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Project Report on:

BANK MARKETING
Submitted By:

POOJA SURESH YADAV

T.Y. Banking & Insurance [Semester V] Submitted To:

Project Guide: MRS.SANGEETA CHAUDHARY Academic Year: 2013 2014

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Declaration

I, POOJA SURESH YADAV from THAKUR COLEGE OF SCIENCE & COMMERCE, student of T.Y.BAKING &

INSURANCE [SEMESTER V], hereby submit my project report BANK MARKETING I also declare that this project which is the partial fulfillment of the requirement for the degree of T.Y.B.Com (Banking & Insurance) of the MUMBAI UNIVERSITY is the result of my own efforts with the help of experts.

POOJA SURESH YADAV

DATE:

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Certificate
This is to certify that the project entitled is successfully done by POOJA SURESH YADAV during the Third Year, Fifth Semester of B.Com (Banking & Insurance) under the University of Mumbai through the Thakur College of Science & Commerce, Kandivali, Mumbai 400101.

Co-ordinator:

Project Guide:

Principal:

Date : Place : Internal Examiner External Examiner

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Acknowledgement
It gives me immense pleasure in presenting the project of MARKETING Firstly, I take the opportunity in thanking our very dear principal Mrs. CHAITALI CHAKRABORTY then I would like to thank The Almighty and my parents without whose continuous blessings; I would not have been able to complete this project. I would like to thank my project guide and our co.ordinator M RS.SANGEETA CHAUDHARY and Prof. NIRAV GODA for his great help, valuable BANK

opinions, advice and suggestions in fulfillment of this project. I am also grateful to mrs.SANGEETA CHAUDHARY for supporting me, giving me encouragement and for providing me with the material and knowledge to make this project a success. I convey my deep appreciation to him for sparing his valuable time and efforts, so as to make me capable of presenting this project. I am thankful to our college for all the possible assistance and support, specially our library by making available the required books and the internet room which have proved useful to me in successful completing my project. I hope that I have succeeded in presenting this project to the best of my abilities.

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EXECUTIVE SUMMARY

The summary of the marketing plan appears in the beginning of the document and gives a general overview of the entire plan. The reader should be able to review the summary and have a broad idea of what will happen when the marketing plan is executed The project scans financial services businesses throughout the world are increasingly using third parties to carry out activities that the businesses themselves would normally have undertaken. Industry research and surveys by regulators show financial firms outsourcing significant parts of their regulated and unregulated activities. These outsourcing arrangements are also becoming increasingly complex. The marketing plan is a lengthy document that identifies the target market, provides the situational analysis, the product analysis, the marketing objectives, and the strategies and measurement methods for effectiveness.

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BANK MARKETING

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INDEX
SR.NO: 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 DESCRIPTION INTRODUCTION DEFINATION HISTORY WHAT DO YOU MEAN BY BANK WHAT DO YOU MEAN BY MARKETING EVOLUTION OF BANK MARKETING TECHOLOGICAL REVOLUTION OF BANK MARKETING IMPORTANCE BENEFITS OF BANK MAREKTING IMPACT OF CHANGES IN MARKETING STRATEGIES MARKETING STRATEGIES IN BANKS MARKETING STRATEGIES ADOPTED BY PUBLIC & PRIVATE SECTOR BANKS STRATEGIES FOR EFFECTIVE BANK MARKETING IN INDIA CHALLENGES FACED IN BANK MARKETING BY THE BANKERS TRADITIONAL MARKETING V/S MOADERN MARKETING TECHNIQUES TRADITIONAL METHODS OF MARKETING INCREASING IMPORTANCE OF MARKETING IN BANKING INDUSTRY CONCLUSION

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INTRODUCTION

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In the earlier days, bankers like any other private sector organizations had their own plans of business development and adopted their own ways and means to achieve their objective. The MARKETING concept was in the form of advertising & promotion. This was the position till the middle of 20th century. Gradually there was a change in the attitude of bankers with respect to customers. In the late 1950s, new concept in the Marketing Services with respect to banking profession, arose in the West. Deryk-Weyer of Barcelays Bank came out with a comprehensive definition of BANK MARKETING. According to him, Bank Marketing consists of 1] Identifying the most profitable markets now and in future, 2] Assessing the present and future needs of the customers, 3] Setting business development goals, 4] Making plan to meet them and managing the various services and promoting them to achieve the plans- all in the context of changing environment in the market.Thus, the idea of customer satisfaction arose in the 1950s, flourished in the 1960s and became an integral part of Banking Services in 1970s. In the course of time, the concept of Marketing widened further. From the stage of customer satisfaction, the Marketing become more concerned with the wellbeing of the Society as a whole & resulted in coining the term SOCIETAL MARKETING. Hartley would call it as Response Marketing attuning with or responding to the changing needs of customers society an d environment. Marketing of banking services is concerned with product, place, distribution, pricing and promotion decisions in the changing, socio-economic and business environment. It means organizing right activities and programmes at the right

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place, at the right time, at a right price with right communication and promotion. The users of banking services or the prospects play a very significant role in the formulation of overall marketing strategies. The bank marketing activities are concerned with the designing of product strategies keeping in view the needs and requirement of prospect. It is also related with the place decisions i.e. location of a bank at a suitable points. It has following unique features:1] Intangibility 2] Inseparability 3] Variability
4] Perishability

With liberalization and globalization of the economy, middlemen are gradually emerging in the banking industry. Foreign banks and new private banks like City Bank, Global Trust Bank and ICICI Bank are offering their franchise in marketing their services. This has introduced the middlemen in marketing of banking services. In banking services, the marketing strategy starts with developing customer profiles by which the bank can collect and analyse all relevant information on customers. The preferences and prejudices of the customers are identified with the help of these profiles and this enables the bank to enhance its marketing activities. In order to satisfy the customers needs new services may be introduced or the existing services of the bank may be modified. Customer satisfaction plays an important role in banking services.

