Sberbank Ranked The Second Strongest Brand In The World Due To Digitalization

At the end of January, many media outlets in Russia and worldwide started to spread the news about Sberbank ranked second in the list of the world's strongest brands in 2018 — according to Brand Finance, the world's leading brand valuation company. The largest Russian bank was outranked only by the Italian car manufacturer Ferrari. It became a hot topic for the marketing communications industry, where people were vying with each other in discussing the event. However, let’s avoid the debates and try to focus on the main thing: what are the reasons for the overwhelming success of Sberbank, which in the minds of many Russians is still associated with poor service and Soviet past? Or is it no longer associated?

The figures behind the success are the following: the value of the Sberbank brand over the past year increased from $11.6 Bln to $12.4 Bln, and the brand strength index rose by three points: from 90 to 93. Everything could be even better — the mark was affected by the decline in the rouble rate against the dollar.

This is not a coincidence, but a systematic, progressive development

One may claim with skepticism and mocking remarks all Sberbank initiatives in the field of technological development but it’s progressing, and it goes faster with each year. Having been a cumbersome and unwieldy brand with a “Soviet” heritage and now it is changing right here and now, and every year its look and vision becomes more technocratic. The reasons for success in brand development were commented by Herman GREF, the President and Chairman of the Board of Sberbank:

“Such a high appraisal of the professional community is a well-deserved result of a team that works hard every day to make Sberbank one of the best technology companies in the world. Many innovations and technologies were developed and first introduced in Sberbank. Now, these technologies are used by banks and companies all over the world. And, of course, world leadership for us is an important confirmation of the relevance of the chosen strategy in terms of technological leadership.”

This event is indeed significant and removes many issues about the correctness of the path chosen by Sberbank and its Chairman. All the crucial milestones reached by the “green bank” are in full view: it is enough to hold a retrospective of the past five years to understand how far the largest Russian financial institution has developed.

The starting point was made in 2014 when the digital business development division was established in Sberbank. Since then, every year has been marked by significant updates, including e-invoicing, the CRM system, cloud platforms for corporate clients, the launch of the startup accelerator, experiments with automation, artificial intelligence and blockchain.

A brave new world of high technologies

There is no need to search for the latest news from Sberbank in the field of digitalization — just on February 14, Anatoly POPOV, the Deputy Chairman of the Board of Sberbank, announced the development and testing of the Auto ML (machine learning algorithm) which is capable of creating new baseline models. The latter, in turn, solve specific tasks — for example, they can give a forecast about a client’s solvency on loan or help in separating good clients from violators.

“One of the possibilities for increasing the efficiency of all business processes in a bank is the introduction of AI. However, the creation of tens of thousands of models to cover all aspects of the activity is practically unrealistic if only manual work of data scientists and developers is used to create and implement models. Therefore, we are implementing one of the most advanced approaches to working with machine learning models in the world - Auto ML, ”

— the deputy chairman of Sberbank commented on the innovation.

Is it time to sum up? Probably it's not, it’s too early. The locomotive of the Russian bank accelerated to such an extent that it rushes ahead of the majority of western competitors, and the high rankings only confirm the fact. BrandFinance CEO David HAIGH noted the effectiveness of the strategy, positioning and success of achievements:

“Sberbank’s performance this year in both brand value and brand strength has been exemplary. The brand has solidified its pre-eminence in its key Russian markets, scoring exceptionally well in Brand Finance’s original consumer equity research that feeds into our valuations. As start-ups and tech ecosystems alike encroach on the financial services industry, Sberbank’s dominance as a brand will provide a solid foundation to adapt and thrive.”

Globalization and the digitalization of finance are in full swing. It seems that Sberbank, having proved its leadership within Russia, will not stop — after all, there is the whole world embraced by the digital revolution to work with.

Image courtesy of Banking Tech