When the news of the U.S. financial meltdown hit the wires, I was in Europe. In the past I would have probably had to rely on European television, radio and print news, with potentially the possibility of getting an international newspaper in large cities. With my laptop on hand, I had an instant connection to the crisis as it developed.
The headlines are still pouring in - WaMu Fails, is Sold off to JP Morgan (WSJ, subscription required) with Bailout Negotiations Still in Disarray. As I said in my contribution to Roundtable, CustomScoop podcast (34 minutes) I did with Doug Haslam hosted by Sarah Wurrey, this domino effect generated by highly leveraged financial institutions is having and will have global repercussions. Europe was already feeling a decrease in tourism due to the unfavorable (to the U.S.) exchange rate. The world may not be flat yet, but it is small - financial institutions are all connected in some way.
This is a major crisis communications issue and it is a branding problem.
Speakers like Tom Peters are asked to put together statements about thriving (or surviving) amidst chaos. Perhaps there is something else we can learn from this fiasco. It is easy to see how even now smaller service-oriented businesses like the more fiscally responsible local and regional banks would prosper while mammoths like WaMu and Lehman falter.
In 1987, Peters wrote that he would largely eliminate top-heavy management superstructures in favor of creative worker involvement and customer participation, with supervisors on hand to encourage. Certainly moving fast in acting and communicating about a company's actions is vital to a business health and to its perception in the marketplace.
John Bell, who heads Ogilvy PR 360 Digital Influence team, put together a list of 5 steps that banks must take to regain trust. In it he makes a great point, "most banks think that brand development and advertising are the same thing". Sadly, so do the management teams of many other companies. Bell's points (in bold) about the next marketing wave for banks with my comments.
2. Make a commitment to educating your customers on personal finance - the point is made even stronger by the fact that today technology allows companies to provide education, usefulness, social connectivity and even entertainment.
3. Whoever said corporate blogging is dead is an idiot - start a blog for godsakes - thanks to Andrew Foote in the comments, I learned that Wachovia has a Twitter account. Forrester Jeremiah Owyang has a list of social media efforts from banks, credit unions, financial institutions, and lenders.
4. Listen and react to your customers publicly - having worked for many years in the financial services industry, I know that there are regulations on disclosure and there are (potentially) privacy issues. What if a bank took the education route, just like Wells Fargo does in their multiple blogs?
5. Advertise all of the above and build a strong community around your bank built on trust - the reason why smaller local and regional banks are less at risk is because they have succeeded at providing a service to their community. Relationships are key to developing trust. As is education and information sharing.
New media is allowing news to spread faster around the world. For the sake of your brand, response cycles need to match that speed or follow it closely. Better yet when you have a proactive and ongoing conversation with your customers.
New media is also enabling companies to have their top performers collaborate among each other, share ideas, and flesh out new services and processes over distances and time zones from anywhere around the world. This collaboration and communication can be carried outside the company walls - or vaults as the case may be - with customers.
It turns out that the most rock solid form of reputation and brand building is trust.
[image of rock climbers assisting each other from Wikimedia]