Magazine article American Banker

From the Editors:

Magazine article American Banker

From the Editors:

Article excerpt

Post-merger image management is a major challenge for financial services companies. American Banker's first special report on financial services marketing examines the diverse strategies that acquisitive banks are using to build their brands and retain customers in new markets.

It is an uphill fight. More than half of the respondents to last year's American Banker/Gallup Consumer Survey had an unfavorable opinion of bank

consolidations - though only one in five had been through one at a primary financial institution in the preceding year.

The survey of 1,001 households also found that those touched by mergers tend to be less satisfied than other consumers and more likely to think service is getting worse.

Among respondents who gave consolidations an unfavorable rating, nearly 29% complained of poor or impersonal service or said their financial institution did not care about them. About 24% worried that consolidation reduces competition, and 20% said it boost costs and reduces efficiency. Even among respondents who had favorable opinions of mergers, only 7% said the service gets better.

The articles in this special report offer some insights into what bankers are doing to improve those statistics. Some industry insiders say downplaying news of a merger - as many banks do in hope of not upsetting customers - squanders a valuable opportunity to hype the positives and boost name recognition. When Citizens Financial Corp. of Rhode Island and Wells Fargo & Co. of California recently moved into new markets after acquisitions, they both tried to generate heavy publicity to pique interest. In an article on page 4A, Bonnie McGeer examines the techniques both used.

The marketing strategy after the former First Union Corp.'s purchase of the old Wachovia Corp. is explored in a case study on page 5A. Matthew de Paula reports how the new Wachovia is incorporating lessons from its bungled 1998 acquisition of CoreStates, which sent customers fleeing. …

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