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The ongoing process of economic reforms has completely changed the operational environment for the whole banking industry in the country. Banks are now required to cope with stiff competition in business and also the complex regulatory norms regarding capital adequacy and provisioning. Banks are forced to adopt various marketing techniques and approaches. Thus, marketing has become imperative for all banks including those in the public sector. Marketing in banks can be stated as a new phenomenon that is shaping well over the past one decade. Public sector bank hardly considered marketing as a tool for business. The competition, deregulation that followed the reforms has changed the environment for banks, where marketing has occupied the place in the business of banks. Today, marketing in the banking industry is characterized by many innovations in products and services, use of advanced technology in product design, up gradation of delivery system, advertising and sales promotion activities, whether in public sector or private sector. Banks now have a firm that marketing strategies alone can brighten the future of banking business. Marketing in banks has become synonymous with customer and banks are found engaged in several activities of discovering, creating and satisfaction customer needs. Indian banking is at cross roads today. With the deregulation and liberalization process in full swing, the consequent policy changes introduced in the Indian financial system in general and banking in particular are effecting unprecedented changes in its functioning. With the emerging changes did spring up new challenges of commercial viability, cost effectiveness, effective marketing strategy, etc. Market oriented policies also gave birth to new players like foreign and private sector banks and subsidiaries offering varied high tech and cost effective Service. There wasan
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absolute shift from sellers into buyers market, establishing theconsumer as the key factor in the market. The dictum as the bank exists because of its customers, has become more pronounced and relevant in the present context. Thus, marketing constitutes the key strategy for banks to retain good customers and also anticipate their future demands.

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DEFINATION

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We define bank marketing as follows: Bank marketing is the aggregate of functions, directed at providing services to satisfy customers financial (and other related) needs and wants, more effectively and efficiently that the competitors keeping in view the organizational objectives of the bank. Bank marketing activity. This aggregate of functions is the sum total of all individual activities consisting of an integrated effort to discover, create, arouse and satisfy customer needs.

This means, without exception, that each individual working in the bank is a marketing person who contributes to the total satisfaction to customers and the bank should ultimately develop customer orientation among all the personnel of the bank. Different banks offer different benefits by offering various schemes Which can take care of the wants of the customers. Marketing helps in achieving the organizational objectives of the bank. Indian banks have duel organizational objective commercial objective to make profit and social objective which is a developmental role, particularly in the rural area. Marketing concept is essentially about the following few thing which contribute towards banks success: 1) The bank cannot exist without the customers. 2) The purpose of the bank is to create, win, and keep a customer. 3) The customer is and should be the central focus of everything the banks does. 4) It is also a way of organizing the bank. The starting point for

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organizational design should be the customer and the bank should ensure that the services are performed and delivered in the most effective way. Service facilities also should be designed for customers convenience. 5) Ultimate aim of a bank is to deliver total satisfaction to the customer. 6) Customer satisfaction is affected by the performance of all the personal of the bank. All the techniques and strategies of marketing are used so that ultimately they induce the people to do business with a particular bank. Marketing is an organizational philosophy. This philosophy demands the satisfaction of customers needs as the pre-requisite for the existence and survival of the bank. The first and most important step in applying the marketing concept is to have a whole hearted commitment to customer orientation by all the employees. Marketing is an attitude of mind. This means that the central focus of all the activities of a bank is customer. Marketing is not a separate function for banks. The marketing function in Indian Bank is required to be integrated with operation.

Marketing is much more than just advertising and promotion; it is a basic part of total business operation. What is required for the bank is the market orientation and customer consciousness among all the personal of the bank. For developing marketing philosophy and marketing culture, a bank may require a marketing coordinator or integrator at the head office reporting directly to the Chief Executive for effective coordination of different functions, such as marketed research, training, public relations, advertising, and business development, to ensure customer satisfaction. The Executive Director is the most suitable person to do this coordination work effectively in the Indian public sector banks, though ultimately the Chief Executive is responsible for the total marketing function. Hence, the total marketing function involves the following:
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a) Market research i.e. identification of customers financial needs and wants and forecasting and researching future financial market needs and competitors activities. b) Product Development i.e. appropriate products to meet consumers financial needs. c) Pricing of the service i.e., promotional activities and distribution system in accordance with the guidelines and rules of the Reserve Bank of India and at the same time looking for opportunities to satisfy the customers better. d) Developing market i.e., marketing culture among all the customerconsciousness Personnel of the bank through training.

Thus, it is important to recognize the fundamentally different functions that bank marketing has to perform. Since the banks have to attract deposits and attract users of funds and other services, marketing problems are more complex in banks than in other commercial concerns.

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HISTORY

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In order to understand the present, you must understand the past. When you study the past, which could be the history of the world, your country or even your own past, you will find that there are patterns that occur over and over again. History really does repeat itself in many ways.

Your customers have their own history and have different financial needs depending on what stage of life they are living through at the time. These stages of life are very similar for each of your customers and they generate similar patterns. In addition, each stage of your customers life has a direct impact on your banks profitability.

For instance, when your customers are children, they may have a small balance in a savings account and generate very little profit for you. Later when they purchase a car, they become more profitable and still later when they settle down and purchase a home, they can become very profitable. However, late in their life, when they have paid off their mortgage and have a substantial amount of their savings in high interest CDs, they can actually become less profitable than at any other time in their life! While it was possible in the past to review a customers financial patterns and how they changed from month to month and from year to year, it was just not a practical exercise. You would have to sift through reams of microfiche stored away in some dusty warehouse. Now, with the advent of relational marketing databases, it is possible to not only review a customers financial patterns over time, but even predict in real time what the customer is going to do next based on the actions they have taken in the past!

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Something old, something new Relational marketing databases have evolved very rapidly in the past 15 years and are now more powerful than ever. The oldest of these technologies is the tried and true Marketing Customer Information File or MCIF. Using an MCIF, you can perform research on a group of customers who have a similar life stage demographic code based on age and income. For instance, if you are interested in studying your wealthy, middle-aged customers, you can examine the past product usage of the profitable customers in this segment to understand why these customers are so profitable. For instance, they might be profitable because they have a high balance in their home equity line.

