The concept of the brand channel is emerging as the new interactive technology that will ease the customer frustration that has come from telephone and internet banking, says Mark Cullen.

It seemed like a good idea at the time. Telephone and internet banking meant excited customers could do their transactions in the middle of the night in their pyjamas, as Robbie Coltrane has been advertising.

That is not to say that it has not been a success. It has. Look at the customer base of, First Direct and But it has also created fist-clenching frustration for customers. Instead of meeting with their understanding High Street bank manager, they now have to discuss their personal financial problems with a youngster on a switchboard in Belfast or Dundee. That is, if they can get through the impersonal telephone button pushing. That is poor customer relationship management.

Customer dissatisfaction grows

A whole decade of this has resulted in large financial gains for banks and building societies. But with customer dissatisfaction growing, the time has come to put some of that money into winning back their confidence. Banks are aware of this and some are already on the case with television advertisements of old ladies wondering why their bank is a trendy wine bar. These ads are designed to woo customers back by reassuring them that normal service has been resumed.

But has it? In a networked economy, and that is what is ahead, the main change is putting power in the hands of the people and out of the hands of corporations.

One of the great marketing myths is that if there is a story to tell about a product, there is no better place to tell it than on television. Traditional television advertising is, however, expensive, relatively untargeted and does not close a deal there and then; and it hands a good deal of product control to third parties. Also, television advertising is a one-way message, with a restricted time element in it. Despite all that, it has remained the most powerful media tool in the armoury.

Brand channels to the rescue

This situation is about to change for the benefit of the customer as well as the financial institutions. While 30- or 60-second commercials sell the attractions, plans or the low service cost, banking consumers will demand entertainment, information and closure in the online world, whether it is through digital interactive television (DiTV), the PC or the mobile. For that reason, many financial institutions and consumers alike will soon start hearing a lot about the "brand channel".

The brand channel is everything that advertising already is and everything it is not. It is also here and now. Brand channels - bespoke TV channels run by companies/brands as opposed to broadcasters - will save money in the High Street by pre-educating the consumer to the retail sell, providing entertainment, convenience and navigating a powerful road-to-market. Most importantly, brand channels maximise returns by selling at the optimum price at the time it is possible to do so. They provide instant fulfilment of consumer desire, thirst for knowledge and impulse purchasing.

Brand channels enhance the brand, giving it personality and seducing the sell through immersive interactivity and real people. People buy from people. It is a trust issue - the way banks used to do business.

The opportunity to launch a brand channel on digital television already exists. The smartest players in the financial field will do so because it is already viable today and, more importantly, they will do so because of tomorrow. The near future will bring new levels of television interactivity, including on-demand/non-linear functionality and broadband video on the web.

Richard Barrington, director of e-Envoy, recently said that the government's goal was for the UK to have the most extensive and competitive broadband network in the G7 by 2005.

"Our vision is to lead the UK in its drive to be the best place in the world for e-commerce," he said.

Open the gateway

The brand channel will become the gateway to an interactive future. The first in will be the winners. If a bank or building society does not open that gateway soon, its competitors probably will.

Even if businesses are sold on the concept, the power, the possibilities and the inevitability of it all, where is the catch? Can brand channels really support their own costs, let alone make money? From early projections, it would seem so.

A fully interactive brand channel on UK satellite today exists in what is essentially a walled-garden of some 200 channels, rather than the Wild West of 17m websites. It reaches more than 5m homes and will drive commerce both electronically and through the brand's outlets, either physically or electronically-based.

According to Patrick Bossert, head of e-strategy at KPMG Consulting: "DiTV represents the biggest future digital interaction channel in the UK. Get your CRM data warehousing and content platforms in order that adding new channels becomes easy."

TV Travelshop and QVC are essentially first generation brand channels and, financially, very successful ones. Future channels will be much more sophisticated, designing their content to relate their products directly to the consumer - the so-called "lifestyle" sell, aggregating a focused group of consumers to their particular passion.

Opportunity not to be missed

A brand channel is an opportunity to show products and services to potential and existing customers - pensions, mortgages, individual savings accounts and the rest - on a repeating video stream. Additional impartial analysis and advice can also be on offer to help customers to make a choice, hopefully the brand's choice. Similarly, financial brands will have the opportunity to relate their products to groups of real people and, for the first time, to explain what they do and why they are good to have. The first retail bank to grasp this opportunity will have a powerful advantage in the market.

Early experience in the UK shows the enormous potential of brand channels. In early 2001, TV Travelshop celebrated its first £1m turnover day. That is big business.

While brand channels may be the way forward, financial services providers have a lot to think about if they want to make money. Brand channels have to broadcast as much as 24 hours a day, seven days a week. How does that work? They are not the BBC or ITV. People will not watch them for 15 hours a week. Prudent scheduling and constant updating will allow the channel to remain fresh and provide something new for the viewer at all times. Much of the freshness will be provided by ever-changing interactive information and opportunities in the broadcast stream, which is cheaper to produce and change than television programmes.

The amount of television content is somewhat defined by the revenue possibilities but without the mass audience of terrestrial channels, none of this can be achieved through old broadcast models and budgets. It is here that traditional television companies will struggle.

Cost and content

In producing content for brand channels the television equipment has to cost less and be smarter. The number of personnel has to be less and each of them will have to cover several skill sets. Also, the production workflow has to be invented once and repeated a thousand times while producing different looking programmes. The process also needs to be commercially focused. Just four reasons that traditional media companies do not fit the bill when it comes to brand channels.

And so, what should it cost? Realistically a 24-hour-a-day, seven-days-a-week channel of quality delivered to 5m homes with in-programme interactivity, and integrated into an existing e-commerce platform will cost a financial institution between £6m and £10m a year. Realistically, that is only a small slice of the marketing/advertising budgets for the kind of banks and building societies that will build them.

It is predicted that most of the major banks and building societies in the UK will be on a digital TV platform by 2006. That gives financial institutions less than five years to get a brand channel and make sure they do not find their businesses turned into a trendy wine bar.

Mark Cullen is chief executive officer of enteraction tv.


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