Marketing in Banks an Introduction | How to answer marketing related questions in bank interviews? | Is Marketing necessary in Banks? | Essay on bank Marketing

MARKETING OF BANKING SERVICES

Banks today are operating in a highly competitive and rapidly changing environment. In the changing economic scenario, a professional approach to business development is essential and the survival of a banking institution depends on its ability to take up challenges coming up in the environment.  Developing business through marketing of bank’s services is one of the crucial areas which need attention of the bankers to ensure profitable survival.

CONCEPTS OF MARKETING

The role of marketing in an organisation’s existence and growth need not be overemphasized in today’s competitive environment. According to Peter Drucker, “marketing is so basic that it cannot be considered a separate function”.

The general belief is that the objectives of marketing is to maximise the market’s consumption of your products and services. However, it would be desirable to set the goal at maximising consumer satisfaction, rather than consumption. The organisation, in the long run, is likely to benefit from a customer oriented approach to marketing. The approach, in other words, should ensure strong foundation for the institution’s existence, because the concepts of marketing has its origin on the premise that man is a creature of needs and wants. And there is constant effort on his side to satisfy his needs. Further, his needs and wants keep changing with time, circumstances and the immediate environment in which he is operating. Marketing management essentially involves the efforts to achieve the need satisfaction of the target group the institution is trying to serve.

BANK  MARKETING :

The basic step involves identifying the needs of the customers and developing products to suit their needs or modifying the existing products accordingly. It also requires the need for foreseeing wants of the customers in future and developing suitable products of their requirement. Deryk Weyer of Barclay’s Bank attempted a comprehensive definition for Bank Marketing. According to him, it consists of identifying the most profitable markets now and in future; assessing the present and future needs of customers; setting business development goals and marketing plans to meet them and managing the various services and promoting them to achieve the plans, all in the context of a changing market environment.  Successful marketing in a bank calls for commitment at all levels to the task defined in this regard. Achieving higher business standards and operational performance through marketing of banking services should be one of the directional goals of the organisation.

The Indian banking system, by habit and tradition, considered deposit growth as the business objective and other parameters such as productivity, profitability, customer satisfaction, etc. were considered less important. In view of the competitive surroundings in which a bank is compelled to function, there is need for formulation of a strategic action plan for its marketing efforts. A marketing strategy, in general, is a systematic, appropriate and feasible set of concepts and actions through which the institution strives to achieve its goal of customer satisfaction and profitable survival.

Strategy should be designed after taking into account the strengths and weaknesses of the organisation. For example, a bank or branch with clientele from various segments could think of “market penetration” by offering the existing range of services to existing customers. On the other hand, a bank which is having expanding business through new branches or branches which are not facing acute competition could think of “Market Development” by offering the existing services to new customers. However, the real marketing challenges arise from the institution’s capability to design new product range for their customers of various segments. The strategy, therefore, lies in increasing the client base and consolidating the relationship with existing and new clients through existing or newly developed products.

The operational aspects of strategies for marketing contain actions such as development of Relationship Banking, designing of effective delivery system, ensuring customer-oriented services and modifying the system into a personal selling organisation. In western banking, officials assigned the job of personally contacting the customers and offering the services at doorsteps had been able to make a significant impact on the development of business for their organisations. The importance and role of personal selling and customer contacts in the marketing efforts of a banking institution stem from the success of such efforts in many banking institutions all over the world.

The implementation of the strategies is as crucial as its design in ensuring successful marketing. The communication of the adopted strategies to different tiers of the institution and ensuring of its proper understanding by personnel at all levels, is essential for successful implementation of the strategies.  The communication becomes difficult in organisations which have substantial branch network spread over a large geographical area. The field staff at the branch level should be trained to implement the strategies after modifying them to suit the environment in which they are operating. The knowledge of the local environment, demographic features and cultural aspects is an essential requirement for the field staff involved in marketing efforts for the organisation.


BANK MARKETING : ROLE OF EMPLOYEES

The marketing strategy, assigns a responsible role on branch officials in bringing out socio-economic transformation of the society. There is need for a total marketing approach from the personnel to penetrate all levels in all areas of banking operations. Efforts need to be made to design and launch suitably tailored services to meet its changing needs of the society. The personnel attempting marketing should be able to establish an organic link with the masses. They should be committed to the cause of social upliftment and should implement in totality the market strategies  formed for the purpose. 

The knowledge of the command area of the branch and the ability to identify potential customers and their financial needs are pre-requisites for the success of marketing strategies. This calls for the need of training the staff with sharp focus on improving the knowledge of the bank staff about the atmosphere and the skills necessary to deal with the customers. 

There is also need for developing a sense of belonging towards the organisation, customers and the society. The field staff, to the extent possible, should know the language and dialect of the people and should be able to communicate in a manner which is appealing to the people. The organisation on their part, therefore, should take adequate care in identifying the right people for this specific job. They should also foster innovative and creative approach in working to bring in new and original ideas and develop talent. 

There is also need for rationalisation of the work load for the personnel in the branches to enable them to give adequate attention to the villagers and their requirements. Every member of the staff is a salesman of the bank’s services and an ambassador of the institution among people. Marketing efforts made by the personnel and its effect on business development should be appreciated and rewarded by the bank management.

The bank personnel, as a matter of strategy, should try to find a place in the hearts of the customers.  Role of “personal influence” on acceptance of an organisation or services in the scenario should be kept in mind. The “personal influence” refers to the effect of statements made by one person about the bank or its services on another person’s attitude towards the institution. A satisfied customer always acts as an ambassador of goodwill for the bank and brings clientele through his own efforts.  The personnel, therefore, should strive for customer satisfaction as a marketing strategy, if not as the objective of the organisation.

In conclusion, it may be understood that the success of marketing of banking services in depends on how the organisation properly blends the marketing concepts with the right approach required to penetrate the mass. And the final result of the efforts will depend on the sincerity and zeal of the field personnel making the efforts and the organisational support available to them.