Strategies involved n mkt. of service product with reference to ubi

901 views

Published on

Published in: Business, Technology
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
901
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
33
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

Strategies involved n mkt. of service product with reference to ubi

  1. 1. Strategies involved in marketing of service product with reference to Union bank of India EXECUTIVE SUMMARY In the today’s age of competition, a bank marketing its services must select its communication tools from advertising, sales promotion, publicity and personal sales. Through marketing measures, the bank tries to project its products/services and overall image to its existing and potential customers. Proper timing and selecting proper media for advertisement and publicity is the difficult part of the bank’s marketing efforts. The concept of the project is to promote communication process. Marketing communication is a dynamic process and continuous in nature. A bank using various channels of communication should keep in to account its business goals, customers’ expectation about product and service as well as the marketing environment prevailing at the time of such marketing campaign. Marketing strategy is the 4th “P” of marketing, which covers advertising and sales promotion, publicity and integrated marketing communication. Marketing communication is a continuous process and proper communication with internal as well as external customers is crucial to ensure effectiveness of promotional measures in achieving the corporate business goals. A well thought and innovative promotional (marketing) strategy backed by a practical action plan will certainly enable the banks to satisfy their customers and make profits without losing sight of the social obligations and changing customer expectations. Reserve Bank of India issues guidelines from time to time regarding advertising and publicity by banks, each bank has to decide on proper promotional mix and its strategies depending on composition of business in its command area and type of services offered by it to its customers. Sneha Potdar/T.Y.BBI 1
  2. 2. Strategies involved in marketing of service product with reference to Union bank of India INTRODUCTION OF MARKETING Marketing in the true sense of the world, is relatively new to the Financial sector. Until recently, marketing in most financial sector organizations was largely synonymous with advertising and public relations and it was not until the 1970’s that marketing departments were formed on any scale. Even then, the role of marketing tended to be more tactical that strategic; marketing was seen as a relatively low status activity with senior management being dominated by executives with a background in finance. In the last decade, marketing has developed as a more integrated function within financial service organizations largely as a result of rapid changes in the operating environment. Marketing thus means the bank’s well organized, planned and goal oriented efforts which must be in congruence with its overall business goals and objectives in the desired market area keeping specific needs of customer in mind. Marketing means communicating with the customer, in order to strengthen his attitudes that are favorable to the bank offering and to change his attitudes, which are unfavorable to the bank. This pre-supposes ensuring that such buyers become satisfied customers of the bank – now or later. Sneha Potdar/T.Y.BBI 2
  3. 3. Strategies involved in marketing of service product with reference to Union bank of India MARKETING STRATEGY DEFINITION “Marketing strategy is a set of objectives, policies and rules that guide over time, firm’s marketing efforts” -Philip Kotler Marketing strategy is a technique, which the bank introduces to study and cope up with market changes. Strategy is the all-important part of marketing. The one time planning determines where the bank is and in the strategy will followed many more important things which is analyzed and realized from the market at regular intervals. In other words marketing is a generic term used for the communication efforts of the firm that are directed towards achieving the objectives of a marketing strategy. The Marketing efforts include the communication channels of - Advertising Publicity Sales promotion Person-to-person communication Bank’s internal communication process Marketing thus means the bank’s well organized, planned and goal oriented efforts which must be in congruence with its overall business goals and objectives in the desired market area keeping specific needs of customer in mind. Marketing means communicating with the customer, in order to strengthen his attitudes that are favorable to the bank offering and to change his attitudes, which are unfavorable Sneha Potdar/T.Y.BBI 3
  4. 4. Strategies involved in marketing of service product with reference to Union bank of India to the bank. This pre-supposes ensuring that such buyers become satisfied customers of the bank – now or later. The objectives of “Marketing” are: • Informing/ telling/ educating potential customer. • Informing existing customers about new products/ services. • Following up with existing/ potential customers for schemes introduced. Approaching a new segment of customers to attract them to promote new scheme. Sneha Potdar/T.Y.BBI 4
  5. 5. Strategies involved in marketing of service product with reference to Union bank of India NATURE AND CHARACTERISTICS OF MARKETING STRATEGY ♦ Strategy is a process Marketing strategy is a process. The strategy process can be broadly divided into three parts: • Strategy planning / Formulation. • Strategy Implementation. • Strategy Evaluation. ♦ Achievement of Objectives Marketing strategy is developed in order to achieve the objectives of the marketing department in particular and that of the organization in general. To formulate marketing strategy, one has to know the objectives that are to be pursued, and also the policies that must be followed. ♦ Future Oriented Marketing strategy is a future oriented plan. It is designed to attain future position of the organization. Through marketing strategy, management studies the present position of the marketing, and then aims at attaining the future position of the marketing department. The marketing strategy provides answers to certain questions relating to: • Profitability of the present business. • Growth and expansion of the business in the long run. • Entry into different businesses in future. ♦ Unified, Comprehensive and Integrated A marketing strategy is not just a plan. It is an unified, comprehensive and integrated plan. • It is unified as it unifies all the parts or sections of the organization together. Sneha Potdar/T.Y.BBI 5
