19 Chapter7 PDF

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Chapter: 7 Marketing of banking services with Reference to

ICICI Bank & HDFC Bank
7.1 Introduction
c 7.2 Application of Marketing in Banking Services.
7 .2.1 Characteristics of Services.
7.2.2 Marketing Concept in Banking Services.
7.3 Marketing of ICICI Banking Services.
7.4 Marketing of HDFC Banking Services.
7.5 Problems in Marketing of Banking Services.
7.6 Problems Associated with Marketing of ICICI Bank
Services.
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7.7 Problems Associated with Marketing of HDFC Bank
Services.
7.8 Comparison of Marketing of ICICI Bank and HDFC Bank.

7.9 Conclusion
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Marketing of Banking Service With Reference To ICICI Bank & HDFC Bank
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CHAPTER: 7
Marketing Of Banking Service With Reference To ICICI Bank &

HDFC Bank
7.1 Introduction
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Before 1950's, the banks were not aware of marketing concept
relating to banking services in India. The marketing concept in banking
industry emerged in the late fifties in the Western countries in the form of
"advertising and promotion" concept. Banker's outlook and notion about
marketing profession changed considerably in 1970. Marketing was
accepted as an organizational imperative. In India the marketing concept in
banking industry, began in the early 80s, the concept went through drastic
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changes in the 90s because of modernization & introduction of sophisticated
technology in banking sector.
Gradually, the banks started advertising and efforts were made
by branch managers to increase the deposit, sometimes even by moving in
the fields. Due to severe competition, it became difficult to attract new
customers with advertising only, so banks started other promotional
activities. By this time, all the banks were in some way or the other, engaged
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in the promotional activities. Gradually, a saturation point came when it lost
its sheen for the customers. Actually, with promotional schemes, it was easy
to attract new customers, but to maintain their loyalty was a difficult task.
So, all the banks realized the importance of walking the extra yard of
friendliness and courtesy while providing their services.
C By 1974, the environment became more serious and during this
period the bank, picked up the idea of 'marketing'. A few marketing

practices were introduced, replacing the earlier practices which were found
to be successful in positioning their products and meeting the needs of, the
diverse market segments.
In banking services, there is a very little scope for innovation of
f banking products. Due to sever competition, the banks started adding,
innovative services to their products to differentiate the same from the
competitors. Developing new product, especially when the environment is
regulated was a difficult task. Though product development or innovation of
financial product requires very little or no additional investrnent, the flipside
is that, no brand can claim of a unique selling proposition for long, as it can
be copied immediately. So there was a need of constant change. ICICI Bank
and HDFC Bank are applying various marketing strategies to make their
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services popular in the market. Though HDFC bank has been popular in
their home loan services and ICICI Bank is more successful in retail banking
services.
Marketing has increase significantly in banking sector in India,
because of a number of market-correlated developments that had taken place
o in the recent years. Banks have become are important financial
intermediaries, which accept deposits from public for the purpose of lending
and investment. Through this function they are also involved in related
business or ancillary services like remittances, demand draft issue, mail
transfer, collection of bills, sale and purchase of foreign exchange, safe
custody and safe deposit vault, guarantee facilities, sale of travelers'

cheques, merchant banking, leasing and hire purchase, etc. These are the few
l services that have been added in recent years. Commercial banks, whose
main resources came from public deposits, face stiff competition from other
financial players. There is competition for deposit not only among banks but
also from and non-banking institutions. As public sector and private sector
companies are colleting, deposits directly from public. Corporate sector also
has the access to the capital market and can raise funds through equity and
debentures. In addition Public sector banks can raise funds from public
directly by way of bonds on affractive terms. Last but not the least, the
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Government sponsored saving schemes such as PPF, NSC, Indira Vikas
Patra, etc was quite successful due to their tax saving benefits and secured
returns. All these factors were adversely affecting banking system in their
efforts to increase deposit mobilization.
The three most important features of the Indian Economy has
experienced in the 20th century, was as follows:8e

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I) Seventies, as the decade of banking system, in resource mobilization
through branch network.
il) The eighties, as the decade of capital market.
ilI) The nineties, as the decade of financial services serving the investors,
entrepreneur in a fair way.
The development of a sophisticated and matured financial
) system in the country, particularly since nineties was due to the emergence
of an articulate financial services sector. Financial service sector gained
importance, not just for its financial resources and employment generation,
but also in its paramount impact on other spheres of economy. In late 70's
and earlier part of 80's, the Indian Industry used to depend heavily on
nationalized banks and financial institutions for financing the projects. It was
8e
Dash Ashutosh, "Marketing of Financial Services-A Strategic Approach" Financial
Services ( Text, Cases, Stratgies) Deep & Deep Publications
Pvt.Ltd, New Delhi, 2002 Pp.l29 -139
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due to the fact that, the financial services sector during that period was
dominated by them and in fact the capital market played a secondary role.
However, during the last decade, the emergence of different other financial
institutions and regulatory agencies have transformed the Indian financial
services sector from being a conservative industry to a very dynamic one. In
fact, the efficiency of the emerging financial system primarily depends upon
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the quality and wide rang of the package of financial services largely
provided by the non-banking financial companies. Although some of these
services in India are at emerging stage, they infact represent the

development of considerable significance for the financial system.
After nationalization of 14 commercial banks in 1969, the
services of public sector banks started degrading in quality of customer
services. This degradation, reached its height and the level of dissatisfaction
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of the customers of public sector commercial banks was at a peak.
Meanwhile, the foreign banks and a few of private sector banks started
developing and adopting themselves in such an environment with greater
speed, efficient staff and technology based delivery system. Due to these
qualitative services, the private sector banks had a clear edged over the
public sector commercial banks. Though the restrictions put by RBI
demotivated private sector banks, they were successful in operating their
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business in banking sector. This success of private sector banks can be

credited to their successful application of marketing principles, which they
used to market the services of banks innovatively. This vouches for the,
success of marketing of services in bank. This appears to be the answer to
many of the problems faced by, public as well as private sector banks.
e Application of marketing principles to bank marketing is the need of the
hour. Thus the banks which not only understand the customers' needs and
frame their policies accordingly, but also successfully apply these principles,
will be able to survive and grow in the current competitive environment.
7.2 Application of Marketing in Banking Services.
I) Services
The term service can be defined as "A service is an activity or

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series of activities of more or less intangible nature that normally, not
necessarily, take place in interaction between the customer and service
employee and /or physical resources or goods and/ or systems of the service
provider, which are provided as solution to customer problems"e0 According
to the above definition, followingare the main Features of the services:
e0
Chrirti*Gronross, Services Management and Marketing, ( Massachusetts:
Lexington Books) 1990 P g.27
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o Services are by and large "activities" or they are series of activities
rather than things.
As a result, the services are intangible
They take place in the interaction between the customer and the
service
e o Provider, which means that service are produced and consumed
simultaneously.
o Customer has a role to play in the production process as the services
are provided in response to problems of customers as solution.el
The concept of 'Bank marketing' or marketing of banking

services implies the delivery (maintaining existing demand and creation of
3 new demand) of wants -satisfring i.e. right services at right price, at right
time, at right place and to the right customer. Thus, marketing management
in banks, aim not only at delivering the services to present and new
customers, but also creating new services for existing and potential
customers.e2 This real change in the perception and concept of bank

marketing was felt in the beginning of the decade of 80. Stiff competition
nt Shu;uh* S., Services Marketing, Concepts, Practices and Cases, Himalaya Publishing
House Pg.60
92
H,.rg*,S.S., Marketing strategies for bank management, Deep & Deep Publications,
New Delhi,200l.
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and technological innovations are the main factors for such a change. New
generation banks with their latest information technology to serve the
customers created the quality gap. People noticed the significant quality gap
between the banks using upgraded technology and banks working manually.
Over the last decade, there had been a growing interest in the field of
c services marketing in general and in the financial service sector in particular.
The extent to which the marketing of financial service differs from the
marketing of goods is subject to a considerable debate. The marketing of
services requires a separate approach from the marketing of physical goods
to deal with the problems faced by the unique characteristics of services.
Services are typically distinguished from goods on the grounds of

