Bank Marketing Mix

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY
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CENTER OF INTERNATIONAL BUSINESS, ABS
LIST OF FIGURES S.NO. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 FIGURE PIE CHART FOR BANKS FROM WHICH SERVICE AVAILED PIE CHART FOR KIND OF SERVICE AVAILED BAR GRAPH FOR EXTENT TO WHICH FINANCIAL REQUIREMENT MET PIE CHART FOR WHETHER THE PUBLIC SECTOR ERVICES HAVE IMPROVED BAR GRAPH FOR WHETHER THE SERVICE CHARGES ARE APPROPRIATE PIE CHART FOR THE BEST MEDIA FOR PROMOTION PIE CHART FOR WHETHER THE PROMOTIONAL SCHEMES APPROPRIATE GRAPH FOR RECALL OF ADVERTISEMENT BAR GRAPH FOR MEANS BY WHICH BANKING DONE BAR GRAPH FOR WHETHER THE BANKS BRANCHES ARE WIDE SPREAD BAR GRAPF FOR THE EXTENT TO WHICH TECHNOLOGY HAS IMPROVED SERVICES BAR GRAPH FOR ATTITUDE TOWARDS AMBIENCE BAR GRAPH FOR ATTITUDE OF STAFF BAR GRAPH FOR WHETHER BANK PROCESSE EASY PAGE NO. 66 66 67 67 68 68 69 69 70 70 71 71 72 72
LIST OF TABLES
S.NO. 1 2 3 4
TABLE VITAL STATS FOR PRIVATE SECTOR BANKS COMPARISION OF PUBLIC, PRIVATE AND FOREIGN BANKS SHAREHOLDERS % HELD IN SBI PRICES FOR CITIBANKS SERVIVES
PAGE NO. 6 15 43 61
EXECUTIVE SUMMARY
The banking industry is an integral part of any society. The key areas that have impacted on the financial services industry include regulation and legislation in various forms. The 1986 Financial Services Act was brought about to regulate the industry and offer consumer some protection. With the entry of new private and foreign banks in the country already having numerous big and small public sector players, the competition has doubt increased. The competitive environment is continuously changing and is also under increasing pressure due to the effect of the economic recession, customer spending and confidence. The dynamic nature of banking industry makes environmental monitoring and analysis essential. Delighting the customer is the buzzword for the service industry today. To fulfill this the banks should have an excellent marketing mix. The marketing ix for services is different then the mix for product. The marketing mix is the organizations overall offer, or value, to the customer. 'The basic marketing mix is often nicknamed "The 4Ps" (product, place/distribution, pricing, promotion); these are elements in the marketers armory - aspects that can be manipulated to keep ahead of the competition' Dibb & Simkin, 1994]. The marketing mix can be expressed in a more customer orientated way as the '4Cs': Customer Value 'product' benefits from the buyers point of view Cost to the customer 'price' plus the customers costs - e.g. travel Convenience for the buyer equivalent to 'place'/channels of distribution Communication a two-way dialogue - not just 'promotion'. The marketing of services presents particular problems given characteristics such as: Services cannot be touched or stocked. They are an experience. Production, consumption and distribution are simultaneous. 'Production' staff is also the customer contact. Quality is variable - and customers tend to use Price as an indicator of quality Customers are less easily convinced of reliability than with a tangible product. To address the special difficulties of services marketing, 3 more 'Ps' can be added to the marketing mix: People Staff selection, motivation and particularly customer care training are critical. Physical Evidence The decor and ambience are very much part of the product offer - as are customer testimonials and celebrity endorsement. Process The efficiency of the process is what provides the benefits for the customer. Efficiency can be monitored by measurers of performance, e.g. based on satisfaction questionnaires and 'mystery customer' surveys. For understanding marketing mix in detail three famous banks were considered for study: ICICI SBI
Citibank. All these three banks are undergoing drastic changes as far as marketing mix goes. The information about the marketing mix of these banks was collected from various primary and secondary sources. Once the marketing mix structure of these banks was ascertained it was necessary to understand the customers response to this mix of various banks. A study of this was conducted by means of getting the questionnaire filled by 50 customers of these banks. By means of the responses the gap between banks offering under marketing mix desired by customers becomes clear. This gap level shows the areas of problems on the basis of which proper recommendation could be prepared.
INTRODUCTION TO PRESENT PROBLEM

In January 1993 the guidelines for setting up private sector banks were issued.
The banking sector has an uphill task considering the challenges it is facing. The gap between thinking and debating the solutions and the implementation of these is widening. This will erode the viability and the economic value of the business. There are several challenges confronting the banking sector. These could be broadly classified into the deployment of funds in quality assets and management of revenues and costs. Another challenge is that Indian banks will have to embrace the sophisticated risk management practices. Thereafter, it will have to address the risk based pricing and that of capital requirements of banks. This past June, the bank regulators on Basel committee on Banking supervision postponed the deadline for finalizing a new version of the 1988 Capital Accord, to provide the basis of determining the capital adequacy. Thus a lot of reforms are required in the banking sector. The foreign and new private sector banks are very mindful of the inefficiencies in the public sector banking. They manage their fee-based income far more aggressively In 1969 Indira Gandhi nationalized 14 private sector banks. Prior to that most banks like Central Bank owned by the (Tatas), United commercial Bank (Birlas) and Syndicate Bank (Pais) were owned and managed by businessmen. The only exception was the State Bank of India. Known as the Imperial Bank of India before 1955, this came under the purview of the RBI; it had been nationalized in July 1955 under the SBI Act of 1955. The businessmen who owned these banks channelised most deposits into their own companies, often ignoring the governments focus areas, agriculture and small scale industries.
That neglect was one of the reasons for the nationalisation of banks. Another was Gandhis desire to spread the banking habit in rural and semi- urban areas.
The emergence of new private banks: The eight new private banks that have emerged on the Indian financial topography since 1994 are clear outperformers in the otherwise troubled sector. In seven years, these banks have grown to account for 6% of the total assets and 10% of the total profits of banking industry. It was the Narsimham committee report dated 1991 that envisaged a larger role for private sector banks. The RBI agreed, and in an effort to make the sector more efficient and competitive, it issued, in January 1993, the guidelines governing the entry of new private banks- a minimum paid-up capital of Rs.100 cr. among others. This was the first time, following the nationalization of banks in 1969that the RBI was issuing fresh banking licenses to the private sector. The NPBs have grown not just organically, but also through mergers and acquisitions. HDFC bank merged with Times Bank in an all stock deal valued at Rs. 200 cr. in Nov 1999, ICICI bank acquired bank of Madura in a stock swap deal in Dec2000 to become the largest among the NPBs.
Vital stats for private sector banks:

New private sector bank Total income Operating income Net profit Provisions and contingencies Spread NPA (%of net advances) Total advances Figures in Rs. cr. 1998-99 4130.49 684.28 397.05 287.23 763.94 6.2 14070 1999-2000 5407.46 124.85 569.42 674.43 1151.71 4.1 22816 2000-2001 7504.26 1368.97 639.41 729.56 1685.13 5.1 31499
Marketing puts the customer at the center of the organization. The organizations, which
6 CENTER OF INTERNATIONAL BUSINESS, ABS
do so, reap the profits. In the grocery sector, Sainsburys, and more recently Tesco, have a firm commitment to marketing, putting them amongst the most profitable retailers in the country. It was said several years ago that Marks & Spencer did not even use the word 'marketing'. They believed they placed their customer truly at the center and that their merchandising and customer definition strategy led them to be the most profitable retailer in Europe. But how does this stack up today. It seems that their customers changed. Customer preferences and desires moved on and the company neglected to see how their customer base was becoming more segmented with differing tastes emerging. The company's products and services become seen as less "vibrant", too staid, insufficiently dynamic. The word got out quickly to customers that the merchandise range was dull, lifeless, and old. Profitability levels and customer confidence dropped. The company that neglected its market research needed to regroup urgently and strengthen its marketing skills. However this required profound management reorientation and development of marketing competencies. The famous retailer is now struggling to make up lost ground and to regain its ascendancy in a much more volatile market. The seven factors of marketing mix of services are though easier to understand but require a great deal of study. Since in banking services the products are not unique and hence easier to imitate. Therefore an efficient, timely and cost efficient strategy to have the best marketing mix is essential. Since the nature of the product can be easily altered in case of service a dynamic approach should be taken towards other attributes of marketing mix. Therefore to combat the challenges of increasing competition in banking industry environment, a detailed and thorough knowledge about marketing mix is a must. The following dissertation report was made keeping this in mind. The report is hence titled as: In Depth Study Of Marketing Mix Of Banking Services
OBJECTIVE
THE OBJECTIVE OF THIS DISSERTATION REPORT IS TO DO: AN INDEPTH STUDY OF MARKETING MIX OF BANKING SERVICES
INTRODUCTION TO BANKING INDUSTRY

Banking Sector in India The economic reforms initiated in the aftermath of the 1991 crisis have blown winds of change in every segment of the economy. The banking industry, one of the supporting precursors to any rapidly growing economy, has undergone a period of considerable change since the 1990s. The three sectors of the banking industry namely public, private and foreign are the cornerstones of the changing banking industry. The Indian banking sector has a massive geographical reach and the credit- deposit (48%) figures speak volumes of the inherent strength of this industry. Until recently, the lack of competitiveness vis-a-vis global standards, low technological level in operations, over staffing, high NPAs and low levels of motivation had shackled the performance of the banking industry. The entry of the New Private Sector banks into the market changed the face of this industry. Nurturing collaborative ventures and paying strong emphasis on forex services, the private banks are globalising Indian banking business. Armed with strategic alliances with foreign collaborators, these banks have opened doors to new positive ideas, concepts and products. These private banks have set a trend for universal banking. For instance Global Trust Bank is the first Indian Bank to have equity participation from International Finance Corporation and Asian Development Bank. Similar trends are seen in Centurion Banks alliance with Keppel Bank, Singapore and HDFC Bank with NatWest Markets, United Kingdom. Recently ICICI successfully completed its ADR issue on New York Stock Exchange (NYSE). The intensification of competition in the banking industry as a result of growing private sector participation coupled with growing customer needs has spurred innovation resulting in new products and services. The private sector banks spearhead this "Innovation Revolution". The new private sector banks are targeting specific products and client group. However with the advent of foreign players participation, the private sector banks position stands threatened. With emphasis on service and technology, it is for the first time that Indian banks (mainly private) are challenging the foreign banks. These banks are making heavy use of technology to give good service at par with foreign banks but to a much wider clientele. Branch size has been reduced considerably by using technology thus saving manpower. This has resulted in an overall cost saving. In addition the Any Time Money (ATM) facility helps draw large customers to a branch. ICICI Bank has already launched DataBase Management (referring to using the database of existing clients to generate more revenues). The new private banks are on an expansion phase and are now moving into semi-urban areas and satellite towns to fulfill their branch expansion norms. ICICI bank, HDFC bank, GTB, IndusInd, BOP and UTI Bank have come out with IPOs as per licensing requirement. The other three private sector banks are expected to come out with their IPOs in next fiscal. Their technological edge and product innovation has seen them gaining market share from the slower, less efficient older banks. These banks have targeted non-fund based income as major source of revenue, with their level of contingent liabilities being much higher then their other counterparts viz. PSU and old private sector banks. The new private banks have been consistently gaining market shares from the
public sector banks. The major beneficiary of this has been corporate clients who are most sought after now. Among the list of top 5 wealth creator ICICI stands 3rd with MVA in Rs. Cr. as 833 and total assets in RS. Cr. as 19737 while SBI is 3rd in top 5 wealth destroyer with MVA in Rs. Cr. as -2324 and total assets in RS. Cr. as 316017. Among the top 50 wealth creator ICICI stands 3rd while SBI stands 48.
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Economic Backdrop and Banking Environment The year under review was marked by significant changes in the economic environment. There was some deceleration in GDP during 2000-01 due to sluggish growth in industry, agriculture and services, though critical sectors like information technology and communications remained strong. Growth in the industrial sector was affected by infrastructure bottlenecks, excess capacity in some sectors and an uncertain environment as investors assess the full impact of Indias commitments to the WTO. Exports, which had witnessed a turnaround during the previous year, surged ahead further and rose by 19.9% in 2000-01, substantially higher than the increase of 10.9% recorded in 19992000. Along with buoyancy in the global economy, various export-promotion measures taken by the Government facilitated export growth. In contrast, the growth in imports slowed down to 0.2% in 2000-01, and the slowdown would have been more pronounced but for the rise in oil imports reflecting hardening in international crude prices. A significant development during the year was the removal of Quantitative Restrictions (QRs) in compliance with WTO requirements. The Exim Policy also announced several measures to boost exports and position Indian producers and exporters to take advantage of liberalization in world trade. Inflation (WPI year-on-year) remained low at 4.9% in 2000-01 against 6.8% in the previous year. On the monetary front, there was adequate liquidity in the economy during 2000-01 with year-on-year growth in broad money (M3) at 16.2% as against 14.6% in 1999-2000. The growth was boosted by inflows amounting to Rs.25,711crore (USD 5.5 billion) on account of the India Millennium Deposits. Growth in aggregate deposits of all scheduled commercial banks at 17.8% in 2000-01 was higher than 13.9% in the previous year. The growth in credit at 16.8% in 2000-01 was, however, lower than 18.2% in 1999-2000, reflecting sluggishness in the real sector environment. During the same period, total resource flow to the commercial sector from banks i.e. non-food credit plus investment in bonds, debentures, shares, CPs, etc., rose by 15.2% against 17.8% in the previous year. The strong growth in food credit during the year supported large-scale food procurement operations of the Government. In keeping with its objective of providing sufficient credit for growth consistent with price stability, RBI announced a number of measures to enhance liquidity and reduce the cost of funds to banks. These included reduction in Bank Rate, cut in CRR, reduction in repo rate and cut in savings bank deposit rate. The Union Budget (2001-2002) also signaled a softer interest rate regime by announcing a cut in the interest rates on small savings schemes. During the year under review, RBI announced several new initiatives in banking sector reforms and development of the money market and government securities market. Other measures include guidelines to put in place risk management systems in banks, move towards unified group balance sheet, strengthening financial sector regulation and supervision, and steps to strengthen prudential norms and adopt global financial standards and codes. Financial sector deregulation has increased the opportunities for banks to augment revenues by tapping new areas of business like insurance, asset management, etc. In addition, banks now have greater flexibility in pricing their products. But this has also squeezed margins and intensified the competition for certain banking products. In this milieu, only banks that seize the opportunities thrown up by technology become customer-centric and offer new products that are cost-effective will be able to stay ahead
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of the competition. The current slowdown in industrial sector, greater access for domestic corporate to markets including abroad, greater flow of FDI and FII funds into the economy and in general greater volatility in equity markets abroad which impact domestic markets are all developments which highlight the need for strong risk management systems, credit appraisal and follow up as well as prudent provisioning policies in banks. Leveraging its strengths in terms of brand name, market leadership, wide network of branches, technology and skills, the Bank will strive to scale new heights in the coming year. This will be supported by initiatives in insurance, lending to mid-corporates, personal banking and priority sector. With technology as a key driver, the Bank will be able to exploit opportunities in cross-selling products, meet customer requirements and enhance profitability and efficiency. The challenge, therefore, is to improve profitability, asset quality along with strong capital backing to support asset expansion, and use the human and financial capital to add value to shareholders of the Bank, while at the same time continuing to ensure strict adherence to statutory and regulatory directives and national policies.
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PUBLIC SECTOR BANKS VIS-A-VIS PRIVATE AND FOREIGN BANKS Indian Banking offers a curious combination of excellence and mediocrity. It is one of the biggest banking industry in the world. It comprises three forerunners - PSBs, Private Sector Banks, Foreign Banks. The PSBs are gigantic, are fleet flouted and the Foreign Banks are technology savvy. Banks have traditionally functioned as reliable intermediaries between net savers and net borrowers. Ignoring fee-based services, Indian Banks have mainly concentrated on the earnings from the spread between the lending and the borrowing interest rates. This becomes quite apparent from even a cursory glance at the published journals of any bank, where the income head is split up into Interest Income and Other Income. Unfortunately, these spreads have diminished and savers have started interacting directly with borrowers. The only way around is to increase the services and fee-based activities. The key to success in the future is going to be Quality Customer Service, with an innovative use of the most advanced technology available. Over the next few years, Indian Banks will need to introduce some, if not all, of the products or services outlined below, to stay in the game. Thanks to liberalization, the Indian Banking Industry is agog with competition. The players are competing like never before. Now the PSBs have to perform better than others to keep ahead in the race, even to be in the race there is a need to better their own performance levels, lest they are likely to be left far behind. Both the foreign and private banks are giving cutthroat competition to the PSBs, which still predominate an eighty four percent share in the total assets of the industry.
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SWOT ANALYSIS
PUBLIC SECTOR BANKS Strengths: Public sector has 84% share in the total assets of the industry. One of the positive outcomes of nationalization has been that of emergence of branch network spread across every nook and corner of the country. This coupled with ownership by the state made these banks enormous in terms of size. PSBs have a significant individual depositor base rendering stability to the asset base. The share of investments of Public Sector accounted for87% of the industry, indicating the dominance of PSBs. PSBs rank higher in deposits, advances and profits, due to their vast network and sheer size of staff. Banking business measured in deposits is still dominated by the PSBs.The market share of PSBs account for 85%Market share on the advances front too is dominated by the PSBs whose advances form 82% of the market. Weaknesses: PSBs have low credit to deposit ratio. Though the PSBs have huge resource base, with competition increasing at a faster pace, they are likely to lag behind in the long run. The complacency could cost them heavily. PSBs have a high level of NPAs(bad loans), huge overhead costs and high break-even levels. The lack of customer orientation and low level of computerization too is leading to their inefficiency. The productivity is less than the other two sectors. Borrowings of the PSBs have increased more than other two sectors, which is contributing to the losses. Expenditure per branch is continuously increasing, as the branches are not properly managed. The PSBs which command about 91% of the total bank branches & about 86% of the banking business in the country, are already saddled with huge work force. This workforce operating under the protective umbrellas of mechanization & computerization for fear of losses of employment opportunities, present or potential. PSBs are very much behind in the technology aspect. Services such as neatly printed statements of accounts, automatic and prompt updation of passbooks, ATMs etc are some of the benefits that customers are being deprived of at PSBs.
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PRIVATE SECTOR BANKS Strengths: Private sector banks have a high credit to deposit ratio and they have kept their operating expenses low. With technology and customer orientation, Private Sector banks are at the higher level as compared to PSBs and on the level playing field with Foreign banks. Private sector banks have a high level of capital adequacy ratio. Private sector banks are fairly advanced in the use of technology. Services such as neatly printed statements of accounts, automatic and prompt updation of passbooks, ATMs etc are some of the benefits that customers are enjoying at these banks. Weaknesses: Private sector banks unlike PSBs have less number of branches so their reach and coverage is not very extensive. Private sector banks have low growth in average advances, this aspect is dominated by the PSBs. For Private sector banks the average NPAs stand at 15.52%. Private sector banks do not examine their business with along term perspective. Many of these banks tend to look at short-term opportunities and gains. FOREIGN BANKS Strengths: Foreign banks have high credit to deposit ratio. Foreign banks are the leaders in technology and customer services. Foreign banks have high level of capital adequacy ratio. Foreign banks show that the increase in the borrowings which earlier amounted to losses is now signaling profits. The average spread enjoyed by the foreign sector is higher than that earned by other sectors. For Foreign banks the average NPAs stand at less than 10% which is lower than the other two sectors. Weaknesses: Foreign banks have very less number of branches and hence their reach is very low as compared to PSBs. Foreign banks have concentrated on corporate banking and fee based income. The business focus for most foreign banks must shift to retail mobilization.
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The following table shows a general comparison of three main classes of banks. Particulars PSU Banks Pvt. Banks (Old) Pvt. Banks (New) Cost of funds Low Moderate High Branch network Wide Spread Regional Low Level of Automation Low Moderate High NPAs High Low Low Capital Adequacy Moderate Low High Employee Productivity Low Moderate High Focus on Non- interest Income Low High High
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ENVISIONING THE FUTURE OF BANKING