  6. 6. Strategies involved in marketing of service product with reference to Union bank of India • It is comprehensive as it covers all the major aspects or areas of the marketing department. • It is integrated, as all the parts of the marketing strategy are compatible with every other functional strategy of the organization. ♦ Strategy Alternatives Organizations need to frame alternative strategies. It is not sufficient to frame one or two strategies. Small organizations may survive with one or two strategies due to fewer complexities in their business. However, large organizations need to frame alternative strategies in respect of growth and survival of the organization. William F. Glueck in his book 'Strategic Management' has identified the strategic alternatives into four broad groups: • Stable Growth Strategy - where a firm tries to hold on to its current position by concentrating on the same product(s) and in the same market(s). • Growth Strategy - where a firm aims at substantial increase in market share and / or sales. • Retrenchment Strategy - where a firm drops some of the activities in a particular business or totally getting out of some of its businesses. • Combination Strategy – a combination of above stated strategies. ♦ Relates to the Environment The internal and the external environment affect the strategy formulation and implementation. The internal environment relates to mission and objectives of the business, the technology used, the physical, financial and human resources. The external environment relates to competition, customers, channel intermediaries, government policies and other social, economic and political factors. There must be proper analysis of both the internal and the external environment before formulating strategies. The analysis of internal environment reveals strengths and weaknesses of the organization and the analysis of external environment reveals the Sneha Potdar/T.Y.BBI 6
  7. 7. Strategies involved in marketing of service product with reference to Union bank of India opportunities and threats. ♦ Allocation of Resources For effective implementation of marketing strategy, there is a need for proper allocation of resources. Proper allocation of resources is required to undertake the various activities so as to attain the objectives. The resources can be broadly divided into three groups: • Physical resources such as sales offices, showrooms, etc. • Financial resources - funds required for marketing operations. • Human resources i.e. manpower ♦ Universal Applicability Marketing strategy is universally applicable. It is applicable to business organizations as well as to non- business organizations. This is because every organization need to frame strategies for their growth and survival. The marketing strategies keep the organizations moving in the right direction. Sneha Potdar/T.Y.BBI 7
  8. 8. Strategies involved in marketing of service product with reference to Union bank of India IMPORTANCE OF MARKETING STRATEGY Marketing strategies play an important role in accomplishing the marketing objectives of a bank, which in turn helps to accomplish the overall objectives of a bank. The role and importance of marketing strategy is explained as follows:  Helps to Attain Marketing Objectives A marketing strategy is a broad long-term plan designed to achieve basic objectives of the marketing department. The objectives of the marketing department may be expressed in terms of growth, market share, profitability, etc. Strategy provides the direction and guidance to undertake the various activities, which are required for the attainment of the objectives.  Helps to Identify Market Segments The marketing strategy enables a bank to identify market segments that it will serve and what service offers it will make. A well-defined marketing strategy clearly describes whom (customers and markets) to serve and whom to exclude. Also what to serve (products and services) and what not to serve (which products/services to avoid, or stop serving).  Helps to Identify Major competitors A well-defined marketing strategy would indicate the major competitors with whom the bank needs to compete and the others whom the bank should ignore.  Helps to Identify the Competitive Advantage A marketing strategy helps a bank to identify the competitive advantage of the bank. With the help of marketing strategy, a bank can identify the competitive differences on whose strength the bank can compete effectively at the market place. Sneha Potdar/T.Y.BBI 8
  9. 9. Strategies involved in marketing of service product with reference to Union bank of India  Helps to Minimize Risks Marketing strategy helps to minimize risks due to changes in competitors' strategies, changes in technology, changes in consumer likes and dislikes, etc. The management in order to face emergencies or contingencies frames alternative strategies. If risks or contingencies take place, the alternative strategies are put into action to minimize the risks.  Aids Decision-making Marketing strategies help in decision-making. Marketing strategy provides necessary guidance and direction for various decisions relating to marketing of services. The managers follow the blue print of the strategy at the time of taking vital marketing decisions.  Facilitates short term planning Marketing strategy is a broad long-term plan. It provides necessary guidelines to frame short term or yearly plans.  Facilitates organizing Marketing strategy facilitates organizing of resources in the organization. On the basis of long-term objectives, the organization can make proper arrangement of physical, financial and human resources.  Facilitates direction The strategy provides guidelines to the organization in respect of the overall objectives of the bank in the long run.  Facilitates control Strategy can also facilitate controlling of activities of the marketing department. The Sneha Potdar/T.Y.BBI 9
  10. 10. Strategies involved in marketing of service product with reference to Union bank of India marketing department can compare the actual performance with the targets. If there are any deviations, the marketing department can take necessary corrective measures to control and correct the deviations. STEPS IN STRATEGIC MARKETING PLANNING The marketing strategy planning must be done within the framework of the overall organizational planning. Marketing planning consists of the following steps: Defining Mission: The first step in strategic marketing planning is to define the mission of the bank. The mission is based on the vision and philosophy of the top management, and the purpose of the business. Internal Situation Analysis After identifying the mission, the marketing manager conducts internal situation analysis. There should be an analysis of the internal environment of the marketing department. It would be also necessary to analyze the internal environment prevailing in the organization. Internal marketing analysis (audit) would reveal strengths and weaknesses of the marketing department and the marketing efforts of the firm. External Situation Analysis The marketing manager must also conduct external marketing audit. The external marketing audit is conducted to analyze: The competitors' position and their strategies The likes and dislikes of consumers. The demand in the market, the government policies affecting the industry, etc. Establishing Marketing Objectives Sneha Potdar/T.Y.BBI 10
  11. 11. Strategies involved in marketing of service product with reference to Union bank of India After conducting the marketing audit (situation analysis), the marketing manager must set the objectives. Marketing objectives are set in all key areas of marketing. Such key areas include sales volume, market share, profit, area coverage, innovation and productivity. Developing Marketing Strategies The marketing strategy is a broad plan of action for using marketing resources to meet the marketing department's objectives. The marketing objectives states as to where the firm would like to go or what it wants to achieve; whereas marketing strategy tells us how to go there or how to achieve the objectives. Thus marketing strategies are framed keeping in mind the objectives. Sneha Potdar/T.Y.BBI 11
