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MARKETING OF SERVICES

Presentationof

MARKET SEGMENTATION, TARGETING, AND POSITIONING OF ICICI BANK.

TOPIC

3

ICICI Bank today (contd.) ICICI Bank is well

positioned to redefine the

banking model by focussing on the

untapped potential in the profitable retail

business segments and leveraging its

superior delivery capabilities and lower operating

costs in the under-served

corporate banking business

Retail banking

Corporate banking

Structured finance

ICICI Bank today4Large capital base

Vast talent pool

Low operating costs

Technology focus

Strong corporate relationships

India’s largest private sector bank and one stop financial solutions provider with a diversified and de-risked business model

India’s largest private sector bank and one stop financial solutions provider with a diversified and de-risked business model

Steps in Segmentation, Targeting, and Positioning

1. Identify Basesfor Segmenting the Market

2. Develop Profilesof Resulting Segments

3. Develop Selection Criteria

4. Select TargetSegment(s)

5. Develop Positioningfor Each Target Segment

6. Develop MarketingMix for Each Target Segment

MarketPositioning

MarketTargeting

Market Segmentation

Step 1. Market SegmentationBases for Segmenting Consumer Markets

Geographic

Demographic

Age, gender, family size and life cycle, or income

Psychographic

Social class, lifestyle, or personality

Behavioural

Occasions, benefits sought, user status, usage rate, loyalty

Nations, states, regions or cities

. Market SegmentationBases for Segmenting Business Markets

Basesfor Segmenting

BusinessMarkets

Basesfor Segmenting

BusinessMarkets

DemographicsPersonalCharacteristics

SituationalFactors

OperatingCharacteristics

PurchasingApproaches

Steps to Choosing and Implementing a Positioning Strategy

Step 1. Identifying Possible Competitive Advantages: Competitive Differentiation.

Step 2. Selecting the Right Competitive Advantage: Unique Selling Proposition (USP).

Step 3. Communicating and Delivering the Chosen Position.

Step 4. Support the positioning strategy with a unique marketing mix

Developing Competitive

Differentiation

ProductProduct ServiceService

ImageImage PeoplePeople

Areas for CompetitiveDifferentiation

Areas for CompetitiveDifferentiation

10

130.00

180.00

230.00170.00

130.00

220.00

0

100

200

300

400

500

2000 2001 2002

Mortgages Other retail loans

Size

CAGR 32%CAGR 32%

Retail loan disbursements

ICICI estimates

Despite the fast growth, the Indian retail market continues to be under-penetrated in comparison to its peers

260.00

(Rs.

in

b

illi

on

)

350.00

450.00

Catalyzing cross-sell11

Internet Banking

Call Centers

500 Outlets 1005 ATMs

Bonds Life insurance Health insurance

Fixed deposits

Consumer loans

Auto & home loans

Credit & debit cards

Power Pay

Customized cross-selling by leveraging relationships,

brand and technology

Our growth in retail (contd.)

12

28.528.61

51.34

22.12

-1020304050607080

2000 2001 2002Home loans Other retail loans

Home & others

(Rs.

in

b

illi

on

)Home loans grew

at 230% in FY 2002

Amongst the leading providers of home loans in India

Other retail loans grew at 130% in FY 2002

5.15

30.73

79.86Outstanding loans

Bank accounts Credit cards

Growth rate 167%

Growth rate 167%

Our growth in retail (contd.)

13

0.1

1.2

0.60.3

0.6

3.2

5.0

-

1

2

3

4

5

1999 2000 2001 2002

Internet banking customersBank customer accounts

(mil

lion

)Bank accounts

grew at 53% in FY 2002

Internet customer accounts grew at 100% in FY 2002Comprised 25%

of bank accounts Among top twelve

internet banks in the world

Home & others Bank accounts Credit cards

5.0

Our growth in retail (contd.)

14Number of credit cards

0.3

0.6

-

0.3

0.5

0.8

2000 2001 2002

(mil

lion

)

Home & others Bank accounts Credit cards

Growth rate 100%

Growth rate 100%

Step 2. Market TargetingEvaluating Market Segments (developing

selection criteria)Segment Size and Growth

Analyze sales, growth rates and expected profitability for various segments.

Segment Structural Attractiveness Consider effects of: Competitors, Availability of

Substitute Products and, the Power of Buyers & Suppliers.

Company Objectives and Resources Company skills & resources relative to the segment(s). Look for Competitive Advantages.

. Market Targeting

Segment 1Segment 1

Segment 2Segment 2

Segment 3Segment 3

Segment 1Segment 1

Segment 2Segment 2

Segment 3Segment 3

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing

Mix

CompanyMarketing Mix 1

CompanyMarketing Mix 1

CompanyMarketing Mix 2

CompanyMarketing Mix 2

CompanyMarketing Mix 3

CompanyMarketing Mix 3

MarketMarket

A. Undifferentiated Marketing

B. Differentiated Marketing

C. Concentrated Marketing

Corporate banking and structured finance

17S

trate

gy

Maximize value of client relationships

Leverage technology to enhance delivery capabilities

Proactive portfolio managementFor efficient capital utilisation and lower

balance sheet exposure

Corporate Banking Structured Finance

The aim is to provide state-of-the-art, low cost and efficient banking services, with a focus on increasing fee-based income

Corporate banking and structured finance

18

Corporate Solutions GroupReach the entire universe of current and

potential clients (over 1300) and offer tailor-made solutions

Government Solutions GroupDevelop comprehensive banking

relationships with all central, state and local governmental entities

Small & Medium Enterprises GroupDevelop comprehensive banking

relationships with small & medium sized enterprises leveraging corporate linkages

Focus on agri-lending to help in compliance with priority sector norms

Str

ate

gy

Corporate Banking Structured Finance

Corporate banking and structured finance

19

Leverage expertise to facilitate loan origination and ensure sell down leading toReduced concentration of risk Optimal risk-return trade-off

Aggressively pursue cross-sell opportunities for all ICICI group products

Corporate Banking Structured Finance

Significant opportunities for funding well-structured projects with in-built risk mitigation

Str

ate

gy

QUERIES

THANKS FOR ATTENTION…

PRESENTED BY, GUNJAN YADAV…