Category : Banking
According to "Philip Kotler: "Marketing is a social and management process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.
According to American Marketing Association; "Marketing is the performance of business" activities which direct the flow of goods and services from producer to consumer.
Marketing can be described as "Getting the right goods, at the right time, at the right place, with the right communication, to the right people at the right price.
Modes of Modern Marketing
(i) Mobile banking
(ii) Display advertising
(iii) E-mail marketing
(iv) Interactive marketing
(v) CRM (Customer Relationship Management)
(vi) Web advertising
(vii) Web Marketing
(viii) E- Marketing
(ix) Online Marketing
(x) Brand Management
Online Marketing: Online marketing is the new way of performing the task of marketing, made feasible by the advent of new technology, namely the internet. On-line marketing is a form of direct marketing and entails the use of internet technologies to reach out to customers. Personal computers televisions, cellular phones or personal digital assistants can be used to go online.
Relationship Marketing: Relationship marketing is a form of marketing developed from direct response marketing campaigns conducted in 1960. It emphasizes customer retention and continual satisfaction rather than individual transaction and per case customer resolution.
CRM: (Customer Relationship Management): It is a term applied to processes implemented by a company to handle its contact with its customers. CRM is a combination of philosophies, policies, and strategies connecting different players within an organization so as to coordinate their efforts in creating overall valuable services for their customer.
Direct Mail: Another common form of non-store intermediaries is direct mailer. Many companies in India use this route to sell products. Readers' Digest was one of the earliest magazines to be promoted using direct mailers. Mail orders can be segregated using direct mail order, business mail order and charitable direct response.
Online shopping: Online shopping or interactive home shopping is a spin-off from the internet. The consumer uses an interactive electronic system, like a computer or a television to make product enquiries and the producer sends information and graphic directly through the internet to the customer. Exchange of information is online and once the order is placed and paid for electronically, the goods are delivered in the buyer.
Cross Selling: Cross selling is the strategy of pushing new products to current customers based on their past purchases. When a bank is in a position to sell to a deposit customer (say saving bank or term deposit), a loan product such as housing loan, credit card, personal loan or vice-versa, this would result into additional business and lead to low per customer cost and higher per customer earning. Cross-selling stands for being able to offer to the existing bank customers, some additional banking products, with a view to expand banking business, reduce per customer cost of operations and provide more satisfaction and value to the customer.
Strategies of Cross Selling:
· Strategies of cross selling are as follows:
· Identification of customers and products that could be offered and the charting the strategy to offer the products. Imparting proper training to the staff to create team spirit and sharing with them the strategy for undertaking cross selling.
· Selecting target customers and narrowing down the product range, or even development of new products if necessary, to meet the specific needs of the group.
· Effective delivery.
Introduction: Adrian Payne has defined service as an activity that has an element of intangibility associated with it and which involves the service provider's interaction with the other customers or with the property belonging to the customer. The service activity does not involve transfer of ownership of the output.
According to Philip Kotler, service is any activity of benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product
The above definitions emphasize the intangible characteristic of services. But some services do have a tangible component.
For example: retailing is a service in -which tangible products are offered for sale in the retail stores. Restaurants are another example of tangible service in which food (tangible) is served to customers.
Characteristics of Services: The major characteristics of services are intangibility, inseparability, heterogeneity and perishability. They are discussed below.
Intangibility: A product is a physical entity, which can be touched. It can be seen, heard, touched, smelt, tasted and tested even before purchasing it or see it, touch it and test drive it to understand its performance. Therefore, - he has a better idea of the product before deciding whether to buy it or not. But a service is not tangible unless it is experienced or consumed. The quality of a service cannot be established as clearly as it could be done in the case of a product. For example, when a customer decides to employ the services of a bank in obtaining a loan for the first time, he does have an idea about the services offered by the bank, but he can really assess the services only after he avails them. A bike can be defined in terms of its HP and mileage, but a service cannot always be defined in absolute terms.
Heterogeneity: A machine can produce units identical in size, shape and quality. But a human being cannot work as uniformly and consistently throughout the day. Since a service is offered by human being, there is a higher probability that the same level of service may not be delivered all the time. The service offered by one employee may differ from the service offered by another although they may belong to the same company. Even the service offered by the same employee may be different at different times of the day. After serving customers continuously for several hours during the day, an employee may not be able to offer the same level of service towards the end of the day. Also the quality of service offered by employees at one branch of a service organization may differ greatly from the service offered at another branch. But if the variation in service quality becomes extremely obvious, customers maybe dissatisfied and switch to a competing firm. Also, the customers may not be able to predict the level of service they would obtain from the firm; the next time they visit it. Hence, service organization should try to maintain consistency in the services they offer by taking special care in recruitment, selection and training of employees.
Inseparability: A service is consumed by the customer as soon as it is delivered by the employee. Thus, production and consumption occur simultaneously in case of services as opposed to products ?which are manufactured, inventoried and then consumed. Services cannot be inventoried and they need to be consumed immediately. Since the delivery and consumption of a service are inseparable, there has to be interaction bet-wean customers and employees of a service organization. For example, the interaction bet-wean patient and doctor is essential if the patient has to be treated for an illness. In the case of a hotel, the interaction between a server and a customer is consumption. As a result, customers tend to equate the quality of service offered by the organization "with their interaction -with its front line employees. Therefore, service organizations should take special care in training and motivating employees. Frontline employees should be trained to be professional in their approach, courteous in the way they talk to customers and patient in dealing with queries.
Perishability: Unlike products, services cannot be inventoried or stored for future consumption. Suppose, a hotel has 40 rooms, but on a particular day, only 10 rooms are occupied. The hotel has an idle capacity of 30 rooms on that day. This is a lost business opportunity for the hotel owner. The fact that it may be fully booked the next day does not compensate for the idle capacity on that day. It cannot be recovered as it is lost for all time. Suppose a showroom recruited 5additional sales people during festival time. Season to serve customers efficiently. But due to some reason, customers did not show up in the large numbers expected. The showroom owner incurred a loss by having excess service capacity. In both the cases mentioned above, the organizations lost opportunities to ear revenue, when the services were on offer. Thus, the perishability of services is another factor that leads to complexity in management in the service sector, service organizations need to be extremely cautious in their demand and supply plans. They need to consider all the possible factors that affect the demand for their service and strive to abide excess or shortage of capacity to meet demand.
Internet Marketing: The web enables tens of thousands of interested individuals to access a free release of software and use it for a limited period. This is a win-win situation for both the supplier and the customer. The software supplier gains from exposure and rigorous testing of his product while the user has access to the latest technology at no charge, at least for a limited period.
Note; For Banking term in detail see the chapter Banking Awareness
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