You can then examine the product usage of the unprofitable customers in this segment. You might discover that they have a home equity line, but the account is inactive. After this research has been completed, a marketing campaign would then need to be designed to increase these customers home equity line balances. In order to do this, you would need to ship the research file to your direct mail house, have a graphic artist and a copywriter design the direct mail piece and then have the direct mail shipped. In addition, you would need to inform your Customer Service Representatives (CSRs) and Tellers that this direct mail had been shipped and you also might need to train these people on how to close and record the sale.

To complete this process, you would need to use the MCIF to gauge the success of your marketing campaign. Whew! And, while all of this effort can be more effective than placing an ad in the local newspaper, it still takes a lot of time and energy on your part. Realizing the inefficiencies of this approach (as good as it may be) the MCIF industry has now integrated this technology into Customer Relationship Management (CRM) systems. The advantage of a CRM is that the research
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developed by an MCIF can be pushed out to every customer tou ch point and various customer interactions can be pulled in for further analysis. One of the newest and most advanced of these systems uses MCIF-like rules that examine the customers history to predict what will be the most likely next purchase by the customer. For instance, a rule could be developed for wealthy middle-aged customers with inactive home equity lines. This rule could then be linked to a pop-up screen on a CSRs platform that would enable the CSR to engage in a profitable face-to-face discussion with the customer. If the CSR were able to activate the account by having the customer increase their home equity line balance, then this would automatically be recorded by the CRM. The system runs in real time and is smart enough to know that if a customer just activated their home equity line moments before he or she talked to the CSR, a different rule would be activated and a different interaction with the CSR would have occurred. These pop-up screens can also appear on Teller platforms, ATM screens and personal home banking Web pages when the customer is interacting with the bank personally or electronically. The beauty of this automation is that you as a marketer dont have to spend your time developing direct mail campaigns or informing and training your CSR or Tellers.

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WHAT DO YOU MEAN BY BANK ?

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A bank may be defined as a institution which deals in money. Banks draw surplus money from the people who are not using it at the time and lend to those who are in a position to use it for productive purposes. Banker is not merely a money lender. He lends what he has borrowed from others. The banks pay a certain amount of money as interest, on the money they have borrowed. Similarly they charge interest on the money lent. Interest is always calculated at a certain rate percent per-annum. The rate of interest on loans advanced is always greater than that on deposits. The difference between the two rates is the bank's margin of income. Banking business" means the business of receiving money on current or deposit account, paying and collecting cheques drawn by or paid in by customers, the making of advances to customers, and includes such other business as the Authority may prescribe for the purposes of this Act; (Banking Act (Singapore), Section 2, Interpretation). "banking business" means the business of either or both of the following: 1. receiving from the general public money on current, deposit, savings or other similar account repayable on demand or within less than [3 months] ... or with a period of call or notice of less than that period;
2.

paying or collecting checks drawn by or paid in by customers.

This has led legal theorists to suggest that the cheque based definition should be broadened to include financial institutions that conduct current accounts for customers and enable customers to pay and be paid by third parties, even if they do not pay and collect checks.

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WHAT DO YOU MEAN BY MARKETING?

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The traditional concept of marketing revolved around profit maximisation. However,marketing in the 21st century revolves around the customer. The shortest meaning of marketing is meeting the needs profitable. marketing is an art and science of creating and satisfying the social needs and wants of profitability. According to American marketing Association marketing is the process of planning & executing the conception, pricing, promotion & distribution of ideas, goods & services to create exchanges that satisfy individual & organizational objectives. According to Philip kotler marketing is a social process by which individuals and group obtain for what they need & want through creating & exchanging products & value with others. Marketing is based on thinking about the business in terms of customer needs and their satisfaction. Marketing differs from selling because (in

the words of Harvard Business School's retired professor of marketing Theodore C. Levitt) "Selling concerns itself with the tricks and techniques of getting people to exchange their cash for your product. It is not concerned with the values that the exchange is all about. And it does not, as marketing invariable does, view the entire business process as consisting of a tightly integrated effort to discover, create, arouse and satisfy customer needs." In other words, marketing has less to do with getting customers to pay for your product as it does developing a demand for that product and fulfilling the customer's needs.

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EVOLUTION OF BANK MARKETING

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Historically marketing in banking in India emerged in late 50s. In 70s the bank marketing scene started changing dramatically when marketing positions were created in certain banks to meet the demand for restructuring banking services. First major step in this field was taken by SBI in 1972 by reorganizing itself on the basis of major market segments dividing borrowing customers on the basis of activities.Canara Bank, Bank of Baroda, Corporation Bank are a pointer about how banks of Indian origin could be market innovative and can manage and respond to the change so quickly and efficiently. Indian braches of foreign banks and the newly established private sector banks also used these techniques successfully in funds mobilization and consumer credit activities. Similarly the financial institutions to tap vast potential of bank and nonbank saver, used marketing concept by introducing attractive schemes(to name,deep discount bonds, family bonds by IDBI,SIDBI,ICICI,SCICI).mutual funds have also brought Innovative products to suit customers fancy and have been successful in mobilizing huge funds. It needs to be understood that marketing is just not the deposit mobilization and the concept has to be applied in line with organizational objectives and meeting the challenges being faced.

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TECHNOLOGICAL REVOLUTION OF BANK MARKETING

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In todays technology driven, modern world, most organisations operate in highly competitive markets, this is particularly true of the financial services sector. Technology has been one of the key drivers of change within this market and most retail banks now offer on-line banking services. Until recently, most banks operated from the traditional high street branches, offering very similar products and services to their customers. A product can be defined as anything that can be offered for sale, this could be something tangible that can be owned or it may be a service that is performed for the buyer. Mostproducts contain both a tangible and a service element. Product positioning is the way in which a product and its associated brand is perceived by customers in relation to other competitive products. Different customers value different combinations of product or service attributes, based on the extent to which it meets their particular need at that given time. For example, the diagram shows that some customers are prepared to pay a particularly high price for a high quality service. While others, prefer a quick standard service, for a low price. If an organisation identifies a group of customers, who require a combination of either goods and or services which is not currently offered, it will have discovered a gap in the market. Intelligent Finances Chief Executive, Jim Spowart, has been a pionee r of direct banking. He realised that while people were queuing in banks at the counter, the customers who telephoned got priority. He felt that if telephone banking could be improved, then a fast and efficient service could be delivered to customers, without the overheads of an expensive branch network. This was the beginning of Jim Spowarts venture into direct banking. Intelligent Finance is the third new generation bank Jim Spowart has set up. It set out to offer something that no other bank was offering, therefore, filling a gap.

