SERVICE MARKETING

Banking Sector
INTRODUCTION
The bank is a financial institution which accepts deposits and lends that money to its
customers. As banks deal with their customers’ finances, banking is a high-involvement
service. Therefore banks need to win the trust of their customers.
Based on the customer profiles, banks segment their market into retail banking, corporate
banking, personal banking etc.

Needs of the Customer

 Depending on customer needs for finance, the market can also be segmented into trade
finance, consumer finance, etc.
 To derive maximum returns and enhance market position – effective management of
marketing mix
 Products offered- may be in the core or augmented form.
 Core products- savings bank account or a housing loan.
INTRODUCTION
 Augmented Products
 internet banking,
 ATMs,
 24-hour customer service etc.

These augmented services help to differentiate service

offering from those of competitors.
 
PRODUCT & PROMOTION
 7 P’S OF BANKING SERVICES
Product
In the formulation of service mix, the bank follow two guidelines:
• Processing of product to market needs
• Processing of market needs to product

HSBC’s Products and Services

7 P’S OF BANKING SERVICES
Promotion
Promotion mix includes 
• Advertising
• Publicity
• Sales promotion
• Word – of – mouth promotion
• Personal selling
• Telemarketing
Each of these services needs to be applied in different degree.
PROMOTION
Selecting a vehicle
• A number of devices to advertise such as broad cast media, telecast media
and print media. 
• In the face of the budgetary provisions, it is necessary to select a suitable
vehicle. For promoting the banking business, the print media is found to be
economic as well as effective.

Advertising
• Paid form of communication.
• Banking organizations : promotion mix with motto of informing, sensing and
persuading the customers.
• While advertising it is essential to be aware of key decision making areas so
that instrumentally helps banks at micro and macro levels.
PROMOTION
Public relations
• Banking services: effectiveness of public Relations is found in high magnitude.
It is in this context that difference is found in designing of the mix for
promoting the banking services.

Punch lines
• Punch lines or the corporate statement depict the philosophy and attitude of
the bank.
Banks have influential punch lines to attract the customers.

“The World’s Local Bank” HSBC BANK

“Different People. Different Views”
 PROMOTION
Telemarketing
• Process of promoting the business with the help of
sophisticated communication network.

• Instrumental in advertising the banking services 

• Banking organizations can use this tool of the promotion mix both for
advertising and selling.

• A counter or center as listed in the call numbers may service multi- dimensional
services.

• Likely to play an incremental role in marketing the banking services.

PROMOTION
Word-Of- Mouth
• Much communication about the banking services actually takes place by
word- of- mouth information, which is also known as word- of- mouth
promotion.

• Helps the banker to know the feedback, which may simplify the task of
improving the quality of services.

• This component of promotion mix is not to influence budget adversely or

generate additional financial burden.

• By improving the quality of services and by offering small gifts to the word-
of- mouth promoters, bankers can get more business command in their area.
HSBC’S INTERNET ADVERTISEMENT
PRICING
7 P’S OF BANKING SERVICES
Pricing
 Pricing decisions occupy a place of outstanding significance.

 The pricing decisions include: interest and fee or commission charged by banks.

 The RBI regulates the rate of interest and the Indian Banks’ Association controls other charges.
This also complicates the price mix for banking sector.

 The value satisfaction variable should be taken in to consideration.

 The value and satisfaction cannot be quantified in terms of money since it differs from person to
person.
PRICING
 The banking organizations are required to frame two- fold strategies.

 First, the strategy is concerned with interest and fee charged and the second
strategy is related to the interest paid.

 Since both the strategies throw a vice- versa impact, it is important that banks
attempt to establish a correlation between two. It is essential that both the
buyers as well as the sellers have feeling of winning.
PEOPLE & PLACE

Complaints are at an all time

low – since we hired Mehta.
He is stone deaf.
7 P’S OF BANKING SERVICES
People
• The instrumentality of sophisticated technologies start turning sour if the
human resources are not managed in a right fashion.
• Foreign banks are performing fantastically: due to a fair synchronization of new
information technologies and a team of personally committed employees.
• The development of human resources makes the ways for the formation of
human capital.

• Human resources can be developed through:

• Education,
• Training
• psychological tests.

• Even incentives can inject efficiency and can motivate people for productive
and qualitative work.
7 P’S OF BANKING SERVICES
Place
 The place element of the marketing mix refers to making the services available
and accessible to customers.

 Improvements in the availability and accessibility of services have changed the

process of banking.

 Technological innovations have given rise to modern channels like the

Internet, which have helped banks increase business volumes and attract new
customers.

 In case of the Banking industry, Bank branches and ATMs should be situated at
convenient locations.
PROCESS & PHYSICAL EVIDENCE
7 P’s OF BANKING SERVICES
Process
Flow of activities:
 All the major activities of banks follow RBI guidelines.
 Adherence to certain rules and principles in the banking operations.
 Activities segregated into various departments accordingly.

Standardization:
 Standardized procedures for typical transactions.
 All banks have some standardization- because of the rules they are subject to.
 Each bank has its standard forms, documentations etc.
 Standardization saves a lot of time behind individual transaction.

Customization:
 Specialty counters at each branch to deal with customers of a particular scheme.
 Customers can select their deposit period among the available alternatives.
 Number of stores:
 Numbers of steps are usually specified
 Specific pattern is followed to minimize time taken.

 Simplicity:
 Various functions are segregated.
 Separate counters exist with clear indication. Thus a customer wanting to deposit
money goes to ‘deposits’ counter and does not mingle elsewhere.
 Procedures simple and efficient.
 Instructions (on boards) in national and regional languages help the customers further.

 Customer involvement:
 ATM does not involve any bank employees.
 Usual bank transactions- definite customer involvement at some or the other place
because of the money matters and signature required
Physical Evidence

 The physical evidences: signage, reports, punch lines, other tangibles, employee’s
dress code etc. The company’s financial reports are issued to the customers to
emphasis or credibility.
 Dress code for internal customers. This helps the customers to feel the ease and
comfort
 Signage:
 logo by which a person can identify the company.
 significant for creating visualization and corporate identity.

 Tangibles:
 Pens, writing pads to the internal customers.
 Passbooks, chequebooks, etc reduce the inherent intangibility of services.
 Seating area available for waiting customers, ambience etc.
RECOMMENDATIONS
After visiting a HSBC Branch in MG ROAD, following suggestions are made:

 Multiple Help Desks

 Strategic positioning of the counters so as to make it more convenient for the
customers
 Providing a one stop solution to all problems instead using different resource
personnel to solve different issues
 Providing customers with some value added services such as offering
something to drink during the waiting hour
 After Sales Service
CONCLUSION
 The banking industry has changed drastically over the past decade.

 The banking reforms and the opening of the economy to foreign and private
banks have improved the working of the public sector banks.

 This has resulted in improved service to the customers of the banking

industry. Increased competition and technology have enhanced the quality of
service offered to the customers and also improved the returns for bankers.

 Banking marketing consists of identifying the most profitable markets now

and in future, assessing the present and future needs of customers, setting
business development goals, making plans-all in the context of changing
environment.
THANK YOU
Group 2
Jacob, 2719
Jitin, 2722
Lester, 2727
Mandanna, 2729
Nisha, 2741