Against the background of the profound structural changes in banking services worldwide, every Indian bank is embarking on a fundamental redefinition of its business and its relationship with the customers. CEOs are attempting to develop strategies to deal with new and pressing business issues: Declining deposit growth. Declining spreads and margins. New market entrants. Higher customer expectations. Growing complexities of technology. The increasingly competitive and complex nature of the banking industry has compounded the compulsion for focussing on the key profit drivers and this has led to fundamental question of exploitation of new opportunity areas. The expansion of banking activities across vertical and horizontal dimensions, in an industry traditionally characterized by high degree of pricing regulations, direct lending and pre-empted investments is the major challenge facing the industry today.
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THE NEED FOR BETTER MARKETIN MIX:

The following Porters Model shows the amount of competition and difficulties faced by the banks: PORTERS MODEL New Entrants The PSBs are facing competition from the new private and foreign banks which are coming into the picture. The entry of new private as well as foreign banks which sprang as a result of the dismantling of entry barriers in the industry. The new banks are more leaner and have been able to invest in the latest technology. Though the new entrants have many advantages still they have to go a long way. Entry barriers are not so small as being thought. PSBs have strong customer base which are loyal to these banks and so the switching cost for these will be very high. The new banks will have to compete with already established private and foreign sector banks. Substitutes The main substitutes are Financial Institutions and NBFCs. Commercial Banks have been facing competition from the Fis in the intermediary business. Fis are also into lending business, raising deposits, giving loans for working capital, disconting, leasing, hire purchase etc. Suppliers The RBI is the Central Bank of India and it regulates the working of all the banks. The bank has the sole right of issuing currency notes above one rupee in denomination. Being the apex bank, it acts as the banker to all other banks. All Scheduled banks have to keep a certain percentage of their demand and time liabilities with the RBI. The scheduled banks have to submit weekly returns of their business to the RBI which regulates the flow of credit. Every bank has to get a license from RBI to carry out banking business in the country. Buyers The individual customers and corporates are the buyers of the facilities being provided by these banks. The PSBs bank on large and loyal customer base. With growing customersdemands the focus is now shifting towards high quality and better services. Private and Foreign banks are now offering innovative products and services like convenience banking, ATMs, inter bank connections
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INTRODUCTION TO SERVICES MARKETING

SERVICES MARKETING Services are witnessing a major boom in India. Services like banks, car financing, consumer durable credit, cellular, paging, express, hospitality, travel and tourism, airlines, and, educational services on are today realizing the importance of marketing. Along with these big service businesses, many small businesses ranging from beauty saloons, pubs, gyms, play schools and so on are realizing the importance of marketing. Even though some of the principles of marketing and advertising services are similar to product marketing, there are significant differences. A service is an act of labour or a performance that does not produce a tangible commodity and does not result in the customer's ownership of anything. Its production may or may not be tied to a physical product. Thus, there are pure services that involve no tangible product (as with psychotherapy), tangible goods with accompanying services (such as a computer software package with free software support), and hybrid product-services that consist of parts of each (for instance, restaurants are usually patronized for both their food and their service). UNIQUE CHARACTERSTICS OF SERVICES Exactly what is a service, and why should services receive special treatment from marketers? A popular definition describes services as "any act or performance 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 physical product." Although, the distinction between goods and services is somewhat artificial, since the success of goods manufacturers is vitally dependent on the service they provide, there are four commonly cited characteristics of services that make them different to market from goods: Intangibility, Inseparability, Variability and perishability. INTANGIBILITY Pure services such as baby-sitting cannot be seen or touched. They are ephemeral performances that can be experienced only as they are delivered. As the above definition of service suggests, intangibility may represent the most critical difference between services and goods, and its implications for marketing are great. Services are intangible because they can often not be seen, tasted, felt, heard, or smelled before they are purchased. A person purchasing plastic surgery cannot see the results before the purchase, and a lawyer's client cannot anticipate the outcome of a case before the lawyer's work is presented in court. To reduce the uncertainty that results from this intangibility, marketers may strive to make their service tangible by emphasizing the place, people, equipment, communications, symbols, or price of the service. For example, consider the insurance slogans "You're in good hands with Allstate" or Prudential's "Get a piece of the Rock." Intangible services are difficult to sell because they cannot be produced and displayed ahead of time. They are therefore harder to communicate to prospective customers. A hobbled weekend athlete cannot see the results of elective knee surgery beforehand. The
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person may be able to talk to other patients who have experienced the same procedure, but their operation does not necessarily reflect the outcome of this particular surgery. Marketers of services can reduce these risks by stressing tangible cues that will convey reassurance and quality to the prospective customers. These tangible cues range from the firm's physical facilities to the appearance and demeanor of its staff to the letterhead on its stationery to its logo. Life insurance companies are particularly savvy about this problem. Their service is, after all, the most intangible service: by definition, the buyer will never know the ultimate result of what he or she has bought! To compensate for this intangibility the major companies over the world have developed strong visual symbols for their firms. Prudential -The rock of Gibraltar All state -Protective hands Travelers -A red umbrella Nationwide -A blanket Wausau -A train station INSEPARABILITY This characteristic is interpreted differently by different service marketing marketers, but all interpretations point out that special operations problems exist for the firm's managers. One interpretation of this term is the inseparability of customers from the service delivery process. In particular, many services require the participation of the customer in the production process. A child getting a haircut must sit still; otherwise, the family photo may have to be delayed for a month. The person who comes to a tax prepare at the last minute with boxes of disorganized records may cause the prepare to overlook some possible deductions. Services are inseparable from their production because they are typically produced and consumed simultaneously. This is not true of physical products, which are often consumed long after the product has been manufactured, inventoried, distributed, and placed in a retail store. Inseparability is especially evident in entertainment services or professional services. In many cases, inseparability limits the production of services because they are so directly tied to the individuals who perform them. This problem can be alleviated if a service provider learns to work faster or if the service expertise can be standardized and performed by a number of individuals (as H&R Block, Inc., has done with its network of trained tax consultants throughout the United States). These examples illustrate the fact that, unlike goods, which are often produced in a location far removed from the customer and totally under the control of the manufacturing firm, service production often requires the presence and active participation of the customer - and of other customers. Depending upon the skill, attitude, cooperation and so on that customers bring to the service encounter, the results can be good or bad, but in any event are hard to standardize. A second interpretation of inseparability refers to the fact that in some service industries the service delivered is inextricably tied to particular individual service providers. Customers may have ground for complaint if their service is not provided by, for example, the surgeon or lawyer they thought they were paying for.
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VARIABILITY The fact that service quality is difficult to control compounds the marketer's task. Intangibility alone would not be such a problem in customers could be sure that the services they were to receive would be just like the successful experiences their neighbors were so pleased with. But in fact, customers know that services can vary greatly. Different front-line personnel have different abilities. Even the same service provider has good days and bad days or may be less focused at different times of day. Services are performances, often involving the cooperation and skill of several individuals, and are therefore unlikely to be same every time. This potential variability of service quality raises the risk faced by the consumer. The variability of services comes from their significant human component. Not only do humans differ from one another, but also their performance at any given time may differ from their performance at another time. The mechanics at a particular auto service garage, for example, may differ in terms of their knowledge and expertise, and each mechanic will have "good" days and "bad" days. Variability can be reduced by quality control measures. These measures can include good selection and training of personnel and allowing customers to communicate dissatisfaction (e.g., through customer suggestion and complaint systems) so that poor service can be detected and corrected The service provider must find ways to reduce the perceived risk due to variability. One method is to design services to be as uniform as possible - by training personnel to follow closely defined procedures, or by automating as many aspects of the services as possible. The appeal of some service personnel - particularly, those involved in such expensive personnel services as beauty parlors treatments or home decoration - lies in their spontaneity and flexibility to address individual customer needs. The danger with too much standardization is that these attributes may be designed right out of the services, therefore reducing much of their appeal. A second way to deal with perceived risk from variability is to provide satisfaction guarantees or other assurances that the customer will not be stuck with a bad result. PERISHABILITY The fourth characteristic distinguishing services from goods is their time dependence. Services cannot be inventoried, since they are performed in real time. And time periods during which service delivery capacity sits idle represent revenue-earning potential that is lost forever. Periods of peak demand cannot be prepared for in advance by producing and storing services, nor can they be made up for after the fact. A service opportunity occurs at a point in time, and when it is gone, it is gone forever. This can present great difficulty in facilities planning. A survey of service firms found that the greatest operational challenges facing them were posed by the perishability of their products. . Finally, services are perishable because they cannot be stored. Because of this, it is difficult for service providers to manage anything other than steady demand. When demand increases dramatically, service organizations face the problem of producing enough output to meet customer needs. When a large tour bus unexpectedly arrives at a restaurant, its staff must rush to meet the demand, because the food services (taking orders, making food, taking money, etc.) cannot be "warehoused" for such an occasion. To manage such instances, companies may hire part-time employees, develop efficiency routines for peak demand occasions, or ask consumers to participate in the service-
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delivery process. On the other hand, when demand drops off precipitously, service organizations are often burdened with a staff of service providers who are not performing. Organizations can maintain steady demand by offering differential pricing during off-peak times, anticipating off-peak hours by requiring reservations, and giving employees more flexible work shifts Matching service capacity to demand patterns can involve managing one or both elements. PERISHABILITY often puts a greater burden on service marketers to manage demand than it does on goods marketers, who can build up inventories to meet peak demand or can reduce prices later to move the unsold inventory. The cited survey found that the firm's principal method for controlling demand was to increase personnel selling during potentially slow periods. Surprisingly, few firms claimed to use the standard economic solution of price changes to increase or decrease demand, although some service industries, such as resort hotels with seasonal demand, do this routinely. Few respondents said they developed alternative, counter seasonal service products to use slack capacity, although that has long been a common practice by goods marketers. Many service providers also control demand by requiring appointments. The alternative to controlling demand is to make service capacity flexible. Some service firms keep on call frontline personnel who can arrive on short notice to meet the surges in demand, or cross train support personnel to assist with customer service during busy periods.
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EXPANDING THE MARKETING MIX FOR SERVICES MARKETING

