INTRODUCTION
The
bank marketing is than an approach to market the services
profitability. It is a device to maintain commercial viability. The
changing perception of bank marketing has made it a social process. The
significant properties of the holistic concept of management and
marketing has made bank marketing a device to establish a balance
between the commercial and social considerations, often considered to
the be opposite of each other. A collaboration of two words banks and
marketing thus focuses our attention on the following:
*
Bank marketing is a managerial approach to survive in highly
competitive market as well as reliable service delivery to target
customers.
* It is a social process to sub serve social interests.
* It is a fair way of making profits
* It is an art to make possible performance-orientation.
* It is a professionally tested skill to excel competition.
bank marketing is than an approach to market the services
profitability. It is a device to maintain commercial viability. The
changing perception of bank marketing has made it a social process. The
significant properties of the holistic concept of management and
marketing has made bank marketing a device to establish a balance
between the commercial and social considerations, often considered to
the be opposite of each other. A collaboration of two words banks and
marketing thus focuses our attention on the following:
*
Bank marketing is a managerial approach to survive in highly
competitive market as well as reliable service delivery to target
customers.
* It is a social process to sub serve social interests.
* It is a fair way of making profits
* It is an art to make possible performance-orientation.
* It is a professionally tested skill to excel competition.
USERS OF BANKING SERVICES:
The
emerging trends in the level of expectation affect the formulation of
marketing mix. Innovative efforts become essential the moment it finds
a change in the level of expectations. There are two types of customers
using the services of banks, such as general customers and the
industrial customers.
emerging trends in the level of expectation affect the formulation of
marketing mix. Innovative efforts become essential the moment it finds
a change in the level of expectations. There are two types of customers
using the services of banks, such as general customers and the
industrial customers.
GENERAL USERS
Persons having an account in the bank and using the banking
facilities at the terms and conditions fixed by a bank are known as
general users of the banking services. Generally, they are the users
having small sized and less frequent transactions or availing very
limited services of banks.
facilities at the terms and conditions fixed by a bank are known as
general users of the banking services. Generally, they are the users
having small sized and less frequent transactions or availing very
limited services of banks.
INDUSTRIAL USERS
The
industrialists, entrepreneurs having an account in the bank and using
credit facilities and other services for their numerous operations like
establishments and expansion, mergers, acquisitions etc. of their
businesses are known as industrial users. Generally, they are found a
few but large sized customers.
industrialists, entrepreneurs having an account in the bank and using
credit facilities and other services for their numerous operations like
establishments and expansion, mergers, acquisitions etc. of their
businesses are known as industrial users. Generally, they are found a
few but large sized customers.
BANK MARKETING IN THE INDIAN PERSPECTIVE
The
formulation of business policies is substantially influenced by the
emerging trends in the national and international scenario. The GDP,
per capita income, expectation, the rate of literacy, the geographic
and demographic considerations, the rural or urban orientation, the
margins in economic systems, and the spread of technologies are some of
the key factors governing the development plan of an organization,
especially banking organization.
formulation of business policies is substantially influenced by the
emerging trends in the national and international scenario. The GDP,
per capita income, expectation, the rate of literacy, the geographic
and demographic considerations, the rural or urban orientation, the
margins in economic systems, and the spread of technologies are some of
the key factors governing the development plan of an organization,
especially banking organization.
In
ours developing economy, the formulation of a sound marketing mix is
found a difficult task. The nationalization of the Reserve Bank of
India (RBI) is a landmark in the development of Indian Banking system
that have paved numerous paths for qualitative-cum quantities
improvements in true sense. Subsequently, the RBI and the policy makers
of the public sector commercial banks think in favor of conceptualizing
modern marketing which would bring a radical change in the process of
quality up gradation and village to village commercial viability.
ours developing economy, the formulation of a sound marketing mix is
found a difficult task. The nationalization of the Reserve Bank of
India (RBI) is a landmark in the development of Indian Banking system
that have paved numerous paths for qualitative-cum quantities
improvements in true sense. Subsequently, the RBI and the policy makers
of the public sector commercial banks think in favor of conceptualizing
modern marketing which would bring a radical change in the process of
quality up gradation and village to village commercial viability.
BANK MARKETING MIX AND STRATEGIES
The first task before the public sector commercial Banks is to formulate that Bank
marketing mix which suits the national socio-economic requirements. Some have 4 P's and some have 7 P's of marketing mix. The common four Ps of Marketing mix are as follows:-
marketing mix which suits the national socio-economic requirements. Some have 4 P's and some have 7 P's of marketing mix. The common four Ps of Marketing mix are as follows:-
Product
To
be more specific the peripheral services need frequent innovations,
since this would be helpful in excelling competition. The product
portfolio designing is found significant to maintain the commercial
viability of the public sector banks. The banks professionals need to
assign due weightage to their physical properties. They are supposed to
look smart active and attractive.
be more specific the peripheral services need frequent innovations,
since this would be helpful in excelling competition. The product
portfolio designing is found significant to maintain the commercial
viability of the public sector banks. The banks professionals need to
assign due weightage to their physical properties. They are supposed to
look smart active and attractive.