intangibility, inseparability, heterogeneity and Perishability are few of the
) other characteristics which are likely to dominate as well as create problems
for services marketing.
In the next few years, the banking environment is in for further major
changes as the banks have to reshape their operations and methods, to
emerge as user-friendly and viable orgarization, in order to be successful.
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7.2.1 Characteristics of services
Inseparability:
This feature of service is one of the major problems faced by he
professionals while marketing the banking services, because unlike the
goods which are produced, sold and them consumed, the services are sold,
produced and then used. Service are usually produced and consumed
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concurrently. This is not the case with goods, as goods are not consumed and
produced at the same time. After production, they are put to quality check,
inventory and distribution of goods is done through multiple channels.
However in case of services, they cannot be separated from the company or
person giving it. A person providing services has to be present to provide the
services.
3 Heterogeneity:
The human factor is the most important part in providing
services which makes it difficult to standardize the services. The quality of
services can't be standardized because of human factor as the customers rate
the services in different ways each time. For example a woman may rate the
satisfaction level differently, even though she visits the same beautician all
the time. The heterogeneity factor makes it difficult to maintain the same
quality level & market the services efficiently.
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Perishability:
Another factor, which makes the task of marketing
professionals difficult, is perishability of services unlike goods services,
cannot be stored. If the services are not sold today, it is a loss not for today
alone but even for future which is not the case of goods which can be sold
c the next day or in future or even if it is not sold it is not a total loss.
Underutilization of services is another factor which found to be waste. A
building unoccupied, a person unemployed, credit unutilized, vacant bed in
the hospital are economic waste.e3
Apart from the fact that if a service is not fully utilized represents a total
loss; the other dimension of this perishability aspect is that, most services
may face a fluctuating demand. For example there is a peak demand time for
buses in morning and evening (office hours), certain train routes are always
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more heavily booked than others. Another example is financial product is
aggressively marketed highlighting the tax benefit and if the tax benefit is
removed in the subsequent budget, the product becomes perishable and less
attractive to the customers. This fluctuating demand pattern aggravates the
perishability characteristics of services.
n'
Jhu, S.M., Services Marketing, Himalaya Publishing, Mumbai,2004.Pp 8-24.
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Ownership:
In case of a product, a person buying a product also makes him
the owner of the product. But this is not the case with services. For services
one has to pay for its use but he can never own it. More over ha has to pay
each time for its usage.
c A service is purchased for the benefits it provides. If we closely examine the
reasons why products are purchased, w€ find that they are bought not
because of their physical, tangible features but because they provide certain
intangible benefits and satisfaction.
Detergent powder provides the primary benefit of cleanliness,
air-conditioner provides the benefit of a cool, comfortable environment or
mixer-cum-grinder provides convenience. The only difference between
I products and services is that in the case of latter, the intangible component is
greater than the former. Thus, services can be treated as a special kind of
product.
From a marketing viewpoint, the same concepts and techniques
are applicable for both product and services. The successful marketing of
both requires market research, product design, product planning and
development, pricing, promotion and distribution.
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Intangibility:
Intangibility is an important aspect that further complicates the
process of marketing of services. The goodsr which are tangible in nature,
can be displayed to promote, view, test or make a trial before making buying
decisions. Customer, can't touch the services, they can't smell them. It is not
c a physical object. It is the professional excellence of decision makers that
count here. While selling or promoting services, we need to concentrate on
the benefits and satisfaction, which a buyer can derive after buying. As a
bank promote the sale of credit card by visualizing he convenience and
benefits the holder of the credit cards are likely to get from the same.
However, for marketing of services, the marketing manager must understand
the nature of the above mentioned five characteristics of services and the
manner in which they impinge on the marketing strategy.

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7.2.2 Marketing concepts in Banking Services.
Manufacturer produces products whereas bankers produce
services. Marketing, of financial services like banking is the process mainly
concerned with creating, delivering and satisffittg customer's demands.
Customer Satisfaction means identifring customer needs, developing
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suitable ways and means of customer satisfaction. Marketing involves
establishing cornmunication channels among management, employees and
customers. Application of marketing concepts to banking services marketing
services presupposes market segmentation, assessment of marketing
organization and marketing control. Some of the areas, which require
c specific attention, may be enumerated as advertising management, pricing
policy, data processing marketing research and public relations.
Though there are differences in products and services in reality there is not
much of a differences in the concepts, used in the marketing of products and
services. Designing and developing marketing strategies and plans brings to
the fore concepts of marketing Mix. This covers- product, price, promotion
and place (place of rendering service). In addition, for services marketing,
l we can have people, process and physical appearance. Designing a
marketing mix for marketing of banking services required a professional
who can, with his creativity and experience, make any scheme and service a
profitable one.
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The product:
Bank's products are its services. In the formulation of product
mix the banks have to consider rising income, expectations of customers,
changing lifestyle etc. The product mix of the banks under study has the
following in its product mix. Deposits, loans, credit, debit cards, various
C loans.
The Promotion:
In formulating the promotion mix, banks have to form a

promotion mix taking into consideration various factors such as the schemes
to be promoted, timing of the schemes, close competitor, etc. The different
components of promotion used by banks include advertising, sales

f promotion, personal selling, tele-marketing, sponsoring events, exhibitions,
etc.
The Price:
The price mix consists of interest charged by the banks on
various services, fees charged by banks for providing various services. In
case of banking products, the prices are regulated by RBI .This component
plays important part of product mix. ICICI Bank and HDFC Bank (as per
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customer survey) have maximum dissatisfaction with respect to interest
charges, fees charged etc.
The place:
This component of marketing mix is related to distribution of
product. It involves selection of place for branch of bank. In respect of place

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mix, ICICI Bank and HDFC Bank have done tremendous job. These two
private sector banks have 601 and 531 branches and around 2000 and 1000
ATMs respectively. This shows the importance of place mix in distribution
of banking services.
The people:
I Latest technology and sophisticated techniques increases the
value and image of banks, but it has no value if the human resources are not
managed in right fashion. This mix is important component of marketing
mix. In ICICI Bank and HDFC Bank we find that this factor is given more
importance. In these banks importance is given to quality of work force.
Training at various entry levels is given in these banks to their employees
especially the employees who handle front-desk.
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We have reviewed different marketing mix undertaken by the
banks. This marketing mix consists of price, promotion, people, and place.
All these components are important to successfully market the banking
services. Lack of any one of the factor will make it difficult for the banks to
achieve the desired result.
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As per the survey result, the researcher has concluded that
ICICI Bank and HDFC Bank are the two most successful banks in using
promotional activities to promote their products. ICICI Bank is aggressively
marketing all its retail products through advertising media. Lately, HDFC
Bank started concentrating on sponsoring events.
f 73 Marketing of ICICI Banking Services.
To study the problems faced by the marketing staff of ICICI
Bank in marketing the banking services, sample of 100 marketing staff were
administered with questionnaire to find out their responses.
While studying the responses of the field staff of ICICI Bank,
who are involved in the actual implementation of marketing policies such as
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marketing executives' direct sales associates, etc were contacted to find out
their responses. On analysis of the responses the following financial
products were identified by the researcher in the form of marketing of
banking services. These products marketed by ICICI Bank marketing staff is
presented in the table 7.1
c Iable 7.1
Financial products marketed by ICICI Bank
Sr.No. Financial Product Percent
I Savine A/C 23
2 Fixed Deposit A/C 4
J Recurring Account J-
4 Current Account l5
5 Home Loans l4
6 Personal Loans 5
7 Credit Cards 34
8 Others 2
) Total 100
Source: Field Study
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Graph 7.1
Financial products marketed by lclGl Bank
2
Others
34
Credit Gards
Persoanl Loans
r$
c percent Home loans -14

Current 15
-
Reccuring
-J
F.D.
-{
Saving A/c
a 27,
0 40 20 30 40
l Efforts were made to include all the categories of services
marketed by executives. The respondents contacted for survey included
marketing executives, direct sales associates and other such as ICICI Bank
home loan councilors etc. Out of the surveyed 100 respondents, there were
55 marketing staff, 39 direct sales associates and 6 were other employees.
The financial product marketed by these executives are saving account 23
percent, fixed deposit account 4 percent, recurring 3 percent, home loans 14
percent, current account 15 percent, personal loans 5 percent, credit cards 34
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percent and others 2 percent which included auto finance, insurance, foreign
exchange etc.
The marketing executives who are the respondents for above
study have working experience ranging from 6 months to 5 years. Number
C of years a marketing staff is working for ICICI Bank is shown in the
following table.
Table 7.2
Working experience of marketing staff of ICICI Bank
No of Years working with Percent

