I recently ran a Financial Services Marketing workshop at the CIM Northern Conference, entitled “Viva La Evolution”, where I urged FS Marketers to evolve the way they gather and use knowledge to think about their customers, their market and themselves.
One of the tasks I set the delegates was to look at the risk of new market entrants from firms in highly trusted sectors and that had excellent customer service. Marks & Spencer was one of the companies I used in this scenario planning exercise to demonstrate the need to ‘look for competitive threats in unusual places’ and to ‘regularly review and update market response plans’.
So Friday’s news that Marks & Spencer is to launch M&S Bank in the summer came as no great surprise to me, with the intention to offer a current account from the autumn and mortgages ‘at a later date’. With over 3 million customers already using M&S Money, the near immediate cross-sales potential of the current account is massive. Add in the fact that M&S has 21 million customers and the business case writes itself.
What did surprise me was the rebrand from M&S Money to M&S Bank. The word ‘bank’ has developed negative connotations in some quarters and the move shows clear confidence that the strength of both the M&S brand and the M&S Bank proposition is materially different (and better) to that offered by ‘traditional’ banks. It certainly looks compelling, as customers will have access to branches that are ‘open twice as long as high street banks, seven days a week’, and will have 24 hour access to online banking.
This is all made possible thanks to a joint venture with HSBC, who describe this as “our most significant innovation in retail banking since we launched First Direct”. Nothing to be worried about there, then.
What do you think about M&S’ move? Do the high street banks have anything to worry about? Or will customer apathy and a renewed focus on increasing customer service levels be enough to hold onto their customer base?
Here’s the slide deck from my workshop last month.