  12. 12. Strategies involved in marketing of service product with reference to Union bank of India BANK MARKETING DEFINITION “Bank marketing is the aggregate of functions, directed at providing services to satisfy customers financial (and other related) needs and wants, more effectively and efficiently than the competitors keeping in view the organizational objectives of the bank.” -by the NIBM, Pune The definition highlights the following points: 1. Bank provides services – with all the functions being associated with them. 2. Aim is to satisfy customers’ needs and wants. 3. The needs and wants of the customer are by far financial in nature and some may be even incidental to or related to the main function 4. The competitive element, efficiency and effectiveness are major factors in the process. 5. Organizational objectives are still the driving force. The aggregate of functions mentioned in the definition, is the sum total of an integrated effort to discover, create, arouse and satisfy customer needs. Each individual working in the bank is marketing person who contributes to the total satisfaction of customers. Sneha Potdar/T.Y.BBI 12
  13. 13. Strategies involved in marketing of service product with reference to Union bank of India WHY BANK MARKETING? “Awareness among customers” Modern technology has made customers aware of the developments in the economic environment including the financial system. Financial needs of the customer have grown multifold into various forms of quick cash accessibility, money transfer, asset security, increased return on surplus funds, financial advice, deffered payments, etc. with a wide network of branches, even in a dissimilar banking scenario, customers expect the banks to offer more and better services to match their demands and this has compelled banks to take up marketing in right earnest. MARKETING APPROACH IN BANKS With the need for marketing in banks having evolved out of the changing environment and constant interplay of various interdependent factors, the importance of a systematic approach to marketing cannot be overstressed. The application of a marketing approach in banks will therefore involve: 1. Identifying customers financial needs and wants 2. Developing appropriate banking services to meet these needs. 3. Pricing for the services so developed. 4. Setting up suitable outlets/bank branches. 5. Advertising to promote the services to the existing as well as prospective customers Sneha Potdar/T.Y.BBI 13
  14. 14. Strategies involved in marketing of service product with reference to Union bank of India 6. Forecasting and market research to assess the future financial markets. In order to achieve the desired results, marketing as a philosophy would require, in addition the total commitment of top management, the involvement and dedication of every employee in the organization. PRINCIPLES OF BANK MARKETING  Understanding the customers The concept of bank marketing is well supported by information technologies. In an age of information technology, the banking services depend substantially on the marketing information system. With the help of different systems and to be more specific with the instrumentality of marketing research, the bankers get an opportunity to study and understand the changing levels of expectations of customers like their lifestyles, likes and dislikes, preferences, attitudes or the behavioural profile because it can not remain same. If the professionals make the emerging changes in a right fashion, the marketing decisions can be made accurately.  Satisfying the customers In almost all the organizations, the first and foremost task is to satisfy the customers. If we understand the customers in a right prospective, the success rate reaches at its peak. If the marketing processes help in understanding the customers, the task of satisfying them is found easier. The formulation and innovation processes of the marketing mixes move in a right and desired order. The customers get the services in tune with their changing requirements, which help banks in expanding the market, increasing the market share, profitability and activating the process of mobilizing the savings and deposits.  Excelling competition Sneha Potdar/T.Y.BBI 14
  15. 15. Strategies involved in marketing of service product with reference to Union bank of India The modern marketing principles are conceptualized in the banking organizations also with the motto of excelling competition. The leading foreign banks have made the business environment so competitive that the task of excelling competition is found difficult to the public sector commercial banks. The public sector banks would find it easier to excel competition if they practice marketing and keep on moving the process of innovation. It is important to mention that the leading foreign banks have been found promoting the use of new technologies to improve the quality of their services but the public sector commercial banks have been facing strong opposition of trade unions on that account. Formulating and innovating the mixes We can't negate that the quality factor assumes a place of outstanding significance, especially in getting the new business vis-à-vis retaining the old one. The private sector banks have been found promoting consumer financing in tune with the emerging trends in consumerism but the public sector commercial banks have not assigned due weightage to this dimension in their service mix. This makes it essential that while formulating or innovating the product mix they assign an overriding priority to the peripheral services since the core services in almost all the banks are by and large the same. While promoting we need to use sophisticated technologies and the cooperation of advertising professionals to make the process creative. While setting fees, rate of interest or commission, the public sector commercial banks need to go through the strategies followed by the leading competitors. We also need due weightage to the development of people since the personally committed human resources are found efficacious in solving the numerous problems. The recruitment and training facilities, the organization of refresher and capsule courses, the incentive plans the performance appraisal are some of the important dimensions influencing the quality of human resources. Sneha Potdar/T.Y.BBI 15
  16. 16. Strategies involved in marketing of service product with reference to Union bank of India THE USERS OF BANKING SERVICES The users/customers constitute a place of outstanding significance. The line of services, the planning and development of services, the offering of services, the pricing strategies or the interests charged for the services made available and the promotional strategies depend substantially upon the nature and type of users using the services of an organization. It is against this background that a study of different categories of users is found significant. The emerging trends in the level of expectations affect the formulation of marketing mix. Innovative efforts become essential the moment we find a change in the level of expectations. Yesterday, the users did not expect fast, decent services but today they expect. Yesterday, the consumer financing was not so much important but today, the banks appear to think about the same on a priority basis. Yesterday, the industrial users did not expect credit facilities on liberal terms and conditions but today, they expect. These changes make it clear that the level of expectations contain dynamism vis-a-vis influence the marketing decisions. We find three types of customers using the services of banks, they are 1) General Users: Sneha Potdar/T.Y.BBI 16
