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Comparison of Marketing Strategies in Banking Industry

1. Introduction

There has been progress and advancement in the field of finance and business due to the popular use of it. Bank Industry has proven that it's far ahead because of the implementation of several technology and the majority of its sectors and companies are doing exceedingly well because of this. Today, when the first is interacting with lenders and other financial institutions there's a distance in services which is felt by the demanding and upmarket consumer. Due to this banks experienced to move up their socks and change their procedures by introducing complex means of conducting business. They have hence provided ATMs (intelligent teller machines), computer and internet banking, phone banking and banking kiosks are demonstrating to be different means to benefit from the banking services in an appropriate and convenient manner.

According to scholars Wong (1998) and Kimball & Frisch (1997), e-channel, also known as innovative distribution route or online bank, as per Daniel (1999) or technology-intensive delivery system, says Filotto et al. (1997), is interpreted as the solutions used to provide financial products using electronic mass media such as personal computer, calling and the web, say Dannenberg & Kellner (1998). The ATM as a matter of fact is the mostly used electronic circulation channel that helps the customers of the bank to execute their banking deals, which could be deposits, withdrawal or balance enquiry 24-time a day. All bankers in Malaysia provide ATM services coupled with the phone banking option. As the customer service section has been centralized services such as cellphone banking, balance enquiry, instruction to issue bankers cheques and presenting standing up instructions are services which is often executed for many. Though a call will first reach an programmed response system, a person may want to talk straight with something representative. The phone banking facility can be acquired 24 hours per day. A few examples are IMMEDIATE ACCESS of Southern Bank, Tele-banking of RHB Standard bank and Maybank. Phone banking, or also called distant e-banking, self-service bank, home bank and office bank, is the third type of e-banking. There is certainly internet bank as well which makes use of the net. This is a comfortable way of learning the total amount in your accounts, if you want to transfer cash or request for a cheque book, and make the repayment of costs, and can be carried out at home or when you are in office.

Within 3 years, marketing companies believe that the financial services business over half of the customers will use the Internet to make themselves proficient in the new financial services, products and search for more information, if they do require it. This number may also go higher in a short period of your energy. LIMRA's optimizing Opportunities with Online Consumers (2007) deducted that around out of 10 online customers, 7 say that they be prepared to check products, prices, grading and information on the company on the internet. These results show that there surely is a great deal of opportunity for individuals to use the internet to expose opportunity within a sizable number of possible customers.

As the internet continues to grow, the expectation of an individual and his behaviour are also changing. Prospective customers will have the skill to develop content online and play a proactive part in creating and sustaining human relationships with companies they could find online.

This dissertation aims at exploring the potency of e-marketing in bank industry and its impact on the industry.

2. Problem Statement

In order to boost the customer foundation, the marketing team of any bank or investment company uses content and illustrations in direct mail or advertising campaigns to catch the attention of and draw customers towards it schemes and products. Of late there has been a rise in tele-callers as well who persistently call and promote the many products available. On the web, which is fast-paced in form and function, banner ads and smartly written click-to-pay has turned into a trap to captivate customers. The other level is keyword buying from Google and other internet search engine providers, and especially the buying of local keywords. This one is a fresh technique used to bring the surfer to a website, where she or he will find ways to work with your bank. The usage of technology in the marketing of service industry especially bank industry is not such a fresh notion. Its been used and have been in use for various countries but it should have a key focus which is discussed in this research.

3. Research Question

"What is the effective e-marketing tool(s) found in loan provider industry marketing? Measure the comparability between UK and Indian Banks?"

4. Research Objectives

The key goals of the research are:

  • To measure the various marketing strategies employed by the banking industry.
  • To study the potency of different marketing strategies used.
  • To examine the many e-marketing methods used by the service industry.
  • To research the effective e-marketing tools employed by UK Bankers.
  • To study the effective e-marketing tools used by Indian Lenders.
  • To measure the comparative research between e-marketing tools found in UK Standard bank and Indian Banks.

5. Books Review

The So this means of Marketing

Marketing has a two-way definition when it talks comes to discussing corporate activities. First of all, it is used to adapt its resources on the constant scale so as to fulfill its chosen customers and in doing this to offer communal and financial benefits. That is being tagged as marketing concept and strains on the accountability of older management to keep an eye on the problem and acclimatize oneself to changing situations. The scholar Levitt (1983), is a promoter of this strategy. The other classification is to perceive marketing as a subject of demand management, primarily a technology to impact the behavior of customer groups. This method is tagged as marketing management and it strains the accountability of operational management to stage-manage demand to get the business. It handles selecting target markets, collection of appropriate offerings and tensions on advertising. Corresponding to Anderson (1983), it offers many advocates as this experienced the thoughts of all marketing theorists up to now.

