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Marketing of financial services

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Various aspects of service marketing in different service sector is focused in the slide. I have tried to inculcate features to help educators and students to understand the various aspects of service marketing.

Text of Marketing of financial services

  • 1. MARKETING OF FINANCIALSERVICESBy : Rachana Rai

2. BANK MARKETING Provides services Aimed to satisfy customers needs andwants Needs and wants may be non financial in nature Competitive element, efficiency andeffectiveness Organizational objectives are still thedriving force Commercial objective to make profit Social Objectives 3. Banking marketing concept emerged in the west in1950s in the form of advt & promotion.The evolution of bank marketing in india can beclassified in 3 phases:1.TRADITIONAL BANKING PERIOD:bankers were concerned with maintenance ofa/cs & transaction of buss with customer in lines withthe rules & regulations. In spite of this, a strong bondbetween banker-customer existed with some selectedcustomers. It was also called CLASS BANKING 4. 2. DEVELOPEMENT BANKING PERIOD: 14 major commercial banks in 1969 was nationalised. The socio-economic objective of nationalisation drove the public sector banks to expand banking activities & extend it to larger groups of customers. Thus called MASS BANKING. Bankers adopted selling concept to mobalise deposits, they didnt find the needs of the customers but offered what was available. However, in 1972 SBI came out with market segmentation scheme & innovative loan plans. 5. 3. BANK MARKETING PERIOD: What caused banking marketing?a.Rising customer needs & expectation due to improvement in general standard of living.b.Entry of foreign & private sector banks in India.c.Economic liberalization of Indian economy.d.Phenomenal growth of competition due to economic liberalisation.e.Rise in the Indian middle class with considerable resources.f. Government intervention in protecting the interest of consumers. 6. Blending of 7 ps with financial services:PRODUCT:convenience of paying dues. Keeping records. Transferring funds. Various deposits. Loans & advances. Consultancy services. International banking, Safe deposits Credit card. So on.. 7. Bankers have to identify the core &supplementary product services as it has more market implications.Core product: its the fundamental benefit that the customer buys from the bank. Customers donot buy product but buy benefit. A particular bank differentiates itself from other bank through augmented product. 8. Augmented product: a basic product with which some ancillary is attached to it. Eg: Suvidha a/c with CITIBANK, ATM card is free. Bankers need to add more innovative services with theirproduct in order to have competitive advantage. Product related strategy include: i. Introduction of new schemes: DEMAT a/c. ii.Modification of product through technologicaldevelopment: online banking. iii.Change in the product line or package: from corporatebanking to personal banking, or deleting an existingservice line. 9. PRICE: In India, banks adopt administered pricing structureto some extent as the deposit & lending rates areprescribed by RBI. 10. PROMOTION: All the promotional tools are essential right from thestage of new product. The objective is to make the pplaware of new product, to persuade customers, toremind customers, build image of the bank. An advertisement in banking is a promise. Eg:newspapers, radio, television, magazines & hoardings.Sales promotion: brochures , calenders, diaries,penstand. Publicity : customers tends to believe a news itemrather than an advertisement. WOM an importantpromotional tool. 11. PLACE: Making the banking service available & accessible tothe customer. Selection of suitable location for thebranch. Should have sound availability oftransportation, communication, electricity & othernecessary facilities for the smooth functioning of thebranch 12. PEOPLE: Banking product cannot be separated from the pplwho markets them. Banks adopts internal marketing in order to make thewhole business customer- oriented. The product is known to the employees before they areeffectively marked to the customers. 13. PROCESS: Accounting procedure for putting through atransaction. Through automation of transactions,accounting procedures & data handling. Eg: loan application , clearance of cheque. 14. PHYSICAL EVIDENCE: Imaginative designs of bank brochures , flashy chequebooks. Attractive brand names, logos, symbols. Customers perception of service quality. 15. HOSPITAL SERVICES 16. ISO 9002 certification: quality assurance is astructured & user friendly set of systems, whichmake the most complex tasks easy & efficient. Itsmakes the senior management free from evrydaystress in observing & monitoring task whichhave to be completed on daily basis. 17. PRODUCT:A. Emergency services.B. Ambulance services.C. Diagnostic services.D. Pharmacy services.E. Casualty services. 