Service marketing managers have found that the traditional four P's of marketing are inadequate to describe the key aspects of the service marketer's job. The traditional marketing mix is said to consist of the following elements of the total offering to consumers: the product (the basic service or good, including packaging, attendant services et cetera); its price; the place where the product is made available (or distribution channels - not generally a real issue for most services, except perhaps for repair and maintenance); and promotion (marketing communication: advertising, public relations and personal selling). Some marketers suggest that the unique requirements of selling services require the manager attend to three additional P's. These are people, physical evidence and process. PEOPLE Many services require personal interactions between customers and the firm's employees and these interactions strongly influence the customer's perception of service quality. For example, a person's stay at a hotel can be greatly affected by the friendliness, knowledge ability and helpfulness of the hotel staff - in most cases the lowest paid people in the organization. One's impression of the hotel and willingness to return are determined to a large extent by the brief encounters with the front-desk staffs, bellhops, housekeeping staff, restaurant wait staff and so on, many of which take place outside the direct control of the hotel management. In fact, the average hotel patron has very little contact with the hotel supervisors and managers. Therefore, management faces a tremendous challenge in selecting and training all of these people to do their jobs well, and, perhaps even more important, in motivating them to care about doing their jobs well, and, perhaps even more important, in motivating them to care about doing their jobs and to make an extra effort to serve their customers. After all, these employees must believe in what they are doing and enjoy their work before they can, in turn, provide good service to customers. For this reason, human resources management policies and practices are considered to be of particular strategic importance for in delivering high-quality services. Establishing a customer-oriented culture throughout the firm and empowering employees to provide quality service cannot be established merely by putting up inspiring posters. Management leadership, job redesign and systems to reward and recognize outstanding achievement are among the issues that a successful service manager must address. The term "internal marketing" has been coined to characterize the sets of activities a firm must undertake to woo and win over the hearts and minds of its employees to achieve service excellence. The "people" component of the service marketing mix also includes the management of the firm's customer mix. Because services are often experienced at the provider's facilities, one's satisfaction with a service can also be influenced by other customers who are being served there. Ill mannered restaurants customers at the next table, crying children in a nearby seat on an airplane and commercial bank customers whose lengthy
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transactions take up the teller's are all examples of unpleasant service conditions caused by a firm's other patrons. On the other hand, the right mix of customers can greatly increase the enjoyment of experience - for example, at entertainment services, such as nightclubs or sporting events. Determining the desirable customer mix for a service, segmenting the market into compatible groups and managing customer arrivals to avoid conflict and enhance the service experience are essential components of service management. PHYSICAL EVIDENCE This element of the expanded marketing mix addresses the "tangible" components of the service experience and firm's image referred earlier. Physical surroundings and other visible cues can have a profound effect on the impressions customers form about the quality of the service they receive. The "servicescape" - that is, the ambience, the background music, the comfort of seating and the physical layout of a service facility can greatly affect a customer's satisfaction with a service experience. The appearance of the staff, including clothes and grooming, may be used as important clues. Promotional materials and written correspondence provide tangible reassurance, they can be incorporated into the firm's marketing communications to help reduce customer anxiety about committing to the purchase. Service firms should design these items with extreme care, since they will play a major role in influencing a customer's impression of the firm. In particular, all physical evidence must be designed to be consistent with the "personality" that the firm wishes to project in the marketplace. PROCESS OF SERVICE PRODUCTION Because customers are often involved in the production of services, the flow and progress of the production process is more important for services than it is for goods. A customer who buys a television set is not particularly concerned about the manufacturing process that made it. But the customer at a fine restaurant is not merely interested in the end result - the cessation of hunger. The entire experience of arriving at the restaurant - of being seated, enjoying the ambiance, ordering, receiving and eating the meal - is important. The pace of the process and the skill of the provider are both apparent to the customer and fundamental to his or her satisfaction with the purchase. The importance of the process is true even for less 'sensual" experiences. Therefore, when designing service production processes, particular attention must be paid to customer perceptions of that process. For this reason, marketing and operations are closely related in service management . SERVICES SEGMENTATION The critical point about segmentation in a service is that to be of use it must penetrate through to the frontline, since in a service the final processes of production are simultaneous with purchase or consumption. Indeed, segmentation remains an elegant division, of interest to marketing, but of little practical effect if it does not achieve this. In particular it is important to re-emphasize two aspects, as follows: INTERNAL CULTURE These are the internal values of the organization related to the values of the customer.
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Such a connection is a reflection of the ideas developed in the service star. The interaction is not just a part of what the customer buys, but is what the customer buys. The values brought to this by the organization are integral. So, for example, if an external analysis were to suggest a segment of 'professionals' with a need for a wide range of detailed advice available within 'n' timescale there is a need to match this with internal values of delegation so that front line staff are empowered to make decisions, within the timescale and have a reward system which encourages the risks attached to such action. Similarly, defusing a crisis for the customer will work only if, in doing it, you do not create a drama internally because management, in turn, is not good at defusing crises with staff! DELIVERY Indeed, in some services - a concert hall, for example, or a restaurant - the concept of distribution is difficult to comprehend. Rather, it is very important to take account of the point about production/consumption. Delivery is about the totality of the way in which the service is accessed before, during and after a sale. In other words, because the interaction forms an integral part of what the customer buys, so the place or places and the feel and values of these must be equally integral. With Taco Bell, for example, 'price' and 'speed' are more compelling reason than 'food' for customers choosing that particular eating place, relative to competition. But taking in to account culture and delivery is inevitably complex since, in essence, one is building a very detailed star. When further considered within broad headings of the service mix, there can be anything up to 50 criteria which govern the market relationship, so it is possible to appreciate just how difficult this can be. REQUIREMENTS FOR A SERVICE ORGANIZATION It is said " Using industrial models to manage service-based corporations makes as little sense as using farm models to run factories" Service Organizations can outperform the competition if they master what the "rules of the service game" Daniel Bell's work made this most clear to us when he described the steps in the evolution of the nature of work: (1) STEP 1: The agrarian "game against nature" in which the game was human versus the land. (2) STEP 2: The industrial "game against fabricated nature" in which the game was between human and machines. (3) STEP 3: The postindustrial services "game between persons" in which the game is between a clerk and a customer or a professional and a client. Each of these games requires different resources and rules. THE THREE TIERS OF A WINNING SERVICE ORGANIZATION Competitive advantage in service derives from unique ways of conceiving and managing service operations. Here, we offer a unique view of service organization - one that treats a service business as comprised of three tiers: a customer tier, a boundary tier and a coordination tier.
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THE CUSTOMER TIER Customers are the foundation of every organization. They are the scorekeepers in the service game. It has been suggested that figure skating is now the sport that offers the most appropriate metaphor for the nature of competition in today's world. It is, instead, an individual organization trying to delight and impress a panel of judges and the judges are the customers. A service organization can successfully bash the other organizations but still loose the service game if the organization ring up 4s and 5s with the customers. Management practice should be based on a deep knowledge of customer characteristics in three areas: expectations, needs and competencies. Each service organization must be fitted to its market and its customers particular definition of service quality. Once customer expectations have been identified and met, respecting customer's subconscious needs is the key to differentiation in a service business. THE BOUNDARY TIER The second tier of service organizations is where the customers meet the organization. The people who deliver service play some special roles within the boundary tier and deserve special attention. Service characteristics like intangibility and customer contact require employees to display more initiative, to cope more effectively with stress, to be more interpersonally flexible and sensitive and to be more cooperative than their colleagues who work in manufacturing. Although non-personal contacts with the customers do not involve face-to-face interaction, we consider these contacts to be the part of the boundary tier because they have great impact on the customers perception of service quality. . THE COORDINATION TIER Coordination is management's responsibility and in service firms, it may be management's most important task. It includes the coordination of the activities of customers who are often on site helping to co-produce the service and the integration of the customer and boundary tiers. Key coordination problems are to ensure that (1) Clear strategic decisions have been made about who the target market is or should be and that the internal functioning of the organization is effectively coordinated to pursue that market. (2) The boundary tier has the logistical, systems and staff support to meet the customer tier's expectations and needs. (3) The needs and expectations of those who work at the boundary tier are being met. The toughest challenge here is to get the various subsystems of the service organization e.g. Operations, Marketing, and Human resources management - to act as one system.
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MARKETING in BANKS: Banking is a major industry through out the world today. Characteristics of banking marketing: INTANGIBILITY: Banking services are generally intangible, but the service providers go t the considerable lengths to tangibilise the services for customers, eg. Bankpass book, regular bank statements, gold credit cards. INSEPARABILITY: the degree of inseparability depends upon the type of services and the actual supplier. Many everyday transactions are carried out now via automated services (ATM). Because access to these systems has broadened to allow use of any particular kind of machine by customers of other institutions, the customer will often not be dealing directly with their own provider. Many financial services are sold by brokers, agents of various kinds and this has led to several difficulties and misunderstanding and dissatisfaction in case of wrong advice or unsuitable product. HETEROGENITY: In this case the complexity of the services transaction process will determine the extent of variability and this can differ to a large extent between institution and even within one institution. The greater the degree of automation within any transaction process, the greater the degree of standardization. Thus simple transactions may be carried out via ATMs and completely standardized or via a branch counter where they might be fairly standardized but subject to some variation in quality. PERISHABILITY: The degree of perishability depends upon the type of service. If a check needs to be cleared by a certain date and the system causes a delay then the benefits to the consumer are lost so the service could be said to be perishable. By and large however money and financial services are enduring in nature. If a banks reserves are not fully utilized profitably through lending or investment they will still retain their worth and may be utilized again on a later date. HIGH INVOLVEMENT PURCHASES/ COMPLEX PRODUCT: Many financial services are high involvement purchases. This will mean that the customer will shop around for the beat advice or best offer and will generally take a long time to plan the purchase, for example with a mortgage or a pension. HIGH LEVEL OF BRAND LOYALTY: Customers tend to stay with financial services providers and use them to satisfy their different needs at different stages of their life. Banks recognized this well and are keen to provide students overdrafts s in the hope of retaining a professional salaried account holder for many years. Many people choose the same bank as their parents because the parents open an account for them. Children and teenagers are a keen target market for the banks because of the possibility of the future business. Financial services also tend to be joint purchases, very often, with decisions made by more then one person.
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THE MARKETING ENVIRONMENT: Environmental analysis and monitoring is of critical importance in any industry especially in the dynamic financial services industry with its proliferation of products and services and changing industry structure. External environment analysis usually involves assessing influences on the organizations business activity under the following main headings: Political/legal: Government attitude towards home ownership State provision of pensions Government encouragement of savings and investment Regulatory control and protection Economic Personal and household disposable income Discretionary income levels Employment levels The rate of inflation Income tax levels and taxation structures Savings and investment levels and trends stock market performance Consumer spending Consumer credit Socio/cultural: Changing employment patterns No. of working women The ageing of population Number of first time housebuyers Change in the no. of households Marriage/divorce/birth rates Consumption trends Technological: Process developments Information storage and handling Database systems
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BANK MARKETING MANAGEMENT: BANK marketing is essentially a three stage process starting with market research to accurately analyze the needs. BANK services must then be designed to fulfil those needs at appropriate prices and then the availability of these services must be communicated effectively to potential customers. Market research is the critical starting point. The success of subsequent marketing planning and policy decisions depend upon a clear understanding of the market. To achieve strategic growth through BANK marketing implementation, three major strategic alternatives are available. Market penetration: the aim is to gain market share at the expense of the competition. There are three ways of achieving this. Encourage existing customers to buy more of the company's products and services, Persuade non-users to try the products. Attempt to get competitors customers to switch to your offerings. Market development: This means seeking newer target markets segments in which to offer existing products and services. Product development: This strategy calls for product ranges to be upgraded or increased to attract a wider customer base. MARKETING PLANNING: It is important to assess consumer needs, desires and motivations towards banking services in order to establish levels of market attractiveness to determine key market segments and to plan the most effective marketing programmes. Marketing Planning in Banks: *Development of market research systems in order to determine what consumers want. * Market segmentation * Product planning through objective setting. * Communication to the both consumers and potential consumers, to inform them of the services available and to remind or persuade them by means of advertisements. Promotion. * Ensuring that the service offering is available and accessible to consumers via an effective distribution programme so that they can buy the service at a value (price)
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THE BANKING MARKETING MIX:

The marketing mix refers to the blend of ideas, concepts and features which marketing management put together to best appeal to their target market segments. THE PRODUCT MIX: As mentioned previously, there is little or no room for innovation in product design due to the ease by which competitors can make similar offerings, for example by altering charges or interest rates to meet those of competitors. Additionally, many financial services are affected by other restrictions, such as government directives relating to income tax and investments or constraints on the amounts which can be invested. Differentiation, therefore, can best be achieved through the other elements of the marketing mix. Current accounts are dominated by banks, although the building societies share of this market in which they could not compete until recently is growing. They hold the majority of mortgage account, however, but this stronghold is increasingly under pressure from banks. THE PROMOTIONAL MIX: The aims of the promotional fall into three main categories: to inform, to remind, and to persuade. It will always be necessary to inform prospective consumers about new products and services, but other issues may also need this type of communication to consumers; new uses, price changes, information to build consumer confidence and to reduce fears full descriptions of service offerings, image building are examples. Promotion designed to persuade consumers would be in line with specific objectives, for example to encourage switching or to build preference. There are a number of promotional tools available for bank marketing Whatever methods may be used it is important to focus on: Clearly identified segments A unique selling proposition Well defined target audience Creative use of media and media scheduling to reach audiences Monitoring and evaluation of promotional effectiveness. PROCESS: Reasons for enhancing process in banks are some of the following changes: Rising competition among banks and from outside the traditional banking sector is driving them to improve their customer service level to retain and increase the customer base and hence the need to provide better service. Globalization and liberalization have added to the competition forcing banks to further reduce cost and increase efficiency More mergers and consolidation of banks put pressure on them to improve productivity and reduce costs. Banks have to follow a customer centric approach to prevent rapid shifts in customers choice.
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Banks face constant pressure to adapt to changes brought about by dynamic environment. This dynamic environment places extreme demands on information systems to provide better customer service, at lowest possible costs and in the shortest possible time The change in the banking environment has happened not only due to competition but also regulation. according to Bart Hellemans, deputy manager Vysya Bank. Hence they are focussing on not just volumes but also on the bottom lines. When you want volumes with profits, you have to bring in sales culture. That explains why our banks keep inquiring whether we need a personal or a home loan when we go to put some money in the fixed deposit. The mantras now is sales, and there is a tremendous pressure on bankers to turn sellers rather then just being bankers. PRICING: The price in financial services terms relates to the cost involved to the customer in say, bank charges or credit card rates. These prices seem to evoke low levels of customer sensitivity as many customers enjoy free banking, by maintaining their current accounts in credit, for example, or paying their credit card balances off each month. The introduction of new charges, however, such as the annual credit card fee had a noticeable effect initially, however, and sparked off competitive reaction from lenders prepared to offer cards with no annual charge. Price also relates to the value of the products to the customer and, as such, can be highly sensitive. This can be in terms of interest rates charged on a mortgage, where reductions in interest for first time buyers or preferential rates for existing customers of other services (for example current account holders) are standard promotional tools in the industry, representing a form of discounting. The rates of return offered to investors is another element of the price and different products within the range are frequently priced at differential rates, to attract long-term savers or large sum investors, for example. Pricing can therefore be used to differentiate the offering and is likely to be used by customers in selecting service. PLACE: Place or location has always been regarded as critical in retail financial services where high street positions are maintained by most of the large institutions. For transaction services where regular and frequent branch contact is required this can be important. First Direct, however, the telephone banking service, has proved that a bank without branches is possible though its customers still need access to convenient ATM outlets. Some consumers prefer personal, face-to-face contact within a branch and may be more likely to use a local branch or building society. Direct Line and other telephone insurance services are also moving away from the traditional large networks of branches and brokers or agents. Changes in distribution systems, technology and consumer demands are all key influences on the evolution of the place component of the marketing mix. Distribution management is concerned with two things: availability and accessibility.
PEOPLE:
Customer care is at the forefront of both quality and differentiation in the financial services industry. Staff needs to be highly trained not only in customer care but also in how to respond to the rapidly changing market environment. Personnel can be used to
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develop competitive advantage in the marketplace and to build and maintain relationships with customers. Customers are no less a part of a firm's human resource than its employees. If the service organization's customers are sufficiently talented, they can do all sort of things for that organization from co-designing the services to co-designing the human resources management practices. Having the "best customers" can be a source of competitive advantage. The customer tier, then, deals with the three important characteristics: their expectations, their needs and their competencies. Once these are understood, the people who deal with customers, those who manage the service counter, come in to play. We have called the people who interface with customers, members of the boundary tiers. The make-it-or-break-it role service employees play is that of linking customers to the organization. PHYSICAL EVIDENCE: The environment in banks is changing, moving away from austerity and formality to a more friendly approach reflected in more attractive branch layouts and decor. Other physical evidence plays an important part in financial transactions such as the documentation which must be presented by the salespeople to prove that they are authorized to offer investment advise. This creates confidence and helps to build the relationship between the customer and provider. Physical evidence is also widely used to tangibilise the service. Attractive brochures and policy documents, presented in glossy folders, cheque book and credit card holders, gold credit cards, childrens collectable money boxes are all examples of physical evidence being used in this way. Earlier customers used to see a bank as a strong institution and therefore the image portrayed was one of solidarity, strength and seriousness as seen in strong buildings, high ceilings and long cash counters. But when the concept of personalized banking came in with foreign banks it brought about a change in the design of banks. PROCESS: A customer who applies for a loan at a bank evaluates the purchase not only by the amount of the loan received and the interest rate paid. The speed and sensitivity of the approval process, the interaction with the bank officers, the accuracy of bank statements and the ease of getting redress if mistakes are found all affect the person's attitudes about doing further business with the bank and his or her willingness to recommend it to others. PEOPLE : Customers are no less a part of a firm's human resource than its employees. If the service organization's customers are sufficiently talented, they can do all sort of things for that organization from co-designing the services to co-designing the human resources management practices. Having the "best customers" can be a source of competitive advantage. The customer tier, then, deals with the three important characteristics: their expectations, their needs and their competencies. Once these are understood, the people who deal with customers, those who manage the service counter, come in to play. We have called the people who interface with customers, members of the boundary tiers.
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The make-it-or-break-it role service employees play is that of linking customers to the organization. The boundary tier - especially but not exclusively the employees at the boundary tier - is the glue that binds customers to the firm. Because service employees are both physically and psychologically close to the customers they serve, they play at least two important roles for the organization: (1) Impression Managers: For many customers, the service employee is the organization. This means that boundary employees behavior and the experiences their behavior creates for customers are service quality in customer's eye. (2) Gatekeepers of information: Boundary employees, being in constant interaction with customers, are useful source of insights into customer attitudes, information on competitor strategies and ideas about how to enhance service quality. We emphasize that attention to the constituents of the boundary tier and their individual abilities, attitudes and motivations is only one of many rules for winning the service game. The service organization should try to avoid what we have called the "human resources trap", which is the mistake many companies make of putting all the burden for service quality on how people at the moment of the truth treat customers. Here, we would also like to stress the importance of the non-personal service characteristics (like the physical facility, billing accuracy and timeliness) and the support that must be given to the front-line employees to enable them to contribute most effectively to winning the service game. As with the figure skater who is provided with just the right music and wardrobe, performance by service workers can be only as perfect as the supporting elements permit.
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METHOD:
To understand the customers response to the 7 different features of marketing mix a questionnaire was prepared. ORGANISATION SITE: For the purpose of finding the customers response towards marketing mix structure of different banks questionnaire was made to be filled by customers of these 3 banks in Delhi and NCR. SAMPLE: SAMPLING UNIT: Comprised of all the customers who were -Based in Delhi and NCR. -Customers of any of the banks under study. SELECTION OF SAMPLE: Selection of the sample was done at random. SAMPLE SIZE: A sample size of 50 customers was taken. INSTRUMENTS USED: To understand consumers behavior towards the banks efforts for their marketing mix structure the questionnaire method of data collection was used. The questionnaire interview were conducted in person, through e-mail and on telephone. The type of questionnaire used was structured, non-disguised. These types of questionnaires are considered to be most effective since they produce more reliable result. Also the data obtained through these are easier for tabulation and interpretation then the data collected by other methods. Also, this type of questionnaire is considered to be more convenient for the interviewee to answer. PROCEDURE FOLLOWED: For the preparation of the report, firstly, the details of marketing mix for ICICI bank, SBI and Citibank were collected. The sources were both primary and secondary. The secondary sources were collected through articles in print, books, brochures, websites and journals. The primary source was through personal contact at the three banks. A small questionnaire asking about the details of the marketing mix was put forward to an employee in each bank who had sufficient information regarding it. On the basis of this the marketing mix of the three banks were studied. To understand thew consumers response to the available marketing mix of banks, a questionnaire was got filled by a total of 50 customers of these banks. On the basis of these responses the customers attitude was understood and analyzed.
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ANALYSIS:
INTRODUCTION TO ICICI Group The Industrial Credit and Investment Corporation of India Limited now known as ICICI Ltd. was founded by the World Bank, The Government of India and representatives of private industry on January 5, 1955. The objective was to encourage and assist industrial development and investment in India. Over the years, ICICI has evolved into a diversified financial institution. ICICIs principal business activities include Project Finance Infrastructure Finance Corporate Finance Securitisation Leasing Deferred Credit Consultancy services Custodial Services The ICICI Group comprises of ICICI Bank Limited, a commercial bank that provides both retail and wholesale products ICICI Securities and Finance Company Limited (ICICI Securities), an investment bank that offers a wide range of fee based services with the support of ICICI Brokerage services Limited (ICICI Brokerage) ICICI Credit Corporation Limited (ICICI Credit), a non- banking finance company that provides a retail distribution channel for the groups retail products, supported by ICICI Capital Services Limited (ICICI Capital) ICICI Investors Services Limited (ICICI Services), offering quality investor servicing ICICI Venture Funds Management Limited (ICICI Venture), a venture capital company ICICI International Limited, an off shore investment management company ICICI KINFRA Limited (I-KIN), a company that offers infrastructure financing and development assistance in Kerala. ICICI Bank ICICI Bank is a commercial banking outfit set up by the ICICI Group. The Bank was registered as a banking company on January 5, 1994 and received its banking license from the Reserve Bank of India on May 17, 1994. The Bank has an authorized capital of INR 300 crore (USD 75.96 million), of which subscribed and paid-up capital is INR 165 crore (USD 41.78 million). The first branch of ICICI Bank was started in Madras in June 1994. As of March 31, 1999, 64 branches were functional across the country. By this year 36 more branches/offices are expected to be added to the network. The branches are fully computerized with state-of-the-art technology and systems. All of them are fully networked through V-SAT (Satellite) technology. The Bank is connected to the international SWIFT network since March 1995.
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ICICI Bank offers a wide spectrum of domestic and international banking services to facilitate trade, investment, cross-border business, and treasury and foreign exchange services. This is in addition to a whole range of deposit services offered to individuals and corporate bodies. ICICI Bank's Infinity was the first Internet banking service in the country, and a prelude to banking in the next millennium. Currently the Bank has around 150,000 customers. Need for merger of ICICI Ltd. and ICICI Bank The recent trend in world banking is towards mergers and acquisitions. This is evident from the mergers occurring in Japan, United States and other parts of the world. The need is being felt for stronger and fewer players, offering a wide gamut of services (universal banking). With competition becoming acute and foreign banks entering the Indian market steps have to be taken to sustain growth in the Indian Banking sector. To meet your business banking needs, ICICI Bank, a commercial banking subsidiary of ICICI, provides an array of commercial banking products. With an authorized capital of Rs. 300 crores (USD 70.70 million), of which subscribed and paid up capital is Rs.165 crores (USD 38.89 million), ICICI Bank's financial strength adds to its capability of servicing businesses. The Bank has harnessed state-of-the-art technology to deliver its services to the maximum satisfaction of customers The Value of ICICI Bank share has been ascertained at Rs. 36.12 per share. Taking Price as Rs. 36.12 per share and the EPS of three years from 1998-1999, Price-Earning Ratio (P/E) has been calculated as follows. 1998-99 1999-2000 2000-01 Earnings 3.84 7.77 13.83 Per Share P/E Ratio 9.4 What's IN What's OUT Objective Profitability Developmental & social Interests of Shareholders Priority sector Strategies Pro-active Passive Segment Target banking Mass banking Business Fee based Fund based NPA Mgt. Recovery mgt. cell Credit monitoring cell Concentration Investments Advances HR policy Hire & Fire Job Security Credit Rating Individual Corporate As ICICI Bank is a leading private player emphasizing more on what's in rather than what's out in the banking sector. Thus this merger is beneficial for the parties concerned.
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MARKETING MIX FOR ICICI PRODUCTS: Personal Banking Cards Home Loans Car loans Two wheeler loans Commercial vehicle loans Personal Loans CD Loans Loans against shares Demat Services Bonds/Fixed Deposits NRI Services . Corporate Internet Banking: Internet Services for Corporates. Whether you are looking for investment opportunities, borrowing products or even risk management assistance, the ICICI Treasury has solutions for you. One of the largest operations in the country, its present turnover exceeds Rs. 1 trillion. Over the last few years, the ICICI Treasury has pioneered a number of key innovations, including: multi-tier prime rates yield curve pricing long-term Rupee-Dollar swaps rupee denominated Floating Rate Notes In many ways, the Treasury is the nerve center of the organization. It mobilizes resources for the Corporation from domestic as well as international markets, manages its cash surpluses, sets interest rates and is responsible for hedging the organizations exposure to market risks. Fully automated independent systems for Foreign Exchange, Fixed Income and Equities add to the operational strength of the Treasury. They provide cutting edge consulting services to clients in public and private sector with the objective of developing the infrastructure sectors. The range of consulting services broadly covers advice on policy related issues, restructuring of existing players, and facilitating project specific investments. At present the consulting services are divided into separate sectoral practices for energy (power, oil & gas, coal & mining), telecommunications, transport infrastructure (roads, rail, ports) and urban infrastructure (industrial parks, municipal infrastructure, etc.). ICICI Bank offers the following services: Working Capital Financing Term Loans Dealer Financing Vendor Financing Financing Cash-flow Gaps Cash Management Services
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I-Payments Corporate Internet Banking Foreign Exchange Remittances/Advisory FII Services
Working Capital Financing ICICI Bank is the first bank to introduce tenor based lending rate. It offers all traditional Working Capital Financing products with a host of features, including lowest prime lending rate with the highest service quality Composite cost. Fund-based working capital products include cash credit, short-term loans payable on demand, bills discounting, export and import financing, financing of short-term cash flow mismatches, fixed and floating rate debentures and subscription to commercial paper Term Loans Term loans for period of three to seven years is sanctioned for financing small and medium sized companies and to support normal capital expenditure. Includes rupee loans, foreign currency loans, leasing, preferred stock and fixed rate debentures. Dealer Financing The bank provides Working Capital Financing for dealers of the company. Customized structures are also worked out to suit dealer needs. Loan assistance is sanctioned to dealers as working capital or as bill discounting lines of credit. Vendor Financing The Bank extends Bill Discounting services on bills drawn by suppliers on the company. Bills accepted by the company are eligible for discounting under this scheme. Discounting rate is linked to the tenor based IBR. Priority sector companies are also eligible for this service. Financing Cash-flow Gaps To manage the cash flow of an organization, ICICI Bank offers assistance for financing cash-flow gaps by giving you an over-draft limit for short tenor financing, consistent with consortium arrangement. Cash Management Services ICICI Bank offers custom-made payment solutions allowing them to reduce the time period between collections and remittances. Cash management products include physical check-based clearing, electronic clearing services, central pooling of countrywide collections, dividend and interest remittance services. I-Payments ICICI Bank has leveraged the Internet to offer e-commerce capabilities. ICICI Bank is the first bank in India to provide fund transfer facility through the Internet. ICICI Bank helps in setting up an Internet based funds transfer system for a supply chain. Funds can be transferred from a company to its vendors and from the dealers to its supplier through the Internet. ICICI Bank makes use of the latest security measures for Internet Banking.
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Corporate Internet Banking Infinity, the Bank's Internet Banking Service, has opened the doors to a New World of convenience. If you have a Corporate Internet Banking account, you can get all Group relationship information at the click of a mouse. Foreign Exchange Remittance/ Advisory ICICI Bank's treasury is one of the strongest treasury operations in the country with a turnover in excess of USD 50 billion. The Bank's experienced and knowledgeable team of dedicated foreign exchange dealers is equipped to help you with fast and narrow quotes for transactions. PRICE They dont have any service charges when a customer goes for the first time on normal services. Debit card of ATM has a yearly charge of 99 Rs. SUPPLIERS LINE OF CREDIT Financing non-project purchase of capital equipment Backed only by bank guarantee Non-project purchases Usually 3 /5 /7 year repayments in semi-annual/ quarterly installments Pricing based on cost of funds and tenure As a Private Equity Asset Management Company, ICICI Venture raises capital from a variety of domestic and international investors, constitutes them into distinct pools and deploys them primarily in unlisted companies that do not have easy access to public sources of debt or equity capital. The choice of an equity partner is a critical step for any entrepreneur. The right partner provides the experience, credibility, responsiveness, flexibility and access to resources that complement the skills of operating management. ICICI Venture excels in all these aspects. ICICI Venture's team of 20 professionals has a cumulative operating and investment management experience of over 100 man-years and a record of successful and innovative financing in private equity. ICICI Venture invests in companies across a broad range of industries at all stages of development, from start-ups to expansion financing in emerging growth companies to management buyouts. Since its founding in 1988, ICICI Venture has helped fuel the growth of over 300 companies in India and 12 in the US. In any investment situation, ICICI Venture prefers to take an active role to create value for the portfolio company and its shareholders. As a wholly owned subsidiary of ICICI, ICICI Venture has access to a broad spectrum of financial and analytical resources. With its keen understanding of the Indian financial markets, access to global capital and a network through influential global alliances, it acts as a vital source of capital and management expertise to entrepreneurs. Working Capital products include both fund-based and fee-based products. . Fee based products include documentary credit and bank guarantees.
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PROCESS The present business model prevalent at ICICI for the delivery of products and services to the customers is as follows. It is based on separate product and channel structures, and results in diffused customer ownership. PRODUCTS/SERVICES SUITE CHANNELS C AUTO LOANS CALL CENTRES US MORTGAGES DSAS T LOANS TO BUY DURABLES ATMs O BONDS MUTUAL FUNDS INTERNET M STOCK TRADING BANK BRANCHES E NET BANKING DISTRIBUTION CENTRES R CREDIT CARDS S Corporate Internet Banking ICICI Bank opens the door to complete transparency in your banking activities The power to know is the power to do Today corporate decisions are taken across the world in split seconds. These decisions are based on quick and easy sharing of vital information; which is made possible only through transparency of operations. ICICI Bank brings you the power of financial transparency through its net banking service. Over the last 7 years, ICICI Bank has established itself as one of India's fastest growing private banks. With a network of over 100 branches (increasing to 360 very soon), 450 ATMs spread across over 100 centers, it has increasingly given more and more Indians the power to bank the ICICI Bank way. In 1997, ICICI Bank took banking to an entirely new level. On to the Internet. With Infinity, it became the first bank in the country to launch Internet banking. It changed the way banking was done. Infinity - Puts the bank on your table Infinity helps ICICI Bank extend its counters and services into homes and offices. Making the bank accessible through the mouse 24 hours a day, 7 days a week, 365 days a year Handled with Care The transparency of your corporate account is limited to you and the core group you wish to share it with. This transparency is fully protected by state-of-the-art online security measures. The multi-layered security architecture comprising firewalls, filtering routers, 128-bit encryption and digital certification protects your account information from unauthorized access. Channelfinance@internet The new product launched by ICICI Bank integrates channel financing and online banking. It is aimed at enabling you to shift the supply-chain operations on to the net. This minimizes paperwork, lowers banking costs and improves operational efficiency. In addition the product also offers overdraft facilities to your dealers and suppliers based on their business with your company. They can now source funds at lower costs from ICICI Bank through you. *
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ICICI Bank lets you optimise on time, money and business opportunities by simply upgrading to Corporate Internet Banking. ICICI bank is actively involved in the maintenance of its software as well as hardware. Infact ICICI group has come up with its own software co. called ICICI Infosys Technology. The banks software is updated every 3 months The technological upgradation happens at corporate as well as branch offices. ICICI Banks IT Infrastructure comprises of the following Networking services and data center related services and it facilities management. All such needs are met by ICICI Infotech. They assist them in all designing, customization, implementation and maintenance of their corporate network. Their networking expertise includes: LAN Design WAN Design Network Management Network Security Routing IP Addressing Satellite Networking (VSATs) The ICICI WAN is a closed user group network and it connects more than 150 locations. ICICI Bank offers various IT enabled processing services for the following areas of work: Investor Servicing Depository Services Mutual Funds Insurance Reconciliation (Rupee and Forex) Accounts Receivable Management Other IT enabled services in ICICI Bank are Call Center design and management and Transaction Processing The application areas of IT in ICICI banks are Whole Sale Banking Solutions Retail Banking Solutions Solutions Formula Funds Solutions for Insurance Image and Workflow Applications Web Based Applications Performance Evaluation and Tuning of Systems PLACE With a network of over 100 branches (increasing to 360 very soon), 450 ATMs, spread across over 100 centers, it has increasingly given more and more Indians the power to bank the ICICI Bank way. ICICI bank boasts of 620 0f the 3800 odd ATM outlets in the country, and hopes to account for two of the six that will be installed every day in the next one year plan to garner some extra income by leveraging the advertising potential of the teller machines. Maximum banking takes place through walk ins. Though the bank is trying for shifting the clientele to ATM. Till date 45%of the customer database has been converted to ATM