Marketing in Banking

The UK clearing bankers have a branch network which is comparable the field sales team of a development company. It is through these branches that customers have the ability to use the services of the lender. The branches work as outlets through which the bank's regulations are placed forth, its romantic relationships with its customers is tackled and the market segments are surveyed and brains reports are compiled. Hence the branch and its own management seem to be pivotal to any marketing exercise and their behaviour towards marketing an essential element in its acceptance.

It may be debated that specialized transformations like cash dispensers, bank cards and other electronic modernization is taking the client further and further from his branch and he is learning to be a stranger with the personnel of the bank. The branch of the lender is the primary crossing point with the client and these very modifications will probably boost the value of the branch as a level for business development and lessen its role as a performer of money trades. Whether marketing in the short term has improved the problem of your company by the results achieved in their branches, management will probably expose marketing. In the original days when standard bank marketing was launched in the UK, there were some questions about the ability of a conventional line of work to acknowledge what appeared to be a different solution to take up. The procedure and the concerns associated with the application of marketing to financial services is hence special interest to students of marketing and bank.

Indian Bank Scenario

In the 1960s marketing in banking institutions started in its most classic form of promotion and public relations. Even though they functioned within the stipulation that there may be only small changes among individual banks, the marketing environment of any bank has since that time changed to a sizable extent. Today finance institutions are facing strong opposition from the international, private and general population sector lenders, and there is a pressure from other finance institutions. Financial institutions aren't only better positioned statutorily, they provide higher earnings and a handy product-mix that offer tax discount benefits as well. A significantly as the supervision of these marketing function will there be, these companies are better supervised and implemented. While, it is discouraging to observe that the huge boost received by the banking sector thanks to nationalization has not been factored in in production and success, on the other hands, its cost of transporting business has truly gone up, its bottom line has fallen and the disparity between the anticipated and recognized quality of customer service in addition has become broader. Because of this, the bank sector has been under strong criticism by the Government and the general public alike.

In order to make their business environment more positive, within the last few years, banking institutions have used various steps which can be initiating creative strategies; organizing processes to reduce newspaper work and delays; presenting teller systems; competent enhancements in the look and feel of the bank's branches; finding out about the model, expert and service branches; offering extra boost to their publicity initiatives; creating customer support systems at the finance institutions' offices; undertaking customer relations programmes; building customer support departments at the top office of banking companies; making courtesy weeks/fortnights, customer support campaigns and door-to-door research; setting up "May I help you?" counters and positioning public relations officers in large branches. These reactions of the lender show which may be they have woken up to rational way of marketing their financial services, also to think beyond the narrow course of marketing as "publicity and public relations" performed so close by them.

UK Bank Scenario

In developed countries, though professional and consumer goods industries have increased their marketing exercises, service companies and the bank businesses appear to be slow-moving in taking on and enforcing the marketing theory, for case studies in various countries, say Watson (1982), Donnelly & Berry (1981), Lewis (1981), Cramer (1968). For the best of the present writers' knowledge, there are no researches of standard bank marketing in producing countries, more so in Turkey. As Turkey becomes more liberalized and industrialized, marketing of bank services becomes crucial to its monetary development. Also, data about lender marketing is very important to international bankers, international financial agencies, domestic insurance plan makers and abroad businesses which deal with Turkish markets.

Technology Marketing in Banks

The bank industry would not have been so complex and evolved experienced technology not been harnessed to its maximum. There have been lots of factors in charge of its progress and evolution. Extensive economic trends and social pushes, well developed down by federal policy and adjustments, end up being the environment within which progress occurs, and the amount of oppositions largely determines the rapidity of amendments. Technology is a way to prevail over obstacle and bills, but in modern times it is becoming all-embracing and advocated change. It has additionally been in charge of the go up in superiority of marketing in the supervision of lenders.

There are two factors why only providing a gist of a single banking system at the present time would be insufficient to study the impact of technology. The first is that the application of technology is unequal among countries and time frame, and the other is the fact technology is growing very fast and can continue to achieve this task. There's a time distance before technological developments are put in place and we need to know what determines this gap. The only way to move frontward is by using a historical analysis, sketching an overview of the parallel progress of technology and banking operations since the 1950s as well as perhaps in to the future.

Technology and Marketing

It is a well-accepted reality the value of marketing in reliant on the amount of opposition in a certain market. Since 1950s, competition has shot up in all banking market segments, and it continues to grow with the prevailing style of de-control, which targets getting rid of structural barriers between types of companies and market, while escalating the control for prudential goals. In this particular environment and period, the growing price of marketing departments is not alarming.

