(18)Positioning a

T Long island
Bank

Like Western Union, banks sell a service and not a This is no longer true. Today
product. Unlike a Mailgram, however, which is a na- Citibank, Chase, Bank of
America, Wells Fargo, Bank
tional service, banking is a regional service. By law, One, and others a r e fighting to
banks are generally restricted to a single state, county become national banks. History
teaches us that only two of
or even aty.
these banks will ultimately
In fact, positioning a bank is much like position- dominate the category. (The
law of duality.)
ing a
department store, an appliance store
any or
other kind of retail establishment. To successfully
po-
sition a retail outlet, you must know the teritory.

The Long lsland Banking Situation

To understand how a position for the Long Island
Trust Company was developed, you should know a
little bit about the territory.
For many years Long Island Tust was the leading
bank on the Island. It was the largest bank, it had the.
most branches and it made the most money.
In the seventies, however, the bank battlefield on
Long Island changed dramatically. A new law permit-
 Poeltlening
company
differently
th

sa
the
over
posure
m i n u t eo
s r
ever

Positioninga Long lslend

Bank "Map
192 witha

branch banking throughout New

ted unrestricted
York State.
New York City banks
Since then, many of the big
entrenched in the Long Island
have become firmly and
Chase Manhattan
area. Banks like Citibank,

Chemical Bank. residents

Also, a good number of Long Island's
do part of
commute to New York City everyday and
their banking at these same banks.
banks into
However, the intrnusion of the big city
the
Long Island Trust's territory was only part of
problem. The territory that really counts is in
the

mind of the banking prospect. And a little research

turned up a lot of bad news.

Mapping the Prospect's Mind

By now you can appreciate the importance of know-
ing what's in the prospect's mind. Not only about
your product or service, but about competitive offer
ings as well.
Often the insights are intuitive. Nobody needs a
$10,000 research project to know that Western Union
is strongly identified with the Telegram. Nor was
much research needed to determine the positions of
Milk Duds, Belgium and Monsanto.
More often than not, however, it can be exceed-

ingly helpful to map the prospect's mind by means of

formal positioning research. Helpful not only in de-
veloping a strategy, but in selling the strategy to top

management. (The chief executive who has spent 30

with one company will obviously see that
years
 Poaltloninga Longleland Bank 193
Most marketing research is
company differently than a prospect whose total exX
Overty concerned with the atti-
posure over the 30 years can be measured in
same udes of customers and
prospects to the company
minutes or even seconds.) itself. t doesn't really matter
done
"Mapping the prospect's mind" is normally
what customers think about
your company and your prod-
with a research technique called "'semantic differen- ucts or services. The thing
tial." This wasthe procedure used to develop a posi- that counts is how your
Company compares with your
tioning program for the Long Island Trust Company. 1s competitors. That's why we

In semantic differential research, the prospect have used semantic

differential
the
each
given a set of attributes and then asked to rak For
research extensively over
years.
competitor on a scale, generally from 1 to 10.
In au-
example, price might be one of the attributes.
ranked
tomobiles, it's obvious that Cadillac would be
at the high end and Chevette at the low end.
so
In banking, there is almost no price perception,
other attributes were selected. The ones chosen
were

these: (1) many branches, (2) full range of services, (3)

Long
quality of service, (4) large capital, (5) helps
Island economy.
Island residents and (6) helps Long
traditional reasons for
The first four attributes are the
bank. The last two
doing business with a particular situation.
are unigque to the Long Island
concerned,
As far asthe traditional reasons were
for the Long Island Trust
the situation was bleak attributes.
Prospects rated them last o n all four
Manybreanches
. . 7.3
Chemical.....
America 6.7
Bank of North
...

National
.6.6
European American.... 6.4
Chase Manhattan.. 6.1
Citibank '
5.4
Long Island Trust
194 Positioning a Longlslend Bank
Fullrange ofservic*
7.7
Chemical....
7.7
Citibank
7.6
Chase Manhattan..
National Bank of North America ... 7.
7.3
European American..
7.0
Long Island Trust

Quality ofservice
Chemical... 7.2
7.0
Citibank
National Bank of North America . 7.0
6.9
Chase Manhattan... 6.8
European American...
.. 6.7
LongIsland Trust...
Large capital
8.2
Chemical.....
Chase Manhattan ..... 8.2
8.1
Citibank
7.8
National Bank of North Ameria ...

European American. 7.7

.. 7.1
Long Island Trust...

The positions were reversed, however, when the

attributes concerned Long Island itself.
Helps Long sland residents
Long Island Trust.... 7.5
6.6
National Bank of North America ...

European American... . 5.2

5.1
Chemical.. ..

. 4.7
Chase Manhattan..
Citibank . . .
4.5
 Posltioning a Long laland Bank 105
Helps Long Isiand economy
Long Island Trust.... ... 7.3
National Bank of North America . . .
6.7
European American.. 5.4
Chemical..... 5.4
Citibank . 5.3
Chase Manhattan.... .. 4.9

When the attributes concerned

Long Island, the
Long Island Trust Company went right to the top. A
not too
Surprising result, considering the power ot the
name.