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PROMOTION: ICICI bank is running an advertising campaign that focuses on the convenience of banking with it. Kamaths A team has wrapped it up by burning money on brand advertising across sectors in a serious manner that, has been rarely seen in the industry using the services of megastar Amitabh Bachchan to launch credit cards, advertising almost daily on prime time television for banking portals, etc. insiders estimate that ICICI should have spent, by a conservative estimate, as much as Rs. 20-30 crore for brand building. ICICI banks media agent is Quantum. For marketing of ATMs also lot of efforts have been put in. each if ICICI ATM does 281 transactions a day on an average but Quantum and ICICI are hoping advertisers will be attracted by the quality of audience they can reach. It remains to be seen whether the costs (ICICI advertising budget is Rs.5000-10000 lakhs) depending on the no. of ATMs chosen and the frequency of the message will pay off advertises in the long run or whether this trend will go the way of banner advertising. The bank considers TV as the best media for promotion. PHYSICAL EVIDENCE: ICICI considers ambience very important since they believe that it leaves a major impact on client. All banks have attractive dcor and lovely interiors. Several scrolling machines are put on which the new as well as existing schemes details are shown. Glossy brochures and leaflets are available at various counters.
PEOPLE:
They consider internal marketing as a very important part. They have excellent training programs for their employees. They have training programs for freshers as well as other employees. These are held every month and also upgraded on a monthly basis. They also have physical training programs. They have a site on the Internet on which they take online feedbacks from the employees and there is complete transparency in this case. The cost of training the employees about better technology range between Rs. 700080000 per employee. The cost varies as per the: Venue:i.e. whether the employee is trained in the Bank training center or if a hotel is booked for the same. Duration of training: ICICI plans to put in a data mining solution that will effectively collate and make sense of data across 3 million bank accounts, 384 ATMs, 130,000 cards, 100 banks branches, 400,000 net banking accounts and 5-6 distribution channels. Its bank has 4 million customers and the institution nearly 5 million bondholder accounts. Also the banks environment has been constantly emphasized as being women friendly.
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SWOT OF ICICI
STRENGTH Is the preferred financier for 10 auto manufacturers companies Considered to be a flexible company Very consumer friendly. Has the highest month on month share of the market. 1.6 million customer base. Owns the largest ATM network. It is considered as a one stop shop for finance related business. Aggressive pruning of its non performing assets is improving its credit rate profile allowing access to cheaper funds. Dealers love to work with them because of fast speed of processing loans Its volumes allow ICICI to offer among the lowest cost
WEAKNESS Need to increase its outlets Its still a metro city bank Need to have more branches OPPORTUNITIES 1, sky is the limit as the market is growing and large part is still to untapped Need to have offers for the consumers with manufacturers Online banking can be profitised upon. Can venture into retail banking. THREATS New entrants are making the competition tougher Consumers are becoming more and more demanding Decrease in interest rates have made in this field bit unrewarding The threat of takeover for ICICI bank under the following heads. De-regulation Globalization Disinter mediation Volatility Managing credit card risks is a challenging job. Change in leading profile from project finance to good quality corporate business is driving net interest margin down. Retail bank business profitability prospects are unclear.
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INTRODUCTION FOR SBI State Bank of India is the largest bank in the country with over 190 years of banking experience and with advantaged technology at our fingertips. Today, State Bank of India ranks among the top 25 commercial banks in Asia with assets exceeding US$ 59 billion. We operate worldwide through the most extensive network ever owned by a commercial bank. With over 8998 branches in India and 52 foreign offices in 31 countries, our total deposits exceed US $ 45 billion. SBI AN OVERVIEW The State Bank of India is the largest commercial bank in India in terms of profits, assets, deposits, branches and employees. At the end of the financial year 2000-01 (AprilMarch), the Bank had total assets of Rs.3,156.44 billion (US$67.71 billion), total deposits of Rs.2,428.28 billion (US$52.09 billion), and made a net profit of Rs.16.05 billion (US$344 million) during the year. The Bank has a vast domestic network of 9,019 branches and staff strength of 214,845. It commanded one-fifth of deposits and loans of all scheduled commercial banks in the country. The origins of State Bank of India date back to 1806, when the Bank of Calcutta (later called the Bank of Bengal) was established. In 1921, the Bank of Bengal and two other banks (Bank of Madras and Bank of Bombay) were amalgamated to form the Imperial Bank of India. In 1955, the controlling interests of the Imperial Bank of India were acquired by the Reserve Bank of India and the State Bank of India was created by an act of Parliament to succeed the Imperial Bank of India. Structure and Organization The Bank has its Corporate Office at Mumbai. Its domestic operational area is divided in 14 Circles, each with one Local Head Office and a few Zonal and Regional Offices. The Bank's top management consists of the Chairman, group executives for National Banking Group, Corporate Banking Group, International Banking Group and Associates & Subsidiaries, and four staff functionaries in charge of finance, credit, human resources and technology management, and inspection and audit. Three Strategic Business Units (SBUs) under the Corporate Banking Group have been set up for focussed attention to very large corporate customers, lease finance and project finance, all reporting directly to the corporate office. Distinguishing features of the SBUs are integration of operational planning with operations within each SBU, a focussed delivery system with appropriate specialist inputs and focussed attention on profitability. Shareholders % of shares held Institution Reserve Bank of India Non-Residents (FIIs/OCBs/NRIs) Financial Institutions including Insurance Cos. Mutual Funds/Banks/Govt. Cos. Domestic companies/Trusts Other Individuals including employees Evolution Shareholding 59.73 18.31 11.58 1.30 6.24 2.84
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The origin of the State Bank of India goes back to the first decade of the nineteenth century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A unique institution, it was the first joint-stock bank of British India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921. Primarily Anglo-Indian creations, the three presidency banks came into existence either as a result of the compulsions of imperial finance or by the felt needs of local European commerce and were not imposed from outside in an arbitrary manner to modernize India's economy. Their evolution was, however, shaped by ideas culled from similar developments in Europe and England, and was influenced by changes occurring in the structure of both the local trading environment and those in the relations of the Indian economy to the economy of Europe and the global economic framework. MARKETING MIX FOR SBI: PRODUCTS The various products available with SBI are: Personal Banking Gold Banking NRI Banking International Banking Corporate Banking Small Scale Industries Small Business Finance Rural Banking Government Business Services PERSONAL BANKING DEPOSIT SCHEMES CURRENT ACCOUNT SAVINGS BANK ACCOUNT Savings Account Savings Plus Account Salary Plus TERM DEPOSITS Term Deposits Senior Citizen Deposit Scheme Reinvestment Plan SBI MODS Recurring Deposit Maturity Value Calculator
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Long Term Floating Rate Deposit Scheme PERSONAL FINANCE Housing Loan Short Term Loan Car Loan Educational Loan Personal Loan Property Loan Loan to Pensioners Loan against Shares / Debentures EMI Calculator SERVICES Locker Rupee Traveller Cheque Gift Cheques Public Provident Fund (PPF) RBI relief bonds PSU Retiring Employees Scheme Loan On Demat Accounts ATM Services Internet Banking Types of loans: SBI Term Deposits SBI Loan For Pensioners SBI Recurring Deposits Loan Against Mortgage Of Property SBI Housing Loan Against Shares & Debentures SBI Car Loan Against Govt.Securities SBI Educational Loan Demat Accounts SBI Personal Loan Rates Of Interest GOLD BANKING Gold Deposit Metal (Gold) Loan To Domestic Jewellery Industry Metal (Gold) Loan To Jewellery Exporters The Bank has prepared the SBI Gold Deposit Scheme, whose purpose is to bring privately held gold in circulation, reduce the country's reliance on import of gold and provide its owners with additional income apart from freeing them from the problems of storage, movement and security of gold in their possession. The scheme will only shift the place of holding from lockers to the Bank and the form of gold from jewellery to bullion. The depositor would derive the benefits of safety and security without any cost. At the same time, the depositor would earn interest on an otherwise unproductive asset and also be able to collateralise the same to raise loans. Thus, a virtual physical ownership and a virtual liquidity is ensured in respect of the gold holding.
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NRI Services State Bank of India, is best placed to serve Non- Resident Indians like you with a wide range of deposits and investment banking services and to enable you to earn interest rates amongst the highest offered anywhere in the world. International banking services of State Bank of India are delivered for the benefit of its Indian customers, non-resident Indians, foreign entities and banks through a network of 52 offices/branches in 31 countries, spread over all time zones. The network is augmented by a cluster of Overseas and NRI branches within India and correspondent links with over 700 banks, the world over. Bank's Joint Ventures and Subsidiaries abroad further underline the Bank's international presence. The services include corporate lending, loan syndications, merchant banking, handling Letters of Credit and Guarantees, short-term financing, collection of clean and documentary credits and remittances. Corporate banking SBI is a one stop shop providing financial products / services of a wide range for large, medium and small customers both domestic and international. Working Capital Financing Assistance extended both as Fund based and Non-Fund based facilities to Corporates, Partnership firms, Proprietary concerns * Working Capital finance extended to all segments of industries and services sector such as IT Export Credit To Corporates / Non Corporates Strategic Business Units (i) Corporate Accounts Group (CAG) (ii)Project Finance (iii) Lease Finance * An exclusive unit providing one stop shopping to top Corporates * A dedicated set up specialized in financing of infrastructure and other large projects * Exclusive set up for handling large ticket leases. International Banking The bank's products include foreign exchange letters of credit, guarantees, remittances, acceptances and collections. Its loan syndication activity covers arranging, participating and underwriting foreign currency loans. It also provides short-term finance through buyers' and suppliers' credits. . Agricultural banking, micro credit, regional rural banks SBI Caters to the needs of agriculturists and landless agricultural labourers through a network of 6600 rural and semi-urban branches. There are 972 specialized branches which have been set up in different parts of the country exclusively for the development of agriculture through credit deployment. These branches include 427 Agricultural
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Development Branches (ADBs) and 547 branches with Agricultural Banking Divisions (ADBs) and 2 Agricultural Business Branches at Chennai and Hyderabad catering to the needs of hitech commercial agricultural projects. The branches have covered a whole gamut of agricultural activities like crop production, horticulture, plantation crops, farm mechanization, land development and reclamation, digging of wells, tube wells and irrigation projects, forestry, construction of cold storages and godowns, processing of agri-products, finance to agri-input dealers, allied activities like dairy, fisheries, poultry, sheep-goat, piggery and rearing of silk worms. The Bank has achieved tremendous growth in agricultural credit. As on March 2001, it has covered 48 lakh farmers with loan outstanding of Rs. 14962 crores, accounting for 28% of total agricultural advances of Public Sector Banks (PSBs) State Bank of India's linkages with Government business are widespread. No wonder that out of 8998 branches in India, about 7000 branches are conducting Government business. The large network of our branches provides easy access to the common man to deposit their Government dues such as Income Tax, Corporation Tax, Central Excise and Customs Duty, etc. SBI Cards SBI Card launched through the Bank's subsidiary, SBI Cards & Payments Services Ltd. (a joint venture with the GE Capitals) continued to attract new customers. The Bank is looking at Credit Cards as a part of its strategic plan for enhancement of customer satisfaction. The number of cards in force at the end of May 2001 was 6.59 lakh. With the addition of 13 more cities during 2000-01, the SBI Card registered its presence in 39 cities in the country. The highlight of the year 2000-01 was the introduction of three new products: Gold Card, Secured Card and Doctors Card. Co-branded cards were launched by six of the Bank's Associate Banks during the year. With this addition, all the seven Associates have now been covered. Insurance SBI has made a foray into insurance business through a joint venture viz., SBI Life Insurance Co., with Cardif S.A., one of the largest insurance companies in France. Cardif is a 100% subsidiary of BNP Paribas, the third largest bank in Europe. The Bank is holding 74% equity in the joint venture; Cardif holds the remaining 26%. PRICING They have normal charges for their services like drafts, collection of charges etc. but the banks prices are considered to be very nominal compared to other banks. Other features of the banks prices are: * SBI's Prime Lending Rates (PLR) are among the lowest * Presently Bank has two PLR's --SBAR for loans payable on demand and upto one year --SBMTLR for loans payable beyond one year.
PLACE
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As of now bank sees maximum transaction through walk ins. But the bank is trying to convert these to ATMs. It is also emphsizing a lot on Internet banking. The Bank has its Corporate Office at Mumbai. Its domestic operational area is divided in 14 Circles, each with one Local Head Office and a few Zonal and Regional Offices. The Bank's top Domestic Branch Network At the core of the Bank's commercial banking business is its nationwide network of 9,019 branches as on March 31, 2001, by far the largest branch network of any bank in India. The Bank's domestic branches represent approximately 14% of all bank branches in India. About 45% of the Bank's branches are located in rural areas, 27% in semi-urban areas and 16% and 12% are located in urban and metropolitan areas respectively. ATMs - growing speedily to touch the 1000 mark by March 2002. This widespread branch network enables the Bank to raise a substantial and stable deposit base, to provide a wide range of lending products and other financial services and to diversify lending risks geographically as well as by type of credit risk and customer. The Bank's ability to diversify and enhance the quality of service related to its deposit taking as well as its lending activities and other financial services is a fundamental strength of the Bank. Indian Associates and Subsidiaries A network of eight Indian Banking Subsidiaries of the Bank, comprising seven Associate Banks and SBI Commercial and International Bank Ltd., are engaged in the business of commercial banking in the country. Branches of the seven associates are located in various regions of the country while SBICI has its offices in Mumbai. The Bank has foreign offices in 31 countries with a network of 51 branches/offices spanning all time zones. The Bank's foreign offices include full-fledged branches at centers such as London, New York, Frankfurt, Paris, Hong Kong, and Tokyo. Besides full-fledged branches, the Bank also has offshore branches, representative offices, subsidiaries, and other arrangements for conducting business. In addition to its own branches and offices overseas, the Bank also has two whollyowned subsidiaries, namely, SBI (Canada) and SBI (California), four other subsidiaries, namely, SB International Ltd., Mauritius, Indo-Nigerian Merchant Bank Ltd. Lagos, SBI Finance Inc., New York and SBI Services Limited, Sao Palo, and two joint-venture Overseas Banking Subsidiaries, namely, Nepal SBI Bank and Bank of Bhutan, for providing banking services overseas. The Bank has a network of 52 overseas offices spread over 31 countries covering all the time zones and has correspondent relationship with 720 foreign banks. During 19992000, swaps worth US$ 65 million were put through The Bank had 139 ATMs in 52 cities. A few ATMs are already made on-line for the Branches, where they are located, and the remaining ATMs will soon have similar facility. PROCESS Technology Orientation With increased competition and new business opportunities, it is imperative for the Bank to introduce and absorb technology extensively and at a rapid speed, not only to remain customer-friendly, efficient and competitive for existing services and business but also, and perhaps more importantly, to be able to manage newer forms of business and services
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in an increasingly dynamic and global environment. The Bank's effort to improve efficiency and customer service through use of technology is reflected in the rapid pace of its branch computerization. As at the end of August 2001, the Bank had 2,678 fully computerized branches at 640 centers, covering 78% of the Bank's business. This includes 950 of the top 1,000 business branches have already been computerized. All specialized branches, like Overseas Branches, NRI Branches, Personal Banking Branches, Commercial Branches, Industrial Finance Branches, etc., are now fully computerized. The Bank crossed many milestones in technological upgradation. Electronic Nostro Account Reconciliation (ELENOR) and State Bank Electronic Payment Systems (STEPS) became operational in December 2000 and January 2001, respectively. Both the projects were conceived, developed and implemented with in-house expertise, and the success was widely acclaimed. ELENOR, dealing with on-line nostro account reconciliation, enabled online reporting of forex transactions from 444 forex intensive branches. STEPS was launched to facilitate instantaneous electronic transfer of funds; its present coverage is 629 computerized branches. Anywhere Anytime Banking: The ambitious ATM networking project went on stream in its pilot phase in March 2001, with the aim of enabling the customers accessing their accounts from many designated centers at any time. As at August 2001, ATMs were networked in eight cities covering 250 branches and 106 ATMs. There are 309 ATMs installed in 100 centers all over the country. The Bank has issued 1.4 million ATM cards, accounting for 30 per cent of the ATMs card issued in the country, as on June 2001. Internet Banking started on a pilot basis on the 1st August 2000 at 11 branches, and by June 2001, 51 branches in major centers were covered. For electronic transmission of inter-branch data for reconciliation through the Internet. The Project ERECON was extended to 2,009 fully computerized branches In 2000-01, the Bank established "SBI-Helpline" at LHO centers, equipped with toll-free telephone lines, fax and e-mail for providing quick and complete information on Bank's products and services, and to enable the customers to have their grievances redressed through electronic media. The SBI Home Page was thoroughly redesigned and revamped during the year. The site is a window for all SBI products and services and detailed corporate profile, and provides seamless integration with Net banking. Product-wise Frequently Asked Questions (FAQs), Newsletters and Helpline facilities attracted a large number of visitors to the site. The Bank made significant improvements to provide better and efficient banking services to customers through introduction of appropriate technologies. These include 1. Electronic Data Interchange projects for handling customer transactions at airports and seaports made operational at 11 centers. 2. Introduction of computerized printing of drafts. 3. Opening of MICR and ECS centers for Electronic Clearing Services. 4. Remote login facilities for corporate customers implemented in over 70 branches covering about 400 customers. 5. Tele-banking introduced on a pilot basis at 38 branches in Mumbai Circle of the Bank, to be extended to other Circles soon.
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f) On-line Electronic Funds Transfer facility in 629 branches g) Swift Connectivity to 146 Branches, accounting over 85% Forex Business h) E-recon--Transmission of inter-branch data for reconciliation through Internet in 1790 fully computerized branches. i) Introduction of Telebanking on a pilot basis at 38 branches in Mumbai to be extended to select branches across all Circles. j) Introduction of remote banking facility for 400 corporate customers in 70 branches, allowing them to view and download account balance and transaction details from their office through a computer connected to the branch Management Information System The Banks Management Information System (MIS) aims at providing timely and accurate information to the management with the help of advanced information technology. Towards efficient data management, Oracle RDBMS has been introduced in the Bank and the process of migration of existing MISLA programme to Oracle environment has started with the development of a Credit Information System, which will replace MISLA. Other plans include introduction of SDF, a database on branch environment/infrastructure, and migration of other applications on Oracle. These initiatives will help in creating a Corporate Data Warehouse. In a spectacular technology demonstration State Bank of India, the country's largest bank, installed a Video Conferencing Network with a state-of-the-art Multi Conferencing Unit connecting its 24 Endpoints spread all across the country from Ahmedabad to Guwahati and Chandigarh toThiruvananthapuram. The network inaugurated on the 5th January as part of the 'Technology Fortnight' being observed by the Bank enabled its management functionaries to attend a mega conference lasting 4 hours and spanning the country, at the flick of a button. The network connects the Corporate Center in Mumbai with the Corporate Accounts Group, Mumbai, 14 Local Head Offices in various State capitals, 4 apex training centers at Hyderabad and Gurgaon, its Foreign Department in Kolkata, the Inspection & Audit Department at Hyderabad and the Agency Banking Department in Mumbai - in all 24 locations at present and expandable to 96 such locations. The facility provides for full motion video transmission connecting the whole conference rooms and its participants to interact, broadcast, share and collaborate seamlessly. The facility will enable SBI to leverage the full strength of its network and empower its management functionaries to coordinate their plans, programmes, product launches etc. in the most cost and time efficient manner. It would enable its highly trained faculty to impart training anywhere or everywhere in the Bank with minimum of travel for either the trainers or the participants. Most important, it will enable the Bank's Chairman, the Managing Directors, Deputy Managing Directors and other Top Executives to interact with the Chief General Managers at its 14 Local Head Offices and other functionaries in the Bank, signaling the breakdown of the time-distance barriers and bringing about a greater synergy of operations. The network will greatly facilitate and expedite the information sharing and decision making process in the Bank with its huge and multilayered structure. Use of Information Technology With the addition of 445 branches during the financial year, the Banks total number of computerized branches went up to 2,117, at 485 centers, capturing over 69% of the Bank's business. Business hours have been extended in 1,812 computerized branches in
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the country. With the addition of 16 more branches, a total of 131 domestic branches were covered under the SWIFT network. VSAT network covered 147 critical branches rendering cash-management services and SBI Datanet, used for inter-branch/inter-office data transmission, covered 1,013 branches. Electronic Data Interchange projects for handling customs transactions at airports and seaports have been implemented at 11 centers. PEOPLE Experience a whole new world of banking at our newly opened Personal Banking Branches (PBBs)- often dubbed boutique branches by others. Customer friendly knowledgeable staff will cater to your financial requirements with speed and efficiency. The continuing deregulation of India's financial services sector has resulted in increased competition for the Bank. In order to maximize shareholder value in this increasingly competitive environment, the Bank aims to improve profitability while consolidating its position as India's leading bank, and capitalize on opportunities presented by deregulation and other changes in the financial services sector to further enhance profitability through the following strategies: a. Improve customer service b. Develop and market new products and services c. Increase employee productivity through training and new technology d.. Improve credit assessment, loan monitoring and debt recovery e. Selectively develop its international operations. Human Resources Management Taking into account the vast changes taking place in the financial sector in India, the Bank has taken a critical look at the changes required in the Human Resources Management (HRM) policies to make the organization more vibrant, customer friendly and respond to the external environment with vision. The Bank has a very large in-house training capacity consisting of two apex Staff Colleges, an Institute of Rural Development, an Institute of Information & Communication Management and 50 Staff Training Centers. Over 70,000 employees pass through the training system every year. The annual expenditure on training is over Rs.55 crore. The Bank has full-fledged technology training system with one apex institute at Hyderabad and 22 satellite centres. Till date, these centers have trained about 75,000 OFFICIALS In the HRD area, a major event during the year was implementation of a Voluntary Retirement Scheme, with the objective of improving the age and skill profile of the staff. A total number of 35,380 employees applied for retirement and 20,784 were permitted to retire. Of the retired employees, 6,694 (32%) were officers, 11,271 (54%) were from Award staff category and the remaining 2,819 (14%) were from subordinate staff category. Staff Strength The Bank had total staff strength of 2,14,845 on 31.03.2001. Of this, 52,459 (24.4%) were officers, 1,06,731 (49.7%) belonged to the Award staff category, and the remaining 55,655 (25.9%) were sub-staff.
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PROMOTION: They consider print media as the best media. The advertising agency is Apex Advertising. Their famous punchline is with you all the way. PHYSICAL EVIDENCE: They give a lot of importance to the physical evidence. The ambience is well taken care of. There has been a considerable improvement in the ambience of several branches. They have been emphasizing on glossy brochures, better infrastructure etc. however this cannot be said about all the branches of SBI.
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SWOT FOR SBI