Sr.No.
ICICI Bank
l. Less than I year 56
l 2. I to 3 Years 40
3 3 to 5 Years 2
4 More than 5 vears 2

100
Source: Field Study
The total bifurcation of the number of years working as
marketing professional with ICIO Bank is as follows: working with ICICI
Bank less than I year 56 percent, between I to 3 year 40percent and 3 to 5
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years 2percent and the marketing staff who have completed more than 5
years with the bank is 2 percent. From above data, the conclusion can be
drawn, that the number of executives working for less than I year are more
i.e. 56 percent, and number of executives working between 3 to 5 years is 40
percent whereas 2 percent between 3 to 5 years and above 5 years is 2
C percent. All the executives working in the category of marketing executives
for less than I year are, fresh graduates, or sometimes just l2th standards
Pass with good communication and convincing skills. These candidates
make perfect marketing executives with the aid of training from ICICI Bank
about their range of services. Since most of these openings are on temporary
basis as soon as some better prospects come, the executives leave ICICI
Bank for greener pastures. The executives who achieve the monthly targets
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with handsome commission are, lured to stay in the job in spite of its
temporary position; this is our second category i.e. I to 3 years working. The
other categories of employees are, those working directly under ICICI Bank
on a permanent basis. These categories of employees are more secure and
has shown more positive attitude towards the bank.
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Marketing of Banking Service With Reference To ICICI Bank & HDI'C Bank
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As the researcher made an attempt to study the marketing of
services by ICICI Bank, it was found pertinent to assess the customer
satisfaction as assessed by marketing staff of ICICI Bank. In this connection
ICICI Bank's marketing staff was asked the questions with questionnaire
and their responses about innovative services are given in the following table
7.3.
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Table 7.3
Responses of Marketing staff about innovative services of ICICI Bank.
Response
No
Can't say
)
Total
Source: Field Study
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Graph 7 .2
Responses of Marketing staff about Innovative Services of lclCl

Bank
100
80
q) 60
O
L
c q)
40
20
0
Response
The responses from customers have been found out about the
innovative nature of ICICI Bank services. Along with customers the
marketing staff of ICICI Bank i.e. marketing executive, direct sales

) associates have been interviewed to ask about their views on the innovative
nature of ICICI Bank services. Around 83 percent of the ICICI Bank

marketing employee is of the opinion that the services offered by ICICI
Bank are innovative. Whereas 72 percent of the employees feel that the
services are not innovative. There are employees in ICICI Bank who could
not answer whether the services are innovative or no such percentage has
come to 5 percent
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Similarly the researcher had contacted marketing staff of ICICI
Bank to understand the customer satisfaction from marketing staffs
perspective, in this connection their responses are presented in the following
table.
Table 7.4
Customer Satisfaction with the Services Offered By ICICI Bank

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Response
Total
\ Source: Field Studv
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Graph 7.3
customer satisfaction with the services offered bv ICICI
Bank
70
60
50
ISometimes
q) 40
(, lalways
L
I
o tr 30 ENever
20
10
0
Response
As per marketing staff, the customers of ICICI Bank are
satisfied most of the times. Around 58 percent said they are satisfied with
) the services sometimes, 4l percent said they are always satisfied with the
services and 1 percent said they are never satisfied with the services.
The researcher made an attempt to find out thb awareness
about the customer services provided by ICICI Bank among the customers.
For this purpose marketing staff was probed by way of questionnaire survey.
The responses received from marketing staff about the awareness of services
among the customers are given in the following table.
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Table 7.5
Awareness of services provided by ICICI Bank
Yes
No
e Can't say
Total
Source: Field Study
Graph 7.4
Awareness of services offered bv ICICI Bank
) 70
60
50
40
30
20
10
0
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Marketing of Banking Service With Reference To ICICI Bank & HDI'C Bank
ii
As shown in table 7.5 and graph 7.4, out of total sample
marketing staff 58.2 percent responded that are informed about the
services, 39.8 percent said they are not informed about the services and 2
percent can't say anything about it. There are 58.2 percent customers who
are fully aware of the services offered by ICICI Bank; this indicates the
strength of ICICI Bank assessed by marketing staff.

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ICICI Bank has been always a leader in innovative banking
services. It identifies new banking services as per the changing period of

times. The researcher made an attempt to identifu the awareness about new
services offered by ICICI Bank, during the study period. This attempt was
made through the marketing staff which has been analyzed in the following
table no 7.6 and presented in Graph 7.5
Table 7.6
Information about New Services of ICICI Bank
Sr. No. Response Percent
I Excellent 44
2 Verv good 3l
3 Good l5
4 Satisfactory 7
sl il l3
100
Source: Field Study
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Graph 7.5
Information about New Services of ICICI Bank
50
40
IExcellent
q)
30 I Very good
I E Good
L
o €)
20 E Satisfactory
10
IPoor
0
Response
When the researcher analyzed the responses of marketing staff about
awareness of new services, it was found that 44 percent said that the
information about new services is excellent, 31 percent said it is very good,
) 15 percent said it is good, 7 percent said it is satisfactory and 3percent said it
is poor.
The researcher also tried to find out the responses of marketing
staff about awareness of changes in charges. These responses of the
respondents are presented in the following table'
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Table 7.7
Awareness about changes in charges of ICICI Bank
Response ll Percent
Excellent
Very good
o
Satisfactory 18
Poor 7
Source: Field Studv.
t Graph 7.6
Awareness about changes in charges.
50
40
IExcellent
q)
30 IVery good
I E Good
L
q)
Fr 20 E Satisfactory
10
IPoor
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The purpose of survey of marketing people was also to find out
about the satisfaction of the customers .From marketing staffs point of
view, they were asked to rate the ICICI Bank in terms information to its
customers about changes in service charges: 5 percent said it is excellent,46
percent said it is very good, 28 percent said it is good, 28 percent said it is
satisfactory and 7 percent said it is poor.

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Similarly the researcher attempted to find out the responses of
marketing staff about changes in interest rates, these responses have been
presented in the following table 7.8 and presented in graph7.7
Table 7.8
Awareness about changes in interest rates of ICICI Bank
Sr. No.
I I Excellent
I
2 33
lLil 35
f4@ 18
f5f 5
Total
Source: Field Study
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Graph 7.7
Awareness about changes in interest rates.
40
30 lExcellent
IVery good
H20
q)
E Good
c E Satisfactory
10 IPoor
Response
'About awareness of changes in interest rates 9 percent said it
is excellent, 33 percent said it is very good, 35 percent said it is good, and 18
percent said it is satisfactory whereas 5 percent said it is poor.

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The attempt is also made in the study to understand the
satisfaction with information about opening of new branches. In,this regards,
the responses of the marketing staffare listed in the following table.
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Table 7.9
Information about opening of new branches of ICICI Bank
Response
Excellent
Very good
c Good
Satisfactory
Poor
Total
Source: Field Study
Graph 7.8
l Information about opening of new branches.
40
30 IExcellent
IVery good
€)
I 20 E Good
L
I
Fr E Satisfactory
10 lPoor
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As far as opening of new branches is concern ICICI Bank's
communication with customers is rated by marketing staff as follows: 28
percent said it is excellent, 34 percent said it is very good, 2l percent said it
is good, l3 percent said it is very good and 4 percent said it is poor.
To evaluate the customer satisfaction from marketing staffs
point of view, their responses have been taken into consideration to come to
conclusion. One of the aspects which were taken into consideration was
redressal of customer complaints. The following table shows the reply to
customer complaints from ICICI Bank to its customers.
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Table 7.10
Reply to customer complaints of ICICI Bank
Response
Excellent
Very Good
Good
C
Satis
Poor
TOTAL
Sotuce: Field Study
Graph 7.9
Reply to customer complaints of ICICI Bank
35
) 30
25 IExcellent
IVery good
820
E Good
i15 E Satisfactory
10
IPoor
5
0
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As far as reply to customer complaints from marketing staffs
point of view , ICICI Bank stands as follows: 6 percent said it is excellent,
10 percent said it is very good, 26 percent said it is good, 32 percent said it is
n 7.4 Marketing of HDFC Banking Services.
For studying the responses of the field staff of HDFC Bank,
who are involved in the actual implementation of marketing policies,
marketing executives' direct sales associates, have been contacted to find out
their Reponses. The respondents include 70 percent marketing executives,
28 percent, direct sales associates and 2 percent includes others for HDFC
Bank.
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Table 7.11
Financial Product Marketed bv HDF C Bank
Financial Product
I Savi NC
Fixed Deoosit A/C
Source: Field Study
Graph 7.10
Financial Products Marketed bv HDFC Bank.
)
60 lSaving A/C
50
lFixed Deposit A /C
ERecurring Acount
E40 E Current Account
lMutual Funds
830 lHome Loans
20 lPersonal Loans
10 @Car Loans
I Credit Cards
0 llnsurance
EOthers
A
v
353
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The respondents contacted for HDFC Bank included their
marketing executives, direct sales associates and other. Efforts were made to
include all the categories of services marketed by these executives. The
financial services marketed by these executives are, saving account 52
percent, fixed deposit account 48 percent, recurring34 percent, home loans
19 percent, current account 43 percent, personal loans 23 percent, car loans

