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7ps of services marketing in banking industry

People are the employees that are the service providers. In a banking sector, the service provider plays a very important and determinant role in rendering the customers a satisfactory and a good service.

It is extremely essential that the service provider understand what his customers expect from him. In the banking sector, the customer needs to be guided in a lot of matters, which is possible only with the help of the service provider. The position in the eyes of the customer will be perceived by appearance, attitude and behavior of the customer contact employees. It is very necessary that the process is very customer friendly. In other words a process should be such that the customer is easily able to understand and easy to follow.

Today if particular banks formalities are long and the procedure very complicated the overall process fails and the customer may not be inclined towards using that banks services. Process can be broadly classified into to parts Deposit and advances Ancillary Services Deposits and Advances: In this part customer transactions are considered whether it is cash deposit, check deposit, cash withdrawal, draft making, fixed deposit, recurring deposit.

All these are the part of recurring deposits. In general we can say that monetary transaction is the part of deposits and advances. According to 1949 banking services act sub section 6, ancillary services were introduced in the banking sector. In this part bill of exchange, promissory notes, business guarantee given by bank on behalf of an individual to company or country. We can say that non monetary policies are the part of ancillary services and this part is very important part of banking sector because it deals with the sensitive issue 7ps of services marketing in banking industry verifying and giving approval to somebody to do business on the guarantee of bank.

Physical evidence refers to all those factors that help make the process much easier and smoother. It is very necessary that the place be designed in such a manner so as to ensure maximum convenience to the customer and cause no confusion to him.

Let us see an example as to how banks try to make little changes so as to make the service better for their customers. Each of them plays a very important and a pivotal role in determining the quality of the service provided to the customer.

This customer orientation can be facilitated by 7ps of services marketing in banking industry and implementing CRM systems. CRM is an advancement of relationship marketing, now involving concepts of the overall marketing concept, total quality management, internal marketing, customer care, and relationship marketing.

CRM concepts have to be realized within an organization in order to be successful with its external customers.

Further, the main focus of CRM is the employees, which eventually achieve relationships with customers, turning a CRM program into success. A successful CRM program is only possible when the attention is equally divided towards customers and employees. Internal marketing and relationship marketing are identified to be able to achieve a better internal and external business environment, making them a matter of differentiation.

Such software can be used to gather data from separate systems or units and provide an overall picture of customers and their relationship with the organization.

Overall marketing concept In terms of the CRM concept, the overall marketing approach as how a bank defines marketing for itself and what the broad goal of the resulting orientation is. Internal Marketing IM The concept of internal marketing refers to a marketing approach within an organization, aimed at employees. Internal marketing can be defined as a heavy investment in employee quality performance. Internal marketing is a process where the overall principles of marketing are applied within the company in order to become customer focused to the highest possible extent.

Total Quality Management Total Quality Management TQM as an organizational approach, aims to continuously improve the quality of all processes in an organization, products and services.

Relationship Marketing An approach to identify individual customers, to create a relationship between the company and its customers that lasts over many transactions; and to manage that relationship to the benefit of the customers and the company.

Relationship marketing is a management process engaging in a triangular relationship between marketing, quality and customer service.

7 P’s of Banking Sector Paper

These three elements are interrelated and serve each other. Furthermore, relationship marketing focuses especially on the retention of customers, establishing a long-term orientation focusing on customer service. Services, being the fastest growing segment of the economy, provide for additional challenges and opportunities.

Concerning the service marketing field, some additional factors can be introduced. In order to develop service quality: People, Presentation and Process are to be considered also in financial service marketing Process Process is the way to deliver the service, focusing on ensuring availability and uniform quality provided.

It will decide how customers will get their needs met in the system. For example, earlier in the banking industry, the customers were waiting in separate lines for each teller. Deutsch 1990 proposed that a single waiting line for multiples tellers is the most common way of process.

The study of Gerstner 2002 presents the branch network of banks consisting of diverse entities, where branches have own micro markets influenced by demographic and economic history. Gerstner 2002 argues that expecting identical sales and performance levels leads some branches to follow goals that are not aligned with their markets, which in return leads to underachievement of these branches. However, even if the theory claims that the process is an important factor of differentiation in the service industry, it appears that in the Indian banking industry this is not a valid criterion.