  17. 17. Strategies involved in marketing of service product with reference to Union bank of India 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 found small sized customers. 2) Industrial Users: The industrialists, entrepreneurs having an account in bank and using the credit facilities and other services for the establishment and expansion of their business are known as industrial users. Generally, they are found large- sized. 3) Prospects: It is also essential to clarify the term, 'Prospects! The general or industrial prospects do not use the banking services at present but they have potentials to become a customer if induced or motivated in a right fashion. Sneha Potdar/T.Y.BBI 17
  18. 18. Strategies involved in marketing of service product with reference to Union bank of India MARKETING MIX FOR THE BANKING ORGANIZATIONS It is a process of formulating the different mixes for the banking organizations, such as the product mix, the promotion mix, the price mix, the place mix, the people, the physical attractions. The formulation of marketing mix for the banking services is the prime responsibility of the bank professionals who based on their expertise and excellence attempt to market the services and schemes profitably. The innovative efforts of the professionals become essential to make the services internationally competitive. The needs and requirements, the likes and dislikes, the preferences, the attitudes, the expectations and the lifestyles can't remain static. There are a number of factors influencing the process of change. Innovation makes the ways for perfection, which helps banks substantially in maximizing profitability and establishing leadership. Marketing mix for the banks includes following: • Product Mix The product mix focuses on the different services to be included in the product portfolio so that the banking organizations successfully manage the present and future. • Promotion Mix Sneha Potdar/T.Y.BBI 18
  19. 19. Strategies involved in marketing of service product with reference to Union bank of India In the promotion mix for the banking organizations, they go through different components of promotion, such as the advertising, publicity, sales promotion, personal selling, word-of-mouth promotion and telemarketing. • Price Mix In the price mix for the banking organizations, they go through the problems related to the payment of interest, fee and commission. • Place Mix In the place mix, bank focus on the problem of location of a bank branch and the problem of offering of the promised services to the end users. • People In the people, banks go through the problem of developing professionally sound, value-based and personally committed bankers. • Physical Attractions In this context, banks go through the problem of developing and maintaining physique to add attractions in the personality of bankers. This focuses on personal care services to make your physique sound Sneha Potdar/T.Y.BBI 19
  20. 20. Strategies involved in marketing of service product with reference to Union bank of India MARKET SEGMENTATION Market segmentation is the grouping of customers or strategy of dividing market in order to conquer them. It helps in making and innovating the marketing decisions. It is against background that the market segmentation assumes a place of outstanding significance particularly in the banking organizations. The bank professionals have to segment the market in such a way that the expectations of all the potential customers are studied in a right perspective and the marketing resources are developed to fulfill the same. The marketing efforts can be made more proactive if the process and bases of segmentation are right. Since the banking organizations serve different sectors and segments, the segmentation should be done carefully. We can’t deny that market segmentation makes it easier to formulate a sound strategy. Since the bank professionals are aware of the changing needs and requirements of a segment, the marketing resources can be developed in tune with the n and requirements of a segment. The formulation of a package is found significant and the bank professionals can do it successfully on the basis of market segmentation. The promotional measures can be sensitised in the face of the receiving capacity of a particular segment. The pricing strategy can be made operational and the sales promotion measures can be made productive. Sneha Potdar/T.Y.BBI 20
  21. 21. Strategies involved in marketing of service product with reference to Union bank of India UNION BANK OF INDIA Inaugurated by father of the Nation at the onset of 20th century, Union Bank of India has traversed the long road of successful Banking of 85 years. The bank traces its origin to the profound thoughts of Mahatma Gandhi -- "We should have the ability to carry on a big bank, to manage efficiently crores of rupees in the course of our national activities. Though we have not many banks among us, it does not follow that we are not capable of efficiently managing crores and tens of crores of rupees." The Bank is a Public Sector Unit with 55.43% Share Capital held by the Government of India. The Bank came out with its Initial Public Offer (IPO) in August 20, 2002 and Follow on Public Offer in February 2006. Presently Institutions, Individuals and Others presently hold 44.57 % of Share Capital. Since its inauguration by Mahatma Gandhi in 1919, the Union Bank of India has grown to become one of the country’s largest public sector financial institutions. With annual revenue of more than INR 6,000 crore (approximately US$1.3 billion), the bank is more than fulfilling Gandhi’s directive that India “should have the ability to carry on a big bank, to manage efficiently crores of rupees in the course of our national activities.” The Union Bank of India now operates more than 2,000 branches across India, administered by approximately 80 offices, including 43 regional offices. Union Bank of India is committed to maintain its identity as a leading innovative commercial Bank, alive to the changing needs of the society. Union Bank has offered vast and varied services to its entire valuable clientele taking care of their needs. Today, Sneha Potdar/T.Y.BBI 21
