As European banks and insurance companies, traditionally loath to sell anything other than proprietary products, open their doors to third-party mutual funds, U.S. banking companies seeking to capitalize on the opportunities are faced with a major decision on branding.

Very few companies can afford the monumental commitment required to achieve even a small measure of the consumer name awareness in Europe that such firms enjoy in the United States, and even fewer are willing to undertake that kind of effort.

Instead, some companies are narrowcasting their message to the institutions themselves, hoping that recognition within the investment community will suffice.

James Cerutti, a marketing consultant and brand expert at FutureBrand Worldwide in New York, said that when banking companies use acquisitions to move into new markets — as many do — the job is especially tricky. In some cases, it may make sense to have a different, well-recognized brand in each market, but a major global brand may inspire more confidence, he said.

Mellon Financial Corp. has opted for the latter approach and in the process is deemphasizing a brand name well known in the United Kingdom.

The Pittsburgh company took a bigger step into the European asset management field in October when it bought the 25% of Newton Investment Management Ltd. of London that it did not already own.

Among investment professionals in European countries, Newton’s name carries broader recognition than Mellon’s as a supplier of third-party funds, according to research by Sector Analysis Ltd., a London market research firm. But Mellon, in part because its name does carry weight among institutional managers for other products, is going with an all-Mellon brand approach across Europe.

“Newton has a very strong name in the U.K. market, but our research has shown that most strong brand names are not country-specific,” said James Lauterie, Mellon’s brand marketing manager.

The issue is playing out in many markets among many firms. Certainly, companies in the United States have long had to wrestle with the question of what to do with names acquired through mergers. Citigroup Inc., which has adopted a multibrand strategy for its U.S. mutual funds, sells two mutual fund brands in Europe: CitiFunds and Salomon Brothers’ Global Horizons.

Next week Citigroup Asset Management is to premiere a series of print ads for both fund groups in German and Dutch business publications. The ads — which will cost less than $1 million — are to resemble Citi’s U.S. campaign, which features investment managers.

Stephen C. Cone, global head of marketing, retail, and retirement services for Citigroup Asset Management, said that creating broader brand recognition among individual investors would make investment professionals more disposed to sell Citi’s funds and make sales easier for Citi’s European investment counselors. “Any little bit you can do is helpful,” he said.

The New York company’s asset management arm expects to sign its first two third-party fund distribution deals in Europe this month, with at least two more to follow next quarter, a spokesman said.

One thing branding executives agree on is that the clout of a well-known parent can help open doors.

Jon Groom, president of Mellon Global Investments Ltd., said European banks and insurance companies might not know Mellon as an asset manager but do know it as a banking company. This gets the company meetings with major distributors, he said.

Once Mellon, which manages $67 billion of assets outside the United States, has a chance to explain its asset management capabilities, “we see a lot of positive reaction,” he said.

Mellon plans to focus its European branding efforts on the institutional side, Mr. Groom said. “For us to try to build name recognition in multiple markets, you could never spend enough money to do it,” he said. “It’s better to spend money on people and developing relationships.”

But not all agree that such relationships are enough.

Magnus Spence, the managing director of Sector Analysis, said that for distributors it is obviously easier to sell a fund from a name the investor has encountered before.

U.S. third-party fund providers may have a steeper hill to climb than they realize, he said. A Sector Analysis survey late last year of 950 investment professionals in eight European countries found only two banking companies among the 20 most frequently mentioned investment brand names. The two were Chase Flemings — the company formed when the former Chase Manhattan Corp. bought Robert Fleming Holdings Ltd. last year — and J.P. Morgan & Co. Both trailed the leader, Fidelity Investments, by a wide margin.

J.P. Morgan Chase & Co., which was formed late last year by the merger of Chase with J.P. Morgan, is trying to figure out what approach it will take, though with a pair of brands well known in Europe, the company is in an enviable position.

A spokeswoman for the New York banking company said it is still working out its European branding strategy and a resolution is not expected until April.

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