In the last post we took a deep dive into the UK banking industry using Dalia’s BrandTracker platform. The insights from the report showed that the banking industry is ripe for disruption: Key brand dimensions indicating future growth were highest among neobanks, as opposed to traditional banks. While traditional banks like Lloyds and Barclays still maintain the highest levels of brand awareness, this could change soon as younger, more tech-savvy consumers look for modern banking solutions.

Today we’ll continue our analysis, following up on our research from August and September. We will start by looking at each of the five brand dimensions we tracked and then discuss potential implications.

Brand Awareness

Awareness of Banks & Disruptors in the UK

Over the past three months, neobanks Starling Bank and Monzo have seen the greatest growth in brand awareness with a respective increase of 5% and 4%. The other brands in this survey increased only slightly, if at all, which is likely due to the nature of brand awareness as a long-term measure.

Because of this, the short-term increase for neobanks indicates that they have not only grown their user base, but also in brand strength. However, they haven’t done so in equal amounts, as the gap between Starling Bank/Monzo and Revolut/Atom Bank shows.

If raising top-of-the-funnel awareness was a goal of Starling Bank’s marketing activities throughout summer, they have accomplished it.

Brand Usage

Usage of Banks & Disruptors in the UK
Values represent the % of respondents who are aware of the brand

Although PayPal still takes the top spot, usage among those already aware of the brand has decreased from 78% in July to 75% in September. Despite the drop, these numbers show that PayPal is an integral part of the UK financial landscape, with a usage rate that exceeds those of traditional retail banks.

Besides PayPal, Barclays (32%), TransferWise (29%) and Lloyds (27%) boast high usage among those aware of the brands. When it comes to growth, TransferWise saw a remarkable increase from 13% to 29% between July and September. On the other end of the spectrum, Revolut (-6%) and Monzo (-4%) recorded the most significant decreases in penetration.

In the case of Monzo, the decline is likely to be due to the sharp increase in awareness that has not yet translated into usage. This could be a result of Monzo focusing on raising general awareness that the company can convert into usage at a later point.

Purchase Intent

Purchase intent for Banks & Disruptors in the UK
Values are in % of respondents who are aware of the brand

With the exception of a few, brand consideration for most brands didn’t change much from July to September. Among the exceptions, the share of respondents who know of Revolut and would consider using it decreased by 6%.

Meanwhile, TransferWise and Starling Bank saw their consideration rate increase by 14% and 5% respectively. This is particularly impressive for Starling Bank, who not only increased their brand awareness by over 5%, but are also very good at creating desirability within their audience.

TransferWise, whose overall brand has progressed most in the observed period, is doing a great job at converting aware consumers into users of the service.

Ad Awareness

Advertisements for Banks & Disruptors in the UK
Values are in % of respondents who are aware of the brand

While traditional banks and PayPal continue to have the largest numbers for ad awareness, most banks saw very little growth over the past three months. In September, 23% of the UK had seen an ad for TransferWise, up 10% since July. Atom Bank (+4%) and Lloyds (+3%) also had fair increases in ad awareness in the observed period.

Relative to the other dimensions measured, ad awareness was less volatile and indicates that the amount of advertising remained largely unchanged, with the exception of TransferWise.

The simultaneous increase in desirability and ad awareness could be an indication that TransferWise’s recent ad campaigns were particularly effective in terms of conversion further down the funnel.

Brand Perceptions

Perceptions of Banks & Disruptors in the UK
Values are in % of respondents who are aware of the brand

As discussed in the previous post, our results show that the UK has a poorer perception of traditional banks compared to neobanks, which is in line with the declining public perception of banks in the past decade.

This is a trend that we continue to see; our September results show neobanks TransferWise (45%), PayPal (40%), and Revolut (36%) taking the top three spots.

On the other hand, only 18% of respondents heard something positive about HSBC and only 11% heard something positive about RBS.

Some trends of note include Starling’s loss of 5% in positive perception from July to September, and TransferWise’s increase by 5% during the same period. As for avoiding negative perception, TransferWise again came out on top, with respondents reportedly not hearing anything negative. On the other hand, Atom Bank saw a significant increase in negative perceptions of 3% over the last three months.

This underlines the results from the previous dimensions, where TransferWise has performed best, particularly compared to some of the traditional banks.

Conclusions

Looking across all five dimensions, there are some visible patterns. TransferWise has done an outstanding job in terms of brand from July through September. They managed to convert awareness into desirability and usage and has by far the best perception.

As for the other neobanks, most have improved slightly in awareness and their conversion, with the exception of Revolut. While Revolut has slightly increased awareness, respondents reported to be less likely to consider or use the service compared to July (this is particularly interesting due to their “no-marketing-approach”).

Overall, neobanks continue to charge ahead, translate their momentum into valuable brands and they are slowly closing the gap on incumbent banks.

From Insights to Strategic Planning

These insights provide executives, marketers and brand managers with a critical feedback loop to measure the impact of their branding activities. It is safe to say that TransferWise should double down on their recent activities, while some other neobanks might reconsider their messaging to maintain a desirable brand. As for the incumbents that derive great value from trust in their brands, these results are another signal that public perception, and hence brand equity, are on the decline.

If you are interested in learning more about brand tracking, have a look at our blog. In case you want to unlock brand insights for your company or sector, don’t hesitate to get in touch with me or visit our website.

About the Survey

The results shown in this post are from a survey conducted by Dalia Research from July 2018 through September 2018 across the internet connected population in the UK. The total sample size is n~3000 for all three waves of data collection. In order to obtain census representative results Dalia built a Multilevel Regression Poststratification (MRP) model. The model used a Logistic Regression in combination with the stepwise variable selection algorithm SODA to make cell-wise predictions. The cell structure was generated using data from Barro Lee/UNStat and EuroStat. The cell variables were age, gender, level of education (as defined by ISCED (2011) levels 0–2, 3–4, and 5–8) region and household income.