Price
Price
is a critical and important factor of bank marketing mix due numerous
players in the industry . Most consumers will only be prepared to
invest their money in search of extraordinary or higher returns. They
are ready to pay additional value if there is a perception of extra
product value. This value may be improved performance, function,
services, reliability, promptness for problem solving and of course,
higher rate of return
is a critical and important factor of bank marketing mix due numerous
players in the industry . Most consumers will only be prepared to
invest their money in search of extraordinary or higher returns. They
are ready to pay additional value if there is a perception of extra
product value. This value may be improved performance, function,
services, reliability, promptness for problem solving and of course,
higher rate of return
Promotion
Bank
Marketing is actually is the marketing of reliability and faith of the
people .It is the responsibility of the banking industry to take people
in favor through Word of mouth publicity, reliability showing through
long years of establishment and other services.
Marketing is actually is the marketing of reliability and faith of the
people .It is the responsibility of the banking industry to take people
in favor through Word of mouth publicity, reliability showing through
long years of establishment and other services.
Place
The
choice of where and when to make a product available will have
significant impact on the customers. Customers often need to avail
banking services fast for this they require the bank braches near to
their official area or the place of easy access.
choice of where and when to make a product available will have
significant impact on the customers. Customers often need to avail
banking services fast for this they require the bank braches near to
their official area or the place of easy access.
BANK MARKETING STRATEGIES
The
marketing research considered being a systematic gathering, recording
and analysis of data makes ways for making and innovation the marketing
decisions. The information collected from the external sources by
conducting surveys helps bank professional in different wants.
marketing research considered being a systematic gathering, recording
and analysis of data makes ways for making and innovation the marketing
decisions. The information collected from the external sources by
conducting surveys helps bank professional in different wants.
In
the bank services, the formulation of overall marketing strategies is
considered significant with the view point of tapping the potentials,
expanding the business and increasing the marketing share. The
increasing domination and gaining popularity banks, the popularity
banks, the profitable schemes of the non-banking organization mounting
craze among the customers for private banks have made the task of
influencing the impulse of customers a bit difficult.
the bank services, the formulation of overall marketing strategies is
considered significant with the view point of tapping the potentials,
expanding the business and increasing the marketing share. The
increasing domination and gaining popularity banks, the popularity
banks, the profitable schemes of the non-banking organization mounting
craze among the customers for private banks have made the task of
influencing the impulse of customers a bit difficult.
The
marketing research simplifies the task of studying the magnitude of
competition by opinion surveys and the feed back customers, the
multi-dimensional changes in the services mix can be made productive if
it is based on marketing research.
marketing research simplifies the task of studying the magnitude of
competition by opinion surveys and the feed back customers, the
multi-dimensional changes in the services mix can be made productive if
it is based on marketing research.
CHALLENGES AHEAD:
The
banking industry in India is undergoing a major change due to the
advancement in Indian economy and continuous deregulation. These
multiple changes happening in series has a ripple effect on banking
industry which is trying to be organized completely, regulated sellers
of market to completed deregulated customers market
1. Deregulation:
banking industry in India is undergoing a major change due to the
advancement in Indian economy and continuous deregulation. These
multiple changes happening in series has a ripple effect on banking
industry which is trying to be organized completely, regulated sellers
of market to completed deregulated customers market
1. Deregulation:
This
continuous deregulation has given rise to extreme competition with
greater autonomy, operational flexibility, and decontrolled interest
rate and liberalized norms and policies for foreign exchange in banking
market. The deregulation of the industry coupled with decontrol in the
interest rates has led to entry of a number of players in the banking
industry. Thereby reduced corporate credit off which has resulted in
large number of competitors battling for the same pie.
continuous deregulation has given rise to extreme competition with
greater autonomy, operational flexibility, and decontrolled interest
rate and liberalized norms and policies for foreign exchange in banking
market. The deregulation of the industry coupled with decontrol in the
interest rates has led to entry of a number of players in the banking
industry. Thereby reduced corporate credit off which has resulted in
large number of competitors battling for the same pie.
2. Modified New rules:
As
a result, the market place has been redefined with new rules of the
game. Banks are transforming to universal banking, adding new channels
with lucrative pricing and freebees to offer. New channels squeezed
spreads, demanding customers better service, marketing skills
heightened competition, defined new rules of the game pressure on
efficiency. Need for new orientation diffused customer loyalty. Bank
has led to a series of innovative product offerings catering to various
customer segments, specifically retail credit.
a result, the market place has been redefined with new rules of the
game. Banks are transforming to universal banking, adding new channels
with lucrative pricing and freebees to offer. New channels squeezed
spreads, demanding customers better service, marketing skills
heightened competition, defined new rules of the game pressure on
efficiency. Need for new orientation diffused customer loyalty. Bank
has led to a series of innovative product offerings catering to various
customer segments, specifically retail credit.
