Marketing of Financial Services:Marketing Research

BANKING DIPLOMA EXAMINATION 

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh(IBB)
Marketing of Financial Services-JAIBB

Marketing Research

A. Definition of marketing research : 

According to American marketing association, marketing research is the function that links, the
consumer, customer and public to the marketer through information - information
used to identify and define marketing opportunities and problems, generate, refine and evaluate
marketing actions, monitors marketing program and improve understanding of marketing as a
process. 
Marketing research is the systematic and objective identification, collection, analysis,
dissemination and use of information for the purpose of improving decision making related to the
identification and solution of problems and opportunities in marketing. 

B. Important things are in marketing research : 

Some specific things are very important in the marketing research definition. These things are
discuss below : 

1. Identification of problem : 

The most important things in the marketing research are problem identification. Because, if the
researcher is unable to identify the actual problem, then all works or activities of the researcher
that are related with time, energy, effort and cost will be wasted. 
2. Collection of data : 

A researcher can collect data and information from various sources and he can use different type
of methods. But all sources and data collection methods are not appropriate for all type of
research works. So, it is very important for the researcher to select the right sources and right
methods to collect data and information. 

3. Analysis of data and information : 

A researcher use different types of tools and techniques to analysis and interpret data and
information. Such as coding, decoding, editing, transcription and verification of data and
information. Different types of statistical tools and techniques are also used to analysis data and
information. All types of statistical tools and techniques are not appropriate for all types of
research works. So, it is very important for the researcher to select right statistical tools and
techniques to analyze his collected data and information. 

4. Dissemination of information : 

The findings, implications and recommendations are provided in a format that makes this
information actionable and directly useful as an input for decision - making. 

C. Classification of marketing research : 

Different types of organization conducted marketing research for two reasons. These are as
follows : 

1. Problem identification research : 

The goal is to identify existing and / or potential problems that are likely to arise in the future,
not apparent on the surface. Examples of problems identification research include market
potential, market share, brand or company image, market characteristics, short range forecasting,
scale analysis, long range forecasting and business trends research. 

2. Problem solution research : 

Once a problem or opportunity has been identified than problem solving research is undertaken
to arrive at a solution. The findings of problem solving research are used in making decisions
that will solve specific marketing problems. Marketing problem solving research included
segmentation, product, pricing, promotion and distribution research. 

D. Steps involved in the marketing research process : 

To conduct a marketing research work properly, it is necessary to follow the right steps. The
success of the marketing research mostly depends on the work performance of each step. These
steps are discuss below : 

1. Problem definition : 

The first step in any marketing research project is to define the problem. Some time the
researcher wrongly thinks that the symptoms are the real problems. But the real causes can be
underline with the symptoms. In defining the problem, the researcher should take into account
the purpose of the study, the relevant background information, the information needed and how it
will be used in the decision - making. To identify the marketing problem the researcher can
discuss about the problems with the decision makers, interviews with the industry experts and
analysis of secondary data. Some time the researcher can conduct the qualitative research to find
out the problems. Such as focus group, reference group or depth interview etc. 

2. Development of an approach to the problem : 

Developing an approach to the problem includes in the research work to formulating an objective
or theoretical framework, analytical models, research questions, hypotheses and identifying the
information needed. This process is guided by the discussions with management and industrial
experts, analysis of secondary data and qualitative research considerations. 

3. Research design formulation : 

A research design is a framework or blueprint for conducting the marketing research project. It
details the procedures necessary for obtaining the required data and information and its purpose
is to design a study that will test the hypotheses of interest, determine possible answers to the
research questions and provide the information needed for decision making. Conducting
exploratory research, precisely defining the variables and designing appropriate scales to
measure them are also a part of the research design. The issues of how the data should be
obtained from the respondents must be address. It is also necessary to design a questionnaire and
a sampling plan to select the respondents for the study. More formally, formulating the research
design involve the following steps : 

(a) Definition of the information needed : 

First the researcher prepares a list for information that is required for the research work. The list
of the required information prepared on the basis of the objectives of the research project. 

(b) Secondary data analysis : 

In the information collection stages the researcher first search secondary data. Because the
secondary data help to reduce time, effort, energy and cost. 

(c) Qualitative research : 

Some time the researcher conduct a qualitative research to understand the problem in a better
way. This research technique is unstructured, exploratory in nature, based on small samples and
may utilize popular quantitative techniques, such as focus groups, depth interview and projective
techniques. 

(d) Method of collecting quantitative data : 

When the researcher realize that secondary data are not appropriate, not available or not valid for
his research work then he search the primary data. Three methods are used to collect primary
data, these are survey, observation and experimentation methods. Which method will be used
that also depend on the nature of the research project ? 

(e) Measurement and scaling procedures : 

Measurement indicates the assigning numbers or other symbols to characteristics of objects

according to certain perspecified rules. Scaling is the process or technique of placing the
respondents on a continuum with respect to their attitude towards something. 

(f) Questionnaire design : 

Questionnaire is designed on the required data and information. Questionnaire has play a vital
role to collect data and information through survey method. In the questionnaire preparation the
researcher has to consider selecting right words, use non - technical terms, avoid leading
question, avoid to use dual meaningful word and so on. 

(g) Sampling process and sample size : 

A researcher cannot able to consider the population to collect data and information. It is
sometime impossible and hug costly to collect data and information from the population. So,
researcher uses the samples that represent the population. Sample can be selected through
probabilistic sampling or non - probabilistic sampling. If the researcher uses large number of
sample for his research work then the he can able to get more accurate result. 

(h) Plan of data analysis : 

The researcher prepares a plan to use different type of tools and techniques that are appropriate
for his research work. 

4. Field work or data collection : 

To collect primary data and information, the researcher involves field forces or staffs that operate
in the field. The field forces, staffs or interviewers could be use different types of methods to
collect primary data and information. These are : 

(a) Telephone survey : 

Researcher prepares a well - designed questionnaire and then he asks questions to the respondent
over telephone. When the respondents are very busy and important person in society then
telephone survey is more appropriate. This method also helpful for the researcher to collect data
and information from a place to cover a vast areas. But the major disadvantages of this method
are, it is very expensive and at the same time all respondents cannot be a telephone set holder. 

(b) Personal interview : 

This method is very popular and wieldy used in the research work. Through this method
researcher collect data and information with face to face interaction. In this method the
researcher can give explanation, interpretation and show pictures to the respondents so that they
can able to give appropriate answers. 

(c) Mail survey : 

Here the researcher sent questionnaires to the respondents with a return envelope. This method is
very helpful when researcher want to collect data and information on personal related, social and
sensitive issues. But the response rate of this method is very low. 

(d) Electronic survey : 

First the researcher collects the e - mail addresses of the respondent then he sent questionnaire
through Internet. Another way to use electronic surveys that is web site. Here the researcher can
sent a questionnaire in the web site. But the main disadvantages of this method are that all the
respondents are not the owner of a e - mail address or they can not be the user of the web site and
the response rate is very low here. 

5. Data processing and analysis : 

Data preparation includes coding, decoding, editing, transcription and verification of data and
information. Different types of statistical tools and techniques are used to analyze data and
information. Such as correlation, regression, time series analysis, t - test, ANOVA test etc. Each
questionnaire or observation form is inspected or edited and if it is necessary then these will be
corrected. 

6. Report preparation and presentation : 

The entire project should be documented in a written report that address the specific research
questions identified, describes the approach, the research design, data collection and data
analysis procedures adopted and present the results and the major findings. The findings should
be presented in a comprehensible format so that management can readily use them in the
decision making process. In addition, an oral presentation should be made to management using
tables, figures and graphs to enhance the clarity and impact of the research work.
Marketing of Financial Services: Consumer behaviour in marketing
management.

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
  Marketing of Financial Services-JAIBB
A.  Consumer behaviour in marketing management :

1.  Situation analysis :

(a)  Consumer / Market behaviour :
(b)  Internal / Company factors :
(c)  Competitive factors :

2.  Marketing strategy :

(a)  Market segmentation :
(b)  Product differentiation :
(c)  Innovation :
(d)  Achieving greater sales volume to present customers :
(e)  Gaining supply or distribution leverage :
(f)  Diversifying into new market :

3.  Marketing program :

(a)  Product decision :
(b)  Price decision :
(c)  Distribution decision :
(d)  Promotion decision :

B.  Role of consumer behaviour in the design of marketing program,

C.  Consumer research process :

1.  Developing research objectives :
2.  Collection secondary data :
3.  Designing primary research :

(a).  Quantitative research design  :

(i)  Observational research  :
(ii)  Experimental  :
(iii)  Surveys :

(b)  Quantitative research data collection instruments :

(i)  Questionnaire :
(ii)  Attitude scales :

(c).  Qualitative research design and data collection :

(i)  Depth interviews :
(ii)  Focus groups :
(iii)  Projective techniques  :
(iv)  Metaphor analysis  :
(d)  Consumer satisfaction measurement :
(i)  Consumer satisfaction survey :
(ii)  Mystery shopper :
(iii)  Complain analysis :

(e)  Sampling and data collection :

(i)  Sample :
(ii)  Probability sample :
(iii)  Non probability sample :

4.  Data analysis and reporting research findings :

Marketing of Financial Services: Market Segmentation

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB
Market Segmentation

A.  Levels of market segmentation.

1.  Segment marketing :     
2.  Niche marketing :
3.  Local marketing :
4.  Individual marketing :                  (To Get Download Option Click Read More)

B.  Pattern of market segmentation.

1.  Homogeneous preferences :
2.  Diffused preference :
3.  Clustered preference :

C.  Market segmentation procedure.

1.  Survey stage :
 2.  Analysis stage :
3.  Profiling stage :

D.  Basis for segmenting consumer markets.

1.  Geographic segmentation :

2.  Demographic segmentation :

(a)  Age and life - cycle stage :

(b)  Gender :
(c)  Income :
(d)  Generation :
(e)  Social class :

3.  Psychological segmentation :

(a)  Lifestyle :
(b)  Personality :
(c)  Values :

4.  Behavioural segmentation :

(a)  Occasions :
(b)  Benefits :
(c)  Users status :
(d)  Usage rate :
(e)  Loyal status :
            (i)         Hard core loyals :
            (ii)        Split loyals :
            (iii)       Shifting loyals :
(iv)         Switchers :
(f)  Buyer readiness stage :
(g)  Attitude :

5.  Multi – attribute segmentation ( Geoclustering ) :

6.  Targeting multiple segments :

E.  Major segmentation variable for business markets.

1.  Demographic :
(a)  Industry :
(b)  Company size :
(c)  Location :

2.  Operating variables :

(a)  Technology :
(b)  User or nonuser status :
(c)  Customer capabilities :
3.  Purchasing approach :
(a)  Purchasing - function organization :
(b)  Power structure :
(c)  Nature of existing relationship :
(d)  General purchase policies :
(e)  Purchasing criteria :

4.  Situational factors :

(a)  Urgency :
(b)  Specific application :
(c)  Size of order :

5.  Personal characteristics :

(a)  Buyer - seller similarity :
(b)  Attitude toward risk :
(c)  loyalty :

F.  Effective segmentation.

1.  Measurable :
2.  Substantial :
3.  Accessible :
4.  Differentiable :
5.  Actionable :

G. Selecting the market segments.

1.  Single - segment concentration :
2.  Selective specialization :
3.  Product specialization :
4.  Market specialization :
5.  Full market coverage :

Marketing of Financial Services: Buyer Behaviour

 BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB
Buyer Behaviour
A.  Major factors influencing buying behaviour.
            The aim of marketing is to meet and satisfy target customers’ needs and wants. Some
time customer say something but actually do different. Their buying behaviour influenced by
many factors.

1.  Cultural factors :                      (To Get Download Option Click Read More)
            The culture is the most fundamental determinant of a person’s wants and behaviour. 

(a)  Culture :
            Culture has a broadest and deepest influence on buying behaviour. The growing child
acquires a set of values, perceptions, preferences, norms and behaviour through his or her
family and other key institutions. For example, a child growing up in the United States is
exposed to the following values : achievement and success, activity, efficiency and practicality,
progress, material comfort, individualism, freedom, external comfort, humanitarianism and
youthfulness.    

(b)  Subculture :
            Each culture consist of smaller subcultures that provide more specific identification and
socialization for their members. Subcultures include nationalities, religions, racial groups and
geographic regions. Many subcultures make up important market segments and marketers
often design their product or services and marketing programs according to consumers needs.  

(c)  Social class :

            Social classes are relatively homogeneous and enduring divisions in a society, which
are hierarchically ordered and whose members share similar values, interests and behaviour.
Social classes do not reflect income alone, but also other indicators such as occupation,
education and area of residence. Social classes differ in dress, speech patterns, recreational
preferences and many other characteristics.

Social classes have several characteristics. First, those within each social class tend to
behave more alike than persons from two different social classes. Second, persons are
perceived as occupying inferior or superior position according to social class. Third, social class
is indicated by a cluster of variables - for example, occupation, income, wealth, education and
value orientation - rather than by any single variable. Fourth, individuals can move from one
social class to another - up or down - during their life time.      

2.  Social factors :

            A consumer’s buying behaviour is influenced by such social factors as reference groups,
family and social roles and status.
 (a)  Reference groups :
            A person’s reference groups consists of all the groups that have a direct ( face to face )
or indirect influence on the person’s attitudes or behaviour. Groups having direct influence on a
person are called membership groups. Some membership groups are primary groups, such as
family, friends, neighbors and co – workers, with whom the person interacts fairly continuously
and informally. People also belong to secondary groups, such as religious, professional and
trade - union groups, which tend to be more formal and require less continuous interaction.
            Their reference groups in at least three ways significantly influence people in our
society. Reference groups expose an individual to new behaviours and lifestyles. Their attitudes
and self - concepts also influenced by the reference groups. And they create pressures for
conformity that may affect actual product and brand choices. So, marketers try to identify their
target customer’s reference groups, which influence varies among product and brand choices. 

