Strategic priorities for banking brand development in the context of digital transformation of the financial sector

Abstract

The digital transformation of the financial sector is turning the banking brand from a purely marketing category into a strategic intangible asset that directly affects a bank’s financial performance, including customer acquisition costs, product margins, business value, and the stability of its customer base.

Problem statement. Banking institutions make substantial investments in the development of digital channels and digital brands; however, they generally lack a clearly defined system of strategic priorities linking brand development initiatives to expected financial outcomes and measurable performance indicators. Existing studies tend to examine either the marketing components of brand equity or purely financial indicators of bank digitalization separately, without systematically integrating these dimensions.

Unresolved issues. The prioritization and hierarchical structuring of strategic directions for banking brand development in the digital environment, their alignment with specific financial effects, and the development of indicators for monitoring their implementation remain insufficiently substantiated, particularly in the context of the structural transformation of Ukraine’s banking sector.

Purpose of the article. The purpose of the article is to substantiate a system of strategic priorities for banking branding development in the context of the digital transformation of the financial sector that can generate positive and measurable financial effects for banking institutions.

Main material. Based on a systematization of international and Ukrainian academic literature, the study identifies groups of factors determining bank brand equity in the digital environment, establishes changes in the relative importance of traditional and digital components of brand quality, and develops a matrix comprising five strategic priorities for banking branding development and their corresponding expected financial effects. For each priority, a system of key performance indicators (KPIs) is developed that integrates non-financial and financial dimensions of performance. Differentiated practical recommendations are also proposed regarding the sequence of their implementation depending on bank size and level of digital maturity.

Conclusions. The proposed system of strategic priorities, supplemented by monitoring indicators and practical recommendations, enables banking institutions to systematically align investments in digital branding with their financial strategy, thereby improving the rationale and evidence base for managerial decision-making at all stages, from planning to performance monitoring, and providing a foundation for the further development of a methodology for quantitatively assessing the financial effectiveness of a bank’s brand strategy.