Marketing: Why One Bank Fails, Another Succeeds

 Case study of two banks: Why one is history and the other is thriving

Like most businesses, you can look at the branding of a bank and forecast how it will fare. Poor branding is often the tip of an iceberg – an indicator of management ineffectiveness and lack of discernment.

And for financial institutions, this is especially true. Conservative appearances and customer empathy are important when handling customers’ money.

Consider a case study: Venture Bank in Lacey, WA in 2009 vs. First Citizens Bank & Trust in Raleigh, NC.

First Citizens bought Venture Bank’s $874 million in assets and entered into a share-loss transaction for $715 million of the assets and state regulators closed the Washington bank.

Venture Bank, with 18 branches, had $970 million in assets and total deposits of $903 million.

There are reasons why Venture Bank failed and First Citizens has succeeded.

With information from a published report,, here’s a brief history about Venture Bank and a couple of observations by me:

  • Venture Bank had its origin as Lacey Bank in 1979 and changed its name to First Community Bank two years later.
  • First Community merged with Citizens First Bank in 1993 and bought Prairie Security Bank four years later. It acquired Harbor Bank of Gig Harbor in 2002.
  • First Community changed its name to Venture Bank in 2003.
  • In March, 2005, the bank made a questionable decision and sponsored a concert with The Ventures, a rock ‘n’ roll band, in a bid to promote the group into the Rock & Roll Hall of Fame.
  • In August of 2005, the bank bought Redmond National Bank and got a new CEO when it rehired Jim Arneson who had been the Redmond bank’s president.
  • In May, 2007, Venture Bank publicized its record Q1 income of $3.2 million.
  • In March, 2007, Venture moved into its new $13 million headquarters in DuPont, just up the I-5 corridor. Not to be hyper-critical, but the reception area resembled a lavish, highly secured mausoleum.
  • The bank’s holding company, Venture Financial Group Inc., announced plans for an initial public offering in July, 2007.
  • In February, 2008, Venture and the Tacoma Rainiers (the Seattle Mariners AAA farm club) signed a lucrative six-figure sponsorship package. (I love baseball, but I recall wondering why. It was great for the ballclub. However, I recall thinking Venture Bank would never get a good ROI.)
  • Seven months later, in September, the IPO was withdrawn.
  • In Nov., 2008, Venture announced it was suffering from its worst quarterly loss ever.
  • Five months later in 2009, the FDIC told Venture Bank it needed $20 million more in assets.
  • Starting in early 2009, Venture’s holding company revealed its SEC-required earnings reports were going to be late.
  • The accounting firm, Moss Adams, informed Venture of its withdrawal as the auditing firm.

Venture’s eccentric marketing

As for the branding, Venture Bank’s Web site also tells quite a revealing story: The bank was guilty of eccentric marketing.

The home page of one Venture Bank Web site,, contended that “SMALL IS POWERFUL.” It showed pictures of a cayenne pepper, matchbook and dart frog. Under the pictures were these captions:

  • “Cayenne peppers are only 6 to 8 inches long but are known to pack a serious punch, up to 50,000 Scoville units of heat.”
  • “Since 1892, when it was first patented, the common match has ignited the cook fires of the world, the fires of imagination and the fuses of powerful explosions.”
  •  “One milligram of the poison dart frog’s venom is enough to kill two African elephants.”

But here’s more. Even after state regulators shut down Venture Bank, a second Web site was still also online:, which used this branding slogan, “As Independent As You.”

At best, this was a nebulous slogan in the eyes of bank customers.

The bank’s home page did a poor job of reassuring visitors and customers that their welfare is important and that the bank will care for their money. Business owners and consumers do not want maverick bankers handling their money.

Ostensibly, Venture’s eccentric Web site – complete with visuals of cayenne pepper, matchbook and dart frog –was the original site. But no one was aware of it to even pull the plug.

For me, as a former broadcast journalist, Venture Bank’s situation – promotion of The Ventures, lavish headquarters and questionable sports-promotion investment – is reminiscent of when I reported on the S&L scandals and the Friday night seizures of failed financial institutions in the 1980s.

No one has accused Venture’s management of scandalous behavior but the bank’s appearances, over-spending, and resulting collapse brought back memories.

In particular, I recall the reporting the collapse of State Savings in Salt Lake City. The principal, J. William Oldenburg, was accused of abusing the thrift’s assets. To a larger degree than Venture Bank, he created unfavorable impression, too.  He drove a Rolls Royce and had been the flamboyant owner of the L.A. Express in the defunct United States Football League.

First-Citizens Bank 

Contrast Venture Bank’s behavior with First Citizens Bank:

Visitors to were directed to First Citizens’ Web site,, where a message from Chairman and CEO was posted:

“On behalf of First Citizens, we welcome you to our banking family. As a First Citizens client, you’ll benefit from our 111 years of experience in the financial services industry, our commitment to exceptional service and our reputation for strength and stability. We’re excited about serving our new communities and building a rewarding, long-term relationship with you.”

Here’s more of First Citizens’ welcome to Venture customers:

“Sound business practices and stewardship of customer deposits are among the highest priorities of our bank. We have more than $14 billion in assets and more than a century of experience serving the financial needs of our clients. First Citizens Bank is nationally recognized for overall stability, security and high levels of customer satisfaction. We’re proud to welcome you to our banking family and assure you that your money is safe with us.”

So, in conclusion, my question is this:  As a bank customer, do you want to read about cayenne peppers, matchbooks and dart frogs? No.

From the Coach’s Corner, here related marketing articles:

Everyone rises to their level of incompetence.”

-Dr. Lawrence J. Peter


Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

Seattle business consultant Terry Corbell provides high-performance management services and strategies.