Jedrzej Marciniak, Bank Zachodni WBK’s head of brand management and
investor relations, about the bank’s ambitious plans to double its
domestic retail banking market share in Poland by 2012. Product
innovation and an expanded branch network will be key – as will
British comedian John Cleese.
robust set of figures for the first half (a pre-tax profit of $1.89
billion down by only 1 percent compared with the same period last
year). It raised its dividend and confirmed it had no need to seek
fresh capital, all in marked contrast to the majority of its
European peers.
AIB’s relatively strong figures were
boosted in no small measure by the performance of Bank Zachodni
WBK, its 70.5 percent-owned Polish subsidiary; it reported income
up 12 percent, primarily driven by net interest income, with strong
loan and deposits growth (up 37 percent and 34 percent,
respectively) compared to the same period last year.
Higher net interest revenue helped WBK
offset a 6.5 percent decline in income from fees and commissions in
the second quarter. WBK, together with its main Polish rivals, has
suffered a decline in fee and commission income after stock market
declines led to lower assets under management at their fund
units.
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“We are very happy with the half-year
results, which show that our strategy, which I would define in one
word as ‘diversification’, is working,” said Jedrzej Marciniak,
Bank Zachodni WBK’s head of brand management and investor
relations. For the second half of 2008, WBK has predicted that its
loan growth should quicken to 30 percent from 20 percent in the
first half, while deposits will increase by a fifth.
The results also pleased the markets, with
shares in WBK – the country’s fifth-largest bank by assets –
increasing 12 percent on 30 July, the day after release of its
results, the bank’s biggest one-day gain since 2001.
Traditionally strong in mutual funds and
asset management, where it has punched above its weight, WBK has by
its own admission underperformed in a number of areas, notably the
consumer finance and mortgage sectors of the market.
“We had a big success two to three years
ago with mutual funds, obtaining a large market share of around 15
to 16 percent, which we still have, but it is also important to
develop strong income streams in areas such as consumer finance,
mortgages and corporate lending,” he said.
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By GlobalDataMarciniak remains positive about the
Polish market and expects the retail market to grow at twice the
country’s GDP growth rate: “We can achieve growth from a number of
segments: in the mass market sector from youth customers entering
the market and from the unbanked sector. There are still huge
numbers of Polish consumers without bank accounts and they will
bank with somebody.”
WBK is also targeting the affluent
segment, which continues to show considerable growth.
“It is getting bigger and bigger every
year and is an important sector for us. For our revenue, mortgages,
consumer finance, investment funds and current accounts will
continue to play an important role,” Marciniak said. “In consumer
finance especially, I think there is more to do and we have needed
a much better brand to succeed in consumer finance. In fact, in the
current situation, sales and brand goals have parallel
importance.”
John Cleese, star of Monty
Python
To boost its brand recognition, WBK turned
to the unlikely figure of one of England’s most celebrated comic
actors, John Cleese, star of Monty Python and the situation comedy
Fawlty Towers. Cleese’s first ad for the bank ran for four
weeks on Polish television and was an immediate, runaway
success.
“The ad was a success for many reasons. We
had worked on the ad for many months and I was sure from the
beginning it would prove to be a good move,” Marciniak says.
So successful, in fact, that Cleese’s ad
for WBK has become the most popular ever Polish clip on the social
media website YouTube.
“The ad started to run on a Saturday and
by the following Monday, I received an email from YouTube Poland to
report a record number of downloads of the ad,” he adds. Within
four weeks, it had attracted over 300,000 views, a figure which
continues to grow.
Marciniak said: “The ads were so
successful the main news programmes on Polish TV gave us coverage,
reporting on what they termed Cleeseomania. It was really great
publicity and PR for the bank.”
In the ad, developed by the agency Men at
Work and produced by Opus Film, Cleese claims that he has an aunt
from Pcim, a small town near Krakow and so is eligible for one of
the bank’s loan products.
