A Bank is a financial institution anda financial intermediary thataccepts deposits and channels thosedeposits into lending activities, eitherdirectly or through capital markets. Abank connects customers that havecapital deficits to customers with capitalsurpluses.
The banking industry in India has a huge canvas of history, which covers the traditional banking practices from the time of Britisher’s to the reforms period. Nationalization to Privatization of banks and now increasing numbers of foreign banks in India. Therefore, Banking in India has been through a long journey. Banking industry in India has also achieved a new height with the changing times. The use of technology has brought a revolution in the working style of the banks.
Bank of Hindustan was set up in 1870. Later, three presidency banks under Presidency Banks act 1876 were setup. In 1921, all presidency banks were amalgamated to form the Imperial Bank of India. Reserve Bank of India Act was passed in 1934 & Reserve Bank of India (RBI) was constituted as an apex body. In 1955, RBI acquired control of the Imperial Bank of India, which was renamed as State Bank of India.
Due to the process of liberalization ,Globalization, Privatization and reform of the financial sector, banking sector has undergone major transformation. Banks are extremely useful and indispensable in the modern community. The banks create the purchasing power The banks have played substantial role in the growth of Indian economy. Use of information Technology and Internet.
Technological Environment. Economical Environment Political / Legal Environment Social Environment
Definition: Typical manner in which consumer purchase goods or services in terms of amount, frequency, timing ,etc.
Why consumer make the purchase? What factors influence their product? Changing factors in our society?
Today’s customer are short of time and they get uncomfortable when the process is lengthy. Very simple and should be at the minimum and one time go. Repeated info and excessive documentation dis-satisfy the customer.
Effortless, simple, secure and efficient channel. EX: a customer uses internet banking He knows what are his payment instructions and he can track the payment online. If this facility is not available, he may not be comfortable with internet.
Need recognition Info search Evaluation of alternatives Purchase Consumer experience Post-exp evaluation
This concept says that the customers will buy those products which are available, offer most qualities, performance and features. The customers will select the solution that meets their need most effectively. It is often difficult to identify the exact market within which a firm competes.
This concept is introduce by: “ Theodore leavitt “ He says a product is like a onion in that there are many layers of offering. There is a saying: “Customers don’t buy product, they buy benefits!!”
Contest winners free deposits,Future Product Offers for discounts Portfolio mgmt ,Mutual Fund,Insurance Depositin g,Augmented Safetyproduct lockers,D. D Loans,Formal product Deposit s Core product
Organizations that seek to provide consistently high levels of service excellence will continuously work to align the three sides of the triangle. Aligning the sides of the triangle is an ongoing process.
This model shows the three marketing functions important for service firms These three marketing functions are internal marketing, interactive marketing and external marketing. According to Grönroos,… the internal marketing has to be managed by the company’s leadership, the interactive marketing happens between the employees and the clients and the external marketing is what takes place between the company’s management and the clients.
Understanding customer needs Managing expectations Traditional marketing communications Sales and promotion Advertising Internet and web site communication
Service delivery Reliability, responsiveness, empathy, assuran ce,tangibles, recovery, flexibility. Face-to-face, telephone & online interactions. The Customer Experience. Customer interactions with sub-contractors or business partners. The “moment of truth”.
Hiring the right people. Training and developing people to deliver service. Employee empowermen.t Support systems. Appropriate technology and equipment. Rewards and incentives.
Way to Use Service MarketingTriangle Overall Strategic Specific Service Assessment Implementation What is being How is the service promoted and by organization doing whom? on all three sides of How will it be the triangle? delivered and by whom? Where are the Are the supporting weaknesses? systems in place to What are the deliver the promised strengths? service?
Core product:The basic services in banking form a basic productEg: Accepting deposits, granting loans Formal product:It is the set of attributes and conditions expected by the customers when they purchasr the productEg: Insurance facilities, locker facilities, atm’s
Augmented product:It is the additional feature that banks provide which exceeds the customer’s expectationsEg: Discounts, Good waiting rooms Potential product:It includes Innovations and product differentiation. Banks alters its services according to the requirement of the individual customersEg: Mobile and internet banking, new schemes tailored for specific customers
Interest rates charged Transaction charged Value pricing Going rate pricing Mark up pricing Charges for cheque books Commmission charges
Important factors affecting the determination of the location of bank are: The trade area Population characteristics Commercial structure Industrial structure Visibility Access
Public relations Personal selling Word of mouth promotion Internet Tele marketing
It refers to the overall layout of the place i.e. how the entire bank is designed. Physical evidence refers to all those factors that makes process much easier and smoother.Eg: In banks the physical evidence would be the placement of customer service executive’s desk or the location of the place for deposting cheques.