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By embracing new technology, Intelligent Finance has developed a new approach to delivering both products and services, in a highly innovative way. This looks set to transform the traditional retail bank as we know it by putting the customer first.

The proposition
Despite the fact that most banks now offer telephone and internet banking services, most continue to function in traditional ways. Placing traditional branch networks at the forefront of their operations. High street branches are an expensive overhead and often offer products which do not always meet the customers needs.

Intelligent Finance was launched last year as a division of the Halifax plc. Intelligent Finance offers a phone and internet banking service, with products that give the customer choice, flexibility and the ability to make the most of their own money. Intelligent Finance offers five products; a current account, savings, credit card, personal loan and a mortgage. The innovation is in the way in which the technology has allowed customers to choose to manage their money and allows them to link the products together to ensure that their money works for them in the most efficient way. Technology has facilitated this revolutionary new system of banking. This allows customers to connect products together, taking account of both their borrowings and savings. This means that by connecting products together, interest is only paid on the balance. For example, a customer may have two products with Intelligent Finance, a personal loan and a current account. The customer has a personal loan for 5,000 and 2,000 in their current account. Intelligent Finances integrated approach allows the customer to connect the two accounts together. The 2,000 in the customers current
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account can be offset against the loan, so interest is only paid on the 3,000 personal loan balance and the customer receives no interest on the current account balance. Alternatively, the customer can choose to pay borrowing rates on their loan and receive the same rates on their savings. It is based on the principle that in effect, some of what customers borrow is their own money, so they should not pay or receive different interest rates on it. Given that the amounts can change daily, the system will calculate balances on a daily basis, allowing the customer to receive the best possible rate of interest on their money. The system is unique in that it allows a customer to have a few products or the whole range of products in their plan. Other banks require the customer to have a mortgage to benefit.

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IMPORTANCE

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Awareness among Customers Modern technology has made customers aware of the developments in the economic environment, which includes the financial system. Financial needs of the customers have grown multifold into various forms like quick cash accessibility, money transfer, asset security, increased return on surplus funds, financial advice, deferred payments etc. With a wide network of branches, even in a dissimilar banking scenario, customers expect the banks to offer a more and better service to match their demands and this has compelled banks to take up marketing in right earnest. Quality key factor With the opening up of the economy, fast change has been experienced in every activity, and banking has been no exemption. Quality is the watch word in the competitive world, which is market driven and banks have had to face up to this emerging scenario. In fact, it may not be out of place to reiterate that quality will in future be the sole determinant of successful banking ventures and marketing has to focus on this most crucial need of the hour. Growing Competition Increased completion is being faced by the Indian banking industry from within the system with other agencies both, local and foreign, offering value added services.Competition is no more confined to resource mobilization but also to lending and other areas of banking activity. The foreign commercial bank with their superior technology,speed in operations and imaginative positioning of their services has also provided the necessary impetus to the Indian banks to innovate and complete in the market place.

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Technological Advances Technological innovation has resulted in financial product development especially in the international and investment banking areas. The western experience has demonstrated that technology has not only made execution of work faster but has also resulted in greater availability of manpower for customer contact. Marketing is the most useful tool for banking.all the products of banking has to be marketed in order to tap the potential customers. Marketing of products and services by fulfilling the need and wants of the customers is required for effective running of the organisation. Marketing is the prime tool of banking sector.It satisfies customer benefits and deal with banker and customer both work was done one is receipt and payment. Moreover, it is direct relation with loan sector. Marketing not only important for banking sector, it is a vital arm of any sector/firm. Without marketing one firm/business entity could not serve a long. How better services/products you offer for the public, the advantages of using your products/services should reach the public. It may be advertisement, good quality, timely attention and many more factors. Coming to banking sector, in the present situation of globalisation, as a big market of the world, our india is facing toughest competition from global banks. In this situation it is must to have good marketing department and good marketing strategy. In current scenario marketing is very useful tool for banking sector for attracting customers for various banking products. Old days are gone for banking wherein the customer had to walk in to his bank and ask for services. Due to increase in competition it has become imperative for banks to use marketing tool to

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increase their market share by providing awareness of their products to their prospective customers Now banks have to provide knowledge of their products to their customers and create requirement of their products among the prospective customer and for that marketing has become a most important tool which connects the customers and products offered by the bank.

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BENEFITS OF BANK MARKETING

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Whatever your banking expertise level is, realizing success is easiest if you have the perfect bank marketing plan. You can get help from a lot of marketing consultant companies, but your success will depend on choosing the right consultants for your bank's marketing. Having a unique bank marketing strategy will help you succeed because it will set your bank apart from other banks in your area of operations. A marketing company can analyze your business, create a plan for business growth, and help you implement that plan. There are many benefits to having a bank marketing plan; however, let's look at the four advantages that can be gained from a quality bank marketing plan proposed by a qualified marketing firm. Gain New Customers New customers are the backbone of any business. Long-term survival of companies cannot depend alone on an existing customer base. It is your marketing strategies, regardless of the type of services included in them, that will influence a new customer to choose to work with you. In addition to direct mail efforts, bank marketing incentives can vastly increase a bank's customer base. Smaller regional banks that are not known nationally could benefit a lot from this. convince current cutomer to consider new products and servies It is a smart idea to direct your bank marketing efforts to your current customer base because it is a lot more expensive to attract new customers than to develop the existing customers. They have already trusted you with their business for at least one product, so it is just a matter of doing a bit more and convincing them
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to further invest. A bank marketing strategy focused on incentives can do just that. The worst mistake a company can make is to think that once a client is secured that the marketing work is done. On the contrary, bank marketing strategies must give much importance to these loyal customers. This is the key to growing the "per-customer" bottom line. Business Increase through Referrals

