Fewer than 25% of banks with supermarket locations are truly successful.

That's the word from Douglas W. Ferris Jr., chairman and chief executive officer of National Commerce Bank Services Inc. of Memphis.

Mr. Ferris, whose company has advised about 300 banks on supermarket strategies, said in an interview that he believes only 20% to 25% of banks with supermarket branches are doing a "really good job." About 30% to 40% are doing an adequate job, and the remainder are doing a poor job, said Mr. Ferris, who was in Chicago for a conference of the Bank Marketing Association.

"I think banks have jumped in and opened a lot of units, but I don't think they know who their customers are," Mr. Ferris said.

The problem, he said, is that banks will open branches with a lot of fanfare and offer certificate of deposit promotions and free checking accounts, all of which lead to fast growth. That growth, however, eventually hits a plateau, and banks begin to realize they haven't done their homework on the profitability of customers they're attracting.

"I don't think banks have executed as well as they could have," Mr. Ferris said. "They think opening in-store banks is about cute marketing, but it's really about managing sales forces."

Banks that view supermarket branches strictly as cost-cutting measures also have flawed strategies, he said. "Cost savings is something you do once," Mr. Ferris said. "If you don't have a revenue strategy, cost savings is going to hurt you at some point."

Everyone was talking about branding strategies at the marketing conference.

Building a brand should be looked at as an investment that brings long- term rewards, said Don E. Schultz, professor of integrated marketing communications at Northwestern University.

Mr. Schultz noted that once a company establishes a brand identity, it must "replenish" that brand annually. "Your brand is dying every year," he said. Therefore, spending on branding should be considered an amortized investment.

Everything from employees to news stories to litter in the street with a company's name on it affects a consumer's view of a particular brand, Mr. Schultz said.

He also noted that too many banks invest in "marketing stuff" rather than customers. Too few companies place value on retaining customers, he added. "Today there is no model, no system of measuring customer retention," Mr. Schultz said. All banks "talk about is customer acquisition."

Branding is a major issue for big banks but not necessarily for small ones. Take, for example, a $175 million-asset banking company like the privately held Kleberg First National Bank in Kingsville, Tex.

Ann DeKoch, marketing director for Kleberg First National, said successfully serving a community of 25,000 depends on a personal touch and the 92-year-old bank's reputation.

Walter A. Dods Jr., chairman and chief executive officer of First Hawaiian Inc., and Raymond M. Cheseldine, former executive vice president of the Bank Marketing Association, were the ninth and 10th inductees, respectively, into the BMA Hall of Fame.

Mr. Dods, who is also president of the American Bankers Association, said in an interview that marketing jobs at banks are much more important now than they had been. "They're the people who used to be in charge of balloons for branch openings," Mr. Dods joked.

Today branding and marketing are two major areas of importance. Bank marketing officials have become respected executives.

As for branding, Mr. Dods is coping with a brand issue at his own institution. His holding company and its lead bank, First Hawaiian Bank of Honolulu, may change to a name that is more universal. One possibility is Pacific One, the name it uses in Oregon and Washington.

Mr. Dods is not alone. First Chicago NBD Corp. is deciding what to do about its multiple brand names. The company goes by First National Bank of Chicago and American National Bank in Illinois and by NBD Bank in Michigan and Indiana. Spokesman Thomas Kelly said the company plans to make an announcement about its brand name by yearend.

The marketing association installed its new board Sept. 1. John Remsen Jr., president and chief executive officer of First Mid-Illinois Bank and Trust of Mattoon, Ill., is the group's new president. Janet Cropper, senior vice president of communications services at Chase Manhattan Bank in New York, is president-elect. Lance E. Kessler, senior vice president and director of marketing services at Keystone Financial Inc., Harrisburg, Pa., is first vice president.

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