Brands of the Year: Desjardins breaks through borders

How the Quebec-based financial co is making a splash in the rest of Canada.


It’s that time again. We’re rolling out our 2015 Brands of the Year, so make sure to check back during this week as we take a look at the brands that had a big impact on Canada this year.

This story appears in the October 2015 issue of strategy.

Desjardins’ VP brand and marketing communications, Nathalie Lachance, sums up the company’s year in simple terms: “We try new things – that’s probably the way we can categorize our year – new things.”

That’s putting it mildly. Desjardins has put its stake in the ground this year as a financial force to be reckoned with outside its comfort zone – Quebec. It made some big moves across Canada, including the acquisition of a major player in the insurance game with State Farm’s Canadian business, the launch of a first-of-its kind app, as well as a concept store and an entirely new mobile bank.

Desjardins, a cooperative financial group that provides insurance, personal and business services, has over seven million members and clients. It also has over 1,000 caisses and service outlets in Quebec (55 in Ontario), and is a dominant player in its home province, both in insurance and financial services, with 43% of personal savings, 23% of consumer credit and 36% of all mortgages.

For health and life insurance, Desjardins is the number two company in Quebec and number five in Canada. And since it purchased the Canadian operation of State Farm back in January of this year, it sits at number two in Quebec and number three in Canada for general insurance (home and car).

This year Desjardins Group ranked as North America’s strongest financial institution by Bloomberg (beating out all the major banks in Canada and the U.S.). Meanwhile, Desjardins General Insurance Group posted a first quarter net income of $73.7 million, compared to $16.7 million for the same quarter last year.

And now it seems that the co-operative, which is ubiquitous in Quebec (it has 98% awareness in that province and 58 to 75% familiarity, depending on the business line), is keen to expand beyond its borders, where it is decidedly less well-known. The numbers dip outside the province to between 52 and 82% awareness and about 20% familiarity.

To boost those numbers, Lachance knows the importance of tailoring messages for different regions. One of Desjardins’ big national launches this year was the Ajusto app. It’s a first-of-its-kind tool that tracks how a user drives (which can then improve their insurance rates), all done through their phone instead of a traditional device inside the car.

“We can talk more about empowerment in Quebec and driving well, and in Ontario we can be more price-oriented,” says Lachance about its different campaign tactics, though humour is always a part of the company’s messaging, to add a little fun to a traditionally dull category.

English spots by Lg2 featured drivers who became highly competitive with their neighbours once they got the app (one outfitting her car with Ajusto decals like a race-car driver, for instance).

Meanwhile, in Quebec, spots highlighted the mobile aspect of the tool, and a Facebook campaign by Montreal digital agency Ressac played to the gamification aspect of the app. The “Ajusto Challenge” got users to challenge friends (and get the loser to do things like dye their hair or wash the winner’s car).

Lachance says this fall they’ll be adjusting the Ajusto messaging, so to speak, outside Quebec, tweaking it based on what they learned from the first campaign.

DSC_0416“We were trying to sell both things at the same time – the app and the insurance. [But] you can do a 90-day trial [without buying the insurance]. This is new technology, people have to get used to it.” So the new campaign will be more about getting people on board with the app, after which they’ll do relationship management to convert them to clients.

While Desjardins won’t divulge specific numbers, Lachance says one in four new auto insurance customers enroll in the Ajusto program.

Another major launch this year was a new entrant in the banking category in Western Canada. Zag Bank, a branch-free mobile bank, is an evolution of West Bank, originally founded in 2003 and then acquired by Desjardins in 2014.

“This was a bold move because to start a bank in Canada, it’s not like in another country where there are so many banks,” says Lachance. “Here, it’s bigger players.”

The bank launched quietly with a friends and family pilot in the spring in Alberta and B.C., followed by a digital campaign, by Lg2 and digital shop Jam3, which asked consumers to go online and create a jingle for the new bank.

In September, a humorous TV campaign launched showing how fast Zag services are (like depositing a cheque).

When it came to branding Zag Bank, Lachance says they opted not to use the Desjardins name because of its lower familiarity outside of Quebec, where it’s mostly perceived as an insurance company.

However, she says, “what we’re learning more and more with focus groups is that when people learn that Desjardins is behind Zag, it reassures them more than we thought.”

She notes that in the future, consumers might see the Desjardins name attached to Zag on some materials.

So where does the name Zag Bank come from? “It’s because we were thinking the banks zig, we zag,” explains Lachance.

That philosophy of going in a different direction also applied to several concept stores that opened in Quebec this year. The new retail locations take a cue from tech stores, with tablets for browsing and “products” in actual packages, like one containing info on mortgages, while staff can approach customers more casually.

Conceptualized by Lg2′s design and branding shop Lg2boutique, the stores are project-based (rather than transaction-based) around things like buying a first home or saving for retirement. There are three concept stores aimed at younger people and one aimed at new immigrants.

Among young people visiting the store, there’s been a 90% satisfaction rate, Lachance says.

The new concept stores and the Ajusto app are indicative of Desjardins’ efforts to embrace innovative thinking, which it’s able to increasingly do thanks to a more streamlined approach to marketing.

It’s not easy to be a highly decentralized organization with about 300 people working on marketing across the country (with a core national team of about 25 to 30).

“We have people from multiple business lines sitting together monthly so that we see the world in the same way, and we see the brand in the same way. That’s a challenge,” says Lachance. “And the brand belongs to the [people], so we have to be very careful and clear in what we stand for.”

Desjardins used to work with over 100 agencies, but has reduced that number to about 30 (for services from social media to production/design), with Lg2 and media agency Touché as its AORs. And it is focusing on taking more of a hands-off approach.

“[The media landscape is] so complex that we gained a lot from stepping back more and working on giving good briefings,” says Lachance, who has an agency background herself, having worked at Cossette and Sid Lee. “The [industry] is becoming so aggressive that we have to be more innovative and creative and risk doing stuff that was not in our boundaries before.”

That includes things like the Hop ‘n S@ve app, which launched last year and allows users to put money in their savings account instead of making an unnecessary purchase (for example, putting $100 away that you might have spent on a pair of shoes).

But despite the focus on new technology and the increasingly complex mediascape, at the end of the day, Desjardins still aims to be an “of the people” company.

Of the $80 million a year it spends on sponsorships, 90% is invested in local community initiatives, Lachance says, with the remaining 10% spent on larger sponsorships like the Montreal Canadiens and the FrancoFolies music festival.

Social media has also been a key tool for the brand’s community focus, Lachance notes, with about 125 different caisses having their own social presence.

“We were built out of communities. And as we got bigger, it was difficult to stay connected. So for us, social media is a blessing because we can go back to participation, education – all the things that were easier for us to do at a certain time.”

It’s no surprise then, that according to data from Engagement Labs released in the spring, Desjardins is the second-highest ranked Canadian financial institution on Facebook, beat out only by RBC.

And while Desjardins is staying on top of social media and innovation while it pushes into new territory, Lachance says it’s keeping an eye on the ever-changing financial landscape out there.

“New players – PayPal, Google, Amazon – they have lots of money and they’re outside the industry, they’re not regulated, so that’s something we look at. So the competition is not just the other banks, it’s these new global players,” she says. “I’m on Google 50 times a day, what’s going to happen the day they launch a credit card?”

We don’t know, but we’re sure when it happens, Desjardins will be ready for it.