Are you building your financial brand purpose?
There’s a major difference between banking on purpose and banking within the confines of traditional vision and mission statements.
I’ve seen some organizations online define their mission statement or vision statement as their “purpose for being.” Mission statements are short. A sentence or two and that’s it. And within these few, brief words, an organization is expected to wholly define how they interact with their employees, distributors, suppliers, shareholders, and the community at large. They often lack:
- Any kind of emotion
- Any kind of concrete substance or definition
- Any thought for anyone not involved in the business.
What I’m about to share may sound controversial, but in my experience, I have discovered it to be true:
When it comes to connecting with consumers, mission and vision statements miss the mark. I’m going to unpack why having a mission statement and a vision statement just aren’t enough, and why it’s time for your financial brand to define a third path; a third way forward: Digital growth purpose.
The Foundational Issues with Traditional Mission and Vision Statements
Mission and vision statements mean well. They really do. The problem is that these traditional mission and vision statements are outdated. They were conceived through the increasingly obsolete lens of operating in a physical or tangible world that was built around financial branches and broadcasts.
The issue here? There are actually a few:
- Our future isn’t tangible; it’s digital. Our world is changing faster than ever, and brick-and-mortar mission statements and vision statements just can’t keep up.
- Mission statements tend to be pretty bland. I’ve seen far too many commoditized statements that are unimaginative and uninspiring. They often look very much the same with no real, discernible difference from one financial institution to the next. Chances are, we could take one bank or credit union’s mission and vision statements and copy and paste them to another financial brand’s website, and no one would be the wiser. They lack personal touch.
- Mission and vision statements are often self-serving and focused inward. Sure, they address the needs of the financial brand, but that means nothing for our members and customers. Even in rare cases where these mission and vision statements do have some sort of external focus or perspective, they are very clinical, with no emotion tied to them. These kinds of mission statements are usually generic or filled with lofty ideas that have no real concrete substance or definition.
- Many mission and vision statements are narcissistic. These mission and vision statements may be a reflection of our society as a whole, but they’re almost always about what our financial brand needs, and what our bank or credit union wants to accomplish.
This is not the way to be a difference-maker in the lives of our account holders. This is not the way to stand apart from the competition or pave the way forward as financial trailblazers.
Build Trust, Relationships Through Purpose
There’s nothing wrong with having a mission statement or a vision statement. But now’s the time to break the mold and redefine what you stand for.
I get it: This can feel like unnecessarily rocking the boat. There’s so much emotion wrapped up in these mission and vision statements and everyone has an opinion.
This is why I see the biggest opportunity to move forward with this stage of your digital growth journey isn’t by strong-arming your team into tearing your mission statement apart. Instead, I’m suggesting something new; something different that has the potential to be truly transformative.
I’m calling this the purpose statement.
Most notably, the purpose statement is outward-focused. What a purpose statement does is establish your financial brand’s purpose in relation to other people. More specifically, it defines your relationship with the people within the communities you serve.
A purpose statement is intended to build trust. It's intended to create value for those people in the communities that you serve.
The result? A deep, meaningful, positive emotional response.
Now, does this mean that we have to toss out our past; to do away with the legacy mission and vision statements all together? Absolutely not.
But when it comes to positioning, marketing, sales, and company culture, it’s time to place a higher priority on the digital growth purpose statement.
When this happens, purpose becomes the north star for your financial brand. Purpose becomes the guiding light of where you can go in the future. Purpose also becomes a litmus test as well for decision-making.
Why It Matters for Your Financial Brand
Why does it matter so much that your purpose statement is not inward-looking or inward-focused like the traditional legacy, mission, and vision statements that we see?
Mission and vision statements create too much introspection; too much tunnel vision. It’s what’s created the situation we’re seeing within our industry. It's the reason that people don't trust financial brands.
Consumers for the most part view financial brands as being driven by their own interests. In fact, a report from Facebook found that 53% of millennials feel they have no one to trust for financial guidance. This amounts to one out of every two millennials. Even worse? Only 8% of millennials feel they can trust financial institutions for guidance. Put simply, an overwhelming 92% of millennials do not feel they can trust financial institutions for financial guidance.
Another study from Viacom shared that 73% of millennials would be more excited about a financial offering coming from Google, Amazon, Apple, or PayPal than they would about an offer that came from a traditional financial brand.
I get it: Money is complex. Money is stressful. But this stress that the younger generations are feeling isn’t just about the economy. It’s about a lack of stress in financial institutions like ours.
Why are these younger demographics so much more trusting of big tech than they are of a traditional financial brand?
It's not just because they interact with technology more than any other demographic on a daily basis. It’s not just because a lot of their digital experiences and digital expectations are being set by big tech by Google, Amazon, Facebook, Apple, Netflix, or Spotify.
Much of this has to do with how we as financial brands act, show up, and communicate with the world. More likely, it’s because of how we fail to do these things. Why? We’re too focused inward.
What Our Account Holders Want
What are our customers looking for in a financial brand they can trust? Perhaps it’s best to point out what they aren’t looking for. Former General Electric CEO Jack Welch summed it up well for us. He said:
"Pursuing shareholder strategy or pursuing shareholder value as a strategy was the dumbest idea ever."