(b)  Family :

(c)  Roles and status :

3.  Personal factors :

(a)  Age and stage in the life cycle :
(b)  Occupation and economic circumstances :
(c)  Personality and self - concept :

4.  Psychological factors :

(a)  Motivation :
(i)            Freud’s theory :
(ii)           Maslow’s theory :
(iii)          Herzberg’s theory :

(b)  Perception :
(i)            Selective attention :
(ii)           Selective distortion :
(iii)          Selective retention :

(c)  Learning :

(d)  Beliefs and attitudes :

B.  Buying roles.

            It is easy to identify the buyer for many products. But even the marketers must be
careful in making their targeting decisions, because buying roles can be change. Five types of
people might play roles in a buying decision. These are :

1.  Initiator :
            A person who first give or suggest the idea of buying the products or services.

2.  Influencer :
            A person whose view or advice influence the buying decision.
3.  Decider :
            A person who decides on any component of a buying decision, whether to buy, what to
buy, how to buy, when to buy and where to buy.

4.  Buyer :
            The person who makes the actual purchase of products or services.

5.  User :
            A person who consumes or uses the products or services.

C.  Buying behaviour.

            Consumer decision - making varies with the different type of products or services buying
decision. We can classify the consumer buying behaviour into four categories, these are :

1.  Complex buying behaviour :

            Complex buying behaviour involves a three - step process. First, the buyer develops
beliefs about product. Second, he or she develops attitudes about the product. Third, he or she
makes a thoughtful choice. Consumers engage in complex buying behaviour when they are
highly involved in a purchase and aware of significant differences among brands. This is usually
the case when the product is expensive, bought infrequently, risky and highly self - expressive.
Typically the consumer does not know much about the product category. So, the marketer of a
high - involvement product must have to understand the consumer’s information gathering and
evaluation behaviour nature.    

2.  Dissonance - reducing buying behaviour :

            Sometimes the consumers are highly involved in a purchase but see little difference in
brands. The high involvement is based on the fact that the purchase is expensive, infrequent
and risky. The buyer will try to learn more information about the product what is available at the
time of purchase but will buy fairly quickly, perhaps responding to a good price or to purchase
convenience. For example, carpet buying is a high - involvement decision because carpeting is
expensive and self – expressive, yet the buyer may consider most carpet brands in a given
price range to be the same.
            After the purchase, the consumer might experience dissonance that stems from noticing
certain disquieting features or hearing favourable things about the other brands.      

3.  Habitual buying behaviour :

Many products are bought by the consumer under conditions of low involvement and absence of
significant brand preference. Such as salt, sugar, match etc. Consumers have little involvement in
this product category. They go the store and reach for the brand. If they do not get their own
brand then they shifts into the other brand. They have no strong brand loyalty. The consumers
have low involvement with most low cost, frequent, less risky purchased products.
With these products, consumer behaviour does not pass the normal sequence of belief,
attitude and behaviour. Consumers do not show interest to search extensively for information,
evaluate characteristics and make decision on which brand to buy.   
Marketers of such kinds of products find it effective to use price and sales promotions to
stimulate product trial.

4.  Variety - seeking buying behaviour :

            Some buying situations are characterized by low involvement, frequent, less risky but
significant brand differences. Here consumers often do a lot of brand switching. As for example,
cookies. The consumer has some beliefs about cookies, chooses a brand of cookies without
much evaluation and evaluates the product during consumption. Next time, the consumer may
reach for another brand out of a wish for a different taste. Brand switching occurs for the sake of
variety rather than dissatisfaction.

D.  Post purchase behaviour.

1.  Post purchase satisfaction :

2.  Post purchase actions :
3.  Post purchase use and disposal :

Marketing of Financial Services:Marketing Environment

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB
Marketing Environment

A.  Demographic environment.                  (To Get Download Option Click Read

More)
            Marketers are much more interested to monitor the demographic environment, because
population makeup the market.
1.  World population growth :
            The world population explosion has been a source of major concern, for two reasons.
The first is the fact that certain resources needed to support this much human life ( fuel, foods
and minerals ) are limited and may run out at some point. Unchecked population growth and
consumption would eventually result in insufficient food supply, depletion of key material, over
crowding, pollution and an overall deterioration in the quality of life.
            Second cause for concern is that population growth is highest in some countries and
communities that can least afford it. In the developing countries, the death rate has been falling
as a result of modern medicine, but birth rate remained fairly stable. Feeding, clothing and
educating of their children while also providing a rising standard of living is nearly impossible in
these countries.  
2.  Population age mix :
            National populations vary in their age mix. At one extreme is Mexico, a country with a
very young population and rapid population growth. At the other extreme is Japan, a country
with one of the world’s oldest populations. In Mexico milk, diaper, school supplies and toys
would be the important products. But in Japan most of the population consume many more adult
products.
            So, the marketers have to create separate products and services for different countries
and have to choose different price, distribution and promotional strategies for them.      

3.  Ethnic market :

            Countries also vary in ethnic and racial makeup. At one extreme is Japan, where almost
every one is Japanese. But on the other extreme is United States, where virtually people came
from all nations. Each group has certain specific wants and buying habits. Several food, clothing
and furniture companies have directed their products and promotions to one or more of these
groups.     

4.  Education groups :

            The population in any society falls into five groups, illiterate, high school dropouts, high
school degree, college degree and professional degrees. The marketers have to observe the
size of each groups in a society and according to their size they have to design their production
plan for different products and services.        
5.  Household patterns :
            The traditional household consists of a husband, wife and children. But in some other
societies we observed that their household patterns are nontraditional including single live - 
alones, adult live – togethers, single parent families, childless married couple and so on. Single
or separated families needed smaller apartment, inexpensive and smaller appliances, furniture
and small size food packets. So, the marketers have to consider to the household patterns of
the different societies. 

6.  Geographical shifts in population :

Population movement from one country to another or from rural to urban areas. Location
makes a difference in goods and service preferences. Those who lived in large cities their most
of the purchase are expensive furniture, perfumes, cloths and so on. Suburbanites buy home
workshop equipment, outdoor furniture and outdoor coking equipments etc. So, the marketers
have to consider to the geographic shifts in population.    

7.  Shift from a mass market to micro - markets :

            The effect of all these changes is fragmentation of the mass market into numerous micro -
markets differentiated by age, sex, ethnic background, education, geography, lifestyle and other
characteristics. Each group has strong preferences and marketer has to reached the customer
through increasingly targeted communication and distribution channels. Marketers are
increasingly design their products and services and selected their marketing programs for
specific - micro markets. 

B.  Economic environment.

            Without the purchasing power, consumers are not able to fulfill their needs and wants
properly. The available purchasing power in an economy depends on current income, price,
savings, debt and credit availability. Marketers pay close attention to major trends in income and
consumer spending patterns.  

1.  Income distribution :

            Nations economic condition mostly depend on the level and distribution of income and
industrial structure. There are four types of industrial structures are observed in the national
economy.

(a)  Subsistence economies :

            In a subsistence economy, the vast majority of people engage in simple agriculture,
consume most of their output and barter the rest outputs for simple other goods and services.
These economies offer few opportunities for the marketers. 

(b)  Raw material exporting economies :

            These economies are rich in one or more natural resources but poor in other respects.
Much of their revenue comes from exporting these resources. For example, Zaire and Saudi
Arabia has copper and oil resources and they export them in the international market. These
countries are good markets for extractive equipment, tools and supplies, materials handling
equipments and trucks. Depending on the number of foreign residents and wealth or rich rulers
and landholders, they are also a good market for western - style commodities and luxury
goods. 
(c)  Industrializing economies :
            In an industrializing economy, manufacturing begins initially to account for 10 percent to
20 percent of gross domestic product. Industrializing economies countries are India, Egypt,
Philippines, Malaysia and so on. As manufacturing increases, the country depends more on
imports of raw materials, steels and heavy machinery and less on imports of finished textiles,
paper products and processed foods. Industrialization creates a new rich class and a small but
growing middle class, both demanding new types of goods and services.        

(d)  Industrial economies :

            Industrial economies are major exporters of manufactured goods and investment funds.
They buy manufactured goods and export them to other types of economies in exchange for
raw materials and semifinished goods. The large and variety of manufacturing activities of these
nations and their sizable middle class make them rich markets for all sorts of goods.       
2.  Saving, debts and credit availability :
            Consumers expenditures are affected by consumer saving, debt and credit availability.
Consumers saving habit increase the amount of deposits, which is helpful for banks to reduce
the bank interest rate and increase the loan availability. Access to lower interest rate helps the
companies to expand faster. When credit facilities are available then consumers can purchase
many goods and services, otherwise these are not possible at present. Marketers must pay
careful attention to major changes in income, cost of living, interest rate, savings and borrowing
patterns because they can have a high impact on business, specially for companies whose
products have high income and price sensitive.        

C.  Natural environment.

1.  Shortage of raw materials :
2.  Increased energy cost :
3.  Increased pollution levels :
4.  Changing role of governments :

D.  Technological environment.

            One of the most dramatic forces makes rapid changes of human life is technology. The
economy’s growth rate is affected by the discoveries of new major innovated technologies. The
marketers are monitoring the new innovation and trend of technology.

1.  Accelerating pace of technological change :

            Many of today’s common products were not available 40 years ago. People of that time
were did not know personal computers, digital wristwatches, video recorders, mobile phones
and fax machines. The advent of personal computers and fax machines has made it possible for
people to telecommunicate the others that is, work at home instead of traveling to offices that
may be takes 30 minutes or more. Some people hope that this trend of technology will reduce
auto pollution, healthy society, bring the family close together and create more home centered
entertainment and activities. It will also have substantial impact on shopping behaviour and
marketing performance.      
2.  Unlimited opportunities for innovation :
            Scientists are working on a startling range of new technologies that will revolutionize
products and production process. Some of the most exciting work is being done in solid - state
electronics, biotechnology, robotics and material sciences. Researchers are working on AIDS
cures, happiness pills, painkillers and nonfattening foods. They are designing efficient robots for
firefighting, underwater exploration and home nursing. In addition scientists are also working on
fantasy products, such as small flying cars, three - dimensional television and space colonies.
The challenge in each case is not only technical but also commercial – to develop affordable
versions of these products.   

3.  Varying research and development budgets :

            The United States annual research and development expenditures are highest in the
world, nearly 60 percent of these funds are still earmarked for defense. Japan has increased its
research and development expenditures much faster than the United States and is spending
mostly on nondefense related research in physics, biophysics, biochemistries, material science,
geography and computer science. Many companies are content to put their money into copying
competitors’ products and making minor feature and style improvements. So, new innovation of
technology depends upon the nature of research work and on the amount of budgets allocated
for research and development works.      
4.  Increased regulation of technological change :
            As products become more complex, the public needs to be assured of their safety and
security. Consequently, government agencies’ powers to investigate and ban potentially unsafe
products have been expanded. Safety and health regulations have also increased in the area of
food, automobiles, clothing, electrical appliances, medical sciences and construction. Marketers
must be aware of these regulations when proposing, developing and lunching new products in
the markets.     

E.  Political legal environment.

1.  Legislation regulating business :
2.  Growth of special - interest groups :

F.  Social cultural - environment.

1.  High persistence of core cultural values :
2.  Existence of subcultures :
3.  Shifts of secondary cultural values through time

Marketing of Financial Services-Designing Competitive Strategies

 BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)

Marketing of Financial Services-JAIBB 

Designing Competitive Strategies

Designing Competitive Strategies

We can further classify the firms by the role they play in the target market. These are :
1.     Market leader – Who has 40 % or more then market shares in the industry. 
2.     Market challenger – Who has 30 % market shares in the industry.
3.     Market follower – Who has 20 % market shares in the industry.
4.     Market nicher – Who has 10 % or below 10 % market share in the industry.

Market leader Strategies.

A.  Market leader Strategies.          (To Get Download Option Click Read More)

            Many industries contain one firm or a firm, which has 40 % or more than 40 % market
share is called market leader. It usually leads the other firms in price changes, new product
innovation or introduction, distribution coverage and promotional intensity. Some of the well
known market leaders are Kodak ( photography ), Coca - Cola ( soft drink ), Mcdonald ( fast
food ), Microsoft ( computer software),  and so on.    

1.  Expanding total market :

            The dominant firm normally gains the most when the total market expands. In general,
the market leader should look for new users, new uses and more usage of its products. 

(a)  New users :

            Every product class has the potential of attracting buyers who are unaware about the
product or who are resisting it because of price or lack of certain features. A company can
search for new users among the three groups. Those who might use it but do not use or buy it
at present ( market penetration strategy ), those who have never use it ( new market segment
strategy ) or who live elsewhere ( geographical expansion strategy ).   

(b)  New uses :

            Markets can be expanded through discovering and promoting new uses for the product.
In many cases, customers deserve credit for discovering new uses. For example, Vaseline
petroleum jelly started out as a lubricant in the machine shops. Over the years, users have
reported many new uses for the product, including a skin ointment and hairdressing.    

(c)  More usage :

            A third market expansion strategy is to convince people to use more products per use
occasion. Soft drink manufacturers convince the customer to use more soft drinks daily rather
than to use on occasions.  

