Dynamics of Financial Services Environment Strategies, statements and planning process

Management Process The process of developing a plan, implementing it and evaluating the results. It is a dynamic and ongoing process rather than on one-time event because management is an ever changing environment.

The Management Process

Management Functions Planning Organizing Staffing Directing Controlling

Marketing Environment Macro-environment Micro-environment Public

Macroenvironment…. The part of the marketing environment tht is external to the business and least controlled by it. –Economic environment –Demographic environment –Social/cultural environment –Political/legal environment –Technological environment –Natural environment

Microenvironment…. That part of the marketing environment that is internal to the business and most controlled by it. –Customers –Employees –Producers/suppliers –Intermediaries

Public/Stakeholders Group of people who have something in common that may affect the ability of the business to pursue its objectives.

Discussion of Macroenvironmental Factors Affecting Banking 1.Do banks have any control over this force? 2.Describe the changes taking place in this element of the environment. 3.How does it affect our general area? 4.Has this change affected the products or services offered by banks? 5.Has it affected the way banks advertise and promote products? 6.How else has it affected businesses?

Marketing Management Process…. The process of planning, implementing and evaluating activities aimed at meeting the objective of customer satisfaction at a profitable volume, carried out in an integrated framework and in a socially responsible manner.

Strategic Planning for Banks Deposit Acquisition Deposit inflow Pools of funds available Bank investments or loans Loan Acquisition Loan application inflow Loan applications reviewed for credit worthiness Loan approved

The Unique Challenge of Bank Marketing

Prerequisites for Successful Strategic Planning….. Senior management support/involvement Cooperation at ALL bank levels Agreement to commit time, talent and resources Design responsibility for plan implementation Recognition that plan will not be perfect or unchanging

Marketing Strategy…. The step in the marketing planning process during which the marketing mix strategies are selected in order to attract the target audience.

Steps in the Marketing Planning Process….. Situational analysis Setting objectives Target market selection Strategy formation

Model for the strategic Marketing Management Process The Marketing Plan Situation Analysis Problems and opportunities (SWOT) Objectives Stretching, measurable, consistent, specific, challenging, attainable, timely Target Market Selection Segments to target with marketing strategy Marketing Strategy ProductPricingPromotionPlace (Distribution) StrategyStrategyStrategyStrategy objectivesobjectivesobjectivesobjectives strategiesstrategiesstrategiesstrategies tacticstacticstacticstactics Implementation Evaluation Feedback and modification

Federal Regulators of the Banking Industry Regulator Federal Reserve System (Fed) Federal Deposit Insurance Corporation (FDIC) Office of the Comptroller of the Currency (OCC) National Credit Union Administration (NCUA) Office of Thrift Supervision (OTS) Entities Regulated Bank holding companies; national banks; state banks that are Fed members Federal Reserve member banks; state-chartered commercial banks that are not Fed members; state-chartered savings associations National Banks Federally chartered and federally insured credit unions Federally chartered savings and loan associations

Expansion Matrix MarketsPresent ProductsNew Products PresentPenetrationProduct Expansion NewMarket ExpansionDiversification

Product/Market Matrix MarketsExisting ProductsNew Products PresentMarket Product Penetration Expansion NewMarket Diversification Expansion product/market Expansion

Types of Objectives Found in Banks…. Mission Statement Corporate or Financial Objectives Marketing Objectives Departmental Objectives Job Objectives

The Product/Market Expansion Matrix MarketsPresent ProductsNew Products PresentMarket Penetration Improve bank’s position with present products in present markets Product Expansion Develop new products for present markets NewMarket Expansion Find new markets to use bank’s present products Diversification or Product/Market Expansion Develop new products for new markets