Question

Given that some financial service providers appear to have little brand recognition but significant market share, discuss whether branding is necessarily the key to a successful strategy in this industry sector.

Answer 1

Branding helps the industries to create an impression over the market which at later stage will be beneficial for them. If we talk about financial sectors than branding have created history over there to. The financial service industry is not limited to providing loans and advances however the advisory consultant, the brokers or the other key aspects also belongs to that sector.

If we talk about market share of financial sector than although without much recognition it is doing well however the competitor in same line by advertising their additional services via branding can get rise in the market share. Therefore, branding is becoming one of the key strategies in this industry as well. Financial sector is using brand recognition at slower pace and the budget is allocated towards infrastructure and technology. However, brand does not represent the sector's log, tagline or marketing but the technique which this sector used to communicate with customer and create recognizable.

How branding helps to add value towards the share of the company:

• Branding helps to create trust in the market for the products or the services: Branding helps for financial sectors as money matters are taken into consideration. Many a time many banks declared themselves bankrupt or are into scams overnight. Therefore, now to develop trust among the customers is must. Hence to attract businesses bargaining power is developed.
• Adding value in the Competitive edge: Branding helps to communicate with customers in such a way that it creates emotional bonds on personal level with commercial partners. In addition, it’s not the services this sector is rendering instead it’s the reputation they are offering.
• What if the company have good share in the market but the customers are limited? To directly reach out to the customers branding becomes necessary.
• The branding has the power to makes banks and other financial sector independent and to protect themselves from hostile takeovers. When the market share of the banks is established many big ventures tries to decode the system and opt for takeover. However, branding and goodwill gives those banks the power to negotiate well.
• Financial sector too has their own set of policies which involve government regulations like tax policies, interest rates, other costs. Therefore, branding helps to mitigate these risk as they create backup for themselves.
• Earlier customer use to reach the financial sectors for the services however the tables have turned now to maintain the customers database the employees of the back are reaching towards the customers. These are the key players who advertise, sale and market the bank's efficiency.
• Hence branding adds on to the financial value and generate more business.

From the above discussion it is very much clear that whether its financial sector or any other sector branding is important for all. Branding is one the key player which attract various type of customers and develop the trust among them. Branding make the differentiation between the company and its competitor.

Hence Yes branding is key to successful strategy in this sector as there is evolution of financial sectors with other services as well therefore to mark the impact on customers for that is must and for which marketing is must.