18. Generally the service offering in a hospital comprisesof the following levels:a.Core level: basic treatment facility & services , like,diagnostic services, emergency services, casualtyservices.b. Expected level: cleanliness & hygiene levels .c.Augmented level: dress code of a staff, AC, renounedconsultants. 19. PRICE: Usually depends on treatment & facilities offered tothe patient. It doesnot believe in profit maximization but aims atproviding quality service to the customers at areasonable price. 20. PROMOTION: Transmission of message to present, past & futurecustomers. Includes advertising, sales promotion,personal selling & publicity. Relies on favourable WOM & doesnot depend onextensive advertising. Conducts campaigns in rural areas. Advertises in health & fitness magazines. 21. PLACE: Refers to the contact point of between the serviceprovider & the customer. Accessibility & availability are the 2 main issues: Accessibility refers to the ease & convenience withwhich a service can be purchased, used or received. Availability: refers to the extend to which a service isobtainable or capable of being purchased , used &received.Hospital must be ideally located. 22. PEOPLE The behavior & attitude of the personnel providing services will influence the customers overall perception of the service.Staff in the hospital must be trained to provide quality patient care with human touch using state of art technology.Warm ambiences with cheerful & efficient staff help make the experience of the public a memorable one. 23. The objective of providing quality service tothe patients can be achieved by:a.Motivating employees to be efficient, dedicated & loyalto the organisation.b.Provide on-the job training to ensure continuousimprovement in health care.c.Utilizing services of professionally competent medicalconsultants.d.Use of latest technology. 24. PROCESS Its a set of activities that take an input, convert it &add value to the input & finally create an output.Processes are designed by blue prints, which sets astandard for action to take place & to implement theservice. In a hospital the process is divided into 4 phases: JOINING PHASE INTENSIVE CONSUMPTION PHASEDETACHMENT PHASE FEEDBACK 25. JOINING PHASE- Arrival of patient. Registration.INTENSIVE CONSUMPTION PHASE- Diagnosis. Treatment. Information about further action.DETACHED PHASE- Discharge of the patient. Payment.FEEDBACK- Fill an evaluation form, get patients suggestions, &make improvements. 26. PHYSICAL EVIDENCE Is the environment in which the service is deliveredwith tangible commodities & where the firm & thecustomer interact. The dress code of the staff, trained to beunderstanding, warm & comforting because thecustomers are usually disturbed or unhappy. Should be well organised, segregated into differentdepartments, air conditioned with good lighting, wellventilated. A good atmosphere will make the customers feel thedifference. 27. TOURISMMARKETING 28. PRODUCT: Panoramic view of the location. Travel to the destination . Accommodation & facility. Entertainment. Its a composite product- combination of attraction, facilities & transportation. Each of the components has its own significance in the product mix. 29. ATTRACTION OF THE DESTINATION:i. Natural sites- hill stations, beach so on.ii.Places of historic interest- monuments, archaeological sites, museums.iii.Events- trade fairs, music festivals, traditional festivals.iv.Cultural attraction- folklore, art, theater.FACILITIES: make tourist stay & enjoy the attractioni. Accomodation.ii.Food.iii.Local transport.iv.Recreational facilities. 30. ACCESSIBILITY: tourist arrives at the location-i. Infrastructure- roads, airport & railways.ii.Equipment- size & speed of vehicle. 31. The three levels of service package for tourism products are:CORE PRODUCT: comprises of essential need or benefit sought by the customer. Eg: relaxation, fun or entertainment.TANGIBLE PRODUCT: comprises of formal offer of the product as given in the brochure stating what will be provided . Eg: breakfast, television, telephone, swimming pool, Gym so on.AUGMENTED PRODUCT: provides vital opportunity to the service providers to differentiate their own products from competitors. Augmented product must be designed & developed around the core product. Eg:Complimentary wine, free entrance ticket so on. 32. PRICE Pricing of tourist product is a complex matter becauseof its composite nature. Geographical location of thedestination affects the pricing decision. An important way in which the travel & tourismbusiness responds to their highly complex pricingcircumstances, is to operate prices at 2 levels.1.1st level corresponds with the marketing strategy,which concerns with product positioning, value formoney & long run return on investment.2.Corresponds to the marketing operation or tacticswhere the prices are manipulated to match thecurrent demand & competition. 33. COST BASED PRICING: for a buss to survive in the long run, the average prices charged must be sufficient to cover fixed & variable cost & assure a reasonable