Believe It or Not, Bank of America Has a Top Brand. Here's Why It's a Crock
According to a new survey, Bank of America (BAC) is the most valuable bank brand in the world. In other news, Republican lawmakers are dancing a jig for universal health care, and Egyptians think Hosni Mubarak is doing a heckuva job.
It's hard to not to take this ranking of the top 500 global bank brands without a huge grain of TARP, uh, I mean salt. B of A topped the list, according to London research firm Brand Finance, which used revenue, growth and other performance forecasts to peg the value of financial firms' trademark and intellectual property and to estimate how much a company would have to pay to acquire the brand. B of A's brand, which was rated as "extremely strong," was valued at nearly $31 billion. Rounding out the top five are Wells Fargo (WFC), Britain's HSBC, Spain's Santander and JPMorgan Chase (JPM).
Said Brand Finance CEO David Haigh in the report:
Bank of America and Wells Fargo did well because they have expanded through acquisitions, American growth expectations have improved and both have focused on promoting their roles as traditional main street lenders.M&A: No help for brand
Are we talking about the same banks here? I suppose it might be technically correct to say that B of A boosted its brand value in buying Merrill Lynch in September 2008, just as the U.S. banking system was collapsing in a heap. But that's like saying BP is now burnishing its brand by scooping up tar-balls.
Granted, I'm not filtering my perceptions through Brand Finance's discounted cash-flow methodology. But when I hear the name "Bank of America" I immediately think: subprime, taxpayer bailouts, "robo-signing," foreclosures and wanton Wall Street bonuses. You know, like the $9 million smooch the company gave this week to CEO Brian Moynihan, presumably in reward for the 11.4 percent dip in B of A shares last year even as the market value of other big banks was rising.
More recently, I also think of WikiLeaks, which is reportedly set to dump all over B of A's brand, and of the financial giant's embarrassing efforts to scrub its reputation by snapping up potentially negative URLs.
And while this is strictly anecdotal, in all my years of writing about business I have yet to hear a single customer express admiration for a company because they were "expanding through acquisitions," a practice more generally associated with ruthless corporate "streamlining." Meanwhile, whatever Wall Street banks are doing to promote their roles as "traditional Main street lenders" is undermined by, well, their recent reluctance to lend to Main Street.
No satisfaction
Then there's little thing called "customer service." B of A has long fared poorly on this measure, lagging rivals on the American Customer Satisfaction Index and coming in at No. 2 in a recent survey of the top 10 companies Americans love to hate:
In the 2010 MSN Money-Zogby International poll, 34.6 percent of those familiar with the bank's customer service called it "poor." Bank of America has earned a spot in the Customer Service Hall of Shame in each of the survey's four years and gets its worst grade yet in 2010. Last year, 28.5 percent called its service "poor."Haigh does note that a range of factors go into creating a strong bank brand, including a "memorable visual identity," consistent and recognizable branding, and a catchy slogan.
OK, I'll bite. Anyone know B of A's tagline? [I'll pause for a moment while you think....] And I'm back -- it used to be the banal "Higher Standards," which replaced the even more forgettable "Embracing Ingenuity." But the company phased those out a few years ago once it started embracing ginormous mortgage-related losses. (Hint: It's not "What's in your wallet?")
Other branding agencies seem more tethered to reality in judging the overall strength, if not the supposed financial value, of Wall Street's name-plates. No bank features among the top 20 in Interbrand's annual ranking, while B of A doesn't even make the research firm's top 100. By contrast, it stands to reason that JPMorgan Chase outstrips B of A in brand equity, since the former at least escaped the worst of the financial crash.
The Brand Finance report contains other dubious claims. My fave is the suggestion by B of A's global strategy and marketing officer that the company is doing its bit for financial reform. You know one thing that doesn't do a company's brand a bit of good? Bullshit.
Thumbnail from WikiMedia Commons 3.0
Related: