is a lost opportunity to be a hero in a trying time of life and winning a new devoted customer base.
A recent survey by Qualtrics, a survey platform and experience company, interviewed consumers about trust and what it takes for a brand to gain trust. As it notes in the accompanying article:
Building loyalty in a time of crisis can make or break a brand. Organizations are turning on a dime to improvise and make difficult decisions that will ultimately have lasting effects on their brands. When asked what factors make consumers trust brands more, the top three responses focused on the well-being of customers, the well-being of employees, and not taking advantage of the crisis to maximize profits.
There is a pretty strong argument to be made that, in the financial services industry, trust is critical to the health of the brand and one of the key underlying attributes consumers use when determining where to put their money.
Financial services actions today are going to have a significant impact on brand perception for years to come. Institutions that understand this will likely come out of this on top, while those that ignore the impact of their actions on their brands do so at their own peril.
Overview by Peter Reville, Director, Primary Research Services at Mercator Advisory Group