The marketing war taking place amongst the major banks has now taken another turn with Westapc's announcement last week to bury St George in Victoria, and resurrect the Bank of Melbourne, with the aim of establishing 100 Bank of Melbourne branches opening over next five years.
The Bank of Melbourne was purchased by Westapc in 1997 and closed in 2004 amidst public anger that a community bank had been swallowed by a major bank.
Bank of Melbourne - A Community Bank Brand
From a branding perspective, Westpac's revival of a community banking brand makes good sense. The move comes at a good time, with people feeling alienated by large national banks, who are seen as anonymous and removed from the communities they serve.
Westpac's challenge will be convincing customers that the rebirth of the Bank of Melbourne - a somewhat untainted brand - is not just a marketing strategy but will genuinely provide better service. There needs to be an authentic alignment between Westapc and the Bank of Melbourne brand. Rather than just bring back an old logo, they will need to credibly demonstrate they are committed to running a bank committed to their customers. The bank has to be a genuine approach in helping people and communities, and not just serve as anther revenue stream for Westpac. If they can build on the Bank Of Melbourne brand this way they stand to gain much from the current climate of distrust and alienation.
The Competitive Environment
In some ways the bank can build on the opportunities that lie on different sides of their competitive environment. They can establish themselves as an alternative to the big banks, whilst competing against more localised banks such Bendigo and Adelaide Bank.
So far Westpac has not clearly indicated where Bank of Melbourne will be priced. Analysts are expecting to be situated somewhere between the premium Westpac brand and above RAMS (home loans).
Westpac's revival of the Bank of Melbourne brand sends a clear message. Consumer's desire for a locally based bank, close to the community it serves will be met. Success now depends on people's willingness to changes banks for it.