  22. 22. Strategies involved in marketing of service product with reference to Union bank of India with its efficient customer service, consistent profitability & growth, adoption of new technologies and value added services, Union Bank truly lives up to the image of, “GOOD PEOPLE TO BANK WITH”. Anticipative banking is an integral ingredient of value-based services. This ability to gauge the customer's needs long before he realizes, best reduces the gap between expectations and deliverance. The Bank has over the years earned the reputation of being a techno-savvy Bank and is one of the front-runners amongst public sector bank in the field of technology. It is one of the pioneer public sector banks, which launched Core Banking Solution in 2002. As of September 2005, more than 750 branches/extension counters of Bank are networked under Core Banking Solution, powered with the centralized technology platform, the Bank has launched multiple Electronic Delivery Channels and has installed nearly 505- networked ATMs. Online Tele banking facility is available to all its Core Banking customers. The multi facility versatile Internet Banking Solution provides extensive information in addition to the on line transaction facility to both individuals and corporate banking with the Core Banking branches of the Bank. In addition to regular banking facilities, today customer can also avail variety of value added services like cash management service, insurance, mutual funds, Demat from the Bank. The Bank continues its endeavor in providing excellent services to its customer and enhance its businesses thereby fulfilling its vision of becoming “THE BANK OF FIRST CHOICE IN OUR CHOSEN AREA BY BUILDING BENEFICIAL AND LASTING RELATIONSHIP WITH CUSTOMERS THROUGH A PROCESS OF CONTINUOUS IMPROVEMENT”. Sneha Potdar/T.Y.BBI 22
  23. 23. Strategies involved in marketing of service product with reference to Union bank of India VISION OF UNION BANK OF INDIA Sneha Potdar/T.Y.BBI 23
  24. 24. Strategies involved in marketing of service product with reference to Union bank of India MISSION OF UNION BANK OF INDIA Sneha Potdar/T.Y.BBI 24
  25. 25. Strategies involved in marketing of service product with reference to Union bank of India A logical extension of the Vision Statement is the Mission of the Bank, which is to gain market recognition in the chosen areas.  To build a sizeable market shares in each of the chosen areas of business through effective strategies in terms of pricing, product packaging and promoting the product in the market.  To facilitate a process of restructuring of branches to support a greater efficiency in the retail banking field.  To sustain the mission objective through harnessing technology driven banking and delivery channels.  To promote confidence and commitment among the staff members, to address the expectations of the customers efficiently and handle technology banking with ease. ORGANISATIONAL STRUCTURE Sneha Potdar/T.Y.BBI 25
  26. 26. Strategies involved in marketing of service product with reference to Union bank of India List Of Regional Offices Bank has a lean three-tier structure. The delegated powers have been enhanced. The decentralized power structure has accelerated decision making process and thereby Bank quickly responds to changing needs of the customers and has also been able to adjust with the changing environment. Bank has five General Manager Offices at Ahemedabad, Lucknow, Delhi, Mumbai, Calcutta and Chennai which function as an extended arm of corporate office. It also has two Zonal Offices at Bhopal and Pune. Tier 3 comprises of 43 Regional Offices at various geographical center of the country. PRODUCT PORTFOLIO OF UNION BANK OF INDIA Sneha Potdar/T.Y.BBI 26
  27. 27. Strategies involved in marketing of service product with reference to Union bank of India  MULTI GAINS CURRENT ACCOUNT SCHEMES  Union Bank of India offers 'Multi Gains Current Account’ scheme to the existing as well as new current account holder.  The scheme offers a host of value added services at no extra cost.  Average quarterly balance of just Rs. 1.00 lac.  Domestic individuals, firms and NRIs eligible for this scheme.  At par payments in 112 cities through Multi City cheque facilities.  The value added services being offered to the account holders of CBS (Core Banking Solution Branches, i.e. branches interconnected with each other) and Non-CBS (i.e. Branch other than the one where account is opened) branches are as under: - 1) Free demand draft on CBS branches. 2) Free collection of outstation cheque. 3) Two free cheque books of 100 leaves during a financial year. 4) Free collection of cheque deposited at non-base branch 5) Free transfer of funds between CBS branches at the base branch center. 6) Free cash withdrawal 7) Free delivery of statement of account once in a month  UNION FLEXI-DEPOSIT  A savings deposit scheme coupled with the benefits of a fixed deposit.  Minimum balance of Rs. 5000. Sneha Potdar/T.Y.BBI 27
  28. 28. Strategies involved in marketing of service product with reference to Union bank of India  Surplus funds over a predetermined amount transferred to a fixed deposit account.  Fixed deposit tenure between 46 days to 5 years.  Minimum fixed deposit for Rs. 5000 and in multiples of Rs.10000 i.e. Rs.6000, Rs.7000, Rs.8000, etc.  Interest will be paid quarterly.  All individuals, singly or jointly and non-resident Indians can open the account. Cheques book/ Pass book • Cheque book in Savings Bank Account. • Automatic two ways transfer of funds from fixed deposits to savings account and vice versa. • Specially designed combined passbook/ statement of account for SB and FD. BENEFITS: • Free International Debit Card (Only in selected cities). • No penalty on premature withdrawal.  UNION HOME  Purpose -- Purchase, Construction of house, Flat or second house of bigger Accommodation.  Eligibility -- Salaried persons, self-employed in business or professional having regular source of income are eligible.  Quantum -- Maximum of Rs. 50 lac. No upper limit in major Metro cities.  Margin -- 15% for purchase/ construction/ repairs/ purchase of plot. Sneha Potdar/T.Y.BBI 28
  29. 29. Strategies involved in marketing of service product with reference to Union bank of India  Repayment -- Up to 20 years with EMI, under Union Awas Maximum 15 years.  Rate of interest -- Lowest, competitive and attractive rate of interest. HIGHLIGHTS -- Loans also available for second House, Free Credit card, Flexible Repayment Schedule, Easy and Convenient EMI. Free Insurance, Insurance cover for borrowers under our UNION HOME PLUS Scheme.  VEHICLE LOANS  Eligibility -- Firms/Companies/Permanent employees of Public/Reputed Private sector / Professional/ Businessmen.  Purpose -- Purchase of new 2 wheeler /old or new 4 wheeler.  Quantum -- 3 times of net income /net annual salary.  Margin -- 20% for new and 50% for vehicle. 10% wherever Tie-up arrangement.  Repayment -- For 4 wheeler 60-84 EMI & for 2 wheeler 36-60 EMI, 36-84 EMI under Tie-up arrangement. HIGHLIGHTS -- Loans available for old vehicles, lowest EMI on daily reducing balance, Firms/ Companies avail loans. Sneha Potdar/T.Y.BBI 29
  30. 30. Strategies involved in marketing of service product with reference to Union bank of India MARKETING FORMULA OF UNION BANK OF INDIA Union bank of India makes the marketing of its products through Advertising, Sales promotion, Personal selling, Publicity, Internal communication, Concept of moments of truth. The Bank uses the various media available to reach the customers through these channels. Union bank of India makes the marketing of its products through:-  Advertising  Sales promotion  Personal selling  Publicity  Internal communication  Concept of moments of truth ♦ ADVERTISING The Bank advertises through mass media, paid communication (presentation and promotion) of goods, services or ideas by an identified sponsor. Advertisements appear in media such as newspapers, magazines, radio, television, cinema, ad-film, hoardings, posters direct mail, etc. The Objectives of Advertising the product are: 1. Product Promotion a) New Product Sneha Potdar/T.Y.BBI 30
