You can't have missed the now-familiar HSBC ad campaign, posted at every airport in the world for a long, long time. HSBC spent years positioning itself as the "world's local bank." They did it via a campaign that featured series of similar visuals and single-word observations, which were designed to indicate that HSBC understood the subtleties of cultural differences and were fully invested in understanding multiple perspectives.
HSBC also understood the subtleties of – and were, apparently, fully invested in – money laundering for drug kingpins and terror cells, while ignoring U.S. sanctions established against rogue nations. HSBC's US unit managed to position the brand in this way by accepting $7 billion of dollars from Mexican drug cartels, conducting 25,000 Iranian transactions totaling over $19 billion in just one week, and helping Saudi banks with terror financing for groups like al-Qaeda. All of which, if you hadn't already surmised, is patently illegal. The bank knew it was illegal too, so the question right about now is, how are you feeling about the HSBC brand?
There's a test for how well a brand engages you. High engagement is almost always followed by positive behavior toward the brand. Disengaged customers look elsewhere. Empowered and hot-wired-to-the-Internet consumers can move faster than an electronic money transfer when they feel the need. See how you answer these questions (for your current bank and HSBC):
Feel like they're a trustworthy organization looking out for your best interests? (Leaders of rogue nations should not answer this question.)
Do you have confidence in their business plan? (Drug kingpins are excused from answering.)
Do their "Breadth of Services" meet your expectations? (Money launderers can skip this question, too.)
How do you feel about their "security"? (Please try and exclude "National security" when you do that evaluation.)
How are you feeling about the brand now? Because those are the questions consumers ask about their banks, and banks need to be able to provide not just answers, but believable answers. Ones that move beyond well-crafted ad campaigns.
For the past five years banks have been at the bottom of the all the categories we track (and we track a lot of categories) when it comes to meeting customer expectations. Given past transgressions, that fact probably didn't come as a surprise to you. A bank's systematized support of some of the U.S.'s greatest enemies in the world probably did. So what's a bank brand to do?
Well, HSBC apologized for the incident, their group chief saying, "we accept responsibility for our past mistakes… are profoundly sorry for them." Feel better about the brand now? It was a really good apology. The bank has also agreed to pay $1.9 billion in fines. That's in addition to $290 million the bank said it spent to fix the laundering issue. Oh, the banks signed a Deferred Prosecution Agreement for breaches of the Trading With the Enemy Act and the U.S. Bank Secrecy Act, so now they're on probation. Had they actually been indicted – one wonders what one actually has to do with rogue nations to get indicted – the U.S. government would not have been able to do business with them. Which would hurt business for HSBC, and that matters even more today especially as they've gotten out of the money laundering racket.
Feeling better about the HSBC brand? Me either.
There's a popular American depression-era proverb, circa 1930, about banks. It went "You don't put robbers to work in a bank." Maybe HSBC can work off that as a new positioning and a really neat ad campaign.