Indeed, Stefan Nyrinder declared that SEB does not consider the process as a decisive factor to differentiate. Presentation or Physical evidence The presentation is important for banks; since people will develop an according image and style for the bank. If a bank, for example, wants to have the image of a user-friendly bank, its interior will look somewhat like a living room, with sofas, plants, and smiling employees.

On the other hand, if a bank wants to have a hi-tech and efficient image, the interior will show a lot of computers and latest technology as well as hard working and busy employees. The exterior design can be utilized to communicate e.

The use of color in combination with texture and finishes is identified to be a simple but very effective factor of differentiation, helping to convey particular messages to the customer and creating a special atmosphere affecting employees and customers likewise. Two types of graphics can be used to establish identity, marketing graphics and branding graphics.

While marketing graphics promote products and services, branding graphics enhance brand image and should be used complementary with all marketing activities. Kotler claims, banks have to communicate an image of safety through e. People 7ps of services marketing in banking industry the service industries, people are of utmost importance. The service provider is one of the most crucial parts in the provision of services, being for example friendly, knowledgeable and professional.

The marketers of the services must select, train and motivate their frontline people. Proper training can make a big difference in the customer satisfaction. Service marketing requires not only external marketing, but also internal and interactive marketing.

For Foss and Stone people in the banking area, and in the service industry in general, are the most important aspect. This is also reinforced by the service marketing triangle. Management has the task to check, encourage and reward employees for building relationships and checking if the customers are satisfied.

As a conclusion, it appears that numerous authors accredit a very important role to people in the differentiation approach. People also have a key part in the general strategy of the bank. An extended CRM model The elements people, the presentation and the process can be considered as a part of the CRM concept as shown before. The authors will thus propose a new model which is considered to be more relevant for a differentiation purpose.

The extended model of CRM consists of three aspects. People, as mentioned before, are targeted by and interact in the IM, TQM, relationship marketing and customer care. Since employees and customers are present in all these four elements, the authors of this thesis decided to include them in one section. Kotler identifies service quality as a key to competitive success. Offering a high quality service is thus a way to differentiate from the competitors.

Moreover, there is an increasing competition in the service area, and in such environment, firms need to differentiate. Service quality strategy, for example a service quality management program, to differentiate.

Moreover, service quality is one of the major values expected by the customers. We focus on the service quality, as a way to differentiate, in their model. The extended CRM model proposed, introduces four factors contributing to increase the service quality: The aim of the Internal Marketing is to increase the quality 7ps of services marketing in banking industry the services offered by the firm.

The relationship marketing, consists of building a high value, loyal, lifetime relationship. It is also a competitive tool. The core nature of the relationship obliges the firm to improve its service quality. Indeed, keeping the customer loyal or building a long term relation provokes a high service quality. Reducing the loss of customers, attracting new customers and improving customers and employees satisfaction are three of the aims of the customer care. A consequence of these aims is an improved service quality.

As a result, the authors of the thesis consider internal marketing, TQM, relationship marketing and customer care as subprograms allowing service quality. Therefore service quality is the major objective also in a CRM concept. All parts dealing with the internal marketing, customer care, relationship marketing and TQM are considered as primary differentiation tools.

They allow for proposing a good service quality which is the major way of differentiation for banks Presentation and Process are not considered by as important as the people aspect.

They will then be presented accordingly as secondary tools of differentiation. Conclusion The human element is a major factor of differentiation. As a consequence, a people-based marketing approach has been identified by the authors to be relevant for this study: There are different factors influencing the basic CRM concept: The way and to which extent service companies approach and deal with these concepts will eventually create unique organizations that stand out from their competitors.

Kotlerespecially adapted for the service area: Process, Presentation and People. Existing theory from established researchers does not provide for achieving truly outstanding characteristics for a retail bank. The reason for this may be found in the general image of a bank representing trust and a sense of seriousness. Airlines Southwest Airlines for example or restaurants McDonalds can contain an image 7ps of services marketing in banking industry fun and still operate profitable, thereby being very different than their respective competitors.

The number of banks differentiating to such extents can be estimated to be rather small. Banks differentiate within smaller dimensions, being able to retain an image of trustworthiness and seriousness.