M.D.

COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

INTRODUCTION OF MARKETING
Marketing is the process of performing market research, selling products and/or services to customers and promoting them via advertising to further enhance sales. It generates the strategy that underlies sales techniques, business communication, and business developments. It is an integrated process through which companies build strong customer relationships and create value for their customers and for themselves. Marketing is used to identify the customer, to satisfy the customer, and to keep the customer. With the customer as the focus of its activities, it can be concluded that marketing management is one of the major components of business management. Marketing evolved to meet the stasis in developing new markets caused by mature markets and overcapacities in the last 2-3 centuries.The adoption of marketing strategies requires businesses to shift their focus from production to the perceived needs and wants of their customers as the means of staying profitable. The term marketing concept holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions. It proposes that in order to satisfy its organizational objectives, an organization should anticipate the needs and wants of consumers and satisfy these more effectively than competitors.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

MEANING OF DIRECT MARKETING

Direct marketing is a form of advertising that reaches its audience without using traditional formal channels of advertising, such as TV, newspapers or radio. Businesses communicate straight to the consumer with advertising techniques such as fliers, catalogue distribution, promotional letters, and street advertising. Direct Advertising is a sub-discipline and type of marketing. There are two main definitional characteristics which distinguish it from other types of marketing. The first is that it sends its message directly to consumers, without the use of intervening commercial communication media. The second characteristic is the core principle of successful Advertising driving a specific "call to action." This aspect of direct marketing involves an emphasis on trackable, measurable, positive responses from consumers (known simply as "response" in the industry) regardless of medium. If the advertisement asks the prospect to take a specific action, for instance call a free phone number or visit a Web site, then the effort is considered to be direct response advertising. Direct marketing is predominantly used by small to medium-size enterprises with limited advertising budgets that do not have a wellrecognized brand message. A well-executed direct advertising campaign can offer a positive return on investment as the message is not hidden with overcomplicated branding. Instead, direct advertising is straight to the point; offers a product, service, or event; and explains how to get the offered product, service, or event.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Benefits and drawbacks

Direct marketing is attractive to many marketers, because in many cases its positive effect (but not negative results) can be measured directly. For example, if a marketer sends out 1,000 solicitations by mail, and 100 respond to the promotion, the marketer can say with confidence that campaign led directly to 10% direct responses. The number of recipients who are offended by junk mail/spam, however, is not easily measured. By contrast, measurement of other media must often be indirect, since there is no direct response from a consumer. Measurement of results, a fundamental element in successful direct marketing, is explored in greater detail elsewhere in this article. The Internet has made it easier for marketing managers to measure the results of a campaign. This is often achieved by using a specific Web site landing page directly relating to the promotional material, a call to action will ask the consumer to visit the landing page, and the effectiveness of the campaign can be measured by taking the number of promotional messages distributed (e.g., 1,000) and dividing it by the number of responses (people visiting the unique Web site page). Another way to measure the results is to compare the projected sales for a given term with the actual sales after a direct advertising campaign. While many marketers recognize the financial benefits of increasing targeted awareness, some direct marketing efforts using particular media have been criticized for generating unwanted solicitations, not due to the method of communication but because of poorly compiled demographic databases, advertisers do not wish to waste money on communicating with consumers not interested in their products. For example, direct mail that is irrelevant to the recipient is considered "junk mail," and unwanted e-mail messages are considered "spam." Some consumers are demanding an end to direct marketing for privacy and environmental reasons, which direct marketers are able to do to some extent by using "opt-out" lists, variable printing, and more-targeted mailing lists. In response to consumer demand and increasing business pressure to increase the effectiveness of reaching the right consumer

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

with direct marketing, companies specialize in targeted direct advertising to great effect, reducing advertising budget waste and increasing the effectiveness of delivering a marketing message with better geodemography information, delivering the advertising message to only the consumers interested in the product, service, or event on offer.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Types of Direct Marketing

1. Internet Marketing :The Internet has revolutionized direct marketing for promoting the sale of products and services to targeted audiences. Access to the Internet provides users with services in four basic areas: information, entertainment, shopping, and individual and group communication. Online channels can eliminate geographic considerations. With this capability people around the world have the same access as the person across the street. Many businesses that can sell their products and services through downloading or can economically ship those products have discovered an entirely new way to market. The Internet makes direct marketing easier, more targeted, more flexible, more responsive, more affordable, and potentially more profitable than ever. Virtually every business should seriously consider the Internet as a part of their marketing mix and determine if it is a viable fit for direct marketing.

2. Face-to-Face Selling :The most traditional direct marketing involves the in-house sales force personally contacting potential and established consumers. Examples of organizations that use face-to-face selling include Mary Kay, Avon and Amway.

3. Direct mail :Direct mail is described as sending information about a special offer, product or sale announcement, service reminder, or other type of communication to a person at a particular street of electronic address. Historically direct mail has existed in the form of printed materials, but CDs, audio tapes, video tapes, fax mail, email and voice mail are also used in direct mail campaigns. For example, America Online experienced a highly successful campaign through mailing out CD-

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

ROMs to prospective customers. Direct mail permits high target-market selectivity; it can be personalized, it is flexible, and it allows early testing and response measurement to take place. A highly selective and accurate mailing lists often determines the success of direct mail efforts to enhance response rates and control costs.

4. Catalogs :Product catalogs are another version of direct mail where the catalogs are the communication tool. The most common use of this approach involves featuring a variety of products that target the needs of a specific audience who have shown a propensity to order from catalogs. An increasing number of business-to-business marketers are sending catalogs on CD-ROM to prospects and customers. The average U.S. household receives more than 50 catalogs each year ranging from general merchandise (Spiegel and J.C. Penny) to specialty goods (Pottery Barn and PC Connection).

