Role of marketing strategies in the bank industry
Background of the Study
Marketing is a social phenomenon and great stimulus for economic progress of most societies in the world. Marketing practice makes improvement productivity possible and gives the society the improve standard of living that is required for dynamic society. Every organization whether it’s a product or a services oriented needs marketing strategy for its products or services to be existing and potential customers in other generate more revenue, make profit and remain in business. (Heinrich,2000)
The role of marketing in the Nigerian banking industry is relatively new. However, the need for marketing in bank stem for intense competition, not only from other banks, but also from their financial institutions. It involves the practice in the banking’ industries has brought a lot of improvement to the banking sector of our economy in terms of customer satisfaction, increase revenue generation, profitability and efficient management. Olujide and Aremu (2004).
The word is dynamic where change is constant on a daily bases. Therefore marketers are forced with a constantly changing environment with its attendant challenges of the needs of the customer, thereby necessitating the designing of innovative beautiful ideas and service to meet these challenges. Consequently, in order for the banks to remain viable, they keep on introducing new products and service. The success of a bank depends largely on her ability to satisfy the financial needs of the customers. Successful marketing actions are the result of management information and of applied common sense. Prosperous marketing companies or banks are those that think positively about their business environment, so developing an organization capable of seeking profitable opportunities, recognizing potentials and new product development which is a service industry. Its product cannot be touched or felt. smelt, heard tasted, and seen before purchase. These features distinguish work hard since the service includes intangibility, imperishability and lack of ownership or title transfer. Having a good knowledge helps the bank staff to perform excellently in the range of services they offered to their numerous customers.The role of marketing in the banking industry ntai1s the use of the marketing mix strategies known as 4 pieces namely, product (services) price, place and promotion and other strategy of marketing bank services to their customers.
In modern business, banks are on the point of transition to marketing orientation, where the accent is on the needs of a potential user, who is stimulated through various marketing activities, measures and variables into sale and profit gain. The key objective in all marketing activities is creating value for the customers, that is, clients, with the aim of providing their long-term loyalty. This implies building stronger connections and relations with the customers, with more partner relationship than a classic offer and demand laws. In such circumstances, the most important marketing function is brand development, representing a set of associations it causes for a customer. In order to maximize the value of its brand, a banking institution has to define a brand strategy as a central part of its corporate strategy. (Todd, 2006).The understanding and overcoming the differences between banking and marketing mentality, that is, transition from the traditional accounting orientation to market orientation of a bank brings high position at the market mainly because of competition differentiation. The key to the bank corporate brand success is finding the elements to differentiate the bank and its products/services from the rest, and the way for the clients to recognize that difference. However, it is not enough only to recognize the difference, it is necessary to encourage positive associations, take a certain place in the customer’s conscience, initiate an action, that is, certain bank product/service purchase on behalf of the client in due course. Brand recognition as a subjective feeling about a product, service or company, and a clear emotion connected to brand identity, enabling maximum business results through market share growth, client basis and according to that, profitability growth. For example, it is necessary to provide liquid investments in the long term, especially from the favourable sources. The main aim of each business bank is to provide capital, ensure investments and business profitability. Through partnership and cooperation with the state, business banks should take part in infrastructure project financing, with multiple external effects on engaging a number of companies and entrepreneurs in their realization, which will contribute to increased employment (Vujovic, 2014)
Statement of Problems
In Nigeria today producers and manufacturers use various media in the marketing of their goods and services in order to communicate ideas and information to groups of people in order to change or reinforce a behaviour.
Opinion is divided that marketing has a remarkable impact on the behaviour of consumer because buyers are informed and educated about company’s offering, thereby guiding them in making a wise decision.
While another group is of the opinion that marketing is exaggerating and useful leading to low appraised of the social value of marketing. This research seeks to answer these problems and offer useful suggestion for improvement. It is very difficult to measure the effectiveness of marketing. One problem is our inability to identify the result of any given marketing or campaign. By the nature of the marketing mix, all elements including marketing are so entertained that measurement of any one by it self is impossible many factors besides marketing influence sales success. Essentially, there are only two parts to marketing i.e. what is said and how it is said. There is the problem of inadequate qualified marketing companies to handle marketing effectively and efficiently as requires by the clients. Some organizations do not recognize the importance of marketing relegated its importance to the background and by not making any budgetary allocation to it. Marketing in Nigeria exaggerates, misrepresents the abilities of products or services (Russel T. Rusell J.T, 2006)
Finally, another problem observed with some company marketing is choosing the medium that will appeal to the generality of the entire population. Companies concentrate most of their marketing on television to radio. However, this does not go well with some segment of the consumers in the society particularly the rural dwellers common medium is the radio.
The banking industry has been facing a lot of challenges in recent times in Nigeria. These include competition among them and non banking financial institutions such as insurance Companies, Mortgage Banks, Discount Houses, Building Societies, Commercial Banks. Economic recession and various regulations on banking operations have hampered the conventional banking system of the early part of the century. Financial habit in a developing economy like Nigeria is still very low especially in the rural areas. Large parts of the population in the country are illiterate and less privileged people. The banking industry is thus faced with the gargantuan task of developing its financial culture and habits for the populace.
The proliferation of banks, in Nigeria have resulted in cutthroat competition amongst banks, this phenomena informed the decision to probe into how banks market their financial service; service is usually an intrinsic part of the package that the customers buys and derives from using a product.
Different strategies for marketing bank’s services abound, such strategies includes market segmentation strategy the product concept, the selling concept, the marketing concept, the societal marketing concept and integrated marketing concept (IMC), most bank’s either deliberately or as a result of over enthusiasm dabble into retailing a service that they do not have the necessary strategic skill and training to perform. It will serve these banks better to know that a repeat business can only come from a satisfied customer since you can only fool most customers once.
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