At the C-suite level, we see that financial brand leaders are traditionally driven by three things:
- The product
- The processes
- The profit
Now, this means the products they bring to market and the products and efficiencies they use to reduce cost ultimately drive their future profits. What they are forgetting though? Consumers are driven by totally different values, wants, needs, and desires. We can think of these as needs that we focus on meeting in this order:
What we need to remember is that none of these values are about how our businesses operate.
It’s so easy to get wrapped up in perfecting our products, processes, and profit margins that we lose sight of who we should be doing it for: Our customers.
The American Association of Retired Persons (AARP) CEO Jo Ann Jenkins shares these same ideas regarding the purpose that drives the work they're doing at AARP. Within the AARP organization, their goals are focused on our ability to live longer, healthier, more productive lives.
These goals may seem like fairly basic ideas that we take for granted. However, through research conducted by the AARP, they discovered that instead, most people view aging as a process of deterioration, of dependency, of reduced potential, and of digital incompetence. It’s a pretty bleak outlook, and it’s one that doesn’t align with their goals or ideas of what AARP knows retirement and aging can be.
As a result of these deeply-ingrained negative attitudes, people are viewing the aging process as something to fear and fight against rather than it's something of continued growth that brings about new opportunities for both the individual as well as society. This problem is exactly what is driving AARP's purpose. They are working towards changing the perception of aging, or as Jo Ann shares, "We need to desperately disrupt aging."
To do this, Jenkins shares there are three keys that AARP is focusing on. Coincidentally? They are health, wealth, and self. This purpose is so easy; it's so simple to understand, yet so powerful from an internal positioning and communication perspective, as well as external positioning and communication.
Conquering the Digital Experience Gap
Products, processes, profits.
Health, wealth, happiness.
Clearly, these two sets of drivers, the financial brands and the consumers—the people—are not fully aligned. It’s no wonder so conflict arises in these relationships.
I call this conflict the digital experience gap. The digital experience gap can only be bridged by building a relationship based on trust.
That's why it's in the best interest of financial brands to win over both the hearts and minds of consumers to get more business.
Without this, we face a certain cognitive dissonance.
Whenever I talk with financial brand leaders, CEOs, executive teams, leadership teams, or boards of directors about some of this “touchy-feely stuff” like empathy, what they're really concerned about is how this might impact their bottom line. This makes complete sense!
However, one of the greatest opportunities that I see for financial brands to capture is clear:
Positioning around a purpose that transcends the promotion of commoditized products will generate even more revenue for your financial brand in this post-COVID digital world.
Put simply, our purpose is the path towards bigger profits. Our purpose is the path towards capturing even more profit.
There are a growing number of leaders—including some that are guiding very big brands like Costco, Trader Joe's, REI, and Whole Foods—who are championing a concept we can call conscious capitalism. This idea refers to building companies based on the idea that their business is more than just about making a profit; that it’s about working with purpose.
According to Entrepreneur Magazine, these conscious capitalism-inspired brands are outperforming the rest of the market by a factor of ten and a half. They are even beating the "good-to-great companies" that were classified in Jim Collins’ thought-provoking book, Good to Great.
But these purpose-driven, conscious-capitalism-inspired companies are outperforming these good-to-great companies like Fannie Mae and Walgreens by up to 300%. I understand that capitalism is quite a polarizing idea in today's political climate. Many feel that capitalism is about creating and maximizing a profit at the expense of others; that it's about creating winners and losers. It's a zero-sum game.
However in today's digital economy, particularly post-COVID, we have an opportunity to transform this mindset of scarcity into a mindset of abundance.
How can we do this?
By reframing and redefining capitalism beyond that zero-sum game. Conscious capitalism is about leading with purpose; about defining our purpose as the heart of any digital growth strategy and the key to its success.
Many of the biggest financial leaders today are thinking about this idea of purpose and conscious capitalism and having a greater impact on the world at large, giving their actions purpose and meaning like never before. Maybe we might not need to be as focused on products, processes, and profits as we originally thought. And it comes down to conquering the digital experience gap. How are we interacting with our clients and customers? What message are we telling them? What are we doing for them?
Commit to Banking on Purpose
As far as consumers go, maybe the drivers of their behaviors aren't as touchy-feely as we would like to believe—and there's an important difference here:
When consumers talk about wealth, for them, it’s not about amassing billions of dollars. People just don't want to have to worry about or stress about money. This stress takes a direct toll on their health, and it also impacts their wellbeing or their happiness.
This is exactly where the opportunity lies for financial brands who commit to banking on purpose.
Consumers are looking for someone they can trust to guide them to a bigger, better, brighter future. And right now, from our view of the world, from the research that we're continuing to do, it's the neo-banks and neo-lenders that are positioning themselves around a purpose bigger than profits.
This is how we are going to bridge the ever-widening consumer trust gap: through a purpose that extends beyond profits.
How are you bridging the consumer trust gap digitally? What's the plan for your financial brand? How will you move forward to close this gap?
Our success depends on working from a sense of purpose.
This article was originally published on February 8, 2021. All content © 2021 by Digital Growth Institute and may not be reproduced by any means without permission.