o
10 percent, credit cards 19 percent, insurance 15 percent and others 2
percent which included auto finance, insurance, foreign exchange etc.
The respondent marketing executives for above study has experience
ranging from 6 months to 5 years.
Table 7.12
Working experience of marketing staff of HDFC Bank
\ Sr.No. No of Years working with Percent

HDFC Bank
1. Less than I vear 49
2. I to 3 Years 33
3 3 to 5 Years l0
4 More than 5 years 8

Total 100
Source: Field Study
A4
3s4
l^
The total bifurcation of the number of years working as
marketing professional with HDFC Bank is as follows: Less than 1 year 49
percent, between 1 to 3 year 33 percent and 3 to 5 years l0 percent and the
marketing staff who have completed more than 5 years with the bank is 8
percent. From the above data it can be said that number of executives
C working for less than 1 year is more i.e. 49 percent, and number of
executives working between 3 to 5 years is 33 percent whereas 10 percent
between 3 to 5 years and 8 percent above 5 years. All the executives
working in the category of marketing executives less than I year are fresh
graduates or sometimes just 12th standards pass with good communication
and convincing skills. These candidates make perfect marketing executives
with training from HDFC Bank about their range of services. Since most of
these openings are on temporary basis as soon as some good prospects come
)
executives leave HDFC Bank for better prospects. The executives who
achieve the monthly targets and earn handsome commission are lured to stay
in the job in spite of its temporary position; this is our second category i.e. I
to 3 years working. The other categories of employees are those working
directly under HDFC Bank on a permanent basis. These categories of
employees are more secure and has shown more positive attitude towards the
A
\. )'
355
C
bank. The direct sales associates of HDFC Bank recruit marketing
employees. Some employees have position in bank's call centre.
The researcher made an attempt to study the marketing of

services by HDFC Bank; it was relevant to review the customer satisfaction
as assessed by marketing staff of HDFC Bank. Therefore HDFC Bank's
- marketing staff was asked the questions with questionnaire and their
responses about innovative services are given in the following table 7.13
Table 7.13
Responses of Marketing staff about innovative services of HDFC Bank
Response
A
'4
356
c
Graph 7.11
Responses of Marketing staff about Innovative Services of HDFC

Bank.
100
80
c 60 lYes
e o
o lNo
o 40
(L D Can't
20
0
Response
The responses from customers have been found about the
innovative nature of HDFC Bank services. Along with customers, the
marketing staff of HDFC Bank i.e. marketing executive, direct sales

\
associates have been interviewed to ask about their views on the innovative
nature of HDFC Bank services. Around 93 percent of respondent of the
HDFC Bank marketing employee is of the opinion that, the services offered
by HDFC Bank are innovative. Around, 4 percent of the employees are of
different view about the innovative services. They feel that the services are
not innovative. There are employees in HDFC Bank who could not answer
whether the services are innovative or no such percentage has come to 3
percent
357
C
The researcher had contacted marketing staff of HDFC Bank to
understand the customer satisfaction from marketing staffs perspective, in
this connection their responses are presented in the following table 7.14 and
presented in graph7.l2
Table 7.14
:
Customer Satisfaction with the Services Offered By HDFC
Bank
Sr. No. Response
Source: Field Study
A
'4
358
o
Graph 7.12
Customer Satisfaction With Various Services offered bv HDFC Bank
100
80
60 lSometimes
c)
I
L
q)
I always
40 ENever
A
20
0
Response
As per the marketing staff, the customers of HDFC Bank are
satisfied most of the times. Around 78 percent said they are satisfied with
the services iometimes, 20 percbnt said they are always satisfied with the
services and2 percent said they are never satisfied with the services.
The researcher made an attempt to find out the awareness about
the customer services provided by HDFC Bank among the customers. For
this purpose marketing staff was probed by way of questionnaire suwey.
The responses received from marketing staff about the awareness of services
among the customers are given in the following table.
?
3s9
o
Table 7.15
Awareness of services provided by HDFC Bank
R.'po'*
[- [*
A
Can't say
-Graph 7.13
Awareness of services offered bv HDFC Bank
70
60
50
E
I
+o'
E30
20
10
0
q
360
According to the survey of marketing staff, the customers of
HDFC Bank are well informed about the services by various mean of
communication. 60 percent said they are informed about the services, 38
percent said they are not informed about the services and 2 percent could not
say anything about it.
The researcher made an attempt to identiff the awareness about
new seryices offered by HDFC Bank, during the study period. This attempt
was made through the marketing staff this has been presented in the
following table no 7.16 and presented in Graph 7.14
Table 7.16
Information about New Services of HDFC Bank
Source: Field Study
A
4
361
o
Graph 7.14
Information about new services of HDFC Bank
60
50
I Excellent
-40
c lVery good
c $so
o
tr Good
n20 trSatisfactory
I Poor
10
0
Response
When the marketingstaffs were asked to rate the information
about new services by HDFC Bank to customers, their responses were as
follows: 49 percent said they are excellent, 34 percent said it is very good, 9
percent said it is good, 6 percent said it is satisfactory and 2 percent said it is
poor.
The study also attempted to find out the awareness of customers
about changes in interest rates. To find out this marketing staff of HDFC
Bank were contacted and their responses are presented in following table
and graph.
q
362
ri
Ttble 7.17
Awareness in changes in charges of HDFC Bank
Sr.No Responses
I Excellent
a 2 ilV
3 ll Good
4 ll Satis
5 ll Poor
Total
Source Field Studv
Graph 7.15
Awareness about changes in charges of HDFC Bank.
50
40 IExcellent
o 30
I Very good
(J
L
(D
E Good
Or
20
E Satisfactory
10
IPoor
0
A
'4
363
The survey of marketing people was intended to find out the
satisfaction of customers form marketing staffs point of view. The
marketing staff was also asked to rate the HDFC Bank in terms of awareness
about changes in charges. 25 percent respondent said it is excellent, 39

percent said it is very good, 17 percent said it is good, 13 percent said it is

'.
Similarly the researcher attempted to find out the responses of
marketing staff about changes in interest rates, these responses have been
presented in the following table and presented in graph
364
o Marketing of Banking Service With Reference To ICICI Bank & HDFC Bank
Table 7.18
Awareness about changes in interest rates of HDFC Bank
Sr. No. Response
1 Excellent
Source: Field study
Graph 7.16
Information about changes in interest rates of HDFC Bank
f 60
50
ENExcellent
40
@Very good
30 E Good
E Satisfactory
20 IPoor
10
3
36s
The survey of marketing people also tries to find out the
satisfaction of customers from marketing staff s point of view, the marketing
staff also asked to rate the HDFC Bank in terms information about changes
in interest rates said: 9 percent said it is excellent, 28 percent said it is very
good, 48 percent said it is good, 11 percent said it is satisfactory and 4
percent said it is poor.
The researcher also attempted to find out the responses of
marketing staff about opening of new branches. These responses are shown
in following table and presented in graph.
Table 7.19
Awareness about opening of new branches of HDFC Bank
Sr. No. ll Response