Referral bank marketing strategies are mapped out plans to maximize word of mouth promotion by offering incentives to current clients. The strategy is used to encourage positive customer feedback about your company and products. Offering an incentive or a cash reward for referrals is a good way to ensure that current customers speak highly of your services and products. This is a highly effective type of bank marketing strategy, both in the short and long-term. Get Your To Bank Stand Out Doing bank marketing within the community often has the most successful results. To step apart from the competition and attract new customers, banks are make use of gifts and cash. Bank marketing with incentives will have an immediate impact, and is a rather inexpensive way to gain instant results. Customers are drawn toward tangible gifts and incentives and interest rates along with various account-based incentives won't get your bank very far.

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IMPACT OF CHANGES IN MARKETING STRATEGIES

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The world today faces huge improvements in all areas which directly or indirectly affect the business environment. This environment becomes quickly changing, therefore the organizations and their marketing departments have to identify the suitable ways to deal and adapt with these changes to reduce the influence of environment changes. Hence, the business organizations and banks as one of these organizations should build a clear strategic vision to understand these changes. Also, they have to use all available funds and human resources to immediately respond for changes. This means that banks should adopt the concept of change management which is a vital tool to face the organizational or strategic changes. This paper aims to identify the relationship between different patterns of organizational changes, marketing changes as one of these changes, and marketing strategy of change that has to use to deal with this change. The change management is a difficult and expensive task and yet the ability to handle with persuasive demands and developing technologies, becomes the critical element for eternity (Alsedairy, 2001). Further, according to (Tuchman & Anderson, 2004) the challenge of change become slight if the organization does not take the following four basic characteristics e.g. focus on organizational objectives, integration of the task, structural and social/cultural elements within the organization and finally flexibility and awareness. Also, (Ander & Levinthal, 2004) concluded that the general management responsible for the organization strategic direction frequently fails to manage the organizations technological revolution and change procedure that generate these opportunities. Marketing strategy of change has become a topic of much debate in recent years. Whether marketing strategy has not changes, has changed, or should change, has all been discussed (Burger-Helmchen,2008). In the journey to understand real world marketing strategy change is not research (Ghatas, 2006). (Veronique, 1996) highlighted the following five levels of strategic changes that can be used to face organizational change: continuation strategy, routine strategy change, limited strategy change, radical strategy
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change and organization redirection. Further studies have confirmed that the circumstances of organizational change can be varied complex by attributing importance to concepts such as positive employees (Avey, Wernsing, & Luthans, 2008), organizational culture (MdZabid, Murali, & Azmawani, 2004), New information technologies (Bauer & Bender, 2002) and trust (Lines et al., 2005). The current study investigated the impact of organizational change in its various forms on the marketing strategies of change. For this purpose, a study model was developed which included the forms of organizational change and their impact on marketing strategies of change.

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MARKETING STRATEGIES IN BANKS

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To formulate an effective marketing strategy the bankers should know the Following aspects: The total potential presently available and its present share in the total market for deposits, advances and other services. Core customer segments i.e. which customers provide highest profit and business potential, so that they always get the desired attention. Core products and services, i.e. which services or products best match the requirements of customers in general and core customers in particular and provide high business and profit potential, so that action is taken to improve such products further to make them more acceptable. What products are supplementary products and keep the core products and services, as high business and profit potentials. Core competitors, i.e. which competitors are posing major threat in serving the core customer segments and which core products and services are they offering to the clients, so that if possible, bank can explore the possibility of offering similar products or services. Core appeal i.e. which advantage should be offered and communicated to customers in general to differentiate ones own organization in terms of pricing, servicing, conveniences etc. Potential products to suit the changing environment, so that they meet the change in customers needs over a time period. Potential customers who could be brought to banks fold. Potential competitors who may erode banks market share, so that we may take action to change our strategies in time, to remain the market leader. Which other products are needed to be introduced to maintain or enhance the exiting business, so that the customer does not feel the necessity of shifting his patronage elsewhere.

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How strong is the information system in the bank and what needs to be done to create a prompt and accurate information system which forms core of any marketing exercise. Customers like all human beings, like to deal with people who care. Hence attitudinal changes particularly in the staff at counter, is needed to understand that our existence is due to customer and customers is Really an important visitor on our premises. Other following types of small actions particularly in a branch advising customers maintaining high balances in their accounts, counselling equity minded customers for investment, interacting with customers to known their difficulties and personally attending the needy customers, creating image of the branch by offering some services, creating social and economical awareness among the people, giving surprise to customers by calling all customers present in the banking hall over a cup of tea on some special occasion, say on the foundation day or bankers day or customers day.

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MARKETING STRATEGIES ADOPTED BY PUBLIC AND PRIVATE SECTOR BANKS

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All the banks in India were earlier private banks. They were founded in the preindependence era to cater to the banking needs of the people. But after nationalization of banks in 1969 public sector banks came to occupy dominant role in the banking structure. Private sector banking in India received a fillip in 1994 when Reserve Bank of India encouraged setting up of private banks as part of its policy of liberalization of the Indian Banking Industry. Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in p r i n c i p l e ' a p p r o v a l f r o m t h e Reserve Bank of India (RBI) to set up a bank in the private sectors. Private Banks have played a major role in the development of Indian banking industry. They have made banking more efficient and customer friendly. In the process they have jolted public sector banks out of complacency and forced them to become more competitive. A countrywide survey reveals that while the private banks have got a tight grip on the purse strings of the salaried class and professionals in the country,

a large majority of customers in Corporate India still prefer the time-tested public sector banks for services ranging from securing credit cards to making bond investment and fixed deposits. According to survey, 60% businessmen in India prefer PSU banks when it comes to sourcing credit cards and another 80% of them knock on the doors of state-owned banks for securing personal and educational loans. The preference for public sector banks for insurance is mainly due to general perception that t h e y a r e mo r e r e l i a b l e , s e c u r e a n d t r u s t w o r t h y. B u t f o r c r e d i t s a n d d e b i t c a r d s , t h e y f e e l private banks provide prompt and efficient service as compared to the outdated services of PSU banks that lead to wastage of time and procedural delays.

