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—
Expert comment on the branding of bank mergers —
The proposed merger of Westpac and St George has been hailed by Westpac
CEO Gail Kelly as a merger of “two iconic brands”.
But the two banks face significant problems in successfully managing their brands
to hold onto customers following any merger, according to RMIT University
marketing expert Dr Stephen Downes.
“Just because two brands are ‘iconic’ doesn't mean that merging them will
make one ‘super-iconic’ brand,” Dr Downes said.
“For example, if you merged Qantas (big, trusted, traditional flag carrier) and Virgin
Blue (maverick, quirky, anti-establishment), you wouldn’t get a Qantas that's
suddenly quirky and anti-establishment.
“Much of St George’s success in recent years has come about because it is not
one of the big banks – merge it with Westpac and you immediately undermine one
of the main reasons that many customers have been drawn to St George.”
Dr Downes has conducted market research interviews with small business owners
in rural and regional Australia and found many felt unwanted by the large banks, as
the Big Four pulled services out of country towns.
“St George captured a lot of share in business banking services by entering this
market and offering a fair deal,” he said.
“So there would be major issues for the merged bank in how it manages the two
brands, should it try to retain the St George brand despite everyone knowing that
it's just a sub-brand of Westpac.”
Dr Downes is a lecturer at RMIT’s School of Applied Communication and an expert
on marketing, branding and advertising.
He is available for comment on marketing and branding issues related to the
proposed merger of Westpac and St George.
For interviews: RMIT University’s Dr Stephen Downes, 0412 962 429.
For general media enquiries: RMIT University Media and Communications,
Gosia Kaszubska, (03) 9925 3176 or 0417 510 735.
13 May, 2008
NEWS 
