Big Four banks named as Australia’s most valuable but least trusted brands

The Australian Royal Commission into the misconduct of banking may have already wiped billions off the sector’s total market value, but banks still represent the most valuable brand sector in Australia according to BrandZ's 2018 'Top 40 Most Valuable Australian Brands'.

Australia’s Big Four banks have been named as four of the country’s five most valuable brands. Commonwealth Bank of Australia, ANZ, Westpac & NAB were all present in the top section of the ranking with a total combined value of US$47 billion. The banking sector in general was the most present industry to appear in the ranking with a total of nine entries making up over half of the value of the entire 40 brands mentioned. 

The 'Top 40 Most Valuable Australian Brands' 2018 BrandZ report was run by WPPAUNZ and Kantar Millward Brown – the creative, digital strategy, marketing and communications branch of the Kantar Group in Australia and New Zealand. The most valuable Australian brand according to BrandZ's first annual Australian specific ranking is the Commonwealth Bank of Australia with a total brand value of USD$16.4 billion. Following the CBA in second place is ANZ with a brand value of USD$11.9 billion.

Telstra also made an appearance in the top 5 and was followed by the other Big Four banks, Westpac and NAB, worth USD$9.3 billion and USD$8.7 billion respectively. St. George was the only other bank to feature in the rest of the top 10, which was otherwise populated by Woolworths, Coles, Optus & Origin.

The firm’s brand evaluation and equity platform, BrandZ, compiled the results using a valuation methodology which includes; corporate earnings and revenue, in-market and logistical factors (price, availability and distribution) and consumer association research (brand meaningfulness, perceived difference and brand salience). Each brand must have also originated in Australia and must be either listed on a credible stock exchange or have its financials available in the public domain. 

Retailers had the highest level of representation in terms of numbers on the index, with 11 of the top 40 belonging to the sector. Alcohol companies, telecommunications providers and energy companies all had from three to five entries, and airlines, fast food and food & dairy appeared on the list once or twice. Banking alone totalled nine entries, including the aforementioned entities in addition to Suncorp, Bankwest, Bank of Queensland, and Bendigo Bank.

As a whole, the banking sector has been underpinning the country’s economic growth since the downturn of the mining boom. “Australia’s economy has been growing for the last two decades with low unemployment rates, contained inflation, strong government securities, low debt, and the banking sector has been its linchpin,” states the report.

“However, most bank brands are perceived as dishonest and consumers exhibit a general lack of trust suggesting that brand building opportunities are critical to the long-term brand health. This will be particularly important in a post-Royal Commission environment, and a world of megacorporate institutions that are growing larger through M&A activities and takeovers.” 

The Australian Royal Commission has done damage to the banking sector which fundamentally stems from a lack of trust in the financial industry by the general public. The decision by the Australian Government to investigate the misconduct in the banking, superannuation and financial services industry led to USD$8.9 billion being lost according to BrandZ's evaluations. 

The consulting firm’s research identifies that a brand which is perceived as dishonest will stagnate in its brand value growth. “The lesson to be learned is that at this moment in time, Australian bank brands need to start again and use brand building as a way of re-establishing trust and building relationships,” the report says. 

To regain the trust of the general public, brands in the banking sector must begin to reconnect with their communities, suggests the firm. “Optimistic brand messaging, warm and accommodating employees, corporate investment in socially supportive programs, environmental responsibility, and simple, personalised digital experiences are all important components in building trust.”

BrandZ go on to suggest that “emphasis should be placed on communicating how these brands satisfy consumer needs, improve brand equity, and shore up any residual weaknesses (i.e., trust and dishonesty). The opportunity to build trust and reduce perceptions of dishonesty should not be missed and getting ahead of the news will send the right signals to stockholders, depositors, and to a large degree, the rest of the Australian economy.”