As ANZ begins shutting down the National Bank brand and forcing its customers, who have been called the most loyal on the high street, into a merged bank, the million dollar question remains - will they stay?
The New Zealand chief executive for ANZ - David Hisco - is confident they will.
Some will be coaxed away by competing Australian-owned banks such as Westpac, BNZ or ASB, whose ad proclaims "Farewell Black Beauty", or to state-owned Kiwibank which cheekily claims in billboards it is "New Zealand's national bank".
But Hisco says customers will stay because the incorporation of National Bank creates a better proposition.
It's "the power of two", according to commercials by Patrick Jane, the actor from US series The Mentalist, who is the face of the bank in Australia, New Zealand and 30 other markets.
ANZ has said it will phase out the National Bank brand over the next two years. It has owned the bank since 2003 but ran it as a separate business.
It acknowledges there are challenges as it attempts to meld the two brands.
Hisco says ANZ looked at past New Zealand bank brand mergers such as Westpac Bank removing Trust Bank from 1996 to 1998, and Postbank being taken over by ANZ in 1989.
Kiwis expected the closure of the National Bank brand would mean closing branches, sacking staff and leaving communities.
"We're doing the opposite," Hisco says. "With two different banks we reached 78 per cent of [the country].
"With [the] merged banks allowing us to open new branches we'll reach 90 per cent of New Zealand, spending $100 million along the way," he says.
"You are going to lose some people along the way."
Since the death of the black horse, only 400 to 500 National Bank customers have left.
"A brand is more than a logo and is about better propositions and the only people who are going to leave are those who have no internal relationship with the [ANZ] brand," he says.
But the National Bank brand has been finely crafted and even under ANZ ownership since 2003 attracted strong loyalty.
Before ANZ bought National Bank it was British-owned, yet through astute branding it emerged as a New Zealand entity.
ANZ accepts it faces a long haul with pressure to hold on to customers when fixed rate mortgages fall and they shop around.
Andrew Inwood, an expert on Australian bank branding at CoreData Research, backs the idea that customers - or at least younger people - are not so attached to bank brands.
"They treat their bank like a utility [looking at the best deal] and do not get caught up in the branding like older customers," Inwood says.
It does matter more for older customers, who typically have more money, and banks spend tens of millions each year on brand advertising trying to prise customers away from the competition.
"Branding is still very important," says Westpac New Zealand's marketing and customer experience general manager, Martine Jager.
People are attracted to a brand by their own personal experiences and the forced move to ANZ provides opportunities.
Any movement of people won't happen overnight and Westpac isn't focused only on ANZ, Jager says. People review banks when they have a change.
"It's not just bringing over National Bank customers - you can't just be focused on a moment in time," she says.
David Tripe, director of the Centre for Banking Studies at Massey University, won't speculate on how many customers are up for grabs but says the brands for National Bank and ANZ are very different.
All customer research suggests National Bank had a good customer service profile while ANZ has undertaken a big push to improve.
"It had got to the stage with ANZ in the late 1990s [where] the only way they could go was up," Tripe says.
"It's been a relatively long and difficult process and they have certainly made an improvement to the brand."
Branding by itself won't be enough to shift anybody from ANZ, but in the new environment customers are primed to consider a move.
ANZ has to be wary of any problems with service or technology that could put pressure on retaining these customers, he says.
All the competing banks see opportunities from National Bank customers being disaffected or not being engaged in the ANZ Bank.
ASB - owned by Commonwealth Bank of Australia - markets itself on its customer service.
ASB marketing and online general manager Roger Beaumont says the market has become more fluid with simplified processes for people to switch banks.
"Since the National Bank announcement we have noticed a further upswing in people switching," he said.
The BNZ - owned by the National Australia Bank - also fancies its chances and has pumped a significant amount of research into prospects for picking up former National Bank customers.
Kiwibank draws a different clientele but both score highly as brands.
Kiwibank spokesman Bruce Thompson says in banking surveys, National Bank customers are the most loyal.
Over the past three weeks the number of new customers had increased from 1300 to 2000 with a disproportionate number from National Bank.
Bank brands are often elaborate and honed but it's an advertising truism that it's hard getting bank customers to switch.
Ad people say - and David Tripe agrees - that clients are loyal partly out of fear that switching brands will lead to major problems with personal finances.
"The evidence is that the fear of those happening is more than likely to occur," Tripe says.
Some believe that despite the fight for ANZ to retain its National Bank customers, the shift from a dual brand to a single-brand strategy has been inevitable since ANZ bought National Bank in 2003.
Branding specialist Inwood says that since the global financial crisis, banks around the world have been forced into acquisitions to increase market share.
Running two brands was more costly.
Australian banks such as Westpac - with its New South Wales brand St Georges Bank - used its second brand as part of a regional strategy in complementary markets.
In this country - and perhaps surprisingly, given the affection for the black horse - the shift to a single-brand strategy is a work in progress.
But now the black horse has gone, the change is blunt.
More transitional ads are coming, but for former National Bank customers the honed imagery of the New Zealand-localised black horse ads is being replaced with the Mentalist talking about the power of two.
ANZ has taken over sponsorship of cricket coverage and the Young Farmer of the Year award.
But for the most part, advertising will be the same as that used in Australia and focusing on its international profile as a bank operating in 32 markets.
Former National Bank customers used to images of arcadian New Zealand scenes are now part of a bigger world.
- by John Drinnan of the NZ Herald
