MARKETING OF BANKING AND INSURANCE
PRODUCTS
• The term was first academically defined in 1937 when the newly born American Marketing Association (AMA) asserted:– “Marketing consists of those activities
involved in the flow of goods and services from the point of production to the point of consumption.[2]"
• Adding to Kotler's and Norris' definitions, the Chartered Institute of Marketing's (CIM) definition claims marketing to be the "...management process of anticipating, identifying and satisfying customer requirements profitably .
Marketing management ?
• Marketing management ?
• Is the process of planning and executing the conception, pricing , promotion and distribution of ideas , goods ,services , to create exchanges that satisfy individual and organizational goals.
• For a marketing plan to be successful, the mix of the four "Ps" must reflect the desires of the consumers in the target market
Types of markets
• Consumer markets.
• Business markets.
• Global markets.
• Non-profit and governmental markets.
Marketing mix
product promotion placeprice
Evolution of marketing.
The five distinct concepts of marketing
• The exchange concept.
• The production concept.
• The product concept.
• Marketing myopia.
• Sales concept.
• The exchange concept.
product exchange buyer-seller.
• The production concept -mass production and least price.
• The product concept.
improved products , new products Focused on the quality, design and quantity of the product
• Marketing myopia.
excessive preoccupation with the product , production or selling , ignoring the customer.
• Sales concept..
as promotional methods are having more importance ,advertising, personal selling, discounts ,sales promotion , public relations etc lies on this.
Selling and marketing
The marketing concept
• The key to achieve the organizational goals consists of the company being more effective than its competitors in creating , delivering and communicating customer value to its chosen target markets.
The marketing concept
Target market
Customerneeds
Integratedmarketing
Profits throughCustomer
satisfaction
Integrated marketing/Societal Marketing Concept
Integrated marketing/Societal Marketing Conceptwhen all the company’s department work together to serve the customer’s interests the result is integrated marketing.e.g. :sales dept, advertising , customer service , product mgmt, marketing research.
Relationship marketing
• building stronger, long-term relationships with customers
• Traditional organization chart
Topmanagement
Middlemanagement
Front-linepeople
customers
• Modern customer –oriented organization chart
customers
Front –line people
Middle management
Top management
MARKETING VS SELLING
MARKETING MANAGEMENTA process of planning and executing the conception, pricing , promotion and distribution of goods and services and ides to create exchanges with target groups that satisfy customer and organizational objectives.
FUNCTIONS OF MARKETING MANAGEMENT
Analysis Planning Implementation Control
MARKETING SERVICES
So ,What is it?
• AMA “ Activities , benefits or satisfactions which are offered for sale or are provided in connection with the sale of goods”
• Zeithmal and Bitner “ services are deeds , processes and performances”
• Something that can be bought and sold, but which cannot be dropped on your foot.
Special Features
?
IMPORTANCE OF MARKETING FOR INDIAN BANKS
"The relevance of aggressive marketing in banks has come to the fore as never before" - M N Goiporia.