  31. 31. Strategies involved in marketing of service product with reference to Union bank of India b) New Uses of Existing Product 2. Enabling Personal Selling 3. Developing Brand Loyalty 4. Dealer Support 5. Facilitate Buying Action 6. To Stimulate Inquiries 7. To Build Corporate Image 8. To Inform Changes in Price (Interest Rate), etc. Advertising is thus a very effective tool of promoting products to establish and maintain brand loyalty. It is said that nothing, except mint, can make money without advertising. Advertising is to a business what electricity is to industry. It is the backbone of the marketing process. ♦ SALES PROMOTION The main aim of any business is to earn maximum profit and this is possible only through maximum sales. The bank makes use of direct mail, catalogues, trade shows, sales contents, premiums etc. Sales promotions are used by a wide range of organizations in both the consumer and business markets, though the frequency and spending levels are much greater for consumer products marketers. The main difference between advertising and sales promotion can be described as - whereas the advertising moves the consumer to the product; sales promotion moves the product to the consumer. ♦ PERSONAL SELLING Sales promotion also can be done through personal selling. In banks, the clerk at the counter is the primary contact point with both existing and potential buyers (customers). Well-informed and well-trained staffs at the counter are eager to explain the schemes to the customers. Proper communication process can ensure successful sales promotion through personal selling, within the branch, across the counter. Sneha Potdar/T.Y.BBI 31
  32. 32. Strategies involved in marketing of service product with reference to Union bank of India The pro-active approach of the staff and projecting a harmonious image of the bank taking keen interest in customers' interest can do wonders to boost the image and increase business of the bank. ♦ PUBLICITY 'Publicity' is a generic term used for wide range of activities ranging from antics of stars in films or media to genuine methods of getting a product, service or even an organization (or even an individual 'talked about' and more widely known to the public). The publicity differs from Advertising not in its aim but in its technique/s. whereas the latter has a more specific job to do, i.e. inform and motivate publicity seeks to interest and draw attention, without essentially motivating or informing the public. Publicity can be good or bad. With high customer expectations and presence of various consumer councils these days it is just possible that a branch of a bank can get wide bad publicity for some mistakes/flaws or inadequacies in giving service. The publicity handouts or press releases are the common form of publicity. Such a press release must  Give specific facts  Not give any sales promotion suggestion  Be accompanied by photographs  Be prepared/sent well in advance of the function/event. Publicity normally is not paid for by the organizations. It comes through good liaison with press reporters, journalists and column writers. Good public relation strategy (P.R. strategy) usually compliments publicity to boost the bank's image. Publicity does the job of reducing ill-effects of bad news and also positive effects of good news if properly backed by proper public relation. Sneha Potdar/T.Y.BBI 32
  33. 33. Strategies involved in marketing of service product with reference to Union bank of India ♦ INTERNAL COMMUNICATION In order to supplement such external communication measures, the bank also have internal communication strategies in the form of an Annual Budget or business and corporate plan which spells out its goals, objectives and targets during the financial year. For such a budget or business plan, Head Offices of the bank assess the business targets of various branches, divisions, zones and regions in the past with reference to the achievement rate (of deposits and advances targets) and the market shares vis-à-vis branches of other banks in that command area. Field Managers, Planning Officers and P.R. or marketing specialists assist in this function to assess the projected levels of business at micro (branch) and macro (corporate) levels. The success of such an exercise largely depends on the realistic assessment of past data and realistic targets set. The utilization of positive strokes and empathy in the top-bottom communications ensures positive feedback/response from bottom to top. The response and involvement by each level in deciding/accepting and implementing business plan decides the success of such an important internal marketing communication. Besides business plan exercise, internal communication also involves: • House Journals • Circulars • Corporate objective/Business plan booklet • D.O.letter – for encouragement/ appreciation • Posters, etc. ♦ CONCEPT OF MOMENTS OF TRUTH Sneha Potdar/T.Y.BBI 33
  34. 34. Strategies involved in marketing of service product with reference to Union bank of India Under promotion, it can be crystal clear that any exercise and strategy in bank marketing is focused around only one person and, i.e. "CUSTOMER" -his needs and wants. The customer is a person who buys our products or services. For an organization there are two types of customers-Internal, i.e. the workforce or employees and External, i.e. the customer. A customer is thus anyone who receives a product or service from us. 'Caring for Customers', therefore, becomes the focal theme of any marketing strategy. 'Customer Care' is a complex service of relationship between customer and bank. A successful outcome of such interactive relationship leads to customer satisfaction. Moments of Truth (MOT) Anytime we deal with a customer, it is a moment of truth. It can occur in three ways: I. Face to face II. Over telephone III. Through written communication/correspondence In type (1), i.e. Face to face (MOT) it can happen in any of the following ways:  With external customer - our organization  With external customer - our division/department  With anyone - even ourselves Each contact with a customer becomes a Moment of Truth. If we try to do something extra every time by setting measurable standards and monitoring them each moment without giving any chance for dissatisfaction or complaint, it becomes the best service we should always put ourselves in customers' shoes which requires lot of empathy but surely enables to give our best for better customer service which is the soul of marketing of banking services. Sneha Potdar/T.Y.BBI 34