2.  Defending market share :

            While trying to expand total market size, the dominant firm must continuously defend its
current business against rival attacks. The market leader leads in the industry in developing new
product and customer services, distribution effectiveness and cost cutting. It keeps increasing
its competitive strength and value of the customers. Market leaders are using different types of
strategies to defending their market share. These are : 

(a)  Position defense : 

            The basic defense is to build an impregnable fortification around one’s territory. Coca –
Cola today, selling nearly half the soft drinks in the world, has acquired fruit drink companies
and diversified into desalinization equipment and plastics. Although defense is very important,
leaders under attack would be foolish to pull their resources into only building fortifications
around their current product.     

(b)  Flank defense : 

            The market leader should also erect outposts to protect a weak front or possibly serve
as an invasion base for counterattack. 

(c)  Preemptive defense : 

            A more aggressive maneuver is to attack before the enemy starts its offense. A
company can launch a preemptive defense in several ways. It can wage guerrilla action across
the market – hitting one competitor hare, another there – and keep everyone off balance. Or it
can try to achieve a grand market environment. It can begin sustained price attacks. Or it can
send out market signals to dissuades competitors from attacking.   

(d)  Counteroffensive defense : 

            Most market leaders, when attacked, will respond with a counterattack. The leader can
not remain passive in the face of a competitor’s price cut, promotion blitz, product improvement
or sales territory invasion. In a counteroffensive, the leader can meet the attacker frontally or hit
his flank or lunch a pincer movement.

            An effective counterattack is to invade the attacker’s main territory so that it will have to
pull back some troops to defend the territory. Another counteroffensive defense is the exercise
of economic or political clout to deter the attack. The leader may try to crush a competitor by
subsidizing lower prices for the vulnerable product with revenue from its more profitable
products. Or the leader may prematurely announce that a product upgrade will be available to
prevent customers from buying the competitor’s product. Or, the leader may lobby legislators to
take political action that would inhibit or cripple the competition.   
(e)  Mobile defense :

            In mobile defense, the leader stretches its domain over new territories that can serve as
future centers for defense and offense. Mobile defense can be classify into two categories : 

(i)  Market broadening :

Market broadening involves the company in shifting its focus from the current product to
the underlying generic need. The company gets involved in research and development across
the world range of technology associate with that need. Such as, thus ‘petroleum’ companies
sought to recast themselves into ‘energy’ companies.  

(ii)  Market diversification :

Market diversification into unrelated industries is the other alternative. When U.S.
tobacco companies are well known about the movement against cigarette smoking, they were
not content with position defense or even looking for substitutes for the cigarette. Instead they
moved quickly into new industries, such as beer, liquor, soft drink etc.      

(f)  Contraction defense : 

            Large companies sometime recognize that they can no longer defend all of their
territory. The best course of action for company, then appears to be planned contraction ( also
called strategic withdrawal ). Planned contraction means giving up weaker territory and
reassigning resources to stronger territories. 

3.  Expanding market share :

            Market leader can improve their profitability by increasing their market share. Achieving
or gaining increasing market share in the served market will not automatically improve the
profitability of the company. Because the cost of gaining higher market share may far exceed its
revenue value, a company should consider three factors before pursuing increased market
share :

The first factor is the possibility of provoking antitrust action. This rise in risk would cut
down the attractiveness of pushing market share gains too far.

The second factor is economic cost. The cost of gaining further market share might
exceed the value. So, some market leaders have even increased profitability by selectively
decreasing market share in weaker areas.
 The third factor is that companies might pursue the wrong marketing mix strategy in their
bid for higher market share and therefore fail to increase profits. Companies that win more
market share by cutting price are buying, not earning a large share and their profits may be
lower.    

Market challenger strategies.

B. Whom to attack by the market challenger.
            A market challenger must first define its strategic objective. Most aim to increase market
share. The challenger must decided whom to attack.

1.  It can attack the market leader :

            This is a high - risk and huge investment but potentially high pay- off strategy and makes
good sense if the leader the leader is not serving the market well. The alternative strategy is to
out innovate the leader across the whole segment.

2.  It can attack firms of its own size :

            It can attack the firm of its own size that are not doing the job and are under financed.

3.  It can attack small local and regional firms :

            Several major market challenger companies grew to their present size by gobbling up
small firms.          

C.  Attacking strategies of market challenger.

1.  Frontal attack :

2.  Flank attack :

3.  Encirclement attack :

4.  Bypass attack :

5.  Guerilla attack :

D.  Choosing a specific attack strategy by the marketer challenger.

1.  Price discount :

2.  Cheaper goods :

3.  Prestige goods :

4.  Product proliferation :

5.  Product innovation :

6.  Improved services :

7.  Distribution innovation :

8.  Manufacturing cost reduction :

9.  Intensive advertising promotion :

E.  Market follower strategies.

1.  Counterfeiter :

            The counterfeiter duplicate the market leader’s product and package and sells it on the
black market or through disreputable dealers. 

2.  Cloner :

            The cloner emulates the market leader’s products, name, brand and packaging with
slight variations. 

3.  Imitator :

            The imitator copies some things from the market leader but maintains differentiation
in terms of packaging, advertising, pricing and so on. The market leader does not mind the
imitator as long as the imitator does not attack the market leader aggressively.

4.  Adapter :
            The adapter takes the market leader’s products and adapts or improves them. The
adapter may choose to sell his product to different markets. But often the adapter grows into
future market challenger.    

Market Nicher Strategies.

F.  Specialist roles are open to the market nichers :

01.  End - user specialist : 

02.  Vertical - level specialist :

03.  Customer - size specialist :

04.  Specific - customer specialist :

05.  Geographic specialist :

06.  Product or product line - specialist :

07.  Product - feature specialist :

08.  Job - shop specialist :

09.  Quality - price specialist :

10.  Service specialist :

11.  Channel specialist :

Marketing of Financial Services: Introduction to Marketing

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB
Introduction to Marketing 
The Scope of Marketing
                                                                                                  
            In twenty first century marketing is not related with the production and distribution of
goods and services. The scope of marketing is so much expanded that it has play vital role to
improve our standard 
(To Get Download Option Click Read More)
of life and at the same time help to create health and wealth society. Following areas or items
where marketing principles, policies and strategies are applied and on the other hand these are
widely used in marketing activities.
\
1. Goods :
            Physical goods constitute the bulk of most country’s production and marketing effort.
Physical goods can be food, car, television, clothing, housing and so on. Most of the marketing
activities are closely related with goods. Without goods transportation, warehousing, grading and
standardization activities can not be performed.

2. Services :
            Services play a vital role in the modern economy. As economies advance, developed
nations are give more emphasis on production of services. Services include the work of airlines,
hotels, care rental firms, barbers and beauticians, maintenance and repair people and service of
accountants, lawyers, engineers, doctors, software programmers and management consultants.
Many market offering are consist of a mix of goods and services. Such as fast food restaurant,
where the customers are consume both good and service at a time. Pure service would be a
psychiatrist listening to a patient or legal advice of lawyer.   

3. Experiences :
            Marketers can create, stage and marketed experience. As for example, Walt Disney
World’s Magic Kingdom, where he create a visiting fairy kingdom, stages pirate ship, or haunted
house and marketed different experiences for the customers. Another example, customers can
gather experience by spending one week at a baseball camp playing with some retired baseball
great players.

4. Events :
            Marketers can marketed events as goods and services. Marketers promote time - base
events, such as the Olympics, company anniversaries, major trade shows, sports events. There is
a whole profession of meetings planners who will work out the details of an event and stages it to
come off perfectly.      

5. Persons :
            Celebrity marketing  has become a major business. A politician can marketed himself
through campaigning political mandate, personal image or success. Today every major film star
has an agent, a personal manager and ties to a public relations agency. Artists, musicians,
doctors, high level lawyer and other professionals are drawing help from celebrity marketers. 

6. Places :
            Place marketing can be expressed in two different ways, one is places are used or play a
vital role in marketing activities. Such as historical cities, regions or sea beach or natural
beautiful areas to attract tourists. Other is places are used like as goods. Such as real estate or
apartment marketing.

7. Properties :
            Properties are intangible rights of ownership of either real property or financial property.
Such as real estate, apartment and stocks, bonds etc. Properties are bought and sold, so it requires
marketing effort. Real estate agents work for property or apartment owners or seekers to sell or
buy residential or commercial real estate or apartment. Investment companies and banks or their
agents are involved in marketing of securities to both institutional and individual investors.   

8. Organizations :
            Organizations are actively works to build a strong, favorable image in the mind of their
public or customers. Universities, colleges, museums, NGOs ( non government organization )
and clubs all lay plans to boost their public image to compete more successfully for audiences
and funds.  

9. Information :
            Information can be produced and marketed as a product. Universities, colleges, schools
and research organizations are collect data and facts and develop or produce information and
thereafter distributed to parents, students, manufacturing organization and communities at a
price. We buy CDs and visit the internet for information. At present in the knowledge society
production, packaging and distribution of information is one of the major industries.    
  
10. Ideas :
            Every market offering includes a basic idea at its core. The buyer of a television set is
really buy recreation and prestige. Products and services are the platforms for delivering some
ideas or benefits. Marketers search hard for core need of their customers and they are trying to
satisfying them. Many organization promote ideas to create better environment in the society. As
for example, slogan of “ planted trees and save the environment ”.     

Demand States and Marketing Tasks

            Different type of demand are exist in the market for different type of products and
services, which are discuss below. Marketer observed the demand in the market and take
necessary action to change the nature of demand or adjust it with the help of different type of
marketing tools and techniques. 

1.  Negative demand :

            A market is in state of negative demand if a major part of the market (customer) dislikes
the product and may even may pay a price to avoid it. Such as vaccination, dental work, air
travel etc.
            The marketing task is to analyze why the market dislikes the product and whether a
marketing program consisting of product redesign, lower prices and more positive promotion can
change beliefs and attitudes.   

2.  No demand :
            Target customers may be unaware of or not interested in the product. College students
may not be interested in foreign language course. A new service holder may not be interest to
take a life insurance policy.
            The marketing task is to find ways to connect the benefits of the product with the
person’s natural needs and interests.

3.  Latent demand :

            Many customers may have a strong need that cannot be satisfied by any existing product.
There is a strong latent demand for harmless cigarettes and more fuel efficient cars.
            The marketing task is to measure the size of the potential market and take necessary
research program and develop products and services to satisfy the demand if that are profitable. 

4.  Declining demand :

            Every organization, sooner or later face declining demand for one or more of its products.
Such demand for gramophone, radio, black and white television etc.
            The marketer must analyze the cause of the decline and determine whether demand can
be restimulated by new target markets, by changing product features, by price reduction or by
more efficient and effective communication.   

5.  Irregular demand :

            Many organizations face demand that varies on a seasonal, daily, or even hourly basis,
causing problems of idle or overworked capacity. Such as road transport city buses are idle
during off - peak hours and insufficient during peak hours.
            The marketing task is to find ways to alter the pattern of demand through flexible pricing,
promotion and other incentives. 

6.  Full demand :

            Organizations often face full demand when they are pleased with their volume of
business.
Such as mobile phone companies faces full demand situation in Bangladesh.
            The marketing task is to maintain the current level of demand, so that they can face the
changing customer preferences and increasing competition. The organization must maintain or
improve its quality and continually measure customer satisfaction.

7.  Overfull demand :

            Some organization face a full demand level that is higher then they can expect or capable
or want to handle. At present in Bangladesh L .P. gas companies enjoying overfull demand.
            The marketing task is to finding ways to reduce demand temporarily or permanently. In
this situation marketers generally take the steps to raising price and reduce promotional activities
and services.   

8.  Unwholesome demand :

            Unwholesome demand is the demand of that products and services which are harmful to
the society. Organizations give their time, money, resource, effort and energy to discourage the
consumption of these type of products and services. Such as unselling campaigns have been
conducted against cigarettes, alcohol, hard drugs, X - rated movies, large families etc.
            The marketing task is to use negative messages and information ( harmful sides of the
products and services ) in promotional activities, increase the price and reduce the availability of
that products and services.     

Types of Markets
           
            A market is a set of all present and potential buyers. We can classify the market
according to the nature, objectives, behaviour of the market, which are discussed below.

1.  Consumer markets :

            This market is constitute by the consumer who buys goods and services for their ultimate
consumption. They do not process it to produce another goods and services or resell it to another
customer. Their buying behaviour is mostly emotional and they are not well informed about
goods and services. Producer or marketer requires to getting a clear sense about their target
customers. Most of the product’s strength depends on developing a superior product and
packaging and backing it with continuous advertising and reliable service. Consumer marketers
decide on the features, quality level, distribution coverage and promotional activities that will
help their product or service to achieve the best position in the market.  

2.  Business markets :

            This market is constitute by the business men or professionals who buys goods and
services to produce another goods and services or resell it to another customer. They are well -
trained and well - informed professional buyers who have the skill to evaluate the competitive
offerings. Business buyer purchase products to make profit. Their buying behaviour is purely
rational. Business marketers must demonstrate how their products will help business customer to
achieve their profit goals. In this market advertise has very small role, but stronger role is played
by sales force, price and company’s reputation for reliability and quality.     

3.  Global markets :

            Companies selling their goods and services in the global market place and face additional
decision and challenges. Marketer must be decide which countries to enters, how to enter each
country, how to adapt their product and service features to each countries, how to price their
product in different countries. In the global market, marketer must have to take other decisions,
such as how to adapt their communication to fit the cultural practices of each country. These
decisions must be made on different legal system, different styles of negotiation, different type of
requirements for buying, owning and disposing of property and so on.    

