Brand strategy in the U.K. retail banking sector: Adapting to the financial services revolution

Segmentation has long been regarded as the cornerstone of a successful marketing strategy [Buzzell (1978)] and acts as a substantive source of differentiation and competitive advantage. The alternative is an unfocused generic strategy not based on the specific needs and wants of a defined target group. For instance, in the car market companies such as Mercedes and Volvo clearly design, price, and brand their offerings to compete in very specific sectors of the market and to appeal to defined psychographic groups. However, in other markets manufacturers and service providers have been slower in implementing marketing strategies which focus on specific consumer segments and utilize a coherent branding strategy to do so. For example, in the U.K., companies operating in the financial services market are noted for deploying generic marketing strategies, particularly the Big 4 retail banks (HSBC, Barclays, NatWest, and LloydsTSB). This paper reviews the marketing strategies of the Big 4 U.K. retail banks and examines in particular their reliance on a monolithic branding strategy, where most of their products and services are promoted under the parent brand name. In particular, it seeks to examine whether such a strategy is still viable given the introduction of on-line banking and the increasing degree of competition that they face.