1
1 ll Excellent
Source: Field Study
366
c
Graph 7.17
Awareness about oepning of new branches of HDFC Bank.
40
35
30
EExcellent
3 25
I Very good
g20
q)
E Good
E Satisfactory
15
I Poor
10
5
0
Response
The survey of marketing people also tries to find out about the
)
satisfaction of customers from marketing staffs point of view, the marketing
staff also asked to rate the HDFC Bank in terms information about opening
of new branches, 27 percent said it is excellent, 26 percent said it is very
good, 35 percent said it is good, 5 percent said it is satisfactory and7 percent
said it is poor.
Customer satisfaction is comprises of many factors such as
services, staff offering services, image of the bank , charges charged ,
communication undertaken bv bank with customers and last but not the least
a
367
o
, the way bank handles the customer complaints. To find out more about the
way HDFC Bank handles the complaints of customers marketing staff were
asked to respond about handling customer's complaints. Their responses are
put in following table and presented in graph 7.18
Table 7.20
A
Replay to customer complaints of HDFC Bank
Sr. No. Response
2 Very good
3 I Good
4 j Satisfactory
I
a 5
Source: Field Study
-
368
o
Graph 7.18
Reply to customer complaints of HDFC Bank
50
40 IExcellent
(D
30 I Very good
()
L E Good
c)
20 E Satisfactory
3
10 IPoor
0
Response
I
The survey of marketing personnel also tries to find out about
the satisfaction of customers from marketing staffs point of view, the
marketing staff'also asked to rate the HDFC Bank in terms of information
about reply to customers complaints, 12 percent said it is excellent, 6 percent
said it is very good, 45 percent said it is good, 16 percent said it is
satisfactory and 2l percent said it is poor. The number of marketing staff

replied it as poor is more i.e.21 percent. This is area where HDFC Bank
needs to concentrate to improvise the customer services.
7.5 Problems in Marketing of Banking Services.
Today, the biggest problem before banks is how to maintain
their existing customer base? And how to attract new customers? No
3
369
^
organization can survive if it is not dynamic in its approach. It cannot run
business without changing in some or the other form. If organization has to
survive, it has to adapt to the changing environment. This not only applies to
manufacturing industry, but also to all other sectors including banking. No
bank alone has the privilege to collect deposit from the public, because not
a only banks, but also private and public companies are directly collecting
large sum of deposit from public.
In the olden days banks were not aware of marketing of
banking services. The marketing concept in banking industry emerged in the
late fifties in the western countries. Banker's attitude and comprehension
about marketing profession changed dramatically in 1970. Marketing was
accepted as an organizational essential. Earlier marketing was recognized
with production industry only. However after nationalization of 14 major

)
commercial banks in 1969 the approach of banks towards customers
underwent a change and the focus was gradually shifted to marketing their
products. The state bank of India initiated the first major set-up in the
direction of marketing in 1972 when, it updated it self on the basis of major
market segments. However at the end of eighties and the beginning of the
nineties liberalization, deregulation, new entrants and severe competition
transformed the financial market towards professionalism. During this
370
period to withstand competition banks seriously began to adopt the

marketing concept and strategies like product development, market
concentration, and market development. The banking services have
undergone considerable change since 1991 and this trend looks to continue
with the ever-growing authority of banking products. In the changed
scenario, marketing has become pertinent to banking industry also because
of many factors such as profitability of banking business, need of innovative
product development, emergence of new range of banking services,
optimum use of vast banking infrastructure, better appreciation of long term
prospects, expanding world market, resources crunch and poor recovery.
Banks have to think of marketing their services not only in terms of their
deposit mobilization and related activities but also innovating new ways and
techniques. Banks could not only face an asset liability mismatch in the
)
coming days due to an over exposure in retail, the actual and final cost to the
bank from operations could actually be well over the low cost reflected in
the loan interest. Second will it trigger the kind of overspending and
subsequent defaults that some of the developed markets have had to deal
with Technology, new products and services have virnrally changed entire
banking experience in the country. Issues facing most Indian Banks recently
are:-
371
Marketing of Banking Service With Reference To ICICI Bank & HDF'C Bank
o
l. Enterprise risk management - Understanding new opportunities.
2. Existing IT System- Island of information
3. Human resources- Re-skill retain and reward.
4. Organization and structure- Hierarchical and slow tumaround time.
5. Existing process and procedures- Internally focused with manual
Workflow.
6. Customer retention and management- know your customers.
7. Transaction, processing and reconciliation - speed, control and security.

8. Brand building and management - Corporate, product, internal, external.ea
The Indian banking sector is faced with multiple and current challenges such
as increased competition, rising customer expectations and diminishing
customer loyalty. The banking industry is also changing at a phenomenal
speed. While at the one end we have millions of savers and investors who
)
still do not use bank, another segment continues to bank with physical
branch and at the other end of the spectrum the customers are becoming
familiar with ATM, E-banking and cashless economy. This shows the
immense potential for market expansion. With technology occupying a
pivotal role in delivery of banking services, the expectation of the customers
has also been growing. These expectations are
'o Rudhuk ishnan, Y., Managing Director SBI Mumbai, Banking in new millennium,
Proceedings of the bank Economists' conference 2000.
)
372
o
Swift services with minimal response time, efficient service delivery, tailor
made and value added product to suit specific needs, hassle free procedure
and minimum transaction cost and pleasant and personalized serviceses. Till
the reform process got underway banks competed more or less amongst
themselves, that too essentially for deposits and occasionally for good
advances. The first impact of the reform process has been the entry of a
number of new players. The services depend on the collaboration of the
customers and producers. The services, is highly labour intensive industry
cannot always be repeated with uniform quality. Service quality can vary
overtime, place and even from customer to customer. Last a given service is
consumed as it is produced. Hence a direct contact can be perquisite for
many services. Indian banks offered more or less identical services and
packaging became a significant differentiating factor.
" Kuppur*u*y, P.T., Chairman and CEO The Karur Vysya Bank.
a
373
n
7.6 Problems Associated with Marketing of ICICI Banking Seruices
In a vast country like India with its highly varying cultural

diversity, the needs of customers, spread across different geographical
locations are unique. Customer needs and their expectation from banks are
determined on the basis of factors like age, sex, proportion of population
employed, family size, number of young people in employment, economic
growth etc. There is also a difference in the level of literacy. The urban area
is dominated by industries and service sector whereas the rural areas are
being dominated by agricultural sector. All these factors have an affect on
the financial needs of the people. The banks have to undertake great deal of
research to find out the exact needs of the people and to design products and
services suitable to Indian conditions.

i
The researcher made an attempt to assess the satisfaction
among the marketing professionals with marketing of banking services of
ICICI Bank by asking responses which has been put in the table 7.21 and
graph7.I9
374
o
Table 7.21
Satisfaction with Marketing of ICICI Bank Services
I Yes 94
2 No 6
o
Total 100
Source : Field Study
draph 7.19
Satisfaction wiht Marketing of ICICI Bank Services

to)
100
80
60
)
40
20
Before evaluating the problem faced by ICICI Bank marketing
staff, the researcher felt it was necessary to find out their satisfaction level
while marketing the ICICI Bank services. It was clear that 94 percent
c
375
o
marketing staff was satisfied with the marketing of ICICI Banking services
whereas 6 percent marketing staff not satisfied with the marketing of ICICI
Bank services.
The marketing professionals of ICICI Bank were probed further
to find out whether they are facing any problems while marketing the ICICI
O Bank services. Their responses with this regards are mentioned in the
following table 7.22 and graph7.20
Table 7.22
Problems in marketing of ICICI Bank services
t. *"_ll *"'o*'. eercent

