NATIONAL INSTITUTE OF FASHION TECHNOLOGY, BENGALURU

MASTER OF FASHION MANAGEMENT

BATCH 2023-2025

Fashion Marketing

Exercise-21

SUBMITTED BY:

Vidhi Agrawal
MFM/23/63
It was only about 20 years ago that most banks typically only used one distribution
channel (their branches). However, since that time, they have dramatically expanded the
number of channels that
they use. Below is a list of common distribution channels for a bank. Your task is to
identify the most appropriate mix of channels for two different banks.

1. The first bank is a central bank that has an extensive number of branches throughout
India. One of the critical aspects of their positioning is that they offer excellent personal
service. Select the five most suitable channels for them.
A1. Given the focus on offering excellent personal service and the extensive number of
branches throughout India, the bank should consider channels that align with these priorities.

Branch Banking:
Description: Given the extensive number of branches, the bank should continue to emphasize
and enhance its branch banking services. This is a traditional but effective channel for
providing personalized services to customers.
Advantages: Direct customer interaction, personalized assistance, and the ability to offer a
wide range of banking services in person.

Customer Service Centers:

Description: Establishing dedicated customer service centers or hotlines where customers can
reach out for assistance, information, and issue resolution.
Advantages: Provides an additional avenue for customers to seek help, ask questions, and
resolve concerns without physically visiting a branch.

Online Banking with Customer Support:

Description: Enhancing the online banking platform with robust customer support features.
This can include online chat, email support, and a helpline for online banking-related queries.
Advantages: Allows customers to access services remotely while still maintaining a level of
personalized assistance through digital channels.

Mobile Banking Applications:

Description: Developing and promoting a user-friendly mobile banking application that
enables customers to perform various transactions and access services on their smartphones.
Advantages: Provides convenience and accessibility, allowing customers to conduct banking
activities on the go while still incorporating features for personalized support.
ATM Network:
Description: Expanding and maintaining a widespread network of ATMs throughout India.
ATMs can provide basic banking services and serve as touchpoints for customers who prefer
self-service.
Advantages: Enhances accessibility, allows for basic transactions outside of regular banking
hours, and complements the in-branch services.

2. The second bank is new to India. They have no branches and have very little brand
awareness in the market. They plan to specialize in offering great-value home loans only.
Select the five most suitable channels for them.
A2. For a bank that is new to India, specializes in offering great-value home loans, and has
limited brand awareness, it's important to focus on channels that efficiently reach and
engage potential customers in the target market.

Online Marketing and Advertising:

Description: Invest in online marketing strategies, including digital advertising, social
media marketing, and search engine optimization (SEO). This can help build brand
awareness and reach a wide audience.
Advantages: Cost-effective, allows targeted advertising, and reaches a tech-savvy
audience.

Partnerships with Real Estate Developers:

Description: Form partnerships with real estate developers to offer exclusive home loan
deals to individuals purchasing properties from those developers. This can be mutually
beneficial, helping the bank tap into the developer's customer base.
Advantages: Targets a specific audience interested in home purchases, leverages
established relationships, and can enhance credibility.

Mortgage Brokers:
Description: Collaborate with mortgage brokers who can act as intermediaries between the
bank and potential homebuyers. Mortgage brokers can help connect the bank with
individuals seeking home loans.
Advantages: Expands the bank's reach without the need for physical branches, utilizes the
expertise of professionals in the field, and reaches customers actively seeking mortgage
solutions.

Online Loan Application Platform:

Description: Develop a user-friendly online platform for home loan applications. This
allows potential customers to apply for loans from the comfort of their homes.
Advantages: Provides convenience, attracts digitally savvy customers, and streamlines the
loan application process.

Educational Content and Seminars:

Description: Create and share educational content about home loans through various
channels, including online platforms and in collaboration with real estate events or
seminars. This can help establish the bank as an authority on home loans.
Advantages: Builds trust, educates potential customers, and positions the bank as a go-to
source for home loan information.

2. Is your selection of channels relatively similar or different between the two banks?
A2. Similarities:
Online Channels: Both banks leverage online channels, including online banking, mobile
applications, and online marketing. This reflects the modern trend in banking to provide
digital and remote services.
Differences:
Branch Banking vs. Digital Channels:
The first bank, which already has an extensive branch network in India, places a
significant emphasis on traditional branch banking to deliver personalized services. In
contrast, the second bank, being new to India and specializing in home loans, opts for a
digital-first approach with no physical branches.
Partnerships:
The second bank focuses on partnerships with real estate developers and mortgage brokers
to reach potential homebuyers, taking advantage of established relationships in the real
estate industry. The first bank, with an existing network, emphasizes partnerships less
explicitly.
Educational Content:
The second bank incorporates educational content and seminars to position itself as an
authority on home loans. This strategy is tailored to educate potential customers and build
trust. The first bank, while not explicitly mentioned in the initial response, may also use
educational content, but the emphasis is not as specific to a product or market entry
strategy.
Customer Service Centers and ATM Network:
The first bank, with its established physical presence, is likely to have customer service
centers and an ATM network, offering a range of services beyond the specialized home
loans. The second bank, being new and focusing on a specific product, may not have these
components in the initial stages.

3. What role does ‘place’ (distribution channels) play in a firm’s overall strategy and
marketing mix?
A3. The "place" element in a firm's marketing mix, also known as distribution channels,
plays a crucial role in the overall strategy and success of a business. This element focuses
on how products or services are made available to the target market.
Here are key roles that distribution channels play in a firm's overall strategy:
Market Accessibility:
Distribution channels determine how easily and where customers can access a company's
products or services. The choice of channels impacts the geographical reach and market
penetration of the business.
Customer Convenience:
The convenience and accessibility of products significantly influence customer
satisfaction. Well-designed distribution channels ensure that products are available where
and when customers want them, contributing to a positive customer experience.
Cost Efficiency:
Efficient distribution channels contribute to cost savings. By selecting the most
appropriate and cost-effective channels, a firm can minimize distribution expenses and
enhance overall profitability.
Competitive Advantage:
The effectiveness of a firm's distribution strategy can serve as a competitive advantage. A
company that can deliver products more efficiently, quickly, or affordably than its
competitors is likely to gain a competitive edge.
Brand Image and Customer Perception:
The choice of distribution channels can influence how customers perceive a brand. For
example, a luxury brand may choose exclusive, high-end retail outlets to maintain a
premium image, while a value-focused brand might prioritize widespread availability in
discount stores.
Product Positioning:
Distribution channels contribute to the positioning of a product in the market. Whether a
product is positioned as exclusive, mass-market, or niche can be influenced by the types of
outlets and intermediaries through which it is made available.
Inventory Management:
Efficient distribution channels help manage inventory levels effectively. The right channels
can reduce the risk of overstocking or stockouts, ensuring that products are available when
needed without excessive holding costs.
Market Segmentation:
Different distribution channels can be used to reach specific market segments. For
example, online channels may be more effective for reaching tech-savvy consumers, while
traditional retail outlets may cater to a different demographic.
Global Expansion:
For firms with international ambitions, the selection of distribution channels becomes
crucial. Understanding and adapting to the distribution systems in different countries or
regions is essential for successful global expansion.
Relationship Building:
Distribution channels provide opportunities for building relationships with intermediaries
such as retailers, wholesalers, and distributors. Effective collaboration with these partners
is essential for mutual success and customer satisfaction.