Developing the Strategy

What approach should Long Island Trust take? Con- Whysend yourmoney to
ventional wisdom says you accept your srengths and the city, if youlive on
the Island?
Work on improving your weaknesses. In other words,
run ads
telling the prospects about the great service, den dna

friendly tellers, etc.

But conventional wisdom is not positioning thinking.
Positioning theory says you must start with what the
prospect is already willing to giye you. , L o o g laed TneAb
Long i a n d r u s t

And the only thing the prospect gave Long Island

Trust was the "Long Island position." Acepting this The first advertisement in the
position allowed the bank to repel the invasion of the Long lsland Trust programn. If
we have learmed anything in 20
big city banks. The first ad stated the theme. years, it is that marketing pro-
grams like this one need a
Why send your money to the city if you live on much heavier emphasis on
publicity. We should have
the Island? encouraged the chairman to
It makes sense to keep your money close to do radio and television as well
home. Not at a city bank. But at Long Island as print interviews. David ver
Sus Goliath is a sure-fire
Trust. Where it can work for Long Island. humaninterest story.
 196 Positioninga Long Island Bank
Island.
Kuwait.
building with a Citibank N.A. sign.
To a big ctty bark,
a branch in Nassau isnit
necessarily your Nassau.
LongLaland TYáit4
The second advertisement in
the Long Island Trust series.
To a home owner in Great
Neck, Nassau is the county
that collects the real estate
taxes. To a banker in
Manhattan, Nassau is an
Island in the Baharnas.
After all, we c o n c e n t r a t e on developing Long
island off
Not Manhattan Island. Or some
Ask yourself, who do you think is most
con-
cerned about Long Island's future?
other
A bank-come-lately with hundreds of
af-
branches in the greater metropolitan area plus
filiates in five continents?
50
Or a bank like ours that's been here for over
Island.
years and has 33 offices on Long
A second ad had a photo of palm trees in front ofa
To a big city bank, a branch in Nassau isn't
necessarily your Nassau.
Chances are it will turn out to be in the Baha
mas. It's one of the favorite locations of the big city
banks. In fact, the multinational institutions have
some $75 billion in loans booked in the Bahamas
and Cayman Islands.
Nothing wrong with that. Except it doesn't do
much for you if Long Island is your home.
Long Island is not only our favorite location,
it's our only location. We have 18 branches in Nas-
sau (County, that is) and 16 in Queens and Suffolk.
And we've been here a long time, over a half
century. We're involved financially to the extent
that 95 percent of our loans and services go to
Long Islanders and their homes, schools and
businesses.
Other ads in the campaign had similar themes:
 Positloning aLong lsland Bank 197
"The ity is a great
want to bank
place to visit, but would you
there"
"To city bank, the only island that
a
is Manhattan." (A tiny drawing of really counts
dwarfed by an enormous Long Island is
"If times get drawing of Manhattan.) The cityis a greatplace
tough, will the city banks get going? to visit,butwouldyou
(Back to the city.) want to bank there?

Fitteen months later, the same

research was re
peated. Notice how Long Island Trust's position im
proved in every attribute.

Many branches Longisand Trat

Long Island Trust..... 7.0

National Bank of North America ... 6.8 The third aovertisement in the
Island Trust series. At
Chemical.... ... 6.6 Long
the time of this campaign
Citibank . . . 6.5
New York City was having
Chase Manhattan....... .6.1 severe financial troubles. The
European American... . 6.1 Implication of the ad is that
perhaps the city might want to
dip into your account in onder
From last to first place in "many branches." In to balance its budget.
spite of the fact that Chemical Bank, for example, has
more than twice as many branches on Long Island.

Full range of services

Citibank 7.8

Chemical . 7.8
Chase Manhattan... 7.6
. . 7.3
Long Island Trust...
National Bank of North America ... 7.3

European American... . 7.2

In "full range of services" Long Island Trust

moved up two spots. From sixth to fourth place.
 Posltioning aLong lend
Bank
198
Quslity of servlce
7.8
ubank .. 7.6
Chemical. 7.5
Chase Manhattan... 7.I
LongIsland Trust.. 7.1
America
National Bank of North
. . .

European American. .
7.0

also
In "quality of Long Island Trust
service"
fourth place.
moved from sixth to

Large capltal
7.0
Long Island Trust...
* . 6.7
Chemical..
Citibank
6.7
America... 6.6
National Bank of North
6.6
Chase Manhattan.... 6.4
European American.

moved from
In "large capital" Long Island Trust
last to first place.
Results were seen not only in the research but
in
the branches too. "With the assistance of the advertis-
ing agency which pioneered the widely accepted
con-

bank's annual report,

Long lsiand Trust is no longer
with us having been absorbed
by larger
a bank. Hopefuly, the
advertising enhanced their
seing price
cept of positioning." said the
"our lead bank, Long Island Trust, assumed the man-
de of the Long Island Bank for Long Islanders. Accep-
tance of the campaign was immediate and gratifying."
You might think that a bank promoting the area
that it serves is an obvious idea. And it is.
But the best positioning ideas are so simple that
most people overlook them.