4.  Non - profit and governmental markets :

            Companies selling their goods to non - profit organizations such as churches,
Universities, Education boards, charitable organizations or government agencies. In this market,
company must be careful to set price for their goods, because these organizations have limited
purchasing power. Lower prices can be affect the features and quality of the goods. In this
market, different type of formalities are needed to make sales.    

Core Marketing Concepts

           
            Marketing have different type of core concepts, which are helpful to understood
marketing as a modern social science. These core concepts are discussed below.

1.  Target markets and segmentation :

            A marketer can not satisfy all type of customers in a market at a time. Not everyone likes
same soft drink, same dress, restaurant, automobile, movie etc. Customer likeness or dislikes of
goods and services are depends upon the age, sex, income, culture, education, status and so on.
Therefore, marketer segmented total market according to age, income, culture, education, status
of the customers. Then firm decides which segment is more profitable and which segment   is
easy to serve or to satisfy.   

2.  Marketers and prospects :

A marketer is someone who seeking a response ( attention, a purchase, a vote, a
donation ) from another party. Where another party is called the prospects. If two parties are
seeking to sell something to each other, then we called them both marketers.

3.  Needs , wants and demands :

            The marketer must try to understand the needs, wants and demand of the target market.
Needs describe the basic human requirements. People need food, air, water, clothing and shelter
to survive. People also have some strong needs for recreation, education, health care, justices and
entertainment. A marketer can not create needs for his market.
            These needs become wants when they are directed to specific objects that might satisfy
the need. A persons needs can be food but his wants can be rice, brad or fruits.
            Demands are wants for specific products backed by ability to pay. Three factors are
important to create demand for a product. First, desire to buy a specific product, second, ability
to buy ( purchasing power ) and third, willingness to pay. Demand can be created by the
marketers.  

4.  Product or offering :

            People satisfy their needs and wants through products. A product is any offering that can
satisfy a need or want of the customers. Product is the most important factor in marketing for any
type of manufacturing and business organizations. Marketers chose their marketing policies and
strategies on the basis of the product nature, position and stage of product life cycle. Major types
of basic offerings of business or social organizations are goods, services, experiences, events,
persons, places, properties, organizations, information and ideas.

5.  Value and satisfaction :

            The product or offering will be successful if it is able to delivers value and satisfaction to
the target buyer. The value is a ratio between what the customer gets ( benefits ) and what they
gives ( cost ). The buyer chooses different offerings on the basis of which is perceived to deliver
the most value. The benefits include functional benefits and emotional benefits. The costs
include monetary cost, time cost, energy cost and psychic costs. The marketer can increase the
value of the customer offering in several ways. Raise benefits, reduce costs, raise benefits and
reduce costs, raise benefits by more than the raise in costs, Lower benefits by less than the
reduction in costs.      

6.  Exchange and transactions :

            Exchange is the core concept of marketing, involves obtaining a desired product from
someone by offering something in return. Exchange is only one of four ways in which a person
can obtain a product. The person can self - produce the product and service, as when a person
hunts, fishes, produce cloths or gathers fruits. The person can use force to get a product, as in a
holdup or burglary. The person can beg, as happens when a homeless person asks for foods. Five
conditions are more essential to create exchange. these are.
            (a) There is at least two parties.
            (b) Each party has something that may be valuable to the other party.
            (c) Each party is capable to communicate and delivery.
            (d) Each party is free to accept it or reject the exchange offer.
            (e) Each party believes that it is appropriate or desirable to deal with the other party.
Exchange is a process rather than an event. Two parties are engaged in exchange if they
are negotiating, trying to arrive at mutually agreeable terms.
A transaction is a trade of values between two or more parties. A transaction involves
several dimensions, at least two things of value, conditions of agreement, a time of agreement,
and a place of agreement.         

7.  Relationship and networks :

            Relationship marketing has the aim of building long term mutually satisfying relations
with key parties – customers, suppliers, distributors – in order to earn and retain their long term
performance and business. Marketers accomplish this by promising and delivering high quality
products and services at fair price to the other parties over time. Relationship marketing builds
strong economic, technical and social ties among the parties. It helps to cut down transaction
costs and time.
           
The ultimate outcome of relationship marketing is the building of a unique company asset
called marketing network. A marketing network consists of the company and its supporting
stakeholders, such as customers, employees, suppliers, distributors, retailers, adverting agencies,
university scientists and others with whom it has built mutually profitable business
relationships.  

8.  Marketing channels :

            To reach a target market, the marketer uses three kinds of marketing channels. The
marketer uses communication channel to deliver and receive message from target buyers. This
includes newspapers, magazines, radio, television, mail, telephone, billboards, posters, CDs,
audiotapes and internet.
            The marketer uses distribution channels to display or deliver the physical product or
services to the buyer or user. This includes warehouse, transportation vehicles, distributors,
wholesalers and retailers.
            The marketer also uses selling channels to effect transactions with potential buyers.
Selling channels include not only the distributors and retailers but also the banks and insurance
companies that facilitate transactions.     

9.  Supply chain :

            Marketing channels connect the marketer to the target buyers, the supply chain describe a
longer channel stretching from raw materials to components to final products that are carried to
final buyers. The supply chain represents a value delivery system. Each company captures only a
certain percentage of the total value generated by the supply chain.    

10. Competition :
            Competition includes all actual and potential rival offerings and substitutes that a buyer
might consider. Competition can be classify into four categories.
            (a) Brand competition : A company sees its competitors as other companies offering a
similar product and services to the same customers at similar price.
            (b) Industry competition : A company sees its competitors as all companies making the
same product or class of products.
            (c) From competition : A company sees its competitors as all companies manufacturing
products that supply the same service.
            (d) Generic competition : A company sees its competitors as all companies that compete
for the same customers.    

11. Marketing environment :

            The marketing environment consists of task environment and broad environment. The
task environment includes the immediate actors involved in producing, distributing and
promoting the offering. The main actors are the company, suppliers, distributors, dealers, agents,
brokers, manufacturer representatives, marketing research agencies, advertising agencies, banks,
insurance companies, transportation and telecommunication companies and the target
consumers.
            The broad environment consists of demographic environment, economic environment,
natural environment, technological environment, political environment, legal environment, social
environment and cultural environment. These environments contain forces that can have a major
impact on the actors in the task environment.     
Marketing Philosophy
           
            Marketing management is the conscious effort to achieve desired exchange outcomes
with target market. But what philosophy should guide a company’s marketing efforts ? What
relative weights should be given to the interests of the organization, the customers and society ?
So, marketing activities should be carried out under a well thought philosophy of efficiency, low
cost and mass distribution. There are five competing concepts under which organizations
conduct marketing activities. These are discussed below.    

1.  Production concept :

            The production concept is one of the oldest concept in business. The production concept
holds that consumers will prefer products that are widely available and inexpensive. Managers of
production oriented businesses concentrate on achieving high production efficiency, low costs
and mass distribution. They assume that consumers are primarily interested in product
availability and low prices. This concept hugely used in the developing countries. It is also used
when a company wants to expand the market.  

2.  Product concept :

            The product concept holds that consumers will favour those products that offer the most
quality, preference or innovative features. In this concept price of the product is not an important
factor. Managers in these organization focus on making superior products and improving them
over time. They assume that buyers admire well made products and can appraise quality and
preference. Company first try to produce a better quality product with the help of their engineers
but they do not consider the needs and wants of the consumer. Here company think that if they
are able to product a better quality product then they can sell it easily in the market.    

3.  Selling concept :

            The selling concept holds that normally consumers are not interest to buy enough of the
company’s product, until they are forced. The company must therefore, undertake an aggressive
selling and promotional effort. This concept assume that typically consumers are not buy much
more and must be stimulated to buy more. It is also assume that company has an efficient and
effective selling and promotional tools to stimulate more buying.
             The selling concept is practiced most aggressively with unsought goods, that buyers
normally do not think to buy it. Such as insurance, encyclopedias. These industries have
preferred various sales techniques to locate prospects and disclose the product benefits to the
prospects. The selling concept is also practiced in the non - profit organizations to collect funds
and political parties. Most firm practice the selling concept when they have over capacity. Their
aim is to sell what they make rather than what market wants.       

4.  Marketing concept or consumer oriented concept :

            The marketing concept or consumer oriented concept holds that the key to achieving its
organizational goals consist of the company being more effective than competitors in creating,
delivering and communicating customer value to its chosen target market. Marketing concept
rests on four pillars. These are discussed below.
            (a) Target market : First company segmented total market according to some effective
basis. Then they choose a target market, which market is more profitable and at the same time it
is easy to serve. Company do best when they choose their target market carefully and prepare
effective marketing programs. 
            (b) Customer needs : A company can define its target market but fall to correctly
understand the customers needs. Understanding customer needs and wants is not always simple.
Some customers have needs which they are not fully conscious, or they can not articulate these
needs, or they use some words that requires some interpretations. So, it is essential to find out the
actual needs and wants of the customers.
            (c) Integrated marketing : When all the company’s departments works together to serve
the customer’s interest, the result is integrated marketing. Integrated marketing takes place on
two levels. First, the various marketing functions - sales force, advertising, customer service,
product management, marketing research - must together. Second, marketing must be embraced
by the other departments, they must also have to think about customer.    
            (d) Profitability : The ultimate purpose of the marketing concept is to help organizations
to achieve their objectives. In the case of private firms, the major objective is to earn profit. In
the case of non - profit or public organizations, it is surviving and attracting enough funds to
perform useful work.

5.  Societal marketing concept :

            The societal marketing concept holds that the organization’s task is to determine the
needs, wants and interests of the target markets and deliver the desired satisfactions more
effectively and efficiently than competitors in a way that preserves or enhances the consumer’s
and the society’s well being. The societal marketing concept calls upon marketers to build social
and ethical considerations into their marketing practices. Here company must try to make a
balance among company profit, customer want satisfaction and public interest. At the same time
company try to build up a health and wealth society so that company can able to survive in long
run.      

Difference between selling concept and marketing concept

Starting point Focus Means Ends

Factory Products Selling and promoting Profit through sales volume
Selling concept
Target market Customer needs Integrated marketing Profit through customer satisfaction
Marketing concept
Marketing of Financial Services: Industry Concept of Competition

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB 
Industry Concept of Competition

A.  Definition of Industry.

An industry is a group of firms that offer a product or class of products that are close
substitute of each other.               (To Get Download Option Click Read More)

B.  Classification of Industry.

Industries can be classified according to competition among themselves are given
bellow. 

1.  Number of sellers and degree of differentiation :

            An industry can be specify by the number of sellers and whether the product is
homogeneous or highly differentiated in nature. These characteristics give rise to four industry
structure types.

(a) Pure monopoly :

            Only one firm provides a certain product and service in a certain country or area. An
unregulated monopolist might charge high price, do little or no advertising and offer nominal
service. If partial substitutes are available and there is some danger of competition, the
monopolist might invest more service and technology.

(b) Oligopoly :
            A small number of large firms produce products that range from highly differentiated to
standardized. Pure oligopoly consists of a few companies producing essentially that the same
commodity ( oil, steel and mobile phone in Bangladesh ). Such companies would find it hard to
charge anything more than the going price. If competitors match on services, the only way to
gain competitive advantages is through lower cost. Differentiated oligopoly consists of a few
companies products ( autos, cameras ) partially differentiated along lines of quality, features,
styling, or services.

(c) Monopolistic competition :

            Many companies are able to differentiate their offers in whole or part (restaurant, beauty
shops). Competitors focus on market segmentations, where they can meet consumers needs in
a superior way and charge a price premium.
(d) Pure competition :
            Many competitors offer same product and service ( stock market, daily essential food
commodity ) to the consumer. Because there is on basis or way for differentiation, competitors’
prices will be the same. No competitor are not interested to advertise there products or services
unless advertising can able to create psychological differentiation ( cigarettes, beer ).

2.  Entry, Mobility, Exit Barriers :

            Industries differ greatly in case of entry. It is easy to open a new restaurant but difficult to
enter in the aircraft industry. Major entry barrier includes high capital requirements, economy of
scale, patents and licensing requirement, scare locations, raw materials, distributors and
reputation requirements.
            Even after a firm enters in an industry, it might face mobility barriers when it tries to enter
more attractive market segments.
            Firms often face exit barriers, such as legal or moral obligations to customers, creators,
and employees, government restrictions, low assets salvage value due to over specialization or
obsolescence, lack of alternative opportunities, high vertical integration and emotional barriers.
Many firm stay in the industry as long as they can able to cover their variable costs and some or
all of their fixed costs.                 

3.  Cost structure :

            Each industry has a certain cost burden that shapes much of its strategic conduct. For
example, steel industry has heavy manufacturing and raw material costs, but toy industry has
heavy distribution and marketing costs. So, marketers can easily classify the industries on the
basis on the cost structure.

 4.  Degree of vertical integration :

            Companies can get advantages through backward and forward integration. Major oil
producers carry on oil exploration, oil drilling, oil refining, chemical manufacture, and service
station operations. Vertical integration often lowers costs and the company gains a larger share
of value added stream. It has some disadvantages, such as high costs in certain parts of the
value chain and a certain lack of flexibility.    

5.  Degree of globalization :        

            Some industries are highly local ( restaurant, beauty shop, small size manufacturing
organization ), others are global ( oil, aircraft, camera, computer ). Companies in global
industries need to compete on a global basis if they are to achieve economies of scale and keep
up with the largest advances in technology.

Marketing of Financial Services: Sales Promotion

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services-JAIBB
Sales Promotion
Q. Define sales promotion? What is the nature, role & importance of sales promotion?
OR
What is sales promotion? Discuss the nature, role & importance of sales promotion.

