Yesterday’s announcement made by ING to spin off their insurance and investment management business hit markets like a torpedo, and sent its share price spiraling down by 18 %. As part of the deal struck with the EU, ING is forced to sell part of what is universally considered to be one of its crown jewels, its US-based operations of ING Direct.

According to the Wall Street Journal, “To win E.U. approval, the company must divest ING Direct in the U.S. and some Dutch retail banking activities by the end of 2013. It will keep its ING Direct Internet banking operations in other countries and must refrain from making acquisitions.”

After the feverish initial reaction from the markets, it remains to be seen what this holds in store for the already battered ING brand. As if the Dutch government bailout and recent scandal involving the Renault-F1 racing team was not enough, ING is now required to part ways with one of the most well-respected consumer finance brands in the US – ING Direct.

Long considered to be one of ING’s “crown jewels”, Wilmington-based ING Direct has been growing steadily since its inception over 10 years ago, by building on its core value proposition of providing simple products at above-market rates. True to style, ING Direct commented on the announcement on Twitter with the statement “Have no fear. We’re still Orange, still as safe as Fort Knox, and still paying more interest than your mattress.”

Whereas ING was still on the 81st position in the 2008 Interbrand “Best Global Brands” ranking, in 2009 it failed to make the Top-100. In fact, financial services brands are remarkably absent this year, with several disappearing from the ranking. Those that remain have seen significant setbacks in brand value, as evidenced by American Express (-32 %), HSBC (-20 %), Citi (-49 %) and others.

According to Interbrand, which dedicated an entire section to the decline of the financial services industry, “Brand value has never before eroded as quickly as it has in the  financial services sector during the 2008–2009 period. As a group, financial services brands have lost a third of their value in a matter of months. Our March 2009 Financial Brands Survey shows that many financial services brands lost their ability to drive choice, loyalty, and confidence, resulting in significant “money in motion” among retail and institutional clients.”

Interbrand goes on to discuss the emergence of a new, three-tier system of financial services brands – the “standing cavalry”, “down-but-not-out” and the ominously named “fallen”. As the economic recovery moves ahead, and banks continue to improve their balance sheets as well as their reputation amongst consumers, it is clear there will (continue to) be a shakeout.

It remains to be seen what the future holds for the ING brand, once one of the strongest and most respected brands in the financial services industry. It would appear that  government aid may come with a hefty price tag after all.

Flickr.com, CCL, Kervinchong

When trying to find a contractor to do some work on my house recently, I was left wondering whether there are industries where reputation does not matter. 

In most countries, building contractors are notorious for not honouring their obligations. Everybody has stories about suppliers overcharging, deadlines that were not respected and quality of work that left (a lot) to be desired. If you have never experienced this, just try using this as a conversation starter at parties – and count your blessings.

With the construction industry in a major downturn and a sharp decline in consumer spending for all-but-the-necessary, I was surprised to find not much seems to have changed. I still find myself having to chase after people to ensure appointments are kept, and work is started at a previously agreed-upon date.

So could it be that certain industries are exempt from “normal” market dynamics ? Or is there still so much work out there that contractors can permit themselves to continue doing things in their own, time-tested ways ?

Looking at industry dynamics, a third possibility comes to mind: what if poor service is just the universally accepted norm ? What if people have gradually come to expect this situation as “normal”, and resigned to the fact that this is just the way things are ?

If that is the case, what could that mean for a new market entrant that focuses on delivering superior customer service as their unique selling proposition (USP) ? Like U.S. automakers and financial services, perhaps the construction industry is long due for an overhaul of accepted business practices; and the current recession will help separate the wheat from the chaff.

True innovation often comes through rearranging previously existing elements into a new configuration. If applied correctly, I feel the following five applications of already existing ideas could really make a dent in the construction industry:

• Consumer reviews – transparent rating and evaluation mechanisms like epinions.com or consumerreview.com could help consumers find and evaluate contractors. They could exchange reviews and suppliers could be rated across different criteria;
• Auctioning sites – services like alibaba.com could help consumers find suitable suppliers in their area, with a 5-star rating scale to help you decide who to select. Consumers can put out bids for contract work, with supplier competing to get the job;
• Referral networks – a referral network like referralkey.com for contractors and other professionals in the building industry could help in building “circles of trust” where consumers and qualified tradesmen meet;
• Social media - by engaging in existing social networks and harnessing the power of social media, tradesmen could showcase their knowledge and skills and build trusted relationships with consumers.
• Sales Force Automation – Hosted CRM and appointment-setting services based on apps like salesforce.com, with strong service level agreements (e.g. callback within 24 hours) could help contractors outsource all non-essential parts of their activities and provide consumers with a “one stop shop”;

At the turn of the century, Charles M. Schwab changed the face of the steel industry by successfully creating U.S. Steel, and then moving on to create the largest independent steel producer in the world. According to Schwab, “all successful employers (“consumers”) are stalking men who will do the unusual, men who think, men who attract attention by performing more than is expected of them.”

Now if I could only find a contractor like that …

Flickr.com, CCL, myfovea

Every day, I receive several sales calls from service providers. Due to the recent economic downturn, ad agencies, brand specialists and independent marketing consultants are all going through extremely difficult times. 

The number of sales calls I receive seems to be inversely related to the severity of the economic downturn – and I feel for the people making the calls. Working as a consultant has allowed me to understand the unique challenge of making your prospect understand why your firm is unique, and better positioned to help them than anybody else.

As a buyer, I am also constrained by the current economic climate. My budget is down and I have to make a choice when it comes to who I hire, and what I hire them for. As the economic outlook gradually worsens, competition increases – and my choice becomes harder.

As I am held accountable for whom I hire, I need to look for the best help available, and hire those people that are guaranteed to deliver superior results. Over the years, I have hired many service providers, and I have adopted a single golden rule: always try before you buy.

For various reasons, it is not always practical to do a pilot or start working together on a smaller project: time constraints, supply and demand, and project constraints are just three of them. Steven Snell over at Traffikd has recently published an excellent article on “10 tips for using a blog to promote your own services”.

In my opinion, blogging is an excellent way for service providers to boost their credibility, and  provide a sample of what they have on offer.

In Steven’s words, “You could be providing the same exact quality of service as someone else who isn’t blogging, but because you have been able to prove your worth to your blog readers, they are almost guaranteed to come to you before going to someone with whom they are not familiar.”

As a buyer, reading a blog allows me to become acquainted with potential service providers in numerous ways, and helps me answer the following questions:

• Is there a “match” in terms of ideas, values or outlook ?
• What kind of projects/problems have they tackled in the past, and how did they approach them ?
• Do I/will I learn something from them ?
• Do they “practice what they preach” ?
• How are they different from their competitors ?
• Do they exhibit original ideas or a new approach ?

 Blogging allows for a relationship to be created before the first meeting even takes place, meaning you have the advantage over your competition. More importantly, it does so in a credible and value-adding way, and 24/7.

For any service provider that caters to corporate buyers, gaining access will become increasingly difficult. With less business out there, and more people fighting to get it, any advantage you have is more than welcome.

By allowing you to create relationships and show people what differentiates you from the competition, blogging may be just the tool that helps others find your edge.