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STRATEGIES FOR EFFECTIVE BANK MARKETING IN INDIA

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Since the inception of globalization in India, banking sector has undergone various changes. Introduction of asset classification and prudential accounting norms, deregulation of interest rate and opening up of the financial sector made Indian banking sector competitive. Encouragement to foreign banks and private sector banks increased competition for all operators in banking sector. The protective regime by the authority is over. Indian banks are exposed to global competition. Even competition within the country has increased manifold. The almost monopoly position Enjoyed by the public sector banks of India is no more existence. Under this development Indian banks needs to reinvent the marketing strategy for growth.

The spread of the bank in Indian rural and semi urban areas are highly Different from state to state and region to region. Many states have fewer networks of bank branches in the rural areas. Under such scenario different marketing approach for different areas is required. If the bank follows the same marketing strategy for all areas the success would be difficult.

Marketing approach for urban area: The urban areas of India are
developed taking into account all parameters of development. The level of income of the people, the literacy rate and level of education as well as awareness of the people about rights of the customer are higher than that of the rural and even semi urban areas. Thus here for effective bank marketing different approach is necessary than that of rural areas.

The marketing strategy should be based on customer service and the use of modern technology in banking. Under competitive environment for the success of the business, better customers and retaining existing customers is possible only with customer service. Use of modern technology in urban areas will also go long way for marketing of banking services. Technology based service like
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credit card, debit card, ATM; anywhere banking, internet banking, and mobile banking are necessary for urban areas. This is because it enables customers to perform banking transactions at their convenience. Business hours of a bank are also an important factor for urban banking. India many private sector banks, especially co-operative banks and now even some of the public sector banks have also started this practice and they find it successful.

To attract business and wholesale customers, banks need to adopt technology based product and service which is suitable to such class of customer. For instance RTGS, collection of out station cheques, issuing the cheques at par at any branch in the country, cash management facility, DD butiques etc. are necessary.

Another strategy for effective marketing is bank need to change the focus from the traditional banking to universal banking. In urban areas the extend and variety of economic activities demands that one institution should meet all financial need of a customer. Under such an expectation of people universal banking would prove successful approach for bank marketing. The term universal banking in general refers to the combination of commercial banking and investment banking, i.e., issuing, underwriting, investing and trading in securities.

A universal bank is a supermarket for financial products. Under one roof, corporate can get loans and avail of other handy services, while individuals can bank and borrow.

For increasing customer base and retention of the existing cliental universal banking approach is effective strategy. Universal banking offers number of benefits to customers as well s the banks. For instance, economies of scale arise
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in multi-product firms because costs of offering various activities by different units are greater than the costs when they are offered together.

Universal banking with focus on retail customers made the ICICI banks to acquire first position in Indian banking sector. Universal banking approach is beneficial to bank also. For banks economies of scale relate to cost-savings through sharing of overheads and improving technology by jointly providing generically similar groups of services. Since universal banking basically provides financial services the inputs like manpower, infrastructure is more or less same. Necessary changes in the inputs can be made easily. For instance training can be given to staff for providing different financial services to customers. Moreover the most important benefit for the bank is that it is useful to increase the fee based income of the bank. Financial sector passing from lower interest rate regime at present and added to this the process of disintermediation is affecting the main and the traditional source of income for the banks i.e. interest income. All banks are striving hard to increase their fee based income to their bottom line. Universal banking can help the banks here positively.

Marketing approach for rural areas: Prior to nationalization of banks in 1969, the rural areas were virtually without banking facility. At that time unorganized sector was dominating in the rural finance. After nationalization of banks in 1969 branches of the banks were started gradually in the rural areas also. Today more than 50 percent branches of the banks are found in the rural areas. However, the distribution of banks in the rural areas is highly uneven. Here banks have to face competition with the unorganized sector. Moreover the rural banking is highly regularized activity by the Government in India. Lending as well as interest rate is regularized. Thus under such environment different

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marketing

approach is required. For effective rural marketing product

development, promotion and communication is important. All these parameters banks have to balance with socioeconomic factors prevailing in the rural areas. Bank need to innovate product that could attract the depositors. Various loan schemes that are suitable for them for getting funds at right time and also they find convenient to repay. For instance traditional saving bank account may be given fixed deposit concept that once a particular limit of balance is reached the funds from saving account is automatically coveted into fixed deposit attracting higher interest rate.

Banks need t develop some scheme which would attract them to bank with. For loans and advances products which are suitable to tarmers, small traders, small scale agro based rural industries are already in existence.

Banks need to see the how value addition can be mad to these existing schemes. Banks also needs to tie up with Non Government Organisations and various Self Help Group for different types of loans, micro financing etc. This will help the bank for building good image and reputation in the rural areas over and above the business. Another potential area which can be explored by the banks in the rural area is retail banking. With the steady increase in the income of the rural people there is ample scope for retail loan products like housing loans and loan for consumer durables.

Marketing through customer services in rural areas is different from that of urban areas. Here personalized banking is the success mantra for banks. Because of high level of illiteracy people prefer to undertake banking transaction themselves.

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They hesitate to depend upon technology based service. For effective marketing in rural areas bank should have staff with right soft skill like concern for customers problem, positive attitude, good communication and negotiation skill. At every level of dealing with the customer bank need to educate them for banking activates and process. To attract the customers from the unorganized sector most important factor is to provide. The borrower the required finance of right amount at right time.