 Ans.: Sales promotion is a key factor & strategy for marketers within the promotional mix.
Sales promotion refers to many kinds of incentives & techniques directed towards consumers &
traders with the intention to
produce immediate or short term effects. Sales promotion helps in stimulating trial or purchase
by final customers or others in the channel. A marketer can increase the value of its Product/
Service by offering an extra incentive to purchase a Product/ Service or brand. A few definitions
are quoted below:-

1. American Marketing Association - Sales promotions is media & non media marketing
pressure applied for a predetermined, limited period of time in order to stimulate trial &
impulse purchases, increase consumer demand or improve Product/ Service quality.

2. Council of Sales Promotion Agencies – sales promotion is a marketing discipline that

utilizes a variety of incentives techniques to structure sales related programs targeted to
consumers/trade/ and or sales level, that generate a specific measurable action or response
for a Product/ Service/service.

3. Institute of sales promotion, U.K. – “Sales promotion comprises that range of techniques
used to attain sales/marketing objectives a cost effective manner adding value to a Product/
Service or service either to intermediate or end users, normally but not exclusively within a
definite time period”.

Sales promotions have 3 distinct characteristics –

(a) Communication – They gain attention & usually provide information that may lead the
consumer to the Product/ Service.
(b) Incentive – They give certain concession, inducement or contribution that gives value to the
consumer.
(c) Invitation – They invite a distinct invitation to engage in the tre.
Nature of sales promotion:-

1. Irregular / non recurring activity- Sales promotion is an irregular & non recurring activity to
increase the sales & this technique is used for specific situations only such as decline in demand,
fall in profit, acute competition in the market or during the introduction of new Product/ Service
in the market.

2. Target- The target for producer’s sales promotion may be middleman, end users, household or
business users or the producer’s own sales force. Middleman sales promotion at their sales
people or prospects further down the channel of distribution.

3. Motivation & extra incentive- Sales promotion involves some type of incentives that offer a
reason to buy. This incentive is usually the key element in a promotional program & is an effort
by which consumers, traders and sales force are motivated towards maximum sales.

4. Acceleration tool- sales promotion is designed to speed up the selling process & maximize
sales volume.

5. Immediate impact- Sales promotion can be implemented quickly & gets sales results sooner
than advertising sales promotions offers an incentive to buy now. 

6. Objective- The objective of sales promotion is to establish a link & coordination between the
activities like advertising, personal selling, publicity etc. sales promotion bridges a gap between
advertising and personal selling.

7. Non media activity- Sales promotion is referred to as a non media activity as sales promotion
is differentiated from advertising & publicity & also includes them as part of the overall
promotions mix.

8. Strategic role- Because of the immediate nature of the impact, sales promotion have been
thought of as merely this view is changing and the strategic role of sales promotion and their
integral role in the promotional mix are being recognized.

9. Planned activity- The fact that sales promotion can be effective throughout the life of a brand
shows their strategic role. Sales promotion activities should be planned well to stimulate sale.

10. Versatile- Sales promotion is extremely versatile. The different forms of sales promotion are
capable of being used with various groups & designed to achieve different effects. Sales
promotion can be useful throughout the Product/ Service life cycle.

11. Means of marketing communication- It is an important means of communication by which

views & ideas of consumers about the Product/ Services & services are exchanged with the
producers regularly.
12. An element of promotion mix- Sales promotion is one of the important elements of
promotion mix, other than advertising, personal selling and publicity.

13. Universal activity- It is a universal activity adopted by all the economies of the world in their
sales efforts.

Role of sales promotion:-

1. To popularize goods and services of the producer among the potential consumers & to
motivate them towards larger purchases.

2. To motivate the existing customers for maximum purchase. 

3. To maintain the sales up to normal level even during seasonal vacations & during the
declining stage of PLC.

4. To increase goodwill of the firm.

5. To educate customers/dealers & salesmen about the techniques of sales promotion.

6. To simplify the efforts of sales force & motivate them for larger purchase.

7. To stimulate maximum sales on special occasions such as Diwali, religious festivals & other
such occasions.

8. To search for a new market & to introduce new Product/ Services in to the market.

9. To counteract competition.

10. To facilitate coordination & proper link between advertising and personal selling.

11. To promote larger sales in certain specified segments of market.

12. To present a counter promotional program against the competitoBDT

13. To develop patronage habits among customeBDT

14. To prove the Product/ Service better in quality & useBDT

 
Importance of sales promotion:-

Sales promotion is an important component of the marketing program . It can be a specific tool
of the promotion. Quality sales promotion provides advantages to the various groups described
below:-

1. Importance to consumers
2. Importance to produceBDT

3. Importance to middlemen.

4. Importance to society & nation.

1. Importance to consumers:-

(i) Availability of new Product/ Services- It is easy to sell new Product/ Services with the help of
sales promotional tools. Hence the producers are encouraged to bring new Product/ Services.

(ii) Various rebates & free discounts- Sales promotions offers various incentives like rebates &
free discounts, free samples which helps to stimulates sales & purchase.

(iii) Thrill in life- The various incentives contents samples, demonstrations, fair and exhibitions
create thrill and joy in consumer’s life and the relish these beneficial offeBDT

(iv) Low price- Sales promotion increases sales volume and reduce the unit cost of Product/
Serviceion & thus the prices reduce & it benefits consumeBDT

(v) Increase knowledge- Sales promotion increases the knowledge of the consumers with regard
to the uses,
operation & maintenance of the Product/ Service. 

(vi) Provide higher standard of living.

(vii) Buying confidence- Sales promotion tools provide the consumers an opportunity to
understand the Product/ Service. This creates a buying confidence among consumeBDT They
may take better buying decisions which ultimately increases their satisfaction level.

(viii) Minimize exploitation- The promotional plan creates a better knowledge about the Product/
Services, their uses & quality. As a result, the seller can’t exploit the consumeBDT

2. Importance to producers:-

(i) Increase in sales- Sales promotion attract consumers & stimulate them to make larger
purchaser.

(ii) Improve effectiveness of Media Activities- the sales promotions plans make the
advertisement & other media activities more effective to achieve the sales largest these give
pulling power to ads.

(iii) Help personal selling- sales promotions supports personal selling process the salespersons
can use demonstrations , distributions to free samples , contest methods to push the sales. Sales
promotion aimed at company’s own sales force might motivate salesmen to get new costumers,
selling a Product/ Service.

(iv) Able to capture new market.

(v) Increase regular sales & seasonal Product/ Services.

(vi) It helps in increasing goodwill of the firm.

(vii) The various promotional incentives offered to the dealers help to achieve cooperation from
them to sale the Product/ Services & to maintain maximum stock with them.

(viii) It is an effective step to face the competition.

(ix) It helps in increasing the demand of new Product/ Services.

(x) It helps in maintaining existing customeBDT

(xi) It creates a trusting attitude among customeBDT Free sample & functional demonstrations
creates a faith in the use of merchandise which results in longer sales.

Importance to middlemen / dealers:-

(i) Facilitates longer sale.

(ii) By operating various sales promotional plans, manufacturers provide various type of helps
such as rebates, trade discounts, gifts, rewards to dealers & reselleBDT

(iii) A direct relationship between the dealers & the customers are established through the sales
promotion techniques which will continue for a long term.

(iv) As the cost of each deal is reduced the profits of dealers are also increased.

Q. What are the functions performed by a sales promotion department?

Ans. The success of modern business largely depends on the functions of sales promotion
department. Sales promotion department becomes more important as there exist a buyers’ market
in place of a seller’s market.
The functions & responsibilities of sales promotions department have been described by Alfered
Ghoss & Haughten in 3 ways:

To establish coordination with other departments.

1. Assisting functions towards dealeBDT
2. To motivate the customeBDT

Usually the sales promotions department undertakes the following functions:-

1. Planning for sales promotion company-The primary function of the sales promotions
department is to make long term & short term planning for undertaking promotional programs.
This is done by evaluating the various factors such as market condition , level of competition ,
demand & supply situation , advertising , personal selling , etc.

2. Assistance to top executives- The sales promotions department provides various information
to top executives & give assistance in related matters for decision making.

3. Coordination & liaison with other departments- The sales promotion department regularly
coordinates with other departments such as advertising, sales force management, packaging,
publicity etc. The value promotion is coordinated in view of the travelling schedule of salesmen,
sales presentation etc. Sales promotion department is also associated with Product/ Serviceion,
finance, training departments of the organization & established coordination with these
departments from time to time.

4. Sales promotion research- In order to make sales promotion program more effective , the S.P.
department undertakes surveys & evaluates the information gathered to know about the changing
values, traditions, culture , consumers behavior & public opinions.

5. Execution of sales promotion program -The sales promotion department also execute
programs design for consumers, dealers & the various advertising & promotional agencies, PR
officers, distributers & exchange ideas with them. It organizes sales exhibitions, trade fairs,
contests etc, from time to time.

6. Provides training to the sales lesson -The sales promotion department trains the salesmen
about the company , its Product/ Services , promotional incentives being gives to buyeBDT The
department also gives introduction about company’s policies & plans. Customers-salesmen
relationship.

7. Evaluation of sales promotion - sales promotion department evaluates the planned promotional
program & with the help of these promotional plans, data are collected & it is analyzed to find
out the effectiveness of the program. Consumes survey, consumer panels gives a clear picture of
the various sales promotional tools.

8. Assisting dealers / middlemen to make advertising more effective-dealers also deal with
advertising of the various Product/ Services. The sales promotion department helps in producing
training to the salesmen , to promote dealer interests etc. The sales promotion department also
decides on with best advertising messages, copies & media for their Product/ Services.

9. Coordination between advertising & personal selling. 

Q. What is distinction with advertising & personal selling?

OR
Discuss the points which make sales promotion distance with that of Advertising &
personal selling.
Ans. Sales promotion can be differentiated from advertising in the following ways:-

1. New media activity:- Sales promotions a non-media or below the line activity & advertising is
the media related activity. 

2. Limited time period:-Advertising is for long term effect & is for longer periods, whereas sales
promotion is for a limited time period only.

3. Easy evaluation:-The impact of sales promotion can be easily measured in comparison to

advertising.

4. Faces on immediate purchase:- Advertising is designed to have awareness , interest &

preference building effects over a long run. Sales promotion simulates quick & immediate
purchase or sales promotion offers a reason to buy now.

5. Creating action:-Advertisement builds long term brand awareness & sales promotion is used
for creating action. Distinction of sales promotion & personal selling.

1. Role:- Sales promotion helps to increase the effectiveness of personal selling & personal
selling creates desire for a Product/ Service thereby effecting sales .

2. Motivation:-Sales promotion provides physical motivation to customers personal selling

provides physical and emotional motivation to customers 

3. Personal presence:-Personal presence of salesmen is not necessary in sales promotion whereas

in personal selling salesmen is required for selling.

4. Media:-Sales promotion can be presented through any media like vocal, written or audio
visual personal selling it can be presented through vocal media only.

5. Compumentary function:- Sales promotion is complimentary to personal selling whereas

personal selling does not complement to the sales promotion program.

6. Continuity:- Sales promotion is not used as a securing activity whereas personal selling is a
routure activity which regularly operates.

7. Orientation:- Sales promotion is oriented largely towards the firms or its Product/ Service ,
personal selling in customer oriented.

8. Object:-The objective of sales promotion is to feel a gap between advertising & personal
selling & the objective of personal selling is to solve the problems of customers & to get more
sales

Q. What are the roles of sales promotion in an company or shortages?

Ans. There are three types of world economy:- developed, developing & under developed
(Shortage economy) . In an economy of shortages, the availability of goods & resources are
shorter or lesser than their demands.

Limitations of a shortage economy-

1. Under developed in economic aspects.

2. Natural resources remain untapped.
3. Restricted development of industrial activities.
4. Lower standard of living of people .
5. Shorter supply of Product/ Service & resources.
6. Slow growth of capital formation.
7. Limited opportunity for employment.

Economists say that development of economy is possible only when there is increased sale.
Therefore sales promotion is considered to be tool for stimulating the sales. Also, in a shortage
economy, seller’s market is dominant whereby seller takes the advantage of the situation &
creates situations of unfair trade practice. Thus, sales promotion can stop this situation of unfair
trade practice & thus the economy will grow through the Product/ Serviceion of new items copy
setting Product/ Services of new industries & industrial units & this way the wheel of economy
development might move faster & can create a surplus situation in an economy of shortage.

Q. What are the commonly used tools & techniques of dealer? Promotions?
OR
What are the different sales promotional tools useful for traders?

Ans. These promotional tools are targeted to marketing intermediaries such as wholesalers,
retailers, distributers or agents who stock the manufactures Product/ Services for sale sales
promotion directed at the trade helps push a Product/ Service into the distribution channel until it
reaches customeBDT

Here are the most common types of trade promotion tools:-

1) Point of purchase displays:- A manufacturer designed display distributed to retailers who

use it to draw the customers attention to Product/ Service promotions is called as pop displays.
Pop includes passion racks, displaycartoons, banners, signs, price cards, mechanical Product/
Service, dispenses etc.

2) Incentives: - Incentives to members of trade include awards in the form of travel, cash bonus,
gifts etc. another form of trade incentive is referred to as push money. Push money is carried out
through a program in which retail sales people are offered a monetary reward for featuring a
marketers brand with shoppe BDT

3) Trade allowance: - Trade allowance is probably a discount or deal offered to retailers or

whole sales, to encourage them to stock display the manufacturers Product/ Service Types of
allowances offered-
(i)Advertising allowance: - In this method, actual expenses or certain percentage to purchases
made, are not met by the producer. Instead an allowance is paid to the dealer toward advertising
expenses.