STRENGTHS: It has a branch network of 9100 branches and has an excellent delivery channel. Being one of the oldest bank people have a lot of trust in the bank. Its India Millenium deposit scheme last year got total NRI Deposits of a huge 5.5 $ billion which makes up a large chunk of the total Indias $40 billion foreign exchange. WEAKNESS: SBI Home Finance finds itself in a spot today because of its focus on housing projects rather then retail housing. It is considered as one of the biggest wealth destroyers. SBI tops on size based measures like revenues, PAT, total assets but appears among the bottom ranks for wealth creations.
OPPORTUNITY: THE ABNK IS TRYING TO PUSH ITS RETAIL GAMEPLAN IN A BIG WAY AND ALSOPLANS TO MAKE MAJOR INROADS INTO HOUSING FINANCE ON ITS OWN
THREAT: More and more corporates are moving from traditional bank loans to cheaper funding avenues in a bid to cut costs. Under the guidelines of RBI a bank can advance only 25% of its capital to a single borrower. Now due to the coming together of standard chartered and ANZ Grindlays, they have an increased capital base. The bank can issue Rs. 500 crore to a single corporate. That makes it the only foreign bank with this facility and hence has given the customers a choice that no longer have to go to SBI for this kind of a loan.
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INTRODUCTION TO CITIBANK
Citibank, the global bank from the US completed 90 years in 1992.It has all along accepted Indias place in the regional as well as the global economy. The bank has encashed its expectations and over the past 90 years has lived upto two of its characteristics: Firstly, it is occupying premium position in the banking industry, and is making Citibankers feel proud in working for the bank and its customers feel prestigious to bank with Citibank. Secondly, it has got well integrated into the ethos and economy of the country. Citibank continues to be a global leader in cash management and in India volumes are growing almost 50% every year in this area. But the buzzword in corporation these days is shareholder value and risk management. A great opportunity seen by Citibank was:A bank that would go to the customers and not vice-versa. It could foresee that since the late 70s the habits of the Indian consumer were changing;buy now, pay later was overtaking save now, buy later. India was also becoming one of the biggest markets for two-wheelers, refrigerators and TVs with annual growth rates of around 25%. The customer and the product were available, all that separated them was an easy loan. The Path Breaker The bank had aimed to be a path breaker in its operations, wherever it operated, and India is no exception. It pioneered in mid 1960s, among the foreign banks, recruitment of Indians to managerial positions. It went to management institutes to recruit its future executives. These executives, over a period of time have been tapped by the parent bank to manage its global operations. Citibank has now become the biggest exporter of high caliber manpower, which was used in other banks. The banks software subsidiary is one of the biggest exporter of bank oriented computer software.
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MARKETING MIX FOR CITIBANK PRODUCTS: Citibank Online offers a wide range of products and services to meet your banking and investment needs. Products: Checking Savings Cititrade Brokerage Individual retirement account Loans and lines Credit card Pricing packages . Riding in (Citibank Expatriate Indian Programme) It was Citibanks conscious decision to reach for NRIs, knowing the countrys needs to mobilize NRI deposits. It was the first among all Indian banks to systematically cater to NRIs and enable them to intimately play their due role in the economic development of their country. Citibank has 14 NRI centers across the globe where there are clusters of expatriate Indians and six branches in India. To increase your loan eligibility, you can jointly apply for the loan with an earning coapplicant who can either be your spouse or your parents. This helps increase the loan applicant's income is added to the total income available for consideration. Savings plans to meet your goals. Citibank offers a variety of savings products to meet both your short and long-term needs. Day-to-Day Savings Great for cash you need on hand, but no checking privileges. High-Yield Insured Money Market Account Higher returns plus limited checking privileges. Certificates of Deposit (CD) Guaranteed returns on funds you don't need right away. Individual Retirement Account (IRA) Tax-deferred savings and investments for retirement
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The various benefits can be divided under the following three heads: Personal banking
Open an account; Everyday Banking; Credit Card/Diners; Mortgages and Loans; Investment; Planning/Retirement Solutions; Insurance; International Special Services Small business:
CitiBusiness; Credit Cards/Diners; Insurance; Investment; Retirement Solution; Loans; Payments; International Special Services Corporate/institutional: Global Corporate/Investment Bank; Citibank e-Business; Citigroup Asset Management; American Depositary Receipts; Travelers Business; Insurance; Government Services; Diners Club; Credit Card; Merchant Services; Expatriate Banking; Private Banking; WorldLink; International Payments Services Advantage debit card ATM card Debit/ATM card ATM reimbursement Auto deduction Checks as cash Citi financial needs analysis Cititrade auto investment Direct deposit Online bank statement Online bill payment Overdraft protection Safe web online protection Wireless alerts
other then these it also provides investment services market snapshot quotes & charts Tools that help put you in control Planning for the future takes research. Here, you'll find a wide variety of planning tools, along with resources to help you learn more about everything from money basics to credit and borrowing and much more. One can learn more about Credit & Borrowing Education Planning Home Ownership Insurance Planning Investment Information Money Basics Using Citibank Online By tools such as: Education Funding Calculator Financial Health Check Future Value Calculator IRA Comparison Calculator IRA Rollover Calculator Major Purchase Planner Periodic Additions Calculator Present Value Calculator Maximize the power of your savings The Citibank Savings Account does more for your money than any other savings bank account. What makes it superior to any other account of its kind, is a host of features carefully designed to give maximum returns on your money. With it, you enjoy incredible financial value and great transactional convenience. 24 hours a day. 365 days a year. Take a look at its unique features and you will know why. Citibank Multi-Deposit Investment Services from Citibank Insurance Benefits Citibank Check Protect National Banking Dial-A-Draft Faster Check Clearing
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Multi-Deposit The flexible fixed deposit Unlike other fixed deposits, the Citibank Multi-Deposit is held in multiples of Rs.1000. Therefore, you can withdraw money whenever you need in multiples of Rs.1000 without breaking your entire deposit or paying interest on your own money. The deposits are broken on a minimum loss basis so as to maximize returns for you. Investment Service The best way to make your money grow Citibank Investment Services together with international partners such as Alliance Capital and Prudential bring you the best of Investment ideas. With assistance from an expert Investment Counselor. One way to ensure that your money works the hardest for you. Insurance Benefits You get a host of insurance benefits. Free Household Insurance With your Citibank Savings Account, you now automatically get Household Insurance worth Rs. 1 lakh against the loss or damage of your household articles due to accidental fire, burglary or theft. Free Baggage Insurance You also get free Baggage Insurance worth Rs. 30,000 against theft or loss of baggage while travelling in India. This cover is increased to Rs. 50,000 while travelling abroad. Lost Card Replacement In case you lose your Citibank ATM/Debit Card, we will ensure that replacement a Card reaches you within 48 hours from the time you repost the loss at no charge. The benefit of Household and Baggage Insurance has been introduced W.e.f.July 1, 2000. This cover is not provided by Citibank, NA and is subject to approval by The New India Assurance Company, Ltd. Special exclusions/limitations are as per policies issued by the insurance company. Check Protect Facility Covers low cash flow You get a temporary overdraft facility of up to Rs.10,000 if your Account is low on cash flow. You just need to call Citiphone. That's all. National Banking One bank across the country With Citibank you can deposit your cash and checks at any of our branches in Mumbai, Delhi, Calcutta, Chennai or Bangalore. All our branches are open until 7pm on all working days so you can visit us at your convenience. Dial-A-Draft Free and convenient draft delivery Just instruct us on the phone and have a draft delivered at over 40 locations within 24 hours. All from the comfort of your home or office
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Clearing As quick as can be At Citibank, checks take minimum processing time. Just 2 days for local clearing, 4 days for most metros, 14 days for checks drawn on any state capital and 11 days for US Dollar checks. Unnati Current Account From the moment you open a Citibank Unnati Current Account, you begin to feel the difference it can make to your business. First of all, you stop spending time unnecessarily with bank managers, and start spending more time with your clients. You stop running your business by the clock, because now you can access your Citibank Unnati Current Account any time and from anywhere. With Citibank Unnati Current Account you stop paying for things you should get free. CitiGold Wealth Management gives you an unparalleled advantage to stay ahead in life. It is an unmatched package of products and services that enables you to maximize your wealth, experience the luxury of banking services and offers you exclusive privileges that benefit your special status. PROCESS The process for some of its services are Citibank Investment Services Citibank Investment Services together with international partners such as Alliance Capital and Prudential bring you superior investment options. With an expert Investment Counselor to assist you in making your decisions. One way to assure that your money works the hardest for you. Check Protect Facility A unique facility that allows you an overdraft of up to Rs.10,000 if there is a shortfall in your Account balance. So, if your cash flow needs temporary bridging with an overdraft, just call CitiPhone and we'll process your request instantly. Free Drafts You can get free drafts drawn on any of 60 locations, up to Rs. 10 lakh per week. Just call CitiPhone from the comfort of your home or office and we'll have the draft delivered to you within 24 hours. Book a draft through the Internet, and we'll have it delivered to third parties absolutely free! Cash/Check Pick-up Call us and we'll pick up your checks for deposit to your Account, absolutely free. Cash Delivery You can order cash between Rs.1000 and Rs. 25,000 per day at your residence or office, at a small charge.
Intercity Cheques With your Citibank Unnati Current Account you get a cheque with payable at par facility across 8 cities in India and growing. These cheques are locally cleared. This translates into great savings in time as well as cost of clearing for your business. CitiGold Wealth Management Process CitiGold Wealth Management is a two step process The first step begins with Citipro, the Financial Managing Tool. It helps you assess your existing wealth, cash flow requirements, and risk appetite and investment horizon. Your profile and your cash flows will determine the optimal portfolio allocation into liquid assets, medium term and long term investments. It also helps you rationalize your existing liabilities and determine your insurance requirements so that your family can continue to avail the same benefits and fulfill their dreams even in case of an unfortunate eventuality. It thus enables you to preserve, protect and grow your wealth. The second step pertains to product selection and portfolio review and rebalancing with CitiChoice. You can select from a shortlist of top performing mutual funds in each of the liquid, debt and equity funds asset classes from leading fund houses in India. Depending on your risk appetite and investment horizon, you can also invest in Government of India fixed income securities, treasury bills and corporate bonds/ debentures/ commercial papers. Unmatched Banking Convenience You can conduct your banking in complete exclusivity and confidentiality at our exclusive the world through financial and business magazines and television programmes. CitiGold brings to you superior banking convenience with draft drawing facilities at over 275 locations, national banking, payable-at-par cheque books, cash delivery and cheque pick-up facilities. An exclusive CitiGold telephone line at CitiPhone, Citibank Online and Citibank Banking Centers enables you to conduct your banking transactions 24 hours a day, 7 days a week - both while you are in India or travelling overseas. CitiAlert messaging services helps you keep tab on your money through Alerts on your email or mobile phone. Direct Debit When you open a new account, you can have up to $1,000 directly debited from any nonCitibank account with check-writing privileges. Direct Deposit You can have your paycheck directly deposited into your Citibank checking, savings or insured money market account. Just click on the Direct Deposit Form link below to download the form. Then print it out and follow the instructions. Or, if you prefer, you can sign up for Direct Deposit with your employer. Wire Transfer Wires received by 4 p.m. local time will be credited to your account no later than the next business day
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PRICE The Citibank Personal Loans are clean cash loans. They do not require any security, collaterals or even guarantors. In many cases, Citibank won't charge you for using non-Citibank ATMs, as long as you meet minimum balance requirements or stay within the transaction limits set for your account. For details, consult the Citibank Online Client Agreement. (Follow the link below and check the section on Package Pricing or the "Checking at a Glance" section.) Basic Checking and Basic Savings are exceptions. With those accounts, Citibank may charge you for using a non-Citibank ATM. To find out more, consult the Client Agreement and see the Section on "Basic Banking." Other financial institutions and ATM operators may independently charge non-customers a fee for the use of their ATMs. Citibank has no control over these charges. Be sure to ask your local ATM providers about their usage fees or look for fee information on the ATM itself. Citibank may in some cases reimburse qualified account holders for ATM usage charges by other financial institutions and ATM operators. It's not a credit card, so you don't have to pay a monthly bill or finance charges. The money you spend is deducted from your checking account at the time of purchase. However, with the Citibank AAdvantage Debit Card there is an annual fee. Here's a rundown on our cards: Basic Citibank Banking Card: No annual fee and no finance charges on purchases. Citibank Banking Card with the MasterCard logo: No annual fee and no finance charges on purchases. Citibank AAdvantage Debit Card: For the Basic plan, which earns one mile for every $2 spent, there's a $25 annual fee. For the Premium plan, which earns one mile for every $1 spend, there's a $65 annual fee. *Note: If you have a Checking Plus line and don't have enough in checking to cover a debit card purchase, then your overdraft line will be accessed and the regular finance charges will apply. OTHER CHARGES There are several other charges associated with getting a loan which together form the effective cost of your loan. PROCESSING FEE This fee is paid up-front to the lender for processing your application. Though it may be a small amount, it increases your cost of borrowing. Processing fees range between 2 to 4 per cent of the loan amount. This charge is negotiable. DOCUMENTATION CHARGES These charges also need to be paid up-front to the lender for processing and verifying all the documents. These charges also add to your cost of borrowing and are negotiable. PREPAYMENT CHARGES There are certain lenders who levy a prepayment charge to the borrower in case of early repayment of the loan. These charges range between 1 to 4 per cent of the balance
outstanding, which is repaid. This adds to the cost of the loan. PENAL INTEREST In case you delay your repayments, the lender charges a penal interest of about 2 per cent of the amount due. , there are no fees for accessing your accounts with Citibank Online. In addition, many of the services that Citibank offers, such as bill payment, are also free. However, you may be charged for specific banking and investment services. Prices for some services are: Service Abandoned Property Transfer1 Bond Coupon Redemption (per series) Checkbook/Check Orders Checking Account Closing (within 90 days of opening) Check Issued in Foreign Currency (Worldlink) Check Returned/Paid Against Insufficient/Unavailable Funds (overdraft)2 Clerical Research (per hour, one hour minimum) Coin Counting3 Collection of Checks Drawn on Foreign Bank4 - if less than U.S. $100.00 - if U.S. $100.00 or more Collection of Notes and Sight Drafts on Domestic Bank Consular/Verification Letter Copy of Cancelled Checks5 Counter Checks Deposited Check Returned Unpaid Domestic Bank Collections4 Foreign Currency Exchange $1,000 and over - Under $1,000 Interim Statement Legal Process Compliance (levies, attachments, etc.) - NOTE: This fee will change to $125.00, effective 4/1/02. Miscellaneous Copies (IRS Forms 1099, Deposit Ticket, etc.) Money Order for Customers Money Order for non-Customers Official Check Postdated Check Request6 Quicken (Per Statement Period) Returning Original Checks in Statement (effective 4/1/02) Safe Deposit Box Annual Rental Safety Check Fees $20.00 $10.00 Varies $25.00 $25.00 $30.00 $25.00 5% $10.00 $30.00 $25.00 $25.00 $5.00 $5.00 $10.00 $25.00 No Charge $5.00 $5.00 $100.00 $5.00 $5.00 $10.00 $10.00 $25.00 $9.95 $2.00 Varies $5.00
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Staff Assisted Bill Payments (Per Statement Period) Statement Copy Stop Payment Request Temporary Safekeeping for First 15 Days - Each Additional Month or portion of Month Travelers Checks Wire Transfer - Incoming Domestic and International - Outgoing Domestic - Outgoing International
$4.95 $5.00 $30.00 No Charge $10.00 1.5%
PEOPLE: RELATIONSHIP DISCOUNTS Relationship discounts are offered to you in case you already have a relation with the lender. For instance, if you are banking with the lender or have previously taken a loan, you have the option of negotiating for lower interest rates on the loan. PHYSICAL EVIDENCE: Ambience of office is greatly emphasized by the Citibank. The dcor, maintenance, quality of posters and brochures is keenly taken care of. Even the websites are made attractive and catchy with detailed information. Even the ATM centers are well equipped and impressively kept. PLACE One can use ATN/Debit card to get cash at over half a million ATMs worldwide and to make purchases at merchants displaying the Cirrus, Maestro, NYCE, and STAR symbols. Select merchants in these networks will allow cash back from your account when you make a purchase. In addition to the locations listed above, the Citibank Banking Card with the MasterCard logo is accepted at over 21 million MasterCard locations worldwide. NRI Services in India 1. Mumbai 2. Delhi 3. Chennai 4. Hyderabad 5. Calcutta 6. Bangalore 7. Pune 8. Baroda