illl
I 2lffif
All the time 5
n--__-l
I
3 Sometime 76
4 Never 8
Total 100
Source: Field Study
l
376
o
Graph 7.20
Problem in Marketing of ICICI Bank Services
q)
at
o
c gt
€) lNever
I
ESometimes
EMost of the time
40 IAll The the time
Pertent
The marketing staff of ICICI Bank faces problem while
marketing of banking services. The researcher tried to analyze the problems
faced by ICICI Bank marketing staff. Their responses are as follows:
a) 5 percent of the marketing staff has problems in marketing the banking
Services of ICICI Bank all the times.
b) 11 percent of the marketing staff has problem in marketing the banking
Services of ICICI Bank most of the times.
c) 75 percent of the marketing staff has problems in marketing the banking
Services of ICICI Bank only sometimes.
d) 8 percent of the marketing staff never had the problems in marketing the
i
377
o
Banking services of ICICI Bank
From the above findings we can conclude that he marketing
staff, which includes direct sales associates, marketing executives, marketing
managers (75%) of ICICI Bank face problems in marketing of banking
services only sometimes. Whereas we can say that around 16 percent
marketing staff face problems in marketing ICICI Bank services either all
C
the times of most of the times. But this percent is negligible we can say that
ICICI Bank marketing staff does not face marketing problems all the times.
As per the responses of marketing staff it is clear that they face
problems in marketing the banking services of ICICI Bank. The researcher
wanted to find out the reasons for the marketing problems faced by
marketing staff. These problems as replied by the marketing staff are put in
)
the following table and graph.
378
o
Trble 7.23
Reasons for problems in marketing of ICICI Bank
Banking staff
Source: Field Study
) Diagram 7.1
IBanking product
I Marketing stategies
E Service charges
E Banking staff
I Others
a
379
o
From above data it is observed that the marketing problems
faced by marketing staff is related to banking products 9 percent, marketing
strategies 10 percent, Service charges 63 percent, banking staff 10 percent
and other 8 percent. Thus the researcher has concluded that major reason for
the marketing problem is service charges. Whenever the marketing
executive approaches the existing customer for any new schemes, the first
reason they complained about is service charges charged by the ICICI Bank.
The reasons which emerged from the survey for marketing
problems are service charges, banking staff, banking products, marketing
strategies. The researcher wanted to probe funher to find out the intensity of
each problems faced by marketing staff. The frequency of problems faced by
marketing staff about the product is presented in following table.
Table7.23
Intensity of Problem related to Product of ICICI Bank.
Responses
Most of the time
^
380
o
DiagramT.2
lAll the tme

EMost of the time
ISome time
ENever
The researcher wanted to find out the frequency of the reasons,
which are faced by the -urkrJing persons while marketing the banking
services of ICICI Bank. To probe further all the respondents were asked to
tick mark the frequency. It was observed that out of 100 respondents only 1
percent said that they face problems related to products i.e. schemes all the
times, 5 percent of the respondents said they face problem related to
products most of the times, and 33 percent respondents said they face
problems related to products sometimes and finally 61 percent said they
never faced problem related to products of the ICICI Bank. ICICI Bank has
strong fundamentals in its schemes, because the customers as well as

marketing staff have responded very strongly about its schemes.
The following table gives the details of frequency of marketing
strategies as a problem in marketing of ICICI Bank services.

t
381
o
Table 7.25
Frequency of Problem related to Marketing Strategies of ICICI Bank
All the time
Most of the time
Source: Field Studv
Figure 7.1
Fhequency of prcblems related to marketing strategies.
The frequency about problems of marketing strategy faced by
marketing staff of ICICI Bank is as follows around 3 percent respondents
^
382
Manketing cf Sanking $emiee With Referenee T* {CXCtr Ennk & XI}FC Snnk
&el tllat they have n:arketing problems all the time abeiut marketing
strategies adopted by {e{Cf Rank, around E pereent said thnt marketing
strategies affeet them tq: cmnvinee the custnmer mcst erf tl:re tirnes. And 37
pereenl m;irketing stafY said th*t scmetimes they fuee problems in
eonvineing the eustermers beeaus* of the marketing stratcgies ad*pted by
xe{Cl Sank. Fina}ly 52 pereent field staff said t}:ey had the problerx beenuse
qlf tl'!e rn*rleeting stnategies *f {fletr Bank. This shows that aetualtry }e}el
Bank's marketing strategles are eustermer frienclly and rnarket frienelly.
{ClC{ Rank, seleet marketing strategies aiter studying eompetitor, marlqet
anel erestorners"
Tai:le 7.2$ sherws the resp*nses o{ markeling staff abollt prcblems fa*ed by
them relateei t* service sharges"
383
o
Ttble 7.26
Frequency of problem related to service charges of ICICI Bank
Most of the time
Source: Field Study
Diagram 7.3
IAll the tme

EMost of the time
I Some time
ENever
The respondents were asked to put down the frequency at which
they face problems in marketing ICICI Bank's services to customers because
of service charges. The results are quite eye opening because only 8 percent
3
384
&{arXrcting of E*mki:rg Senviee With Refe}"ence Y* nCnCI Kank & H$SC &anlE
hslve replied that tl:ey never had problems beeause cf service el"larges,
rvhereas rxost other had replled that they had preblems 4 pereent said they
have prnhlem all the time, 4l pereent st:me times and 4? pereent m*st erf tl:e
tirnes" it emerging frem the above sludy that the major problei:r marketing
staff faee while marketing their serviees is serviee eharges eharged }:y {ete{
Bar:k.
Similarly, the researeher tried to llnel out th* frequ€mey *f probtrems related
to banking staff, by {C{eI Sank r:narketing staff" Their respCInses &}e
presented in table 7.27 and graph 7"21
Tab[e ?"?7
Frequeney of l\{ark*ting Frobler"n relateei to staffof ICICI Bank
m Respeinse
rj
T-t***l
tl
All ths time
Most of tlle tirne
rj
r:
Sslmetime
I: $ouree: Fielet Study
385
o
Grtph 7.21
Frequency of Problems related to staff of CCI Bank
70
60
50 I All the tme
q) 40 I Most of the time
I
L
c)
Fr
30 tr Some time
c 20 E Never
10
0
When, the researcher probed marketing staff about banking
staff as reason for marketing problems. The replies given by the staff has
been grouped a,s follows; 2 percent have problem all the times, 1l percent
have problems most of the times, 69 percent have problems sometimes and
only 18 percent never had problems because of the staff of the ICICI Bank.
As per the study conducted for the customer the major reason that emerged
for their dissatisfaction is bank staff. The same problem cannot be ruled out
about marketing staff also after seeing their responses.
7.7 Problems Associated with Marketing of HDFC Banking Services
HDFC Bank is one of the successful private sector banks is providing
innovative services to its customer. It applies all the modern methods to

f
386
o
provide services with prompt product delivery. The customers of HDFC
Bank are also satisfied with the way bank markets its products, bank
communicates with its customers and bank handle the customers. One aspect
of HDFC Bank remains to be studied and that is marketing aspect. To study
marketing aspect of HDFC Bank it was felt necessary to study the problems
faced by theses private sector banks.

^
The researcher made an attempt to assess the satisfaction
among the marketing professionals with marketing of banking services of
HDFC Bank by asking responses which has been put in the table 7.28 and
graph 7 .21
Table 7.28
Satisfaction with marketing of HDFC Bank services
Source: Field Study
^
387
o
Graph 7.22
Satisfiction with Marketing ofHDFC Bank services
120
100
80
q)
9 60
L
€)
o 40
20
0
Response
Along with the customers of HDFC Bank the marketing staff
who are directly involved with the marketing of HDFC Bank schemes are
surveyed for the purpose of study. It is found that 98 percent of the

)
marketing personnel satisfied with the marketing of HDFC Bank are
marketing services. Only 2 percent are not satisfied with the HDFC Bank's
marketing services.
After, finding out the satisfaction of marketing staff, while
marketing HDFC Bank services. The researcher wanted to find out whether
the marketing staff faces any problems in marketing the banking services.
To find out this the researcher asked questions related to marketing problems
o
388
o
to the marketing staff. Their responses are listed in following table and same
is presented in graph7.23
Table 7.29
Problems in marketing of HDFC Bank services
o
All the time
Most of the time