(ii) Promotional allowance: - Certain items which helps in advertising and publicity are
distributed to retailers free of cost.Such novelties include pens, calendars, paper weights, bill
books, bags, diaries, memo pads etc.

(iii)Display allowance:- The producers who don’t provide display material to dealers, provide
them with display allowances.

(iv)Buying allowance/Price off allowance:- The price of allowance is given on purchase made
during a specified period of time directly from the producer. This encourage larger purchase
from the producer.

(v) Brand deal allowance:- Such allowances are given to those middlemen who deal exclusively
with a single brand.

(vi)Buy back allowance:- It is a sum of money given to the reseller for each unit brought after an
initial deal is over.

4) Sales training program:- Another form of dealer promotional tool is sales training program.
Salesmen at the retail level need to be trained about the features of the Product/ Service, benefits,
advantages of different models/brands etc. cosmetics, appliances, computers, electronic Product/
Services are examples for which consumer rely on trained sales staff.

5) Trade shows:- Trade shows are certain activities designed where manufacturer can display
their Product/ Services to current as well as prospective buyer BDT They are attended by
retailers to distributors and involve demonstrating Product/ Services, identifying prospectus and
gathering customer BDT Trade shows are particularly valuable when a new Product/ Service is
introducing in to the market many companies use trade shows to entertain key customers and to
develop and maintain relationship with them.

6) Cooperative advertising:- In this method the dealer and the producer both jointly share the
expenses of advertising. Either the producer may bear a fix amount of the advertising expenses
or certain percentage to the purchase made by the dealer in a year.

7) Free merchandise:- Free merchandise is sometimes offered to resellers who purchase stated
quantities of the same or different Product/ Services. 

8) Sales contests:- Sales contests are organized for dealers also on the basis of highest sales
achieved by dealers during a specific time period. Prizes, certificates are issued to such dealers
and such contest hence motivates the dealer for longer purchases.
9) Retailer kits:- Materials that support retailers selling efforts are retailer kits. The kits contain
supporting information such as detailed Product/ Service specification, ad slicks- print ads that
are ready to be sent to the local print media.

(10) Advertising and display aids:- Some of the aid are –

(i) Local news paper advertising:- Advertisements in local news paper specifying name, contact
no. and address of dealers, helps the people to know about the dealers in town.

(ii) Direct mail advertising:- In this the producer sends various advertising and publicity material
to dealer by mail. This includes reply cards, calendars, diaries, folders, house magazines, order
book, hand bills etc.

(iii)Outdoor advertising:- Producers provide banners, sign boards, posters, bill boards, holdings
to dealers at their own cost. 

(iv)Organizing fashion shows:- Some companies organize fashion shows in big cities to promote
their Product/ Services. This is also an encouragement to Deale BDT

11) Sales assistance:-

(i) Building up sales plan: - Producers extend help and express knowledge to wholesalers and
retailers in building up sales plan, formulating strategies and sales programs. This helps the
dealers to increase their selling skills.

(ii) Sales meetings:- Producers organize sales meeting for distributors to provide knowledge
about new Product/ Services, sales policies and sales plan.

(iii)Buy back guarantee:- Producers sometimes gives buy back guarantee to dealers for the goods
that have not been sold by them. Thus goods are sold to dealers on sell or return condition.

(iv)Special trade terms:- Middlemen/Dealers are encouraged by special trade terms which may
be related to price, payment, credit, allowance, financial assistance balance of stock etc.

(v) Special services:- Producers also offer special services to dealers which include packaging,
categorization of Product/ Services, dealer listing.

(vi)Credit facilities: - Producers provide short term credit facility to dealers to motivate them to
have maximum stock of the goods.

12) Management assistance:- It includes –

(i) Providing knowledge about management techniques.

(ii) Advice towards policy matteBDT

(iii)Guidance in setting up internal organization.

(iv)Sales management process.

Q. What are the different tools of sales promotion for consumer promotion?
 
Ans. This sales promotion is aimed at final consumer or use BDT Consumer sales promotion
used by retailers are aimed at attracting customers to specific locations. The consumer promotion
tools are-

1) Sample-Samples are offer of a trial amount of a Product/ Service generally 84% consumer
package goods marketers use sampling as part of their promotion strategy. By offering free
samples, a company gains entry into that market, soaps, detergents, toothpastes, shampoos,
conditioners are examples of few Product/ Services that are normally popularized through free
samples. Free samples are distributed for several reasons: To stimulate trail of a Product/ Service
to increase sales volume in the early stages of PLC, to obtain desirable distribution. The samples
can be distributed through in store sampling (food Product/ Services and cosmetics), door to door
sampling, mail sampling, (through postal service), news paper sampling, mobile sampling, on
package sampling, professional sampling(drugs).

2) Premiums:- Premiums are goods offered either free or at low cost or an incentive to buy the
Product/ Service. Premiums are offered as bonus, prize, gifts or other free offer BDT Premium
can be used to boost sales to attract competitor’s customers, introduces different Product/
Services.
E.g.:- Aquafresh toothpaste- At the launching of Aquafresh toothpaste offered two tubes at the
price of one.
Colgate offered 125gm. tube for the price of 100 gm. Santro- book year santro today & take
home a world space Hitachi digital radio receiver worth BDT 4990/- free.
Pepe- Buy Product/ Services worth BDT 4000/- & get a bag worth BDT 888/- free.
Adidas- Buy Product/ Service worth BDT 2800/- and get a Adidas bag free.

3) Contests: - Contests of various kinds constitute widely used sales promotion tools. There are
consumer contest which are open for all, consumer contest are given wide publicity to attract the
participation of the widely scattered consumer base. Consumer contest take a variety of forms-
Quiz contests, beauty contest, car rallies, scooter rallies, suggesting a logo etc. Contests can be
divided in to 2 broad categories- Skill competition & sweepstakes. One form of sweepstakes is a
game & scratch off cards with instant winners & prizes are an important promotional tool. E.g.:

(i) Nescafe shake contest – Nescafe shake contest offered BDT 5 lacks as total prize money with
BDT 1 lack for the first prize. The total number of prizes ran to 21000. The contest had a specific
objective to make consumers aware of Nescafe as a cool summer drunk in addition to this
traditional image of a hot beverage.

(ii) Cadbury’s family contest- Cadbury announced fabulous prizes round the world, economy
class are ticket for two adults & two children plus BDT 1 lack in prize money. The participant
has to submit a minimum no. of Cadbury’s wrappers & coin a jingle to participate in the contest.
The campaign helped to increase the sales.

(iii)Lakme – Create your own shade contest – Lakme lever held the to elle 18, Create your own
shade contest for the target audience of elle 18 range of colors cosmetics & fragnances. The
participants were required to create own shades. The winner created a sparkling blue shade &
later Lakme launched the new shade in the market.

(iv) Pepsi contest for children – Pepsi ran a contest among children to promote its potato chips
brand ruffles. Nearly 500 children from a school were collected 30 of them were picked to speak
for a minute the winners were given ruffles. Pepsi had covered 250 schools and 125000 students
across the country spending BDT 2 lacks only.

4) Demonstration:- Companies resort to Product/ Service demonstration for sales promotion

especially when they are coming up. With a Product/ Service new to the market. In Bangladesh
Product/ Services like beverages, washing powders, electronic Product/ Service have utilized
Product/ Service demonstration as a tool of sales promotion. it may be-

(i) Demonstration at retail store.

(ii) School demonstration.

(iii)Door to door demonstration.

(iv)Demonstrations to key people.

5) Coupons: - Coupons are certificates which offer reductions to consumers for specified items.
Coupons distributed through newspaper, magazine advertisement or by direct mail. Coupons
enchoose the customer to exploit the bargain and them also serve as an inducement to the trade
for stocking the items.

Types of coupons-

(i) Instant redemption coupon- Consumers can immediately redeem the coupon.

(ii) Bonus back coupon- Coupons can be placed inside packages so that customer can’t redeem
them quickly.

(iii) Scanner delivered coupon- Firm can issue coupons at the cash register. These are triggered
by an item being scanned.

(iv) Cross ruffling- It is the placement of a coupon for one Product/ Service on another Product/
Service. E.g. a coupon for an onion sauce placed on a package of potato chips is a cross scuffling
coupon.

(v)Free standing inserts coupons can be delivered to consumers through news paper.
(vi) In store couponing- Coupons are distributed in a retail environment.

6) Trade fairs and exhibitions:- They form one of the oldest practices of sales promotion.
Trade fair & exhibition provide companies with the opportunity for introducing and displaying
their Product/ Services. This brings the company’s Product/ Service and the consumer’s direct
contact with each other. Trade fairs have become a handy and effective tool of sales promotion.
Orders and enquiries worth billions get generated at international trade fair BDT

7) Discounts and price of E.g. 20% off on levis 10% on Tanishq

8) Free gifts/Gift cards- Companies also give gifts to consumers, dealers and key people. These
gifts include pens, diaries, table, decoration. Gifts normally carry the company’s name and logo.
The gifts are intended to create goodwill towards the company.

9) Exchange schemes/Money back offers- This is the latest sales promotion tool in consumer
disables market. E.g. Akai exchange scheme- Bring in your old color TV with remote. Videocon
money back offer.
Philips- 5 in 1 offer.- Philips TV, 2 in 1, Mixer, grinder, rice cooker at an attractive price.
Sponsoring the games and teams- Many companies like reliance, Pepsi, Pentaloons, Maruti
sponsor different games and sports in the country and abroad.

Q. What are the tools of sales promotion used for business and industrial goals?

Ans. Sales promotion is targeted for business and industrial goods also Industrial Product/
Services differ with that of consumer goods. The tools which are used are-

1) Trade shows: - The industrial Product/ Services are displayed and demonstrated to the
members of trade and industry. The representatives explain about the Product/ Services.
The trade shows can be useful for smaller firms which can’t much in advertising and also
salesman can make for more contacts. Trade shows are important rules for reaching potential
wholesalers & distributors for a company’s brand.

2) Business gifts:- These gifts are given as a part of building and maintaining a close working
relationship with suppliers business gifts may include small items of jewellary, watch, electronic
items, expensive trips.

3) Trial offers:- Trial offers are particularly well suited to the business and industrial market.
Trial offers provide a way for buyers to lower the risks of making a commitment to one brand
over another. Trial offer is a good way to attract new customers who need a reason to try
something new.

4) Frequency program: - high degree of travel associated with many business professionals
make frequency programs and an ideal form of sales promotion for the business and industrial
markets. This can be used in airline, hotel and other industries.
5) Coupons:- Coupons are used in business to business sector. Coupons must reach the hands of
a purchasing against or someone who has the authority to make decision.

6) Contest and sweepstakes:- As like in consumer promotional methods. Customer methods.

Business buyers are also interested in winning prizes as are customers in other situations.

7) Sampling:- Sampling is an excellent method to encourage a business to buy a Product/

Service. E.g. producing a sample in the area of process materials has the advantage of giving the
engineers an opportunity to analyze the materials to see if it meets their standards. Through
analysis they may find that the material is actually superior to the Product/ Service they currently
use.

8) Bonus picks:- offering a prospective a bonus pack may attract new users as price is a
negotiated item in our B2B sector price of discount can be offered by vendors seeking to obtain a
new business contract.

9) Other tools:- They may include demonstrations, free training, warranties, credit faculties
maintenance services, films, publicities and audio visual aids.

Q. Discuss the promotional tools aimed at internal organization?

Ans. Promotional of internal organization concern with the steps to be taken for a sound
promotional programs. The elements of internal promotion are as follows-

1) Approval of promotional philosophy:- The success of a promotional program depends on

the attitude of the top management. There for a promotional program requires the approval of the
top management. The manager has to make a cost profit analyses so that top management
appraise him about the profitability of program.

2) Product/ Service department for marketing:- Quality of a Product/ Service is responsible

for the success of sales promotion program. As the customers are quality conscious and he
always makes a comparison with that of competitors Product/ Service before taking the final
decision of purchase. Therefore the Product/ Service manager should continuously work on
improving the features of the Product/ Service.

3) Coordination with advertising department:-It is the advertising department that make the
ground for the sales by giving Product/ Service knowledge among the distributors as well as
potential customer BDT When the frequency of the advertisement is reduced then the sales
promotion’s frequency start increasing. Therefore a coordination has to be made with the
advertising department.

4) Coordination with sales department:- Sales promotion program can be successful if a

proper exhibition is established with the sales department. Its includes arranging and organizing
sales meetings and conferences, organizing contest, sales exhibition, traveling to sales personal
etc.
Q. What are the needs for evaluation of sales promotion program? Discuss the methods of
evaluations of sales promotion program.
OR
Discuss the needs for evaluations of sales promotion program.
OR
Why the need arises for evaluations of sales promotion program? Explain.

Ans.- Though almost all companies resort to sales promotion techniques , only some of them
follow it in a planned way. The conditions for the success of sales promotion program are as
follows:-

1. Identify the requirement – The firm needs to find out. It is to bring in substantiate extra sales
immediately. It is to offered accumulated stocks ? It is to regain loosing consumer interest in the
Product/ Service etc.

2. Identifying the right promotion program-The firm has to select the program suitable for
current need & situation the choice of the firm should be deducted according to the resources
available with the firm.

3. Enlisting the involvement of salesmen- Often sales promotion program are conceded &
planned at the head office . But for the campaigns to succeed, it is essential that the salesmen be
briefed on the contest & contest of the program. They have to be informed of their roles in the
conduct of the program.