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9. Ahmedabad Branch locations are at 1. Mumbai 2. Delhi 3. Chennai 4. Hyderabad 5. Calcutta 6. Bangalore 7. Pune 8. Baroda Ahmedabad 9. Jaipur 10. Vadodara PROMOTION Biggest spender on promotion is considered to be Citibank, which spends Rs.15 crore on advertising, of which about 50% is, spend on boosting its credit card business. The bank however spends Rs. 60 crore on marketing. Citibank is glitzy and high profile and it has the widest portfolio-it is into credit cards, personal loans and other such products. It also introduced local understanding of a global level of service that came to India. Citibank has been coming up with various schemes from time to time. Mostly it uses print media to promote its products. It has several punchlines of which the most famous are The Better Way To Manage Your Money Starts Here. The Citi Never Sleeps. Apart from these it also goes in for various schemes in collaboration with companies like Indian Oil and MTV. It also promotes extensively on Internet. Presently it has an advertisement in sify.com home pages Some e.g. Sify Citibank Special Occasions Exclusive round-the year Special Offers on Citibank cards just for Sify users. Because for a Citibank cardholder, no day is just the same and no month is just like another. There's always more to look forward to from Citibank every month. Besides enjoying the usual benefits like world-wide acceptance, 24 hour accessibility and ATM facility, with these Cards you can now enjoy additional exclusive offers that come your way every now and then! Making the whole year a special occasion! Indian oil Citibank international card Use this fuel efficient Credit Card anywhere in the world and get free fuel in India! No transaction fees at Indian Oil Outlets!! Collect turbo points every time you use it and get free fuel Plus discounts on JK tyres, Exide batteries etc plus more Go places with this card! Smart deals Now Citibank Online helps you make the most of your money, every way possible.
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Introducing Smart Deals -- unique values and special savings developed exclusively for you.
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SWOT OF CITIBANK INDIA STRENGTHS 1. Being the first entrant in the auto-finance business the brand recall is high among consumer. 2. As it has tie-up with Maruti which is the largest seller of automobile in India. It has an edged over its competitors as when consumer goes to dealer. 3. People associated Citicorp with Maruti. 4. The Citicorp has very wide network which gives it an extra leverage. 5. It has the first mover advantage. 6. Alongwith Times Group it brought in Times Online Money Ltd. Which is Indias largest financial supermarket. WEAKNESS 1. People are unaware about the fact that Citicorp provides are loans for other car manufacturing companies. OPPORTUNITIES 1. As the auto-financing market is increasing rapidly the company can gain considerable market share. 2. The companies to have preferred financial status with other manufacturing automobiles company. 3. With the change in life style of companies people are open to the idea of car finance. Which will help Citicorp the gain a greater market share. THREATS 1. Entry of new players in the market the competition is increasing. 2. With a decrease in the interest rates the profits of the company are under threat.
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ANALYSIS OF QUESTIONNAIRE
To find what does the consumer believe about the marketing mix of the above three banks: Q.1. Which of the following bank do you avail service of : ICICI SBI CITIBANK Out of the 50 people contacted for filling up of the questionnaire 46%dealt with ICICI, 30% with the SBI and only24%with the Citibank. There is only a marginal difference between the no. Of customers for each bank.
SEVICES AVAILED FROM
CITIBANK 24% SBI 30%
ICICI 46%
Q.2. What are the services that you generally avail from banks? ATM Credit Card Loans Others (savings &deposits)
SERVICES AVAILED
OTHERS ATM 18% 26% LOANS 14% CREDIT CARD 42%
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The services availed by customers are as above. Q.3. Are all your financial requirements met effectively with your bank? Yes No When asked about this60% of the respondents answered in the affirmative. Out of these 67% ere the customers of ICICI, 20% of SBI and 13% of Citibank. This gives an idea about the amount of varied services provided by different banks. ALL FINANCIAL REQUIREMENTS ARE MET WITH YOUR BANK
20 20 10 0 3 ICICI 6 9 4 8 YES NO
SBI
CB
Q.4. Do you feel with the introduction of private and foreign banks the services of public sector banks have improved? Yes No Most of the respondents felt that with the advent of private and foreign banks the services of public sector banks have improved drastically. 62% of the respondents felt that there has been a change while 38% feel there ahas been no considerable change.
HAVE SERVICES OF PUBLIC SECTOR IMPROVED
NO 38%
YES 62%
Q.5. Are the service charges of your bank : High Low
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Reasonable Out of the total respondents 74%feel that bank charges are reasonable (of these 16.2% were Citibank customers, 57%were for ICICI and 27% for SBI), 6%feel that they are low (100% of these were SBI customers) while 20%feel that they are high (out of these 60% were dealing with ICICI, and 20%each for SBI and Citibank). SERVICE CHARGES OF THE BANKS ARE
30 20 10 0 20 ICICI 21 10 23 SBI 6 0 CB 6
HIGH LOW REASONABLE
Q.6. What is the best source of promotion by which you get to know about the new services provided by your bank? T.V. Print Internet Word Of Mouth 38% of the respondents feel that TV is the best means for promoting banking services, 28% found print media as the best alternative and 22% favored Internet as the best means. 12% of the total respondents believed that nothing could promote banking services better then word of mouth.
BEST MEDIA FOR PROMOTION
WOM 12%
PRINT 28% INTERNET 22%
TV 38%
Q.7. Are the promotional schemes of your bank appropriate and understandable? Yes No
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66% of the total respondents feel that the current promotional schemes of their respective banks are both appropriate as well as understandable.
ARE THE PROMOTIONAL SCHEMES APPROPRIATE/UNDERSTANDABLE
NO 34% YES 66%
Q.8. Can you recall the last advertisement of your bank in the media you consider as best? Yes No Only 64% of the total respondents were able to recall the last advertisement for their banks. Out of these 71% were dealing with ICICI, 6.2% with SBI and 21.8% with Citibank. Out of the ones that were not able to recall 72% were dealing with SBI and 28%with Citibank and none from ICICI. CAN YOU RECALL THE LAST ADV OF YOUR BANK
30 20 10 0 ICICI 0 2 SBI 23 13 7 5 YES NO
CB
Q.9. By which source do you generally perform your banking functions? Walk In ATM Telephone Home Credit Card Internet The sources by which the functions performed by customers of various banks are as follows:
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20 18 16 14 12 10 8 6 4 2 0
MEANS BY WHICH YOU DO BANKING 18
9 6 1 WALK IN 2 0 0 TELE 0 0 0 HOME INTERNET 2 3 7
10 6 2 0 ATM CREDIT CARD 7
ICICI SBI CB
Q.10. Are the branches of your bank widespread? Yes No 78% of the total respondents felt that their bank had enough branches (54% of ICICI customers, 36% of SBI customers and 10%of the Citibank customers). 73% of the Citibank customers felt that their bank had not enough branches. ARE THE NO. OF BRANCHES OF YOUR BANK ENOUGH
30 20 10 0 ICICI SBI CB 2 21 14 1 4 8 YES NO
Q.11. How much do you feel your banks services have improved by means of new technological gadgets? Very Much Not Much Not AT All When confronted with this question most of the customers replied that technology has changed the look and performance of the banking services.70% of the total believed that there has been a lot of change (51% of ICICI, 26% of SBI and 23% of Citibank customers). While 24% believed that there has been only a marginal change 6% felt the
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services and its quality has not changed at all (out of these 67% were SBI, 33% of ICICI and none of the Citibank customers. HAS TECHNOLOGY LED TO IMPROVEMENT OF SERVICES
20 15 10 5 0 18 9 4 1 4 2 VERY MUCH 8 4 0 CB NOT MUCH NOT AT ALL
ICICI
SBI
Q.12. How do you find the ambience of your bank? Very Good Average Poor 62% of the total respondents found their banks ambience as very good (61% of ICICI, 6.4% of SBI and 32.2% of Citibank customers. 34% felt that the banks ambience was kind of O.K.20% of the respondents had complaints regarding the ambience out of which 60% were customers of SBI, 30% of ICICI and only10% of Citibank customers.
HOW IS THE AMBIENCE OF YOUR BANK
20 15 10 5 0 ICICI SBI CB 1 3 2 7 6 19 10 1 1 VERY GOOD AVERAGE VERY POOR
Q.13. How is the attitude of the bank staff towards you? Very Friendly Formal Bad 54% of the respondents had very good experience with the banks staff. 67% of the ICICI customers found their staff very friendly, while only 15% of SBI and 18% of Citibank customers found their banks staff friendly. 34% of the 50 respondents found their banks staff formal (24% of ICICI, 47% of SBI and 29% of Citibank customers). Out of the 12%
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who felt that the banks staff attitude was bad 16% were ICICI customers, 50% were SBI customers and 34% were Citibank customers.
ATTITUDE OF THE STAFF 20 15 10 5 0 ICICI SBI CB 4 1 4 8 3 5 5 2 18 VERY FRIENDLY FORMAL BAD
Q.14. Are the process of your bank services: Easy Difficult 76% of the total customers felt that bank processes for the delivery of services were easy (67% of ICICI customers, 20% of SBI and 13% of Citibank customers. Out of the 40% who felt the processes were difficult 45% were SBI, 15% were ICICI and 40% were Citibank customers.
THE BANK PROCESSES ARE 20 15 10 5 0 ICICI SBI CB 7 2 16 13 9 3 EASY DIFFICULT
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CONCLUSION
ICICI has one of the largest bouquet of services available and has been successful in positioning itself as a one-stop shop for various services. However Citibank despite of large no. Of available services has not been very successful in convincing its customers. The entry of the large no. of private sector banks and foreign banks had a positive consequence for customers of public sector banks. Since scared of competition and under constant pressure of the threat of losing their customers to any of the above public sector banks improved the quality as well as quantity of their services. Public sector charges for services are still very nominal compared to other banks. Citibanks service charges are considered to be the highest TV is still the favorite among the consumers to see the advertisement of their brands. Although the most traditional and primitive method of spreading positive comments through word of mouth is still being preferred by a large no. of customers. Internet marketing has also set its foot in the marketing of banking services. Most of the ICICI customers were able to recall the advertisement with Amitabh Bachchan talking about ICICI bank and its services. It seems that the banks aim of getting a place in customers mind has been largely fulfilled by taking a role model most of the Indians can relate to and trust. Traditional form of banking by walk in still very popular even though banks are trying hard to convert these customers to ATMs. The other forms of banking are way behind these two and need to be pushed to the customers in the most effective and efficient manner. The banks need to create awareness among the customers about these methods. Citibank needs to have far more branches then it currently has. ICICIs growth and increase in the no. of branches has earned fruitful consequences with most of its customers 54% satisfied with the no. of branches. The change brought about in the banking industry due to various new and technologically upgraded methods has been exponential. Most of the banks have changed their service pattern completely to stay upbeat with these technological advances. These help not only in providing services in the most cost efficient and effective manner but also largely reduce the time and hassles involved. ICICI has made the best use of these innovations while the public sector banks like SBI has still way to go to upgrade its systems and come to par with other players in private sector. The ambience of a bank leaves a dark impact on the minds of the customers. ICICI has completely renovated its banks according to the changing times. The ambience of Citibank is also up to par with other players. However the most commendable task has been performed by SBI which has undergone a complete change in its interiors and dcors well as the presentation of brochures. Though not all branches have been totally revamped but would soon be going on the same lines. The behavior of the SBIs staff has also seen a great change in the recent years. Though still a lot of its customers are not satisfied with the staffs attitude. ICICI and Citibank customers are pretty happy with the attitude of the staff.
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Today, the customer is the master. He/She has a lot of choices to select from and if one has to retain ones customers one will have to ensure that that the customers get a much better deal from their banks. In order to survive, all banks and financial services would probably have to quickly and seriously re-evaluate their delivery strategy, if they have to survive in the market space. The Internet is slowly converting retail banking into a commodity where the days of loyalty to bricks and mortar banking are obsolete. Jurassic banking is pass. In concluding one may state that Indian banking in the next millennium is likely to be driven by mergers, universal banking and Internet technology. While mergers will confer economies of scale, universal banking will dismantle the barriers between the traditional dichotomies of financial services. While one realizes the fact that the Internet is likely to convert banking into a commodity one has to take into account that thirty years of solitude has steeped Indian Banks into a morass of inefficiency, slothfulness and complacency. If Indian banks refuse to visualize this trend they may well be consigned to history. However, if they react proactively Indian Banks stand to gain a lot from the opportunities that E-banking offers.
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RECOMMENDATIONS:
Banks should go in for branding exercises comprising of two parts: enhance brand logo i.e. to make it more catchy and easy so that customers could relate to it, and secondly by focussing on service since whether in the bank or at the ATM service is key. Hence these should be incorporated in branding. Banks like ICICI can go into retail banking as it is the best long term solution for ICICI to remain with the A group of finance companies in the future. Assuming that ICICI continues to grow at its historical rate of 15%per annum, five years from now, retail disbursals will amount to a whooping Rs.15,000 crore. ICICI needs to move away from high risk, low return business of project finance and venture into new areas. It also needs to focus on being the best and forego its earlier strategy of just being the first of the block. ICICI needs to remove laid back investor unfriendly unit approach. Of All the three concerned banks ICICI needs to build a strong management team . Banks need to have high investment in infotech while at the same time should own expensive premises in the most attractive locations. The banks should emphasize on being completely automated and provide information faster and keep flexible working hours. They can use outsourced agents to contact customer directly. Banks should work to transform themselves into one stop shop for all financial services. Banks should go for seamless connectivity for corporate customers, device neutral connectivity for retail consumers, cross selling and up selling using CRM technologies, evaluating and enhancing the lifetime value of customers and so on. At the back end the headquarters of all the banks should have a central serve that provides on a daily basis, the balance sheet of the bank, its asset liability profile, details of individual customer payments and the risk status of the assets. This will help the bank to ensure that rogue employees arent abusing the powers granted to them and still better will improve the financial health of the banks. Branch banking is clearly out as it involved huge costs and also considered outdated in the new technology age. So, the banks need to be where the customer is i.e. take bank to the customers door step through other distribution channels from Internet to phone, even mobile banking. Banks could opt for M&A with one specific objective to acquire customers and increase their geographic reach. This provides a lead of atleast 12 months and considering RBIs branch licensing policy, it would take atleast 5 years to get an all India branch network. Banks should improve their advertising and other means of promotion. This is so since when there is no big benefit to offer because products have become standardized, there is need to advertise to create a sharp reference and then preference. The foreign banks such as Citibank earlier restricted business to MNCs should now expand completely and strategically in the domestic market.
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Foreign banks should now mark some capital for their non-fund-based activities in their tier II capital. this would effect their balance sheets to some extent. Banks can have proper call centers like ICICI. These provide the following advantages: 1. A Single Point Of Contact to provide customers with a uniform Interface. 2. Better service to customers by giving them consistent information and extended hours of service and hence promote cross selling. 3. Maintenance of contact history for all customers to have better understanding of customers needs. 4. To increase customer retention rate. MANAGING CUSTOMERS AS HUMAN RESOURCES Banks should let technology, clearing and book keeping take a backseat and put customer services in front. The idea here is to "look to your customers to increase productivity" to borrow from the title of a classic, but somewhat overlooked, HARVARD BUSINESS REVIEW article by Christopher Lovelock and Robert Young. Perhaps the thought of "making customers serve themselves" or "having them do some of the work themselves" seems out of step with these times in which businesses are constantly chided to pamper and delight their customers. Yet customers can obtain delight from serving themselves if it provides them with a greater sense of control over the service production process. PERFORMING A CUSTOMER JOB ANALYSIS : A job analysis specifies the critical behavioral requirements of a position. It details, for example, the most important and most common behaviors needed to perform the job satisfactorily. Precisely what is it that we want our customers to do? The way we have been thinking about this is to put customers on a kind of service co-production time line and figure out what we want them to do on that time line. There are four stages in the customer's job: (1) The pre-service encounter (2) The encounter itself (3) De-coupling (4) Post-encounter