The mayor of Pcim was, however, far from
amused at what he considered to be a disparaging reference to his
town and complained to WBK and the Polish media about the contents
of the ad. The council in Pcim changed its mind about the
commercial when it realised that WBK’s commercial was a perfect
vehicle to get the town noticed and was, in fact, great
publicity.
“Yes, the mayor was very angry that Cleese
seemed to be making fun of his town but then the council realised
it was actually a great comic providing publicity for Pcim,”
Marciniak says.
By the end of July, the bank and Cleese
agreed to a follow up ad and at a press conference in Warsaw on 28
July, Cleese met with the mayor of Pcim to receive an award in
recognition of putting the town on the map. The ad also proved to
be a commercial success for WBK.
“On the sales front, the ad was a huge
hit,” Marciniak explains. “If I compare the average weekly sales of
the cash loan product Cleese was promoting before the ad ran
compared with the end of the four week ad campaign, there was an
increase in sales of the product close to 40 percent.”
During the campaign, WBK granted more than
PLN10.33 million ($4.61 million) in cash loans a day, compared to
little over PLN7 million a day before the campaign. While a number
of banks in Western Europe have dropped humorous ads with the onset
of the credit crunch, notably HBOS and Barclaycard in the UK,
Marciniak sees no problem in banks running amusing ads in the
current climate.
“As a marketing person, I believe people
like ads with humour and humour is an important element of the
campaign. People generally do not see too many signs of a credit
crisis in Poland and the feedback is that people love the ads. For
his part, Cleese told me how surprised he was at how popular he was
in Poland.”
Spontaneous brand
awareness
WBK’s ad campaign also scored on brand
awareness, and Marciniak says: “There was a huge increase in the
spontaneous brand awareness of WBK which we measure. It jumped by
15 percent, so we really did win on a few fronts, with the brand
goals one of the most important marketing objectives for the bank,
especially as we continue with our branch expansion programme.”
While traditionally strong in the west of
Poland, WBK has embarked on an eastwards expansion, targeting
growth in central and Eastern Poland. WBK’s current branch network
is 452 outlets, up from 350 in early 2007.
Its network this year will rise by another
50 to 80 branches, passing 500. And as part of its aim to double
its retail banking market share to more than a tenth of the Polish
market by 2012, WBK aims to open an additional 100 branches in
2009.
“Poland is a big country and we need to
continue opening branches and develop other distribution channels
such as our call centres, online and direct banking channels. If
you want to successfully target ambitious market share goals you
need to develop all the networks together to address different
customer segments. We need scale. To leverage our marketing
investments we need scale,” Marciniak said.
One sector of the market the bank has
carved out a niche in has been the under-30s segment.
“If we are successful with people under
30, it is because we have a good internet banking offering,” he
explained. “Our under-30s account has more than a 10 percent market
share and is more than just a student account – it appeals to young
adults as well.”
Retail product innovation is also crucial,
with Marciniak stressing: “We try to be innovative… historically
we have introduced new types of accounts. This year for example, we
introduced the first money back account in Poland, introducing a
whole new category into the country.”
Account innovation was also evident in
WBK’s offerings to Poland’s growing number of foreign workers. The
bank has introduced some new products for migrants, offering free
ATM use, which has been very popular for Polish workers in Ireland
and the UK. New mortgage products have been launched – as well as a
promotion offering mortgage decisions in principle within 15
minutes.
“Historically we have had some limitations
in mortgages, having the reputation of being a Polish zloty lender.
The Polish market is around 75 percent Swiss Franc mortgage
lending, but we have now introduced some Swiss Franc lending. We
have increased our mortgage share and can increase it some more,
but there are some limits in play.”
As for the AIB influence, Marciniak sees
only benefits.
“It is a very friendly influence but best
of all, the Irish people are really keen to obtain a deep
understanding of the Polish market and let us get on with the job,”
he adds.