  35. 35. Strategies involved in marketing of service product with reference to Union bank of India It follows a 4-pronged attack on its market base. In this four pointer scheme, it uses the different media available to get to its customers and make the products & bank easily available to them. The 4 – point attack is as below: MARKETING THE PRODUCTS Union Bank of India has more than a dozen products available for its customer base, which is over & above the regular services offered to the customers. The products are marketed by way of: ♦ Media advertising – The Bank has advertisements appearing in the Print, Television & Radio networks. The famous byline of the ads of the bank is “Good people to bank with”. ♦ Direct mail – A mailing list of customers is prepared by the bank. Letters, leaflets, folders and catalogue are sent to them through mail to inform them of the details of the product. ♦ Press release – Through press release they make people aware about their new products and changes in their existing products. This is done through newspapers, business magazines etc. ♦ Application information – It is the information which a customer or the person who is going to receive the services of the product provided by the bank. ♦ Documentation - To receive the services of the product provided by bank the customer has to fill some application forms which are usually enclosed with ration card, pan cards etc. ♦ Trade shows – The bank usually conduct trade shows to advertise or to make customers aware of the newly launched products. These trade shows are conducted through the medium of fairs and promotions. Sneha Potdar/T.Y.BBI 35
  36. 36. Strategies involved in marketing of service product with reference to Union bank of India ♦ Catalogs – The bank uses catalog to make customers aware of their products and the services provided by them through the medium of brochures, pamphlets etc. ♦ Articles – The bank provides articles which show their current position and their activities. This is usually provided through the medium of newspapers and business magazines. ♦ Sales guide – The sales person of the bank guides the customer with detailed information about the product. He also solves the queries of the customer regarding the product or services provided by bank. MARKETING THE CONCEPTS ♦ Media relations – The bank maintains good relations with the media as they have to advertise to make people aware about them and to make people aware of the services rendered by them. ♦ Press releases – It is the source of providing information to the customer regarding the services or the product provided by the bank. ♦ Articles – It is also one of the source of providing information regarding the product services provided by the bank. The bank market their products through various articles in newspapers and magazines. ♦ Sponsorships – The bank provides sponsorships to organizations to make aware about the services provided by them. ♦ Advertising – advertising plays a key role in marketing the product services in the market. Bank usually advertises through television, radio, hoardings, pamphlets etc. ♦ Investor relations – The bank maintains good relation with their investors. ♦ News letter/ magazines – The bank uses magazines and different news papers to market the newly launched concepts. Sneha Potdar/T.Y.BBI 36
  37. 37. Strategies involved in marketing of service product with reference to Union bank of India MARKETING SALES TO PROSPECTS ♦ Presentations -- The bank conducts presentations in small scale. It is usually conducted among the internal management of the bank. This is done to provide knowledge to internal staff. ♦ Seminars – The bank conducts seminars on a large scale. It is usually conducted to provide information to the people about the product services rendered by the bank. MARKETING CUSTOMER PARTNERSHIP ♦ Communication - Personalized customer communications, based on data in a database, can be shown (using tests and controls) to increase customer retention, loyalty, cross sales, upsales and referrals. They are effective. They are the main reason you build a marketing database. ♦ Future direction – The bank promises its customers that they will try to provide better services to its customers in near future. Challenges facing Union Bank of India The Union Bank of India is undergoing a major transformation due to changes in economic conditions and continuous deregulation. These multiple changes happening one after other has a ripple effect on a bank trying to graduate from completely regulated sellers market to completed deregulated customers market. Sneha Potdar/T.Y.BBI 37
  38. 38. Strategies involved in marketing of service product with reference to Union bank of India  Deregulation: This continuous deregulation has made the Banking market extremely competitive with greater autonomy, operational flexibility, and decontrolled interest rate and liberalized norms for foreign exchange. The deregulation of the industry coupled with decontrol in interest rates has led to entry of a number of players in the banking industry.  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. Natural fall out of this has led to a series of innovative product offerings catering to various customer segments, specifically retail credit.  Efficiency: This in turn has made it necessary to look for efficiencies in the business. Banks need to access low cost funds and simultaneously improve the efficiency. The banks are facing pricing pressure, squeeze on spread and have to give thrust on retail assets  Diffused Customer loyalty: This will definitely impact Customer preferences, as they are bound to react to the value added offerings. Customers have become demanding and the loyalties are diffused. There 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.  Misaligned mindset: These changes are creating challenges, as employees are made to adapt to changing conditions. There is resistance to change from employees and the Seller market mindset is yet to be changed coupled with Fear of uncertainty and Control orientation. Acceptance of technology is slowly creeping in but the utilization is not maximized. Sneha Potdar/T.Y.BBI 38
  39. 39. Strategies involved in marketing of service product with reference to Union bank of India  Competency Gap: Placing the right skill at the right place will determine success. The competency gap needs to be addressed simultaneously otherwise there will be missed opportunities. The focus of people will be on 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 with other banks to cope with the challenges Leading players in the industry have embarked on a series of strategic and tactical initiatives to sustain leadership. The major initiatives include:  Investing in state of the art technology as the back bone of to ensure reliable service delivery  Leveraging the branch network and sales structure to mobilize low cost current and savings deposits  Making aggressive forays in the retail advances segment of home and personal loans.  Implementing organization wide initiatives involving people, process and technology to reduce the fixed costs and the cost per transaction  Focusing on fee based income to compensate for squeezed spread, (e.g. CMS, trade services)  Innovating Products to capture customer ‘mind share’ to begin with and later the wallet share  Improving the asset quality as per Basel II norms Transformation initiatives needed for bank The ECS value proposition for helping banks in their transformation agenda Sneha Potdar/T.Y.BBI 39
