POWER POINT PRESENTATION ON MARKETING OF FINANCIAL SERVICES

MARKETING CONCEPT A situation where buyers and sellers of a commodity interact. Coming together of buyers and sellers of the same or similar commodities. Marketing is the process of determining consumer demand for a product or service , motivating its sale and distributing it in to ultimate consumption at a profit. a

MARKETING VS SELLING MARKETING MANAGEMENT A 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

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

SERVICE A service is any act or performance that one party can offer to another that is essentially intangible and does not result in the ownership of anything. It’s production may or may not be tied to physical product.

MAREKTING OF FINANCIAL SERVICES Intangibility, inseparability and heterogeneity are manifested at both strategic and tactible levels in services marketing. Marketing strategy provides the organisation with a sustainable competitive advantage in the markets it operates. Organization should understand consumer needs and identifies how those consumers should be grouped into different market segments. Product attributes, pricing decisions, methods of distribution and communication should all seek to reflect the chosen position.

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 force Commercial objective to make profit Social Objectives

Essentials for a Banks Success Cannot exist without customer Create, win and keep customers Organizational design should be oriented to the customer Deliver total satisfaction to the customer Customer satisfaction is affected by the performance of all the personnel of the bank.

MARKETING MIX Key concept in the modern marketing Considered to be core of marketing It is the set of tools that the firm uses to pursue its marketing objectives in the target market Decisions must be made for both the distribution channels and the final consumers

CHALLENGES FACED BY MARKETING OF FINANCIAL SERVICES The marketing of financial services is a unique and highly specialized branch of marketing. The practice of advertising, promoting, and selling financial products and services is in many ways far more complex than the selling of consumer packaged goods, automobiles, electronics, or other forms of goods or services. The environment in which financial services are marketed is becoming more competitive, making the task of marketing financial services increasingly challenging and specialized. Financial services marketers are challenged every day by the unique characteristics of the products they market.

EVIDANCE OF CHANGE IN FINANCIAL MARKET

The environment in which financial services are marketed is becoming more complex and challenging. The process of marketing of financial services is also changing due to emerging regulations enforced by regulatory bodies that control the nature and extent of marketing activities of financial services providers. As a result of these changes,competition is increasingly intense and it has become more challenging to achieve marketing success. In such an environment, the optimization of marketing capabilities in a financial services organization is evermore critical for the long-term health and survival of the organization.

Consumer Loyalty It has been well established that in the majority of financial services categories, customer defection rates are significantly lower than they are in most other markets. The tendency of customers to remain with their current financial services provider has traditionally been quite strong. It is important to note though that defection patterns vary significantly by the financial service category. For example, life insurance policyholders have an interest in staying with the same insurance provider, since changing insurance carriers may result in the reassessment of the application, a need for new health exams, and possible higher rates and lower coverage levels. On the other hand, credit cards accountholders may feel less obligated to stay with the same company because the negative impact of switching is limited, and changing credit card companies may in fact considerably lower borrowing costs due to intense competition within this category. The incentives offered by competitors in the credit card markets often outweigh any potential switching costs, resulting in lower rates of customer retention.

SOURCES OF CHANGE IN FINANCIAL SERVICE MARKETS

Unique Aspects of Financial Services Subjective Perceptions of Quality: A unique aspect of financial services marketing which differentiates it from other marketing practices is the illusive notion of quality. Price Complexity: The prices of financial services are intrinsically complex. For example, the lease price of an automobile might consist of monthly payments, the number of payments and a down payment, rather than the single sticker price used when purchasing the vehicle with cash.

Regulations: The practice of marketing financial services is distinctly different from other marketing practices due to the dozens of regulations that rule the industry. For example, the type of content included in a financial service advertisement is controlled and closely monitored by regulatory bodies, such as the Securities and Exchange Commission,the Federal Trade Commission, and the departments of insurance in individual states.

Consumer Protection: Any informed discussion of financial services marketing must also include issues related to consumer protection and conflicts of interest, which have historically characterized the industry. The human inability to make rational financial decisions has fascinated researchers in psychology, economics, finance and marketing for decades.