Cahoot has been in a state of flux since Spain's Banco Santander Central Hispano acquired its parent, Abbey, last November.
Over the past eight months, the online bank has seen a succession of four managing directors take the reins. The most recent appointment was made last week when former M&G marketing director John Goddard was brought in.
Responsibility for marketing has been shifted from pillar to post, too.
Debbie Cutler's departure from the role of marketing director earlier this year exacerbated the upheaval, with the bank deciding to merge its business development and marketing teams to form a single sales and marketing department.
This summer, Abbey moved its 拢30m ad account from TBWA\London to WCRS, raising further questions about the future of both Abbey and Cahoot's marketing strategy. Cahoot's advertising appears to have been shunted to one side, with the account lying dormant since the Banco Santander acquisition.
Perhaps the biggest blow to Cahoot's image came in November 2004 following a glitch that enabled users to bypass security measures and view other customers' accounts.
Security concerns have long been cited as one reason why consumers continue to use traditional high-street banks more than online ones. However, as the public becomes more used to buying over the web, the online banking sector is expected to grow.
In July's Hitwise rankings for bank and financial institution website visits, online brand Egg was ranked in eighth place - higher than some traditional banks and far ahead of its nearest online competitor. Cahoot languished in 25th spot.
Although Cahoot is established as a standalone bank, it is still not clear what Banco Santander plans to do with it. The Spanish company was swift to change Abbey's logo to incorporate the Banco Santander flame, but has left Cahoot to its own devices. Goddard's initial actions may offer a clue as to the direction the business is taking.
We asked Mike Phillipson, managing director of Propaganda and a former head of marketing at both Smile and First Direct, and Mark Batchelor, director of consultancy at brand consultants Henrion Ludlow Schmidt, whose clients include Deustche Bank and West LB, how Cahoot can ensure it remains competitive.
DIAGNOSIS 1 - MIKE PHILLIPSON MANAGING DIRECTOR, PROPAGANDA
Having a happy heart and happy wallet is one of life's conundrums.
Banks spend a lot of time focusing on the latter, but sometimes forget the former.
For money-savvy consumers, Cahoot's pricing policy over the past five years has been competitive, but it has found it increasingly hard to be heard.
The start-up euphoria when Cahoot press releases were hungrily snapped up by salivating journalists is gone. Prospects like brands that are winners, because they say something about them and what they feel. First Direct, Smile and Egg have obsessively managed this.
Cahoot has lost control of its brand architecture over the past three years, as well as communicating mixed messages that do not strike a chord with its target audience. Without an emotionally discriminating attitude, it is fast becoming commoditised. The online site is screaming out for a distinctive personality, not just a cosmetic one.
It needs to behave like a challenger brand to engage people. Then the right consumers will have a happy heart too.
REMEDY
- Develop a brand manifesto.
- Relaunch the site with imagery that befits a challenger brand. Support this with innovative services.
- Enhance those products that are more relationship-based, such as current accounts.
- Re-energise the PR strategy to rebuild the bank's reputation.
- Get the whole of Abbey to understand the positive role Cahoot has to play.
DIAGNOSIS 2 - MARK BATCHELOR DIRECTOR OF CONSULTANCY, HENRION LUDLOW SCHMIDT
It is not great if a financial organisation such as Abbey can't look after itself, and this has been a basic problem for Cahoot, which needed to tap into its parent brand's credibility to accelerate its own growth.
In the rush to make online banking more youthful and accessible, Cahoot, along with many others, chose a tone of voice that is unsophisticated.
I am all in favour of making banking more engaging, but it seems lightweight and doesn't add credibility.
Cahoot's positioning is a 'commitment to provide highly-attractive rates'.
So it is selling on price, and as we know, there will always be someone cheaper. Customers need reasons to stay, not just to buy in the first place. The ads based on being 'smart with money' suggested an interesting proposition. But get closer and it looks the same as everyone else.
People are comfortable transacting online and recognise some slight risk, but they don't expect security problems from their bank. A desire for rapid growth is not an excuse for messing up the basics.
REMEDY
- Re-ignite the 'smarter banking' theme, perhaps through relevant customisation.
- Initiate a retention campaign, reduce churn and grow some lifetime customers. An army of happy customers will build credibility surprisingly quickly.
- Add some sophistication and consistency to communications.
- Be competitive in pricing, but don't let this become the proposition.
- Sort out the technology stuff.