  40. 40. Strategies involved in marketing of service product with reference to Union bank of India We at ECS Limited have vast experience in partnering with leading players in banking for addressing these challenges in a holistic manner. Our expertise is reflected in our product offerings for addressing the key challenges. A select few are outlined below: ♦ Strategy • Sales & Marketing strategy for both retail & wholesale banking • Expanding geographies ♦ Brand • Understanding the values of the brand • Repositioning the brand to communicate the values ♦ Organization restructuring • Re organization of the bank in line with the strategic thrust ♦ Re engineering of the key business processes • Redesign of Sales processes to increase conversion ratio • Six Sigma process improvements for branch channel, Call Center & back office processes • Centralization of branch operations and deferred processes to free up resources ♦ Cost efficiency • Reduction in Total cost of acquisition • Reduction in Transaction costs • Reduction in fixed and overheads cost Sneha Potdar/T.Y.BBI 40
  41. 41. Strategies involved in marketing of service product with reference to Union bank of India ♦ Right sizing and matching of skills • Manpower modeling for branch & back office at various volume scenarios • Productivity improvement for sales & service functions • Competency Assessment & profiling ♦ Creating a high performing organization • Define new roles & responsibilities, KRA • Assessing competencies of people across levels and match the position with the skill set • Designing and implementing a new PMS for restructured organization ♦ Change management & creating a new mind set • Developing critical mass of champions and drive ‘Change’ across the organization to move from conventional banking to new age banking Image makeover on at Union Bank Thiruvananthapuram: A business, organizational and process makeover is on at the Union Bank of India, which is likely to be capped by an extensive re-branding exercise during the final stages of implementation. The made over 88-year-old public sector bank will be unveiled by March - April 2008, in tome for the new financial. The most visible change will be the new logo, which will be accompanied by a comprehensive corporate communication strategy. Sneha Potdar/T.Y.BBI 41
  42. 42. Strategies involved in marketing of service product with reference to Union bank of India The Boston Consulting Group has been appointed as advisor to the bank for its business and process re-engineering efforts, the most immediate impact of which will be felt in the form of a renewed focus on the retail, SME and agri-business sectors. Back office processes such as clearing, account opening, cheques book issuing and dispatch of account statements are slated to be spun off from branches to centralized back-offices. The bank has set up a centralized data centre in Mumbai, with an onsite back-up server and an offsite mirroring facility in Bangalore. Almost half of the bank's branch network has completed migration to this core banking platform, with the remaining expected to follow suit over the next few months. Excerpts of Interview with Mr. Mahadik, Customer Relationship Manager, Borivali branch, Union Bank of India 1) What is Strategy? A strategy is a plan of action designed to achieve long term objectives of a firm. 2) What is Marketing Strategy? Sneha Potdar/T.Y.BBI 42
  43. 43. Strategies involved in marketing of service product with reference to Union bank of India Marketing strategy is a technique, which the bank introduces to study and cope up with market changes. Strategy is the all-important part of marketing. The one time planning determines where the bank is and in the strategy will followed many more important things which is analyzed and realized from the market at regular intervals. In other words marketing is a generic term used for the communication efforts of the firm that are directed towards achieving the objectives of a marketing strategy. 3) Importance of marketing strategy in banking sector? The marketing strategy plays very important role because it helps to Attain Marketing Objectives, Identify Market Segments, identify Major competitors, Identify the Competitive Advantage, Helps to Minimize Risks, etc. 4) What are the steps followed in strategic marketing planning? • Defining Business Mission. • Internal Situation Analysis. • External Situation Analysis. • Setting of Marketing Objectives. • Developing Marketing Strategies. 5) How UBI market their different products? Union bank of India makes the marketing of its products through Advertising Sales promotion Personal selling Publicity Internal communication Concept of moments of truth 6) What are the different Medias used for marketing? The medias that are used for marketing is divided in to two and they are as follow: Sneha Potdar/T.Y.BBI 43
  44. 44. Strategies involved in marketing of service product with reference to Union bank of India Indirect media Indirect media includes Press media Visual media Web media Radio Direct media Direct media includes Cards Sale letters Circulars Book lets Folders Calendars Diaries House organ 7) What is the relevance of Advertising in Marketing Strategy? Advertising is a very effective and most frequently used promotional tool in marketing of banking services. The success of Advertising reflects in the business figures like Deposits, Advances, Profitability, etc. Effective Advertising is the technique of creative communication. It ensures co- ordination and application of various batches of the art and profession to achieve a pre- determined end, i.e. to communicate a message to the public in general or to the desired segment of public/market in particular. Advertising serves as a ‘mouthpiece’ for the organization’s objective to be made public. Sneha Potdar/T.Y.BBI 44
  45. 45. Strategies involved in marketing of service product with reference to Union bank of India CONCLUSION So, I would like to conclude by saying that the marketing of service sector products is of core importance. No product or service can establish or get his share of market without marketing. Today, bank in India have to face tough competition among themselves to survive in the globally competitive market. They have to strictly abide by the proverb “Survival of the fittest” Sneha Potdar/T.Y.BBI 45
  46. 46. Strategies involved in marketing of service product with reference to Union bank of India The marketing strategy adopted by the Union Bank of India seems to be good but not sufficient if it wants to be the contender of India’s best bank in terms of sales and profit, with banks like State Bank of India and Bank of Baroda marketing their products effectively and aggressively. It has become imperative for the Union Bank of India to market its products and services aggressively and also efficiently. State Bank of India and Bank of Baroda have charged their image and attitude in order to face the challenges posed by the global banking sector. Due to globalization and liberalization, even foreign banks are allowed to set up their branches in India. Thus, Indian banks not only have to face competition between themselves but also from their foreign counterparts. In order to make its presence felt in the masses, it has become mandatory for Union Bank of India to revamp its marketing strategy to face other Public sector banks, Private sector banks and foreign banks. BIBLIOGRAPHY BOOKS REFERRED: Marketing of Banking Services Marketing and Finance – by Michael Waz & Vinayak Paralikar Sneha Potdar/T.Y.BBI 46
  47. 47. Strategies involved in marketing of service product with reference to Union bank of India WEBSITES REFFERED  www.unionbankofindia.com Sneha Potdar/T.Y.BBI 47

×