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CHALLENGES FACED IN BANK MARKETING BY THE BANKERS

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After two years of responding to government intervention into the revenue structure of financial organizations, bank marketers are now faced with heightened levels of competition, a more demanding customer base, an unfavourable rate environment and, in many cases, a shrinking budget. But potentially most challenging to financial institution CMOs I meet in my travels is the ability to respond to the shift in the ways we interact with customer and prospects. The flood of data, channels, devices and changing consumption patterns have marketing departments in financial organizations of all sizes trying to determine if they are prepared. They are reviewing the skills sets that will be required to take advantage of the opportunities these challenges present, and realizing that gearing up may require a heightened level of personal engagement from all members of their team. These challenges are reinforced by a set of studies that I recently reviewed that surveyed marketers from all industries. IBM's 2011 Global Chief Marketing Officer Study entitled, From Stretched to Strengthened found that the majority of CMOs feel unprepared when it comes to the explosion of data available (71%), the impact of social media (68%) the growth of channels and devices (64.5%) and the movement from mass markets to micro markets(64.5%). More importantly, several of the areas where CMOs stated they were least prepared were also those they believed would be the most important for their businesses. As shown below, each of the top four areas of preparedness gap are also in the quadrant where the impact on the marketing function was thought to be the highest.

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But while there were many references to the growing analytical side of online measurement and monitoring in the IBM study, only 26% of CMOs surveyed track blogs, 42% track third-party reviews and 48% track consumer reviews. The need for a much better understanding of ROI was referred to many times in the study, going as far as saying that the CMO of today is in position similar to that of the CFOs 10 years ago.

Turning data into action was also the primary organizational issue in Unica's Annual Survey of Marketers, with the need to harness the power of the mobile device and to leverage the potential of truly integrated marketing also ranking high. As with the IBM study, the Unica research indicated that there is a significant gap between desire and achievement, with much more progress needed in the use of insight for better customer communication and measuring the impact of efforts across channels.
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What was interesting about the Unica study was that, while social media definitely registered as the champion of emerging channels in terms of use (53%), the enthusiasm for the channel was less than in recent years, possibly signaling the desire to see more tangible results from efforts. This also seems to be true in the bank marketing industry, where many are questioning the financial impact of investments made in social media and wanting to connect 'fans andf ollows' into leads and sales. Just like most other industries, bank marketers are being tested daily during a period of unparalleled change and will be required to respond to these new market realities:

The consumer is definitely in control of the business relationship, with the

ability to shop with a click and change bank partners without ever confronting us face-to-face.

While margins are thin and the tolerance for fees is low, delivering customer
value is the table stake in the game both from a perspective of products offered as well as access afforded.

There is a greater need for seamless integration of marketing channels with

an eye towards both effectiveness and efficiency.

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Accountability for marketing investments has never been more important at

a time when bank revenues are at a premium, with new tools for measurement and skills for assessment being leveraged.

Each of the above realities will require a more robust and continuous level of
testing as tools, approaches and consumer attitudes continue to change.

Over the last few days at the National Center for Database Marketing Conference, where hundreds of practitioners met to discuss current trends and share success stories from a variety of industries, one thing was clear . . .there is no silver bullet. In fact, most marketers are working hard to hone their skill sets in a very fluid environment.

The good news is that there are amazing solutions being developed daily to help marketers do their jobs more effectively. The bad news is that the change is continuing at a more rapid pace every day. To be effective, bank marketers will need to have both great learning agility and adaptability to 'what's next'.

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TRADITIONAL MARKETING V/S MODERN MARKETING TECHNIQUES

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In planning for marketing technique development, most businessmen do not give much thought on traditional methods. May be they are thinking more about the many free website tools, applications and plug-ins at the read. Yes,
technology has advanced much faster than most, including what I had expected.

However, I see the traditional marketing techniques still being a part of an important element of marketing a business effectively.

Whether a business chooses to use the more traditional marketing techniques as a secondary marketing strategy; more like an extension of an online marketing strategy or if as a primary marketing strategy, there is still good use and purpose of using traditional marketing techniques. A good example of national businesses using traditional marketing techniques is that of a clothing retailer. Clothing retailers distribute catalogues to homeowners across the UK and is a great way not only to advertise but to increase revenue and profits. I think it s ingenious and perhaps works better than a TV advert; yes TV

advertisements target many potential customers, however, a person may see and forget about the advert then go shopping at the local high street for clothes.

Where as a catalogue, from my experience is ideal, as you will see the catalogue over and over again and then you keep it because it might come in handy not only for you, but for other family members or it is simply something to look at and flick through, whilst your favourite program is on TV. In this case, is it the more traditional marketing technique that is primary or is it supporting the TV adverts?

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Some businesses however, have little choice when it comes to deciding which marketing strategy they use to attract more or repeat customers. This is often due to cost and resources or even suitability of the campaign and overall objectives. I personally think that for the vast majority of businesses, online marketing and strategies are the hub of all marketing, however, you still need to be prepared with your marketing strategy; both online and offline in order to create a successful marketing strategy through reaching your target market with your message.

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TRADITIONAL METHODS OF MARKETING

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Here are a few traditional marketing techniques that are still being used today as part of or a full marketing strategy: Print Ad Campaigns Catalogues Leaflet distribution Flyers All of the above direct mail techniques can be used with a more modern marketing technique and often works very well together i.e. the internet and leaflet distribution could be a great way to reach a wide target audience. More often than not, businesses will use two or three marketing techniques to try achieving their strategy goal. Remember though, that it is not always best to have more; sometimes businesses would be better concentrating on one area of the marketing strategy and putting their resources into that specific marketing technique as apposed to two or three. The more techniques that you put your resources into, this could dilute the overall marketing strategy, so think about what is best for the company and also what if it fails, can you afford to have one or two of the marketing techniques to fail? Maybe one may fail but another one may be very successful and your overall marketing strategy has not failed, but been successful and youll also be able to determine the better of the two or three marketing techniques for future reference. Sometimes we have to fail in order to learn and improve for next time. Traditional methods of marketing typically involve advertising through newspapers, magazines, telephonebooks, radio, and TV. These ads are typically placed for a fee which corresponds to the size of the ad, as well as the medium in which it is published.