Recovery Actions: - Firms can sometimes bounce back from broken promises through acts of recovery. Here, too, fairness comes in to play. There is research showing that customers feel their complaints have been dealt with more fairly when recovery is handled "by the book". Customers seem to get greater peace of mind from knowing that the effective handing of their complaints was because of in-place company policies rather than to their having been lucky enough to have stumbled upon one particular employee who happened to figure out what to do on his or her own. AFTER SALES SERVICES: Historically, after-sales service was regarded in most manufacturing companies as a necessary evil - as a supporting but relatively minor function in the overall function of the organization. While it was realized that it was important to provide a reasonable level of after-sales service, the role and function of service was generally viewed
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purely as a cost center. As consumers grew more sophisticated, they became less willing to accept poor quality goods and services. The banking organizations should to realize that by offering guarantees and service warranties they could enhance their competitive position. CUSTOMER CARE PROGRAMMES Service organizations are particularly dependent on levels of customer care, as the 'people' element in the marketing mix reflects. For customer care programmes to be successful they need to span the entire organization. Training will not work if it is carried out on a piecemeal basis and should be supported all the way from the top. Customer care programmes will typically be comprised of six main stages: Objective setting: Define the programme objectives Current situation analysis: Conduct a customer service audit - internally and externally Strategy development: Develop a strategy for raising levels of customer service from the current to the desired standard. Functional planning: Define training needs and other requirements to execute the strategy Implementation: Implement training and other initiatives through workshops, seminars. Promote the programme both internally and externally, develop internal marketing programmes. Monitoring: Test results through customer and employee surveys, evaluate the training methods. Improve and update the programme on a continuous basis. New segments such as Children and teenagers are a keen target market for the banks because of the possibility of the future business. For communication strategy: The banks should try to reflect a consistent and attractive personality in all manifestation of organization that reaches the public. Also they should aim for a recognizable human personality to compensate for intangible/diverse product and incorporate the staff as the key T.A. During communication the banks should emphasize in the specialization rather then all the things for all the people, which could help in creating a unique positioning. One of the best strategies is customer retention. Loyal customers who keep purchasing are extremely valuable. This could be done by having a database marketing where customer buying histories and other information can be listed on a database, and then referenced and cross-referenced in the future to target new products or promotions accurately. A market research should be conducted by the banks to find out about the customers who have defected. A research is important to establish why customers defect, as studies shows that a huge proportion of dissatisfied customers dont complain and simply stop using the service. By the same token, customer complaints handling procedures process should be handled out carefully to ensure that - the complaint is rectified and the customer is satisfied. -the necessary action is taken to prevent that problem from occurring again.
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Proper monitoring of service quality should take place. This is done under the following headingsInternal performance analysis Customer satisfaction analysis Specialist market research Banks like SBI should emphasize more on Internet banking. ICICI is already cashing on it. e-mail is the sleeping giant of the marketing mix, and its appropriate and strategic use can help businesses reach existing markets, and new markets, cost-effectively and with a high success rate. Graeme Victor, MD of World Online, says many companies are loath to use e-mail as a marketing tool because they are concerned with spamming and damaging their brand; they view it as inappropriate for leading brands; and they do not believe they will obtain sufficiently high response rates. Net banking though is convenient but the fact that there is no human interface is unnerving some customers. So banks should try to personalize the online site as much as possible. Of the top ten internet banking sites Citibank India:Citidirect holds the 2nd position while ICICI bank: Infinity holds the 3rd position. Relationship Banking: The modern bank cannot rely on its branch network alone. Customers are now demanding new, more convenient, delivery systems. And services such as Internet banking have a dual role to the customer. They provide traditional banking services, but additionally offer much greater access to information on their account status and on the banks many other services. To do this banks have to create information layers, which can be accessed both by the bank staff as well as by the customers themselves. THE BANKS CAN HAVE EXTENSIVE ONLINE ADVERTISING Gartner Group recently provided a guideline to marketing managers who need to determine the true costs of online banner advertising and opt-in e-mail marketing compared to traditional print (offline) marketing campaigns. It says marketing managers are struggling to divide increasingly limited marketing budgets among various online and offline marketing platforms. Banner Advertising: Web-based advertising revenue is shrinking for many Web sites, and banner advertisement CPM (cost per thousand impressions) rates are plummeting. Thanks to the "e-advertising law of diminishing returns," this is a natural progression for banner advertising as the Internet continues to grow. Opt-In E-Mail Marketing: Direct e-mail marketing has response rates of 5 percent to 15 percent, exceeding those of online banner ads and traditional direct mail (1 percent to 3 percent). Drawn by high response rates and perceived lower costs, two-thirds of Global 1000 companies have allocated as much as 5 percent of their marketing budgets for email campaigns. Enterprises are also building their own e-mail marketing lists from storefronts, Web sites, catalogues and public events. The cost of acquisition for these
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efforts will vary greatly. E-mail list rental rates are dropping, especially on the business-to-consumer side. Just as traditional marketers use publications, TV, radio, trade shows and many other forms of media to create a "mix" that reaches the right audience in the right way, so should online marketers use e-mail and banner ads as part of an overall marketing mix. Banking on targeted marketing Banks should now scans all of its customers for value, risk, attrition, and propensity to buy. Contrary to popular belief, banks do have many unprofitable customers. A CRM report issued by the UK-based Cranfield School of Management, assisted and sponsored by Computer Sciences Corporation (CSC), finds that each year a quarter of new customers at US banks never generate enough revenue to offset basic acquisition costs. An additional 30 percent never generate enough income to make a positive contribution to profits. The report found that most banks are not doing effective database-driven targeted marketing. In fact, only one in eight banks adopt targeted marketing using an enterprisewide strategy -that is, developing campaigns based on an understanding of the customer's value to the bank across product areas. ATMs: The New Role Models Banks should ready their ATM fleets to explore new frontiers in service The banks can make ATM screens blossom with high-resolution color, featuring news, entertainment and advertisements. Of course, cash and stamps still are available, but now so are movie tickets, coupons and maps. With a realm of possibilities as vast as cyberspace, these devices can be dressed to impress-and financial institutions take notice. Some board the bandwagon, initiating pilot programs that offer a range of banking features on customized ATMs. Others are more cautious. And all wait for a measure of supercharged success. Newer ATM services, such as bill payment and ticket offerings, can be introduced. Banks should really look at their ATMs not as product sellers, but as relationship devices. One way that Web-enabled machines can enhance customer relationships is by interfacing with home computers. It really is talking about personalizing that ATM experience-personalizing the transaction experience for your customers." Developing ATM technologies could bring benefits to FIs, too, Earley says. "I think access to the Internet is another method of communicating that decreases the number of technologies they need to support and put things on a centralized platform. And that may be important to the banks. the Verma Committee recommended the need for greater use of IT even in the weak Public sector banks. Actually, the nationalization of banks back in the 80s is proving to be a major obstacle in bringing about the required technological changes. Nationalization of the banking sector has led to occurrences of pseudo developmental activities for nurturing vote banks, loss of accent on performance and profitability, creation of unions etc to name a few.
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Today, technology savvy private banks are making the most out of opportunities thrown up by the Internet leaving behind their slow moving public sector counterparts in valuations as well as growth. Now, when one considers the fact that public sector banks dominate the banking landscape in India, one realizes that a lot has to be done and done quickly for India to catch up on E-banking. Presently there are 33 private banks and 43 foreign banks but the 27 public sector banks mop up the bulk of the business. They account for over 84% of the total deposits and over 82% of the total banking advances in India. In the words of Mr. Bandi Ram Prasad, Chief Economist, Indian Banks Associations, If Indian banking system has to undergo a transformation, then the public sector banks must be in the forefront of the change. Before we delve into the problems plaguing the public banks a look at the present scenario in India acts as an eyeopener. Banks should put more emphasis on RURAL BANKING About 75% of the Indian population lives in rural areas and about 80% of this population is dependent on agriculture for its livelihood. Agriculture accounts for about 37% of the national income. The development of the rural areas and of agriculture and its allied activities thus becomes vital for the rapid development of the economy as a whole. In this regard, India has succeeded in developing one of the largest rural banking systems in the world. Various regulatory measures have been taken enabling the banking system to play an important role in the economic development of the rural areas. Banks should go in for rural commercial bank branch expansion, thus moving from class banking to mass banking and
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LIMITATIONS:
The preference of various customers may be a bit influenced since most of the respondents were from Delhi and NCR. Since the data has been collected from a variety of primary and secondary sources there might be slight inaccuracy in conclusion. Since the questionnaire was structured, non-disguised type, it prevented me from probing the respondents for more explanation on certain topics. Number of customers/respondents for each bank was different and hence the final ratio of response varied.
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ANNEXURE
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ANALYSIS OF QUESTIONNAIRE:
What does the consumer believe about the marketing mix of the above three banks: Q.1. Which of the following bank do you avail service of : ICICI SBI CITIBANK Q.2. What are the services that you generally avail from banks? ATM Credit Card Loans Others (savings &deposits) Q.3. Are all your financial requirements met effectively with your bank? Yes No Q.4. Do you feel with the introduction of private and foreign banks the services of public sector banks have improved? Yes No Q.5. Are the service charges of your bank : High Low Reasonable Q.6. What is the best source of promotion by which you get to know about the new services provided by your bank? T.V. Print Internet Word Of Mouth Q.7. Are the promotional schemes of your bank appropriate and understandable? Yes No Q.8. Can you recall the last advertisement of your bank in the media you consider as best? Yes No Q.9. By which source do you generally perform your banking functions?
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Walk In ATM Telephone Home Credit Card Internet Q.10. Are the branches of your bank widespread? Yes No Q.11. How much do you feel your banks services have improved by means of new technological gadgets? Very Much Not Much Not AT All Q.12. How do you find the ambience of your bank? Very Good Average Poor Q.13. How is the attitude of the bank staff towards you? Very Friendly Formal Bad Q.14. Are the processes of your bank services: Easy Difficult
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IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

INTRODUCTION TO PRESENT PROBLEM

Vital stats for private sector banks:

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

INTRODUCTION TO BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

ENVISIONING THE FUTURE OF BANKING

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

THE NEED FOR BETTER MARKETIN MIX:

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

INTRODUCTION TO SERVICES MARKETING

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

EXPANDING THE MARKETING MIX FOR SERVICES MARKETING

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS

IN-DEPTH STUDY OF MARKETING MIX OF BANKING INDUSTRY

CENTER OF INTERNATIONAL BUSINESS, ABS