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Individual Case Study Differentiation and brand positioning: National Australia Bank (NAB) Western Sydney University

Introduction This analysis report on National Australia Bank campaign to differentiate itself from other 3 three banks in the Australian’s Big 4 Banks based on the case study about National Australia Bank (NAB) (Hartley, n.d.). To be more specific, three questions will be answered to understand how did NAB reposition itself in the minds of consumers and what process did NAB have to go through to achieve its success and the importance of maintaining a track record prior the campaign launch. 1. Q1: Firstly, the ‘Big 4’ banks held a very old-fashioned perception in the minds of customers, thus, to raise market share, NAB had to rework their relationship with their current and potential customers. Traditionally, the ‘Big 4’ banks use ‘service differentiation’ to attract consumers. Nonetheless, this differentiation strategy was not as effective as it was exaggerated and under-supported. To tackle this situation, in the beginning, NAB tried to reposition itself with attributes such as sustaining the lowest standard rate for mortgage amongst the three other major banks, increase the quantity of NAB ATMs nationwide, eliminating various types of fee and change its hierarchy of credit card payment to get attention from the consumer. However, the reposition was unsuccessful as it is important to include perceptual attributes in positioning strategy and positioning ultimately occur in the consumers’ minds (images, thoughts and feelings). Consequently, NAB switched it reposition strategy to a more perceptual strategy which involves with essentially abstract attributes across multi-platform from P.R., social platforms, a website dedicated to the campaign, outdoor activities, broadcasting, digital billboard trucks, newsprint, street artists, aerial advertising and film. The campaign started with a tweet seemingly as a mistake from NAB’s employees. Through an untrained eye, it would have seemed

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like a mistake made by NAB's employees. But this was the first move of many more strategic moves yet appealing to the consumer to differentiate NAB from the 'Big 4', as they would call, the 'Break Up'. Through the campaign, NAB had a chance to strip the conservative image out of the minds of consumers, consequently, raise consumers interest of the bank. With the help of relevant and humorous advertisement such as a full-page ad on Valentines Day telling customers to end their contract early with their banks transit their business to NAB. Which is something NAB had done before but not successful as there was a lack of perceptual attributes in the repositioning campaign. NAB also implement some guerilla marketing stunts to support this advertisement furthermore. Strategically, NAB has fruitfully different perceptions of potential consumers previously held about banking. The 'break-up' from the 'Big 4' repositioned NAB as a bank that wants to do better for the customers which give NAB a distinct position in the banking industry. 2. Q2: In February 2011, NAB introduced a chain of customer-centric initiatives which last more than a year. The initiatives were designed to target both potential and current customers of NAB, these initiatives are a vital attribute for NAB to stay competitive and put pressure on the Big 4 remaining banks. Although NAB constantly offered the lowermost rates amongst three other banks, the customer wasn’t paying attention which led NAB to create a multi-platform marketing campaign to overhaul the consumer perception about NAB. Before the launch of the repositioning campaign, NAB needs to demonstrate a consistent competitive rate compared to the other banks in the Big 4. If it was not for the consistent track record, the customer would have sceptical about the claim as it was under-supported when the campaign launched like how other three banks’ campaigns which focus on

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service differentiation. Majority of consumers find the service differentiation from other banks to be ingenuine as the Big 4 do not have any proof that they have the best interest in the consumer. The repositioning strategy of NAB does also highlight the lowest rate they are offering as the key variable. By having a track record of providing the constant lowest rates as possible for the consumer to commit to its repositioning strategy, it reinforces the brand loyalty of the consumer and strengthen the beliefs in the minds of consumers. Oppositely, assuming NAB did not have a track record of being competitive on rates before launching its campaign, it would result similarly as to the other way three banks have been used to attract customer, which was unsuccessful. As a result, by doing things right with the customers and having a consistent track record of maintaining the lowest rates out of all the banks in the Big 4, NAB was able to rose to become the banking market leader and achieve various great successes. 3. Q3: The positioning process consists of seven steps in total, beginning with the identification of an appropriate set of competitive service serving to a target market and end with publishing positioning statement to guide the marketing strategy development and implementation. Firstly, at the business level, NAB's business is banking. Thus, NAB would have to compete with other banking business, to be more specific, the other three remaining banks in the Big 4. In the first step, NAB is required to identify a relevant set of competitive services catering to a specific target market, which NAB did by introducing a set of new points of differentiation to the existing and potential target customers, including maintaining the lowest standard rate for a mortgage in the Big

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4, increase the number of ATMs nationwide by 200%, decrease interest payments on credit cards and eliminating maintenance fees for various banking services. After the first step, the following step is to find determinant attributes, which NAB was able to identify benefits as its only positioning base. NAB must deviate from attributes such as price as their point of differentiation in their strategy as its highly competitive. By having one positioning base, NAB can avoid confusion or disbelief on the part of the consumer often coming from a complex positioning strategy. At step three, NAB ought to collect information about perceptions of the consumer to figure out what are the attributes that are determinant for the market that NAB targeted. Through market insight, NAB understood that customers sense that the Big 4 banks were conspiring with each other to put out similar rates to rule out competitors. Also, NAB believed that majority of customers from the other three banks in the Big 4 stay because the switching cost is too high, not out of loyalty, plus, there is no added value from switching to different banks. With this customers’ perception in hand, the analysis of the current position of NAB in the competitive set, which is step four the seven-step positioning process. The competitive set is already predeterminate as there are only four leading banks in Australia, the Big 4, including NAB have high awareness in the minds of most consumers. Traditionally, the positioning strategy that been implemented by other three banks which is service. In order to gain a distinct position, NAB must come up with a unique strategy to obtain a profitable position where the other three banks are lacking. However, there would be some drawbacks with having a distinctive position, which is the risk of turning the current customers away. In reality,

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this scenario did not happen to NAB because the strategy that NAB is imposing is just trying to be a better bank for everyone. At step five, NAB was successful in identifying the customer most preferable combination of attributes. The customer-oriented initiative focusses on two attributes which were important to the customer, attractive rates and consistent customers offerings. Step six is where NAB can finalize both the analysis part of the positioning process and the decision on where the brand would be positioned. Furthermore, NAB was able to uncover new services that could fill the gaps in the market. Finally, at step seven, NAB was able to finalize the positioning statement to lead the development of the marketing strategy which was an aggressive and extreme wellorchestrated campaign that was able to get the attention of the consumer and of other banks. Conclusion In the end, NAB was successful in differentiating it from the Big 4 with unique brand positioning strategy, the ‘Break-Up’ caused a tremendous growth in transaction, credit card application and mortgage inquiries for NAB. Being the first of the Big 4 to reposition itself to be different from other competitors. In the long run, this campaign will benefit NAB as it strengthens NAB’s position as a leader in the finance business in Australia.

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References Hartley, N. (n.d.), Differentiation and brand positioning: National Australia Bank (NAB). The University of Queensland. Pg. 1-3.

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