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In years past, when almost all individuals read the local newspaper or received a new phone book every year, these were solid media or marketing channels on which many business owners could rely. However, this is rapidly changing. More and more people are choosing to get their news online rather than through the newspaper, and a large number of households no longer take telephone books, since it is often easier to simply look numbers up online. Even popular magazines have fallen prey to the Internet age. Many of these magazines do not have the same circulation numbers they once had. They too have been forced to adapt to the constantly changing world of technology, and in doing so, advertising opportunities for business owners who had previously found success through placing ads in these magazines have changed. In some instances, the change has been favorable desperate to retain print advertisers, many newspapers and magazines has been forced lower prices. Conversely, ultra popular publications have created a restricted availability that rivals Superbowl commercial status. Lastly and sadly, many smaller publications that support local business and provided hometown advertising options have folded, forcing business owners to find affordable alternatives. Although many of the traditional marketing opportunities have either completely disappeared or changed dramatically, there are still opportunities available for those business owners who do not want to venture into an entirely new and unfamiliar world of Internet marketing. Sponsorships of local and regional events can be very lucrative for business owners. They are typically relatively inexpensive, and can be tailored to your advertising budget. This is where you can capitalize, as you are getting your name out without spending a ton of money. The biggest potential payoff with this type of marketing is that your potential customers now associate you and your business with the community. Local radio, cable TV, and billboards are all viable options for
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business owners with larger marketing budgets. If you have driven the 1-95 corridor, you will always remember the multitude of billboards for South of the Border. More affordable traditional options include door flyers, windshield flyers, and direct mail. Find a reliable marketing or printing company that specializes in creating campaigns that suit your budget, industry, and target market.
The 2 Keys to Success

To succeed in traditional and newer types of marketing requires that you pay attention to the following 2 keys: 1. Know who your customers are and target them. The best marketing message in the world wont resonate if delivered to the wrong customers. For example, a plastic surgery advertisement targeting middle age women wont work on ESPN. 2. Craft a compelling USP (unique selling proposition) and offer. The offer you convey in your advertisement must stand out, and you must convey why you are unique. Are you better, faster, less expensive than competitors? And are you offering something compelling (e.g., free trial, free consultation, first-time discount) to get new customers to take action? If not, your advertising will be much less effective. 3. Traditional marketing still works for businesses of all sizes. These strategies can be reliable ways of keeping your business in the public eye and generating new business without breaking the bank.

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INCREASING IMPORTANCE OF MARKETING IN BANKING INDUSTRY

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The various other factors which have led to the increasing importance of marketing in the banking industry are categorized as follows: Government Initiatives The Indian economy embarked on the process of economic reform and various policy measures initiated by the government resulted in the increasing competition in the banking industry, thereby highlighting the importance of effective marketing. The Narasimhan Committee Report evidence of the Governments desire to reregulate the banking industry so as to encourage efficiency through competition. The Government initiatives include: Deregulation of Interest Rates The bank may reduce their Minimum Lending Rates so as to attract Customers (individual and corporate). Such reduction in lending rates Reduce the spread between the deposit rates and lending rates, i.e. the banks margins would decline and they would have to increase their volumes or provide attractive services so as to maintain profits.This calls for bank marketing. Increasing Emphasis on Bank Profitability: With the Narasimhan Committee Report, banks have been directed to improve their efficiency, productivity and profitability. Banks are required to be selfsufficient. In fact, the report has adopted the BIS standards of capital adequacy (though in a phased manner).

Foreign Banks
Foreign banks offer stiff competition to the Indian Banks and with their superior services and technologies offer them a competitive advantage. Thus Indian Banks have to effectively apply marketing concepts to attract customers.

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Entry of New Private Banks In the early 90s new competition emerged in the form of new Private Banks, who brought along with them a high technology-based banking matching with International Standards and have made a significant dent in the banking business by capturing substantial share in the profits of the banking industry. Reduction of Statutory Liquidity Ratio: With the Governments aim of reducing the SLR to 25 percent, the banks will have surplus funds for which they will have to attract users.

Social Environment
Increasing Urbanization, Education and Awareness: The higher literacy level, migration to urban areas and higher awareness due to the boom in the mass media have important implications for the retail banker. He needs to be conscious of the fact the increasing proportion of people are aware of financial service and are, therefore demanding and expecting higher quality services. Technology Development Modernization of Technology has facilitated the introduction of new banking services as to attract new customers. An example of this is the Automated Teller Machines or the facility of Any Time Money. Also in foreign countries, banks are experimenting with money transmission at Point of sale, e.g., petrol station linked with banking network.

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Credit is Easier to Obtain Growing Importance of Non-Banking Financial Institutions: Fixed Deposits being offered by the NBFCs are very attractive for the public, because of the wide gap of interest rates offered by banks on term deposits and that offered by the NBCSs. Further, they offer a variety of specialized services to their customers so as to attract and retain them. Disintermediation: The increasing role of capital markets in mobilizing funds is reducing the importance of banks as intermediaries. Companies are directly approaching the savers through the capital markets. Mutual funds help in attracting the small investors who do not want to take much risk.

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CONCLUSION

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It is submitted that the banking system is on the threshold of a momentous era of change and continuity in growth and development, of individual customer needs and corporate practices, technology and competitions. The role of marketing in the banking industry continues to change. For many years the primary focus of bank marketing was public returns. Then the focus shifted to advertising and sales promotion. That was followed by a focus on the development of a sales culture. Now the focus is on the individual customer meeting and even anticipating his or needs and developing trusting, long-term relationships by delivering high quality personalized service. Marketing both as a philosophy and an activity; is expected to contribute immensely to the realization of goals both immediate and future. All though all the elements of the marketing concept customer satisfaction, profit integrated framework and social responsibility must receive the greatest emphasis in the years ahead. They must be guided by the dictum of Mahatma Gandhi.A customer is the most important visitor in our promises. He is most dependent on us. We are depending on him. He is not an interruption on our work. He is the purpose of it. He is not an outsider on our business. He is part of it. We are not doing him a favour by serving him. He is doing as a favour by giving as an opportunity.

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