,
Sometime
Source: Field Study
Graph 7.23
hroblerm in Marheting of HDFC Bank Seryices
I Never
(l)
eh
tr Sonrctinres
tr Most of the tirre
a
tt
o)
t4.
I All The the time
3
389
&{*rketing of'E*lnkixrg Serviee Wlth R.*f'eremec To XeICX $ank & HX}FC Banla
The marketing personncl asked to list down the problerns faced
by thern whitre marketing HnFe Bank seruiees the findings, Rre as {i'rileiws:
a) 6 Bercent of tl:e marketing staff &eed problems in marketing the banking
serviees cf K&Fe Eank all t}:re times.
b) 4 pereent eif the rnarketing stafThad prcblem in marketing the banking
senviees of filFC $ank mCIst CIf the ti:n*s"
*) S5 perc*nt of the marketing staff had problen:s in rnarketing the banking
serviees of F{SFC Eank only solr}ctimes.
d) 5 percent of the rnarketing stafr never l"rad the problems in marketing ttrre
banking serviees clt H$FC Bank
Fron: the abcve findings the researeher has serneluded that the
rnarketing staff, whieh inenueles dircei sales assq:eiates, marketing exeeutives,
anetr marketing managers ef F{SFC Bank, faees prohlems in rnarketing of
banking serviees only scmetimes, 1{} pereent relarketing staff fbee pnoblems
in marketing {{OFe Eank serviees either all the times or most *f t}re times.
But this percent is negligible therefore I:lSFe Eank marketing stafF eloes neit
faee ntarketing problerns ail the tin:es"
The marketing personnel faeed problems while n:arketing
$npe Sank senriees" The researeh*r wanted to find cut the reasons feir sueh
390
o
problems. The reasons for which HDFC Bank marketing staff faces the
problems are listed in the following table 7.30 and Figure 7.4
Table 7.30
Reasons for Marketing Problems of HDFC Bank
Sr. No. Reasons Percent
o I Banking product 8
2 Marketing strategies t2
3 Servicg charges 55
4 Banking stays 20
5 Others 5
Total 100
Source: Field Studv

3
Dirgrtm 7.4
IBanking product
IMarketing stategies
E Service Charges
EBanking staff
I Others
o
391
&Ianleeting erf Kxxkimg Serviee With Reference To IC{CI K*n[< & XSSC SaxrXc
The ab*v* tabie anel figure givcs us an idea about the reasons cf
marketing probler::ls &ced by n:arketing stafX Thc re&scn given by
manketing staff as banking preiduet is Spereent , marketing strategies 12
pereent, Serviee eharges 55 peneent, banking staf,f, 20 pereent and clther 5
n:ercent. l["he {inelings e*nelude that major reasCIn fcr the marketing probiem
is ser"r.'iee eharges fullcwed by staff at 20 pereent whcnever the marketing
executive apprerael'les the existing eustelmer ferr any new sehemes, the first
reason the3i eomplained about is serviee eharges eharged by the HDFC
&ank. Feople also eerrnplained about staff at their eaXl eenters.
The rnarketing personnel of HnFe Eank had prcblen:s related
tc produeis. But unless the intensity of probl*m &eed by rnarketing staff ,
the researeher wnutrd net be in a pasition to eome to any eonclusion so the
respCInses of marketing staff about frequeney of markcting problem abelut
Broduet are iisted in the fcllowing table"
3??
o
Table 7.31
Frequency of problem Related to Products of HDFC Bank
All the time
Most of the time
Source: Field Study
Diagram 7.5
3
IAlt the tme
HMost of the time
I Some time
INever
It was found that out of 100 respondents only 2 percent had
products i.e. schemes all the times, 3 percent of the respondents faced
problem related to products most of the times, 20 percent respondents said
o
393
&{*rleeting of Rxxr}ring $ex'viee &1itk Ref,cre*ce Ter }etrCX Eank & K$FC $an}c
they face problerns related tCI produets soi"netimes and finally 74 perce:rt said
th*y never hael Broblem rclated t* prcduets t:f the F$)FC Bank. Thus it is
ssneluded by the res*are]:er that {-{nF'C }3ank strarng fundamentals in its
prcduets ancl sstrrernes, beealrse the eustclmers as well as marketing staff trrave
resp*nded v*ny strongly aberut its produets.
The f,requenay cf rnarketing pr*blem faeed by marketing staff
ab*eit rnarketing strategies adnpted by F{n}Fe Sank is listed deiwn in t}re
followins tabtre"
T'nhle ?.33
rT:mm
Iirequeney *f Fr*}:lem Related to &{arketing Strategies cf Htr}Fe Eank
t_l:mL:l
r:mr:l
t_:ruL5
L:::]ML5
Llm15 Scuree: llleld Study
3?4
c
Graph 7.24
r Al the frne
I ltlostof the time
ISome time
I Never
The frequency abouj problems of marketing strategy faced by
marketing staff of HDFC Bank is as follows: 2 percent respondents feel that
they faced marketing problems all the time about marketing strategies
adopted by HDFC Bank, around 2 percent faced the problems in marketing

J
of banking services because of marketing strategies adopted by HDFC Bank,

3 most of the times. And l6 percent marketing staff feels that sometimes they
face problems in convincing the customers because of the marketing

strategies adopted by HDFC Bank. Finally 80 percent field staff never had
the problem because of the marketing strategies of HDFC Bank. This shows
that actually HDFC Bank's marketing strategies are customer and market
related. HDFC Bank, select marketing strategies after studying competitor,
market and customers.
c
39s
o
When the researcher was conducting customer survey about
reasons for dissatisfaction of the services of HDFC Bank, the major reason
which emerged was service charge. In case of marketing staff survey, there
are also charges as a reason for marketing problem. This problem can be
evaluated form the table below
o Table 7.33
Frequency of Problems Related to Service Charges of HDFC Bank
Reryonse
All the time

Most of the time
Never
) Sotuce: Field Study
Diagram : 7.6
IAll the tme

EMost of the time
I Some time
ENever
o
396
&{xrketing of Sanking Servi*e With R.eferenee T'o ienCl Sank & KSSC K*nk
The resperndents were asked to put dowr: the f:equeney at rvhiel:
they faec prerblcms in marketing H$Fe Bank's serviees ter eust*tners

beeause of serviee eharges" The fullCIwing rvas the result :5 pereent have
replicd that they never had problems beeause erf serviee eharges, whereas
mq:st other had rcplied that tl"rey had prcbiems 45 pereent all the time, 2S
pereent sCIine times anei 30 pereent m*st of the times. Thus it is e*neluded by
the researeher tl:at the ma"]cr re&son f*r r"nanketing problem is senriee ehanges
eharged by I{I}FC Bank"
The fbllowing table gives the frequer:ey e"rf problern fa*ed by
n"rarketing staff about banking stafY.
Table ?.34
Frequency of Prclblem Related To Sanking Staff of F{DFC Eank
Response I Fereent
All the tirne 25
i,1
l\,{ost *f t}re time '
a
rn
S*rnetime
,
:
A
J
i
l
l
Total
Souree: Field Study
3E7
o
Graph 7.25
Frequency ofProblem ficed by nnrketig staffofHDFc Bank abotfr

Banlcing Staf
40
30
I Allthe tme
c
q)
q)
L
(D
20 I Most of the tire
er tr Some tirre
10 E Never
0
I
When marketing staff of HDFC Bank asked to give banking
staff as a reason for marketing of banking services, the replies are as
follows: 25 percent faced problem all the times, 33 percent had problems
most of the tim'es, 39 percent had problems sometimes and only 3 percent
) never had problems because of the staff of the HDFC Bank.
As per customer's survey conducted by researcher the major reason was
banking staff, the same reason has emerged out of marketing staffs survey.
The major question remains whether all these problems affect
the marketing staff in convincing the customer about other products. We can
see from above table that only lpercent feel that they have problem in
convincing the customers all the times because of all these problems stated
above, 36percent have problems most of the time and 5lpercent have
o
398
Mar}<efing cl'Eanking Senviae \&iith R.efer€nee T* trCnCI Bank & HSfe Baxrk
problerns s*me tirnes end 12 pereent never have prcblems because *f all
tl:rese reason to e*nvinee ttre eus{orners.
7.8 Comparison of foIarketing of ICICI Bank and HDFC Bank
For studying the responses nf the field staff of HIIFC Eank
and {e{e{ Bar:k who are invo}ved in the aetual irxplem*ntaticn of marketing
pnlieies, marketing exeeutives' direet sales assoeiates were eeinta*ted to find
qlut their responses. The rcsperndents inelude 7{i pereent marketing
exeeutives 28 pereent direet sales assoeiates and 2 percent ineluded cthcrs
for $OFC Eank and 55 pereent marketing exeeutives 39 percent direet sales
assoeiates and 6 pereent ineluded others fur ICICI Bank. The marketing staff
elf HIIFC Kanlc and {etrC1 Eank asked ts} rate the serviees of bot}r t}re banks
in terms q:f, innCIvative nature. H$FC &ank rnarketing staff seems to be mCIre
pesitiv* about the innovative nature clf banking seruiees by XIIFe Rank at
93 pcreent whereas in ease of IeICI Eank the pereentage is E3 pereent. trn
terms of negative response for ttrre innovative nature 12 pereent IeIeI Kar:k
marketing empleryees saiel it is not inn*vative and 4 pereent cf Ktr]FC Eank
n:arketing stafY said the serviees are ne:l inneivative.
399
&{*rketing of Snnking $ewice With Refe!'enee To ICXCI Saxrk & Kl}P'e $erm}<
In *ompnrison tei other private sectCIr banks iCIC{ Eank is better in ternxs of
eustomer satis&etion at 79.6 pereent and HSFC Bank at 6X pereent" {t ls
eoneiuded that in tems of eustermer satisfuetion {eIe{ Eank ranks first