3. Efficiency:
Excellent
efficiencies are required at banker's end to establish a balance
between the commercial and social considerations Bank need to access
low cost funds and simultaneously improve the efficiency and efficacy.
Owing to cut-throat competition in the industry, banks are facing
pricing pressure, have to give thrust on retail assets.
efficiencies are required at banker's end to establish a balance
between the commercial and social considerations Bank need to access
low cost funds and simultaneously improve the efficiency and efficacy.
Owing to cut-throat competition in the industry, banks are facing
pricing pressure, have to give thrust on retail assets.
4. Diffused customer loyalty:
Attractive
offers by MNC and other nationalized banks, customers have become more
demanding and the loyalties are diffused. Value added offerings bound
customers to change their preferences and perspective. These are
multiple choices; the wallet share is reduced per bank with demand on
flexibility and customization. Given the relatively low switching
costs; customer retention calls for customized service and hassle free,
flawless service delivery.
5. Misaligned mindset:
offers by MNC and other nationalized banks, customers have become more
demanding and the loyalties are diffused. Value added offerings bound
customers to change their preferences and perspective. These are
multiple choices; the wallet share is reduced per bank with demand on
flexibility and customization. Given the relatively low switching
costs; customer retention calls for customized service and hassle free,
flawless service delivery.
5. Misaligned mindset:
These
changes are creating challenges, as employees are made to adapt to
changing conditions. The employees are resisting to change and the
seller market mindset is yet to be changed. These problems coupled with
fear of uncertainty and control orientation. Moreover banking industry
is accepting the latest technology but utilization is far below from
satisfactory level.
6. Competency gap:
changes are creating challenges, as employees are made to adapt to
changing conditions. The employees are resisting to change and the
seller market mindset is yet to be changed. These problems coupled with
fear of uncertainty and control orientation. Moreover banking industry
is accepting the latest technology but utilization is far below from
satisfactory level.
6. Competency gap:
The
competency gap needs to be addressed simultaneously otherwise there
will be missed opportunities. Placing the right skill at the right
place will determine success. The focus of people will be doing work
but not providing solutions, on escalating problems rather than solving
them and on disposing customers instead of using the opportunity to
cross sell.
competency gap needs to be addressed simultaneously otherwise there
will be missed opportunities. Placing the right skill at the right
place will determine success. The focus of people will be doing work
but not providing solutions, on escalating problems rather than solving
them and on disposing customers instead of using the opportunity to
cross sell.
STRATEGIC OPTIONS TO COPE WITH THE CHALLENGES:
Dominant
players in the industry have embarked on a series of strategic and
tactical initiatives to sustain leadership. The major initiatives
incorporate:
a) Focus on ensuring reliable service delivery through Investing on and implementing right technology..
b) Leveraging the branch networks and sales structure to mobilize low cost current and savings deposits.
c) Making aggressive forays in the retail advances segments of home and personal loans.
d) Implementing initiatives involving people, process and technology to reduce the fixed costs and the cost per transaction.
e) Focusing on fee based income to compensate foe squeezed spread.
f) Innovating products to capture customer 'mind share' to begin with and later the wallet share.
g) Improving the asset quality as Basel II norms.
players in the industry have embarked on a series of strategic and
tactical initiatives to sustain leadership. The major initiatives
incorporate:
a) Focus on ensuring reliable service delivery through Investing on and implementing right technology..
b) Leveraging the branch networks and sales structure to mobilize low cost current and savings deposits.
c) Making aggressive forays in the retail advances segments of home and personal loans.
d) Implementing initiatives involving people, process and technology to reduce the fixed costs and the cost per transaction.
e) Focusing on fee based income to compensate foe squeezed spread.
f) Innovating products to capture customer 'mind share' to begin with and later the wallet share.
g) Improving the asset quality as Basel II norms.
CONCLUSION:
The
banking environment of today is rapidly changing and the rules of
yesterday no longer applicable. The corporate and the legal barriers
that separate the various banking, investment and insurance sectors are
less well defined and the cross-over are increasing. As a consequence
the marketing function is also changing to better support the bank in
this dynamic market environment. The key marketing challenge today is
to support and advice on the focus positioning and marketing resources
needed to deliver performance on the banking products and services.
Marketing, as an investment advisor, is about defining 4Ps and
implementing key strategic initiatives to Market segments, increasingly
redefined, relevant micro-segments to survive and flourish in the
highly competitive market
banking environment of today is rapidly changing and the rules of
yesterday no longer applicable. The corporate and the legal barriers
that separate the various banking, investment and insurance sectors are
less well defined and the cross-over are increasing. As a consequence
the marketing function is also changing to better support the bank in
this dynamic market environment. The key marketing challenge today is
to support and advice on the focus positioning and marketing resources
needed to deliver performance on the banking products and services.
Marketing, as an investment advisor, is about defining 4Ps and
implementing key strategic initiatives to Market segments, increasingly
redefined, relevant micro-segments to survive and flourish in the
highly competitive market
No comments:
Post a Comment