4. Enlisting the support of the dealers:- It is also essential to enlist then support of the dealers
in any large scale sales promotion venture. Since the major part of the activity is around the
dealer shop, the pop material and the Product/ Service under campaign will get the required
prominence. Only if the leader so dealeBDT

5. Enlisting the advertisement agency’s support:- The adevertising agencies support is also
essential for the successful working of a sales promotion campaign. carrying out a sales
promotion campaign is as challenging as conditioning an advertising campaign. So companies
while commetting heavy finds for sales promotion make it a point ensure that that they benefit
from the experience and experlise of their agency.

6. Timing of the campaign:- The sales need of the company is the prime factor that desides the
timing. But the firm has to eansider factors like seasonality of purchase of Product/ Service.

Need for evolution:- The need for evaluating the sales promotion programs are-

1. Identifying growth and development opportunity.

2.Taking correction steps in case of any draw back.
3.To measure the effectiveness and achievements of objectives.
4.Facilities for future planning.
5.To encourage for research & innovations.
6.To motivate the employees into have contributor.
7. to know the maturity limit of sales promotion program.
8.To study new & modern tools of promotion.
9.To get allocated maximum budget for sales promotion.

Methods of evalution:-

1. Sales data method- This method is a widely a accepted practice. In this method , sales
volume or market share prior to any sales promotion techniques are measured . Eg. If market
share of a Product/ Service before the introduction of sales promotion is 4% , during the period
10% & immediately after the program 6% ,Thus giving an increase of 8%. Showes that new
customers are created by the sales promotion program.

2. Consumer panel data- This technique help to identify that how the customers have been
motivated by the sales promotion technique for longer purchase . How much quality have the
customers purchased & What were the charges of their buying behavior after the sales promotion
program. This technique help to identify the various classes of customers on new or old
customers / women / men / industrial / general customers etc. 

3. Consumer surveys- This method collects various kinds of information about the customers so
as to analysis the effectiveness of sales promotion. The analysis of suchinformation help to know
following things-

1) The numbers of customers who have remembered the techniques used.

2) The views opinion about these techniques.
3)How these technique have been helpful in influencing the buyer’s behavior & brand chore of
customer?
4)Do the customer require any innovation to be differed in the Product/ Service?
5)Do these techniques improve the image of the firm?
6)Do they feel like using these techniques through the year?

4. Experiment methods- The effectiveness of sales promotion technique may be measured by

experimenting them in selected markets. However there can be certain difficulties. They are as
follows-

1) The consumer always looks for deals customers are interested only in the purchase in the
items Which offer certain additional incentive with that of the Product/ Service.

2) The promotional tools at times can be very costly as, if the organization does not get expected
results. Then the price of Product/ Service may be increased. 

3) The cooperation from middlemen might not be smooth.

Q. Define sales forecasting? Discuss the produce & the methods of sales forecasting.
Ans. Sales forecast is the basis of corporate planning forecasting is a systematic attempt to
Product/ Service the future on the basis of known facts. It is the result of numerous assumption
made about the external and internal environment of firms.

Sales forecasting is the estimate level of the company sales based on chosen marketing plan and
assumed marketing environment. 
OR
Sales forecasting is the climate of sales during some specific future period time & under a pre
determined marketing plan of the firm.

Important –

1. it is the foundation of planning.

2. Companies uses the sales forecast to allocate resource across different functional areas.
3. It is the key factor in all operational planning throughout the company.
4. It serves as a base for sales force planning.
5. It plays a major role in the success of the organization.
6. It is the key to sales management.
7. It helps in profitability of the firm
8. It helps in facilitating Product/ Service ion planning
9. It helps in better financial planning.
10. It is developing sales strategies and promotional plans
11. It helps in suggesting R & D.
12. Also helps in better inventory control & sales quota determination.

Process of sales forecasting :-

Determination of goals – The sales manager should decide the goals for sales forecasting. The
objectives may include determination of sales publicity programme, marketing methods, sales
quota determination, estimation of working capital etc. Determining the factors affecting sales –
The controllable factors are like marketing & advertising policy, organization structure etc. & the
non controllable factors like political & social systems, seasonal fluctuations etc. must be
determined. Selection of techniques – Suitable methods for sales forecasting must be selected
keeping in view the objective time intervals resources and nature of the firm. Correction of data
– This is the step of collecting various kinds of information’s & data related with future demands
of Product/ Services. Analysis of market potential –
The next step is to analyze the data of market potential. Analysis requires two steps>>

a) Select the market associated with Product/ Service demand.

b) Eliminate those market segments that do not contain prospective business.

Forecasting of future sales:- 

Sales projection should be made for an entire Product/ Service line or for an individual Product/
Service or for companies total market or individual market segment. 
Making operational programme & the budget:-

The firm determines the requirements for various operational activities such as Product/
Serviceion purchasing marketing capital assets. On the basis of forecast the related plans such as
sales budget sales quotes sales publicity and material acquirement are formulated Derivation of a
sales volume objectives:-
A sales volume objectives for the coming operative period is hoped for the outcome of a
company’s short range sales forecasting procedure, The sales volume should be consistent with
managements profit  aspirations and the companies market capabilities.

Evaluation & revision of forecasts:-

The sales executives should evaluate the forecasts carefully. The company should examine all
the assumption on which it is based. The company should the forecasting process periodically.
The first step in the review is to determine the accuracy of past forecasts to learn if changes are
needed in the way forecasts are made if the company finds that sales forecasts are significantly
different from actual sales in the period it should undertake a review of the sales forecasting
process.

Techniques of sales forecasting:-

I. Survey methods:-
a) Executive opinion
b) Prudent manager forecasting
c) Delphi method
d) Sales force composite
e) Detecting differences in figures
f) Survey of buyer intention
g) Product/ Service testing and test marketing.

a) Executive opinion – It consists of obtaining the views of top executives regarding future sales.
The forecasts made by executives are arranged to yield one forecast for all executives or the
differences are reconciled through discussion.

b) Product/ Service manager forecasting – In this method the company personnel are asked to
assume the position of purchasers in customer companies. They must then look at company sales
from a customer’s view point & prudently evaluate sales.

c) Delphi method – This method begins with a group of knowledgeable individuals estimating
future sales. Each person makes a prediction without knowing others in the group have
responded. these estimates are summarized. Now knowing how the group responded. They are
asked to make another Product/ Serviceion on the same issue. This process of estimates &
feedback is continued for several rounds. In final round involves face to face discussions among
the participants.
d) Sales force composite – This method is based on collecting an estimates from each
salesperson of the Product/ Services they expect to sell in the sale forecast period. The estimate
may be made in consultation with sales executives and customeBDT

e) Detecting differences in figures method – In this method the sales person produces figures
broken down by Product/ Service & customers and the area manager produces figures for the
sales persons territory. They then meet & must reconcile any differences in figures. the process
proceeds with the area manager producing territory by figures.

f) Surveys of buyer’s intentions – This method consist of contacting potential customers &
questioning them about whether or not they would purchase the Product/ Service at the price
asked.

g) Product/ Service testing & test marketing – This technique is of value for new or modified
Product/ Services for which no previous sales figures exists & where it is difficult to estimate.
Likely demand. It involves placing the pre Product/ Serviceion model with a sample of potential
users beforehand & noting their reactions to the Product/ Service. Test marketing involves the
limited launch of a Product/ Service in a closely defined geographical test area.

II. Mathematical methods :-

a) Moving average technique – Simplest way to forecast sales is to predict that sales in the
coming period will be equal to sales in the best period. This forecasts assumes that conditions in
the last period will be same as the conditions in the coming period.

SALES t+1 salest + salest-1 + sales + s………………… salest-n

SALESt+1 = Forecasted sales

SALESt = Sales in the present period.SALESt+1 = Sales in the period immediately past.

b) Exponential smoothing models – It is a type of moving average that represents a weighted

some of all past numbers in a time series. with the heaviest weight placed on the most recent
data.

c) Regression analysis – This technique is used to project sales trends in the future. The sales
plotted are for each past time period. It determines and measures the associations between the
sales & other variables.

d) Projection of past sales – It takes a variety of forms. · To set the sales forecasts for the coming
year at the same figure.May be moving average of the sales figures for several past yea BDT

e) Time series analysis – It is a statistical procedure for studying historical sales data this process
involves measuring 4 types of sales variations – long term trends, cyclical changes, seasonal
variations & regular fluctuations. Then a mathematical model about the past behavior of the
 series is selected assumed values for each types of sale variation are insisted and sale forecast is
made. 

f) Market factor analysis – Market factor analysis determines market factors & measures their
relationships to sales activity.

g) Correlation analysis – This method takes in to account the association between potential sales
of the Product/ Service and market factor affecting its sales. 

h) E-charts – this technique is furtherance of moving average technique. It also shows the
monthly sales & cumulative sales.

Market Research Process

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services -JAIBB
Market Research Process: Defining Problem and Objectives
�          Exploratory research
�         Preliminary information
�         Problem definition and hypothesis suggestion 

�          Descriptive research

�         Better describe marketing problems, situations, or markets
�          Causal research
�         Test hypothesis of cause and effect relationships
Market Research Process: Develop the Research Plan
�          Determine Specific Information Needs
�         Target customer characteristics
�         Patterns of product usage
�         Demand factors
�         Response of marketing channels
�         Customer reactions
�         Projected sales
�          Gather Secondary Information
�         Internal database sources
�         Company, public, and university libraries
�         Government and business publications
�         Commercial data services
�         On-line databases
�         Internet data sources
�         International data
Advantages of Secondary Data
�          Less time to obtain
�          Lower cost than primary research
�          Alternate means of access to information
�          Benefit from resources of others
Potential Problems With Secondary Data
�          Information may not exist
�          May not be:
�         Relevant
�         Accurate
�         Current
�         Impartial
Market Research Process: Plan Primary Data Collection
�          Research Approaches
�         Observation
�         Survey
�         Experiment
�          Observational Research
�         Observing relevant people, actions, situations
�         Mechanical observation, people meters, checkout scanners
�         Some things not readily observed
�          Survey Research
�         Questions about knowledge, attitudes preferences or buying behaviour
�         Most widely used source of primary data due to flexibility, information type collection, and
sometimes quicker than other two methods
�         Very difficult to construct properly; Unwilling/ unable respondents; answer questions which
they have no knowledge; pleasing answers
�          Experimental Research
�         Best suited for gathering causal information
�         Given different experimental treatments
�         Variables controlled
�         Responses measured and recorded
Personal Interviewing
�          Individual
�         Talking with people in homes, offices, on the street, or in shopping malls ONE ON ONE
�         Computer interviewing
�          Group
�         Focus group
�          Online
�          Electronic
�          Sampling Plans - three issues
�         What is the sampling unit?
�         What is the sample size?
�         What is the sampling procedure?
Probability Samples
�          Simple random sample
�         Equal probability
�         Mutually exclusive groups
�         Random sample drawn
Non-probability Samples
�          Convenience sample
�         Select easiest population
�          Judgement sample
�         Select for accurate response
Market Research Process: Research Instruments
�          Questionnaire
�         Question contribution
�         Question form
�          Closed-end
�          Open-end
�         Wording
�         Ordering
�          Mechanical
�         People meters
�         Checkout scanners
�         Eye cameras
Market Research Process: Present the Research Plan
�          Written Research Proposal
�         Management problems addressed by research
�         Research objectives
�         Information sought
�         Sources of secondary information
�         Methods of obtaining primary data
�         Benefits and costs
Market Research Process: Implement the Research
�          Collect Data
�         Company research staff
�         Outside services
�         Most costly and error process
�          Analyze Data
�         Isolate important information and findings
�         Check accuracy and completeness
�         Tabulate results
Market Research Process: Interpret and Report Findings
�          Focus on useful decision support
�          Clear and open
�          Discuss interpretation
�          Team approach
        �          Ultimate decision with management

Marketing Strategy and the Marketing Mix

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services -JAIBB

Marketing Strategy and the Marketing Mix:

Customer-Driven Marketing Strategy

Market segmentation is the division of a market into distinct groups of buyers who have
distinct
needs, characteristics, or behavior and who might require separate products or marketing
mixes
Market segment is a group of consumers who respond in a similar way to a given set of
marketing efforts
Customer-Centered Marketing Strategy
Market targeting is the process of evaluating each market segment�s attractiveness and
selecting one or more segments to enter
Market positioning is the arranging for a product to occupy a clear, distinctive, and
desirable place relative to competing products in the minds of the target consumer
Developing an Integrated Marketing Mix
Marketing mix is the set of controllable tactical marketing tools�product, price, place, and
promotion�that the firm blends to produce the response it wants in the target market

Marketing Challenges

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services -JAIBB

 Marketing Challenges

 Technological advances
 Rapid globalization
 Deregulation
 Privatization
 Free market economy
 Growing attention to social and environmental responsibilities
 Greater use of marketing by nonprofit and public sector organizations
 Customer empowerment

Role of Marketing

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)

Marketing of Financial Services -JAIBB

Role of Marketing of Financial services in the Economic Development Like
Bangladesh 

 Increase in agricultural production

  Development of foreign trade
  Market development and expansion
  Proper distribution
  Increase in national income
  Creating employment opportunity
  Facilitating competition
  Increase export
  Increasing industrial production
  Creation of new utility of product
  Maintenance of economic stability
   Service marketing
   Development of standard of living

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Differentiation for gaining competitive advantage.

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)
Marketing of Financial Services -JAIBB

Sources of Differentiation
Differentiation: A firm differentiates itself from its competitors when it provides something
unique that is valuable to buyers beyond simply offering a low price. It is one of the two types of
competitive advantage a
firm may possess/hold.