Even a perfunctory look into marketing literature demonstrates that the contribution of loan provider marketing has undergone a big change in this era. Some freelance writers have typified three different stages through which it includes advanced - the first level was the main one where marketing was restricted to advertisements that reiterated the bank's strong items; the next was one where the bank or investment company was proactive in marketing its services; and the last stage started out when banks attempted to discover and match the genuine requirements of the customer. Within the first stage there is not much a marketing department could do, however, in the second and third phases marketing had a robust role to enact in standard bank management.

In the second stage, technology had taken with an important role in lender marketing, with the design of services. One method that was followed was to put on accounts for depositors, which frequently acquired a layering of interest rates as per the size of balance or an interest rate that improved daily and every week with money market rates. Others offered some interconnection between two different accounts, perhaps a current bank account and an interest-bearing accounts; when the latter account was operated by the building society or savings bank or investment company that had little influence to offer current accounts, exchanges between your accounts included two establishments. It was typical of banking institutions in the next marketing stage to get sluggish and so slow down the customers from making the the majority of the power to minimise their current amounts day by day; in the third phase they are expected to meet the customers' requirements, but it is surprising how handful of them have yet to provide "sweep" accounts so the current balance is exactly zero by the finish of the day. These features of the new accounts could have been impossible without support from the computer.

The third level is the main one in which marketing becomes the superior part in the strategy of the finance institutions, when marketing departments lose their stand out as the bank's management, at the highest levels especially, must comprise of people who may have connection with marketing. Additionally it is a stage where the method is to fractionalize the retail customer platform. Lenders which provide repayment services can easily beat the rivals based on their computer record of the traits and the financial behavior of these customers. Technology is hence vital for this level but it might be wise to understand that technical support for services and segmentation has been around lifestyle since 1980 by means of mainframe computers; the sole new thing is the addition of new software.

6. Research Methodology

Research approach

The researcher needed on a research study solution to get a detailed knowledge of how e-marketing Industry. According to Denscombe (2000) when emphasizing on one or few research devices with the objective of obtaining complete information, the best method is to take up the case study approach. As per Yin, when the researcher has minimal control over happenings and when the strain in on a certain event in real life and also to answer 'how' or 'why' questions, research study is the preferred method methodology.

Case selection

By using arbitrary sampling techniques, the researcher found 4 banking institutions which include 2 from each country i. e. UK and India. One people and one private sector standard bank was chosen for both the countries. As per scholars Hunt & Shelley (2004), a qualitative method makes the researcher understanding and construe the qualitative character of the info. The way ahead keeping the qualitative aspect of the study at heart includes an in-depth study and examination of the prevailing research and techniques appropriate to the precise research problems, concerning environmental issues within the marketing combination and plans created by the firms. The purpose is to totally grasp the way the companies create marketing ways of remain in the competitive market.

Data collection

Primary data:

According to Denscombe (2000), for a detailed knowledge and understanding of the value of e-marketing strategies in in Loan company. The researcher used a face-to-face interview as the most apt method. This would not only allow him to seek information, but also give him an chance to seek complete clarifications on the thoughts. Walshman (1995) acquired stressed on the advantages of personal interviews as one of the best ways to track record the views and aspirations of the interviewee. The researcher faced problems such as restrictions on the selective thoughts of 1 person, inconsistencies credited to rigid beliefs of the interviewee, collation of voluminous data, transcription by using this methodology.

To collect information from the interviewee, the scholar has suggested to make use of the semi-structured interview guide as interview questions would are different as cases possessed completely different strategies. Matching to Walshman (1995) interviews provide the best way to comprehend the views of the individuals regarding the activities and events, which have or are occurring and the views and dreams of themselves and other members. In qualitative approach there is the extra benefit for permitting the researcher to go back to the sketching board and assess the understanding provided by the respondent in greater detail as compared to other methods. The interviews will be taken among managers of the companies who are accountable for the creation of green marketing strategies. The researcher recorded the responses and also concurrently recorded them to transcribe later. The researcher will be going for 5-10 interviews from each standard bank.

Secondary data collection

Secondary data is compiled from different options such as websites, annual reports, books, journals and articles and circumstance studies. The objective these details gathering is to find out the related data regarding strategies implemented by the Trident Alternatives.

Pilot analysis:

A pilot review was completed among interviewees to ensure that the conditions used are correct and suitable. According to Denscombe (2000, p 135), interview will be presented using the face to face procedure in order to assist the interviewer to ask questions that have been not in the interview guide depending on respondents answers.

Data analysis

The information was examined using content evaluation. Following the interview received over, information was decrease to identify the habits and themes and obtain a specific understanding. As per Ghauri and Gronhaug (2005) information was explored, analyzed and classified predicated on the questions in the study questions. If more information was needed or when new questions arose, then another round of data collection would be conducted.

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