Process constitutes the overall procedure involved in using the services offered by the bank. The process should be customer friendly If the overall process is too complicated than the customer may not be inclined to use such services
INTANGIBILITY PERISHABILITY VARIABILITY INSEPARABILITY HETEROGENOUS TRANSFER OF OWNERSHIP NOT POSSIBLE
The concept of market segment is based on the fact that the market of commodities are not homogeneous but they are heterogeneous. Market represent a group of customer having common characteristics but two customer are never common in their nature, habits, hobbies income and purchasing techniques.
According to Philips Kotler, “Market segmentation is sub-dividing a market into distinct and homogeneous subgroups of customers, where any group can conceivably be selected as a target market to be met with distinct marketing mix.”
Identity: The members should be divided into various groups such as Professional Sector, Agriculture Sector, Household Sector. Accessibility: The Banking services should be accessible at all the places. Even at remote places the ATM centers need to be place in order to give service to customers.
Responsiveness: The banking industry need to know the changing requirements of the customers. They should take customers reviews, suggestions for their services Size: Segment should be large and should be divided into various groups such as high income group, low income group and middle income group
Advantages of BrandingClients are more willing to pay a premium price for strongbrands.A strong brand simplifies client choices.Helps to retain customers.People are naturally attracted to firms with strongbrands, which translates to a better pool of talent applying fpositionsIt confirms your credibility.
Positioning Strategy of BankingSector To successfully position commercial bank services and other services it requires careful consideration of important, attractive, distinctive and superior service attributes to customers. It is essential to consider communication to customers as equally important as to employees for successful positioning of commercial banking services. Most important is to use customer contact employees to effectively communicate to customers. For successful positioning strategy of commercial bank services it is important to consider and promote a few but well specified, distinct and superior benefits relative to competitors since they do influence the position of the bank in the market and significantly contribute to market performance.
Conti…. Top management should analyze carefully the competition that exists within its group (direct competition) and also consider the characteristics of the competitive positioning strategy of the rest of the groups.
Strategies for Shifting Demand to match capacity: Demand Too High Demand Too LowUse signage to communicate busy Use sales & ads to increasedays & times. business from current market segments.Offer incentives to customers for Modify the service offering tousage during non- peak times. apply to new market segments.Take care of loyal or regular Offer discounts or pricecustomers first. reduction.Advertise peak usage times & Modify Hours of operation.benefits of non-peak use.Charge full price for the service – Bring the service to the customer.no discounts.
Strategies for flexing capacity to match demand: Demand Too High Demand Too LowStretch time, labour, facilities & Perform maintenance, renovations.equipment.Cross-train the employees. Schedule employee training.Request over-time work from Lay-off employees.employees.Rent or share facilities.Rent or share equipment.Sub-contract or out sourceactivities.
Yield Management:- Balancing Capacity Utilization, Pricing, Market Segmentation, and Financial Return. Yield= actual revenue/ potential revenue. actual revenue= actual capacity used* average actual price. potential revenue= total capacity* maximum price.
Largest nationalized commercial bank in India In terms of assets, number of branches, deposits, profits and workforce. Headquarters in Mumbai, India and employs about 205,896 people.
Investment banking Credit Commercia Cards l BankingMortgage Retail PRODUCTS s Banking Private Pensions Banking Asset Management
SBI Personal Publicity & Sales InstructionalAdvertisement Communicati Public Promotion Material on Relations
OPPORTUNITIES THREATS• Financial Inclusion • Advent of MNC banks• Rural India • Changing interest• Merger of associate rates and the banks with SBI changing policies of• Global expansion RBI• Micro Finance • Competition in the retail segment• Branch Expansion • Private banks in the• Strong economic rural and semi-urban growth sector• Corporate demand for • Change in credit government policies