Sharing is caring: The Co-operative Bank trumpets its profit sharing and mobile app

When banks advertise they usually try to act as if they’re our friends, saying they want us to get the most out of their services, pushing all the opportunities they can offer us – like new homes or successful business start ups. The Co-operative bank has taken a more honest approach saying what banks really want from us and how easy it is to leave that behind and join their bank, and has enlisted the help of a snappy reptilian (or crocodilian to be exact) named Brian to get the message across.

The TVC is one of two, the second of which will be released next week which encourages people to make the switch to The Co-operative Bank (formerly PSIS), which it says can be done easily through its mobile app.

The TVC features a rather flustered young man who seems surprised at how his pet crocodile Brian is destroying his home, ruining his love life and chewing on his belongings. But of course “It’s in their nature”.

A parallel is then made between Brian the crocodile, which does exactly as a crocodile should, as the TVC says “Don’t be surprised when your bank acts like a bank. They’re designed for one thing, making profit from you. If you’re not happy with that maybe it’s you that should change.”

Both Kiwibank and TSB have played the local ownership card in an effort to gain customers, but former Co-operative Bank general manager Sadhana Raman told StopPress earlier its main strategy was to focus on the fact that its customers got a share of its profits.

Director of marketing Grant Jennings says the bank was trying to challenge consumers as to why they would be surprised banks act the way that they do. “We are obviously quite different and as a consequence behave a different way and we are attempting to challenge people to overcome that apathy of changing banks for the better.”

While he would not say how many downloads the bank’s mobile app has had he did say it is the highest rated app in that space. “It’s incredibly user friendly and it’s got some really innovative calculators on it. It’s an easy way to join us rather than necessarily having to go to the branch.”

Jennings says the board ultimately decide on the rebate and then depending on the customer engagement with the bank determine s the size of the annual rebate.

He says the bank is approaching the 150,000 customer mark. “We’ve seen good growth in the customer base since obtaining the full banking licence and having a business that is built on [sharing profits]has given us a strong point of difference in the market.”

Jennings wouldn’t put an exact number on it when asked, but he says thousands of people have switched to the bank and many of those have been through the app.

Y&R Wellington managing director Tim Ellis says the inspiration of the TVC was formed by the nature of banks in general. “Most banks are designed to take profits from their customers to fund their big shareholders. That’s the way they’ve been set-up, it’s what they’ve done forever, it’s in their nature.,” he says. “A bit like it’s in the nature of a giant man-eating animal to take a little too much too. The Co-operative Bank is a different kind of bank though. Because they are 100 percent customer owned, the only people they are in it for are their customers.”

He says the campaign kicks off with support through The Co-operative Bank’s owned channels “Branch, digital, mobile and social. But watch this space because it’s just the start.”

Ellis says of the crocodile Brian is ” … a massive saltwater crocodile and was built and designed by the geniuses at Blockhead who did the post-production and animation work. They have worked very hard in a short window to create something truly brilliant.” 

According to the Herald in May the bank posted a 24 percent lift in annual profit, while also boosting its rebate to customers.

The bank’s chief executive Bruce McLachlan told the Herald it had increased overall profits by 59 percent and added 35,000 new customers since becoming a registered bank in October in 2011.

Net profit of the bank rose to $8.9 million in the 12 months to 31 March from $7.1 million a year earlier.

The bank increased its client rebate by 38.5 percent to $1.8 million according to the Herald. “Profit before rebates and tax rose 30.9 percent to $13.4 million, while net operating income increased 8.4 percent to $66.2 million and deposits jumped 12.1 percent to $1.6 billion.”

The bank’s loan book increased by 10.9 percent to $1.6 billion while bad debts fell 31.7 percent to $1 million.

The Herald reported the bank said its capital and liquidity ratios of 16.5 percent remained the highest of any New Zealand bank.

The bank opened up a branch on Auckland’s Queen Street last November and has signaled plans to launch up to six more in the city.

Y&R’s 2013 TVC for the bank was shot by Luke Shanahan of Robber’s Dog and promoted how the bank shares its profits with customers.

Nielsen data shows banks’ ad spend for 2014, with ANZ spending the most and The Co-operative Bank spending about $5.5 million, more than Westpac at about $4.5 million.

According to a PwC release on banking profits, New Zealand’s five major banks (ANZ, ASB, BNZ, Kiwibank and Westpac) have continued to show strong profits and lending growth in the first quarter of the 2015 calendar year (being 1 January 2015 to 31 March 2015, first quarter 2015).

The report says net profit before tax increased by $94 million or 5.9 percent to $1.69 billion for the first quarter of 2015 compared to $1.59 billion earned during the fourth quarter of 2014. “The $94 million increase in profit before tax is attributable to an increase in other operating income of $75 million (10.5 percent) and a decrease in operating expenses of $33 million (3.0 percent), offset by a decrease in net interest income of $3 million (0.1 percent) and an increase in impairment losses on loans of $11 million (12.4 percent).

The report says: “All in all, this is another strong result reported by New Zealand’s major banks behind the back-drop of escalating house prices, predominantly in the Auckland property market. While there have been numerous views on what is driving Auckland property prices, the Reserve Bank has continued to take action to elevate the concerns that a rapid house price correction in Auckland property market would have on New Zealand’s overall financial stability. Time will tell what the full impact of these initiatives will be, but at least the Reserve Bank won’t be accused of not taking active steps to lessen the risk of financial instability from a sharp correction in house prices.”

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