A bank’s vision and mission are its guiding principles. A bank’s core values are aligned to its objectives, to generally provide customer solutions and aspire to be the leading financial services provider among its peers.
To achieve these successes, banks will adopt good and effective marketing strategies, to include the 4 commonly known Ps in the marketing.
They are Price, Place, Product, and Promotion. The 4 Ps are key elements of the marketing strategy and in the past have been introduced as the most prominent Ps in the mix. Now, with evolution in a rising competitive business environment, and sensitivity around customer experience, banks have had to review the breakdown of their marketing strategies to include a few other Ps to the mix.
In an introductory course to Marketing, I did a review on the elements of marketing as it affects the banking industry. I quickly realized the strategies deployed by most banks couldn’t entirely have been based on price, product, place, and promotion alone. In addition, with as much relevance are physical evidence, process, and people. An extended approach leads us to concepts on psychology, people’s expectations, and personal needs and requirements of customers.
Product Strategy for Banks
A lot of banks are adopting a hold-co structure to deliver services to their customers in most major finance segments, such as pensions, asset management, capital markets, trusteeship, insurance and more. Banks offer services in different sectors, such as personal banking, corporate banking, commercial banking, women banking, and agricultural banking.
With the emergence of FinTech’s, banks have had to adapt and innovate to create digital investment platforms requiring minimal human intervention for investors. Cards solutions are diverse, with credit and debit cards, utility cards, lounge access cards, foreign currency cards, utility cards and even virtual cards.
Price Strategy for Banks
Banks have curated an intentional pricing strategy that meets their customers’ willingness to pay for the Bank’s product/service. Lending rates and transactional fees are competitively priced, in line with market realities.
Some accounts offer concessionary pricing, and relationship pricing is considered. There are promotional campaigns and offers of reduced costs on transactional collateral (cards, cheque books).
Place Strategy for Banks
A bank will be deliberate in projecting its physical and digital presence across the industry. In this cashless economy, banks ensure ATMs are accessible with multiple points strategically located in some high traffic zones like malls, high streets, and airports.
Product placement is important. Banks have studied the best approach to reach their desired markets, by making their products available to customers through a vast distribution network. With the use of agency banking, some banks have reached rural communities to serve the unbanked and under-banked.
Customers can interact and transact online, through digital and mobile apps, chatbots, and the easily accessible WhatsApp. For the less sophisticated mobile phone users, USSD codes offer a quick solution to simple banking requirements.
Some HNIs have access to dedicated fast track services at contact centres. These are the many touch points through which banks have placed their products to maximise utility.
Promotion Strategy for Banks
Banks use a variety of promotional strategies to deliver their messages to customers. They use different types of media for advertising campaigns – press, TV, the internet, newspapers, influencing marketing and social media. They also make use of different sales promotion techniques, like offering special incentives, reward schemes and concessions to its customers.
It isn’t uncommon for a bank to engage in grants and sponsorships, as well as partnerships, economic empowerment programs, and corporate social responsibilities.
Then there’s the emotional slogans, aimed at promoting a sense of partnership and security between the customer and the Bank.
Fidelity Bank – We are Fidelity, we keep our word
First City Monument Bank – My Bank & I
Zenith Bank– In Your Best Interest
Physical Evidence Strategy for Banks
This speaks to the quality of the store. Post COVID and in the coming years, banks will gradually start to phase out the brick-and-mortar structures. Both customers and banks have found a new rhythm, and it is online.
Process Strategy for Banks
Best results are driven by best people using best processes. Banks cut out substantial budgets for funding on research and development, and software solutions for effective process improvement implementations and automation.
People Strategy for Banks
Most strategy documents focus on service quality management. Commercial banks need to have assurance, which refers to knowledge and courtesy of employees and their ability to inspire trust and confidence. Staff should be motivated and driven to give optimal output, while work-life balance techniques are becoming the order of the day. Business leaders with emotional intelligence are highly sought after to lead high-performance teams.
Psychology Strategy of Banks – (People expectations and Personal needs)
This speaks to the mind of the customer mostly at a given life stage and during the life cycle of a product. Understanding the customers’ psychology helps a bank anticipate the customers’ reactions to social and economic changes, and feeds into product build. Here, banks can evaluate customers’ expectations and match them to their personal needs and requirements.
When you collapse it, that’s about 10 Ps to marketing as they affect the banking sector. Let’s discuss if you discover any more.