Differentiation allows a firm to command

► a premium price i.e. additional payment of price through by lowering buyers

    cost or enhance buyer performance so that the buyers will be willing to pay
    price.
            ► to sell more of its product at a given price
            ► to gain better buyers loyalties.

It is to be noted that, differentiation not only happen in product or marketing practices but
it can arise anywhere in a firm’s value chain i.e. successful differentiation strategies grow
out of the coordinated action of all parts of a firm not just the marketing department.

Steps in differentiation:
1.      Determine who the real buyer is. The first step in differentiation is to identify the real buyer.
The firm, institution, or household is not the real buyer, but rather one or more specific
individuals within the buying entity who will interpret use criteria as well as define signaling
criteria.
2.      Identify the buyer’s value chain and the firm’s impact on it. A firm’s direct and indirect
impact on it’s buyer value chain will determine the value a firm creates for its buyer through
lowering buyers cost or raising buyers performance.     
3.      Determine ranked buyer purchasing criteria. Analysis of the buyer’s value chain provides the
foundation for determining buyer purchase criteria. Purchase criteria take two forms such as use
criteria (uniqueness in meeting use criteria creates buyer value) and signaling criteria
(uniqueness in meeting signaling criteria allows that value to be realized). Purchased criteria
must be identified in terms that are operational, and their link to buyer value calculated and
ranked.   
4.      Assess the existing and potential sources of uniqueness in a firm’s value chain.
Differentiation can stem from uniqueness throughout a firm’ s value chain. A firm must
determine which value activities impact each purchase criteria. It must then identify its existing
sources of uniqueness relative to competitors, as well as potential new sources of uniqueness.
5.      Identify the cost of existing and potential sources of differentiation. The cost of
differentiation is a function of the cost drivers of the activities that lead to it. Some forms of
differentiation are not very costly and pursuing them may even lower cost in ways that the firm
has overlooked.
6.      Choose the configuration of value activities. A subtle understanding of the relationship
between the firm’s and the buyer’s value chain will allow a firm to select a configuration of
activities that creates the largest gap between buyer value and the cost of differentiation.  
7.      Test the chosen differentiation strategy for sustainability. Differentiation will not lead to
superior performance unless it is sustainable against erosion or imitation. Sustainability grows
out of selecting stable sources of buyer value, and differentiating in ways that involves barriers to
imitation or where the firm has a sustainable cost advantage in differentiating.
8.      Reduce cost in activities that do not affect the chosen forms of differentiation. A successful
differentiator reduces cost aggressively in activities that are unimportant to buyer value.
Promotional Mix of Bank Services

BANKING DIPLOMA EXAMINATION

Banking Diploma Courses in Bangladesh under The Institute of Bankers, Bangladesh (IBB)

Marketing of Financial Services -JAIBB

Promotional mix of Bank service: A study on Dutch Bangla Bank Ltd. - (DBBL)

Introduction:
Promotional mix is the combination of all the promotional tools used for communicating the
offered services. Dutch Bangla Bank Ltd. (DBBL) is such a reputed service provider that has
become differentiated from
other Banking organizations in Bangladesh which was formed as a joint venture having 70%
share of Bangladesh and 30% of Europe. DBBL got its commence paper or the permission of
starting business functions in 1995on 4th July. It commercially started its business function with
a branch at Dhaka first on 3rd June 1996. With in a short time it grew faster in the market. At
present it is a fully online banking organization in our country having 39 branches all over the
country. Not only that it has the highest number of ATM booths in our country. It has made the
banking services easier to the country people through 130 ATM booths that are the highest
number in comparison to all the present government and private banks in our country.

With all its promotional mixes DBL is operating functions effectively maintaining corporate
social responsibility refunding the money back from a certain profit portion. For the well
combination of the promotional mix and its contribution DBL has occupied a distinctive position
in the market. In the CAMEL (Cash, Assets, Management, Equity and Liability) study under the
supervision of central bank of Bangladesh DBL occupied the first position in2004. In the year of
2005 it occupied the second position. In Bangladesh DBL has introduced on line banking
through Internet, POS and ATM. The success of offering the proposed service has been possible
by the contribution of the sound blend or the promotional mix including both the printed and the
electronic media.

Reasons for choosing DBBL:

There are a lot of service organizations available in our country. But in our case study we have
selected DBL as it has fame in the market.

Our study will cover only the promotional mix side, about this regard the promotional mixes are
known a little bit to us. It is known that if the offerings are not matched with the communication
then customer will not be satisfied. Ultimately word of mouth will not be generated. Here DBL
seemed very much careful. We know that communication gap is very much crucial for any
service organization to make it successful which is the deviation between service provided and
communication disclosed. DBL is sincere about this regard and that has influenced us to select
DBL as an object for our case study.
THEORETICAL FRAMEWORK:
The theoretical framework refers to arguments quoted by the renowned experts about the
mentioned topic. Here the theories developed by the writers are bellows:

According to McCarthy “promotion is communicating information between seller and buyer to

change their attitudes and behavior.”

According to Philip kotler “ promotion stands for the various activities the company undertakes
to communicate its products merits and to persuade target customers to buy them”

According to William J Stanton “the term promotion is used to refer to the use of persuasive
information which is conjunction with other elements of marketing mix.”

According to Philip kotler “promotion or communication mix means combination of all

promotional tools and the firm’s promotion or communication mix communicates the firm’s
positioning strategies to its relevant markets, including consumers, employees, stockholders, and
suppliers”

Communication mix: according to Douglas Hoffman “ the firm’s promotion, or communication

mix, communicates the firm’s positioning strategy to its relevant markets including consumers,
employees, stockholders and suppliers. The term communications mix describes the array of
communications tools available to marketers. Marketers need to combine the elements of the
marketing mix (including communication) to produce a marketing program. The elements of
marketing mix fall in to four broad categories: personal selling, media advertising, publicity and
public relations and sales promotions.”

Personal selling: According to Philip kotler “ personal selling is an oral presentation and
conversation with one or more prospective customers.”

According to William J Stanton “personal selling is the direct presentation of product or service
to a prospective customer by a representative of the organization selling it.”

Advertising: According to Philip kotler “Advertising is any paid form of non- personal
presentation and promotion of ideas, goods, or services by an identified sponsor”

According to William J Stanton “ advertising is impersonal mass communication that the

sponsor has paid for and which the sponsor is clearly identified.”

Publicity: According to Philip kotler “ publicity is a non personal stimulation of demand for
product, service or business that is transmitted through a man, media at no charge.”

According to William J Stanton publicity is a special form of public relation that involves news,
stories about an organization or its services.”
Public relation: According to Philip kotler “ It includes a variety of programs designed to
promote or protect a company’s image or its individual products”

According to William J Stanton “public relation encompasses a wide variety of communication

effort to contribute to generally favorable attitude and opinion toward an organization and its
service.”

Sales promotion: According to Philip kotler “ sales promotion a key ingredient in marketing
campaigns, consists of a diverse collection of intensive tools, mostly short term, designed to
stimulate quicker or greater purchase of particular products or services by consumers or trade”

According to William J Stanton “sales promotion is demand stimulating activity designed to

supplement advertising and facilitate personal selling. It is paid for by the sponsor and frequently
involves a temporary incentive to encourage a purchase.”

Empirical study:
Empirical study refers to the reality of perception. The reality about its communication mix or
promotional mix is up to mark. What it is promising to the customers through the different
promotional mixes are being matched with the reality. The services include:

 Usual Banking services.

 Online Banking facilities.
 Services to the distressed community

DBL uses all types of promotional mixes to cover the target market. It is currently using both the
printed and electronic media. The elements of promotional mix consist of: -

 Advertising.
 Sales promotion.
 Public relation.
 Publicity.

 
Word of mouth:
DBL is communicating the proposed services through the mentioned elements of promotional
mixes. Now a short explanation of the service offered can be viewed.

Usual Banking services:

DBL offers the usual Banking services include the fastest and speedy transactional account
services consist of current account, savings account, fix deposit scheme and special target
account. The well-trained front desk executives with well-decorated inanimate environment are
performing the activities very well.

Online Banking facilities:

DBL is providing the shoposticated target customers with online Banking facilities through ATM
card, Internet, POS and SWIFT (POS and SWIFT’s meaning was not available in annul report
2005 of DBL)
Earlier it has been noted that country wide it has the highest number of ATM booths including
130 by which the customers are withdrawing money with in 24 hours. It is offering the
customers four types of cards and these are Classic card, Silver card, Gold card and Visa
electron. For the Classic card there is no charge and for the first time clients, Silver card is
offered to the current account holders who can transect anytime and any amount according to the
deposit, Gold card is allowed to the account holders who have at least 500000 tk deposit and
through the Gold card the customers can shop in credit basis up to 2000000tk, Visa electron is
under process that may offer unique service to the client in future. The foreign client can send
money from any corner of the world through the Western Money Union, as DBL is one of the
representatives that serves the nation the service through the Internet facility.

Services to the distressed community:

Besides the important services performed or the clients DBL is performing some distinct
activities for the people who are distressed in some of cases they are deprived of a lot. DBL is
doing a lot for those people through performing the corporate social responsibility (CSR)
countrywide. DBL previously would allocate 2.5% of its annual profit to perform the CSR
activity and now it is allocating 5% of its annual profit for the CSR activities. DBL has formed a
foundation for smooth performances named DBL foundation. To build the corporate image it is
donating a lot of money to different charitable organization, donating to the flood affected and
winter affected people in our country.

Promotional mix used by DBL:

We know that the combination of all the promotional tools is referred to as promotional mix.
Here DBL is blending a sound mixer by which it is trying to caver the whole target market. Now
we will view separately all the elements of promotional mix.

Advertisement:
DBL is using all the printed media and electronic media for communicating the services to the
clients. The elements of the mixes are as follows:

Printed media: DBL is using all the printed media including the newspaper, magazines, festoons,
billboard, and etc. to communicate their services.

Electronic media: It includes different TVs both the government run and privately own to
position the idea “your trusted partner”.

Sales promotions: Sometimes DBL undertakes sales promotion to attract the existing and new
clients short time basis but not appointing any personnel specifically as sales personnel. Word of
mouth of the existing clients act as sales promotion for that period.

Public relation:
DBL sponsors different seminars, symposiums, math Olympiad to build corporate relation with
the mass people.
Publicity:
As DBL is performing a lot of social responsibilities. It was awarded the number one CSR
performer in the southern Asia in a conference held in Philippines. Not only that different media
both views the countrywide nonprofit able performances printed and electronic which are
publishing and telecasting the news countrywide. it also did the beatification of part of Dhaka
city, Hotel Sheraton to Ishkha road and that attracted the media as a result DBL is getting
publicity than any other service organization in our country that represent obviously the reality.
Word of mouth:We know that satisfied customer is the best source of promotion and DBL has a
great impact of word of mouth, which is generated from the existing satisfied customers as they
promote the bank services that they avail. Further more those potential customers who don’t
have account but wish to open an account in future for availing the smart service of DBL.

In the study we find that the promotional mixes of DBL are contributing a lot to retain the
goodwill and day by day the authority is being serious about making a sound mixer of their
communication mixes.

Analysis:
The service organizations offer their offerings through the promotional mixes. If the reality is
matched with the promotional messages then no problem but the situation will be very crucial if
promises are not matched with the real services. The deviation between the theories with the
practice is analysis. In the study we find that the inanimate environment of the DBL of - branch
is very much modern and the behavior of front line executives are standard. The standard of each
advertisement in different media are very fine. Especially the social responsibilities performed
by the DBBL attracted to the eye of many. Actually DBL has properly used its promotional
mixes. It is trying to provide the standard and promised services to its clients. DBBL thinks that
the service provided will make the customers loyal as a result those customers will further
recommend the others. For doing that it is emphasizing on the publicity and public relation and
publicity that is the result of CSR. The target customer of DBBL is the higher customer group
and slightly he upper middle class group as well. DBBL has been successful to communicate
with the target customers by the proposed services through the promotional mixes. The proposed
on line banking has matched with the reality also. In short it can be asserted that the differences
between the services of DBBL communicated through various tools and the real mixers of
promotion, the performances of individual promotional tool and the reality of the service offered
are positive to DBBL and to the customers.

Conclusion and Recommendations:

The promotional mixes and the effectiveness of them are fully judgmental but the reality of the
services can be understood better if we would possess accounts at the bank. In spite of this we
can say that this joint venture is performing very well in serving the nation very well. But still
there are some recommendations, which are as follows:

Target customers:
Although DBBL has targeted the higher-class income group but most of the people in our
country are middle class and lower class income group. DBBL can target that segment to
increase its market share although it has become successful to satisfy the higher income people.
Customer training:
We know that DBBL has 130 ATM booths allover the country but the people are less trained
about this technology. So it can provide more training to the targeted customers about different
card including classic card, silver card, and gold card. Although visa electronic is not available
but the band has to teach the people about the upcoming technology. Although it is providing the
prospectus and other written learning aid but the language is in English. Those can be translated
in to Bengali for the betterment of the customers.

New social task:

In order to draw the attention of the people DBBL can create new ides that means the scope for
performing the Corporate Social Responsibility (CSR) such as promoting the bad image of early
marriage and creating mass awareness about it. Informing the people about the Sanitation and
first aid in critical situations.

In brief we can claim that, to the customers DBBL is a popular bank. For this it has obtained 2nd
rank. It blended a good promotional mix. Consumers perceive a little risk. It is offering
professional banking. Promotional mixes are effectively communicating. Day by day it will
target new customer. Its slogan will be correct “ your trusted partner”. It will be very careful for
social responsibility. It will show the customers more honesty. For adding value to customers no
conclusion. DBBL will be more careful that’s our recommendation.
STUDY MATERIALS