CHARACTERISTICS OF SERVICES Intangibility Inseparability Heterogeneity Perishability
Nature and Scope of services
Evolution
• Self servicing • Outsourcing• Business proposition.• Until 20th century focus was on product
marketing –support services • Public sector undertaking /Monopoly • Until 1970 same principles -manufacturing
marketing of services• 1980s deregulation of services
Services sector in the Indian Economy
• Economic activities – 3 category–Primary, Secondary, Tertiary
• Share in GDP (Hidden & Unorganised)
–1950-51 – 57% Agri, services -29%, Industry– 14%–2000-01 – 25% Agri, services – 49%, Industry– 26%–Annual Growth rate of services highest during 9th five year plan(1997-2002) at 7.8% ,agri-2.1, industry – 4.5%–Social and personal services has the highest growth rate of 9.1% followed by, financial , real estate and business services (source : Economic survey, GOI)
Reasons for growth
• Two major reasons – interim dd from firm , Final dd from consumers• Development of IT• Aging population • Working women• Increase in Life expectancy (male 68, female -66)• Change in socio-cultural values• Advances in product technology• Economic affluence (NCEAR- no of middle income household on
raise 550million in 2009-2010 , 53million – 94-95)• Increased leisure time • Government policies• Internationalization • Growth of DINKS• Attitudinal Change in youth
Scope of Services
• Insurance • Tourism• Health care• Transport • Software
• Postal services• Banking• Education• Telecommunication• Electricity
BANK MARKETING Provides services Aimed to satisfy customer’s needs and
wants Needs and wants may be non financial
in nature Competitive element, efficiency and
effectiveness Organizational objectives are still the
driving forceCommercial objective to make
profitSocial Objectives
Essentials for a Banks SuccessCannot exist without customerCreate, win and keep customersOrganizational design should be
oriented to the customerDeliver total satisfaction to the
customer Customer satisfaction is affected by
the performance of all the personnel of the bank.
Are Banks truly Are Banks truly marketing-savvy and marketing-savvy and customer - centric?customer - centric?
Are Banks truly Are Banks truly marketing-savvy and marketing-savvy and customer - centric?customer - centric?
• Myth 1 – The larger the range of products, the more customer-centric
Mythbuster – The range of products has Mythbuster – The range of products has
emerged from beingemerged from being
competition-centric.competition-centric.
• Myth 2 – Better technology (read CRM) leads to• better customer service.
Mythbuster – TechnologyMythbuster – Technology
alone does not deliver, alone does not deliver,
helps people do.helps people do.
• Myth 3 – Launch a product and the customer will start• using instantly.• - Give a customer a card and he will learn how to play• with it immediately
Mythbuster – Customers needMythbuster – Customers need
To be educated too…To be educated too…
Mythbuster – Customers Mythbuster – Customers are not only present are not only present where competition is.where competition is.
• Myth 4 – The only way to get a customer is from
• competition.
• Myth 5 – Just advertise and - You will sell.
Mythbuster – Advertising will only sell, Mythbuster – Advertising will only sell,
Not retain customers. Not retain customers.
Myth 6 – No difference between marketing & selling
Mythbuster – Mythbuster – “Selling focuses on the needs of the “Selling focuses on the needs of the seller; marketing on the needs of the buyer. seller; marketing on the needs of the buyer.
Myth 7 – In the absence of relationships ‘trust’ builds financial brands
Mythbuster – TMythbuster – Trust is not a differentiator at all…rust is not a differentiator at all…it is the very minimum that the customer expects!!it is the very minimum that the customer expects!!
So what will the So what will the differentiators be :differentiators be :
So what will the So what will the differentiators be :differentiators be :
• Technology ?
• Brand ?
Marketing Lessons
Product
Price
Place
Promotion
Consumer
Cost
Convenience
Communication
OLD New
Wining companies are those that can meet customer needs economically and conveniently and with effective communication
Services Marketing Mix – 7P’sProduct, Price, Place, Promotion, People, Physical evidence, Process
PRODUCTA product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need
PRODUCT PERSONALITY
THE CORE
THE ASSOCIATED FEATURES
THE BRAND NAME & LOGO
THE PACKAGE AND LABEL
PRODUCT CATEGORY Durability, tangibility and use Product item, Product Line, Product
mix Banking product
PRODUCT LIFE CYCLEIntroduction, Growth, Maturity, DeclineThe product Life cycle operates at three levels product level, product sub category, brand level.
PromotionRole of promotion
PersuasionInformRemindingReinforcing
Promotion mix
AdvertisingPersonal
selling
Sales Promotion
Public Relations
Direct Marketing
Blended Mix of Promotion Tools
Promotion mix strategies• Push strategy -Retailer
• Pull strategy - Customer
Factors influencing promotion mix• Types of product/market• Buyer’s readiness stage• PLC stage
Promotion mix integration