emong ali the private sector banks at 7S.6 pereent as per the rating cf Xelel
Rank marketing slatTand F{SFe Eank markc{ing staff" Only lE.4 pereent *f
ncfel Eank n:ark*ting staff differs i:l :rb*ve opinion cf their enileagues and
they {be} that trCfe{ Sank is the s&me as other private seetor bnnks t}rere is
ncl eiifkrence between new generati*n private seetor banks and {elC{ Bank.
In ease of HtrFC banks 35 percent marketing statTfeetr strongly that there is
nc diffbrenee in the priv*t* seetor banks; HnFe Sank is same as either
privnte seetcr banks" On tl':c *tLrer hanel 2 percent iCICi Bank employees are
negative about banks sezuices and they said Ie{C{ Bank's serviees are not ns
g*od as *ther privat* seet*r banks" HnFe Bank employees eeny out same
*pinien at 4 percent.
?. $ Csnelusion
The attempt made by researeher to find arut. respon$cs sf

n:arketing staff *f IC{C{ Sank and X$}le Sank about t}re satisfaetieir: of
eust*mers es pereeived by marketing staff was sueeessful" It was quite
&uitfl"rl attempt in tenns *f understanding eustorner satisfaetion, marketing
4.0i)
Marketing of Sanking $er-vice With R.eferexee Tc ICICI llank & HSPC S*mle
*f banking serviees of both the banks, ttre problems faced by marketing staff
ab*ut marketing the serviees, tr"easons for such prcblems, ctc.
The marketing stnffs were surveyed by way e:f questicnnaires to
flnd cu{ t}:eir viernrs about er.lst*mcn sntisfaetion" T}re marketing stafft
inelueied marketing exeeutives, marketing manager, sales executives,
e*unail*rs with nSA {Sireet Sales Assc}eistesi, field stalY" The experienee eif
these marketing pens*nnel rnras between S months to 5 years and above"
The et:nelusicn ef the rnarketing staffs survey is as finllerws: ICICI Sank's
rnarkeling staffs 83 pereent of thern feel that IeIeI Bank serviees are
imrovative" About nwarencss of serviees provided by IeIe{ Rank, 58 pereent
**m the totai sample respelndents rvere &w&re of ali the serviees prcvided. ln
ease of informatiqln aberut new serviees, rnost of thc respondents were found
positive nbout it. As fur as &wareness *f ehanges in eharges is esneemed ?5
pereent of the total respondents were persitive about awareness *f th*
el:arg*s. F*r ehanges in interest r*tesu 77 pereent of ttrre total respnndents fbel
that fetre{ Bank aiways infonns t}rem about sue}r e}ranges in advanee.
Spening erf ner,v branehes is enneerned E3 pereent of the total respcndents
were positive abcut it. As far as reply to eustomer eermplaint is eoneerx, it is
fclund that 58 pereent resp*neients, said it is satisfuetary CIr pCIor, where as 42
pereent said exeellent, good and very gemd. Arour:d E2 pereent responefents
40t
&{nrketing of &*mXcixrg Sewiee With Refer&mce To {eIeI Sank & K$$"C &an[*
were not hapBy with ttr1e banking staff. This elearly sheiws tl:nt XCIC{ Bank
needs to eonecntrate *n redressnl *f eustq:mer eomplaints and banking staf{-
Anottrer rs&ssns whieh w&s em€rged **m the e*st*ners survey erf IetC{
Kank, is tire serviee charges eharged by ICICX Bank" The eust*mers as well
as rnarketing staff fbel that it is very liigh"
$imilarly this suwey was also condueted ern marketing staff of
!"{nFe Eank tei finel sut the resp$nses erf marketing staff about eustomer
satisfoction a:lql marketing statYs satisfuetion while marketing the services
c)f HSFC Bank"
Abcut reply t* eustomer's eornplaints cnly 63 pereent
respondents w*re positive" As far as innovative serviees of HnFe Ka:rk is
enneerxed nimost 93 percent respondents were pcsitive" The researeher
wanted tn flnd cut the &w*reness c"!f eustomers about new serviees, opening
ot" branehes* ehanges in interest rates, reply tq: euston:er eon:plaints et*. It
was nbserved by the researeh*r that in all the abcve eeses exeept reply to
sustomer enmplalnts more than ES pereent respondents were positive.
nelel Bnnk and ISFC Rank, b*th market their produets in very innnvative
ways! eustomers are satisfied with the wa5' both these banks market tireir
servie*s. Sut {}"lese l:anles alsc faee ee:tair: prablem while marketing t}re
402
Mar!*eting of Sanhi:rg Senviae Wiflr ld.efcrenee To nCXCi Snnk & KIS'C Xnxk
serl/iees. The maj*r problems whieh emerged frcr:n the study anc high
eharges, banking staff ar:d reply {er eustomer eomp}aints. Rank s}rauld
ecne*:rtrate E:n these three faetors whieh are ereating eXissatisfbetiein emong
custeimers as well as marketinE staff"
403

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o

Chapter: 7 Marketing of banking services with Reference to

7.8 Comparison of Marketing of ICICI Bank and HDFC Bank.

Marketing Of Banking Service With Reference To ICICI Bank &

relating to banking services in India. The marketing concept in banking

"advertising and promotion" concept. Banker's outlook and notion about

marketing profession changed considerably in 1970. Marketing was

accepted as an organizational imperative. In India the marketing concept in

technology in banking sector.

Gradually, the banks started advertising and efforts were made

by branch managers to increase the deposit, sometimes even by moving in

the fields. Due to severe competition, it became difficult to attract new

customers with advertising only, so banks started other promotional

C By 1974, the environment became more serious and during this

period the bank, picked up the idea of 'marketing'. A few marketing

diverse market segments.

In banking services, there is a very little scope for innovation of

f banking products. Due to sever competition, the banks started adding,

innovative services to their products to differentiate the same from the

competitors. Developing new product, especially when the environment is

regulated was a difficult task. Though product development or innovation of

financial product requires very little or no additional investrnent, the flipside

be copied immediately. So there was a need of constant change. ICICI Bank

Marketing has increase significantly in banking sector in India,

because of a number of market-correlated developments that had taken place

o in the recent years. Banks have become are important financial

transfer, collection of bills, sale and purchase of foreign exchange, safe

custody and safe deposit vault, guarantee facilities, sale of travelers'

efforts to increase deposit mobilization.

The three most important features of the Indian Economy has

experienced in the 20th century, was as follows:8e

through branch network.

il) The eighties, as the decade of capital market.

entrepreneur in a fair way.

The development of a sophisticated and matured financial

of an articulate financial services sector. Financial service sector gained

institutions and regulatory agencies have transformed the Indian financial

services sector from being a conservative industry to a very dynamic one. In

provided by the non-banking financial companies. Although some of these

services in India are at emerging stage, they infact represent the

After nationalization of 14 commercial banks in 1969, the

services of public sector banks started degrading in quality of customer

developing and adopting themselves in such an environment with greater

public sector commercial banks. Though the restrictions put by RBI

demotivated private sector banks, they were successful in operating their

business in banking sector. This success of private sector banks can be

success of marketing of services in bank. This appears to be the answer to

e Application of marketing principles to bank marketing is the need of the

will be able to survive and grow in the current competitive environment.

7.2 Application of Marketing in Banking Services.

The term service can be defined as "A service is an activity or

provider, which are provided as solution to customer problems"e0 According

to the above definition, followingare the main Features of the services:

o Services are by and large "activities" or they are series of activities

rather than things.

As a result, the services are intangible

e o Provider, which means that service are produced and consumed

o Customer has a role to play in the production process as the services

are provided in response to problems of customers as solution.el