5. Telemarketing :The process of contacting people on a qualified list to sell services over the phone has grown in popularity to the point that the average household receives 19 telemarketing calls each year. Successful telemarketing campaigns depend on a good calling list, an effective script and contact structure, and well trained people that are compensated and rewarded for making calls that result in sales. The telecommunications industry including AT&T, MCI/WorldCom and Sprint has used telemarketing extensively to attempt to increase their market share.

6. Direct-response Advertising :Direct-response advertising is communicating with potential buyers through television, radio, magazines, and newspapers. The prospective consumer watches, hears, or reads about the product or service and initiates a call to a toll-free number to place their order. Television, for

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

example, offers a wide range of exposure, from a 30-second commercial to a 60-minute infomercial.

7. Kiosk Marketing :Customer order machines, versus vending machines that actually provide products, are another form of direct marketing. Examples of kiosks range from computer terminals in Eddie Bauer stores so customers can order from the entire line of products not available in the retail store to Florsheim Shoe Company kiosks placed in airports for home or office delivery. Your banks automatic teller machines (ATMs) placed in convenient and high traffic areas are another example of kiosk marketing. A combination of these direct marketing techniques may offer the optimal revenue generation solution.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

MEANING OF ONLINE MARKETING

Online marketing is the term denoted to the definition, A marketing tactics which controls all of its operation through internet and websites is referred as Online Marketing. Online marketing provide an opportunity to consider if you are interested in starting an online business that will enable you to work from home. This marketing basically works on different niches and by niches I mean different areas where we can apply online marketing techniques. Some people also refer it as Internet marketing. Online marketing, specially & specifically paid placement and search engine optimization, have a proven an excellent track record providing companies the highest returns of any vehicle in their marketing mix.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Benefits of Online Marketing For Consumers & Companies:-

Benefits to Consumers:
1. Convenient :
customers can shop 24 hours a day from anywhere without going to the store physically.

2. Immediate :
consumers can interact with the seller's site to find the information, products, or services they desire, then order or download them on the spot.

3. Interactive Ads or Marketing Campaigns:

Using advertising that engages potential customers is key in todays fast paced, little time consumer shopping space. One benefit to eCommerce marketing is the merchants ability to develop and improve a number of interactive advertising or marketing campaigns designed to reach out and engage shoppers. Videos, flash, presentations, graphics, moving animations. They can all be used as interactive devices to help entice shoppers to drop in and shop around for the products or services offered. Interactive ads and applications on the Web are predicted to reach new heights as technology improves.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Benefits to Companies:
1. Customer Relationship Building :
companies can interact with customers to learn more about their needs and to build customer databases.

2. Reduce Costs & Increase Efficiency :

avoid the expense of maintaining a physical store, costs of rent, insurance, and utilities. Digital catalogs cost less to produce than printing and mailing paper catalogs.

3. Greater Flexibility :
unlike a paper catalog whose products and prices are fixed until the next printing, an online catalog can be adjusted daily or even hourly, adapting product availability, prices, and promotions to match changing market conditions.

4. Access to Global Markets :

The Internet is a global medium, which allows buyers and sellers to click from one country to another in seconds.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Four Ways to Conduct Online Marketing :

1. Creating an Electronic Storefront :
companies can buy space on a commercial online service or it can open its own Web site. These sites are designed to engage consumer interaction that will move them closer to a purchase or other marketing outcome.

2. Placing Ads Online :

companies can place online ads in three ways: (a) classified ads in special sections of major commercial online services (b) ads in certain Internet newsgroups set up for commercial purposes (c) buy online ads that pop up while people are surfing the web. Such ads include banner ads, pop-up windows, "tickers" (banners moving across screen), and "road-blocks" (full-screen ads that users must go through to get to other screens they wish to view)

3. Participating in Internet Forums, Newsgroups, or Web Communities :

companies may participate in or sponsor Internet forums, newsgroups, and bulletin boards that appeal to specific special interest groups.

4. Use Online E-mail or Webcasting :

companies can send out customer newsletters, special product or promotion offers based on customer buying histories. Webcasting or "push" programming delivers information of interest to consumers' desktops.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

E-Commerce Domains
1. BUSINESS TO CONUMERS (B2C): Now more mainstream and diverse has created new e-commerce targeting opportunities Online behavior differs by age.

Online consumers differ from traditional off-line consumers. They initiate and control the exchange process. Value information highly.

2. BUSINESS TO BUSINESS(B2B): B2B sales far exceed B2C sales:B2B sales are estimated to reach $4 trillion in 2005. Open trading networks: E-market space bringing sellers and buyers together. Private trading networks:Links sellers with their own trading partners.

3. CONSUMER TO CONSUMERS (C2C): C2C web sites help consumers exchange goods or information eBay is one example Blogs:Allows interchanges of information for special interest groups Highly credible for advertisers.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

4. CONSUMERS TO BUSINESS(C2B): Allow consumers to search out sellers, learn about offers, initiate purchase, or dictate purchase terms. Ex: Priceline.com Some sites facilitate the feedback process between customers and companies. Ex: Planetfeed.com

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

TYPES OF ONLINE MARKETERS:1. Click-Only-Competitors:E-tailers, search engines and portals, ISPs, transaction sites, some content sites, enabler sites 2. Lack of planning and research:Did not develop marketing strategies and spent lavishly off-line on mass marketing. Over emphasis on acquisition vs. retention Low margins.

3. Click-and-Mortar Companies:Channel conflict was initially a concern E-commerce often created new customers, rather than cannibalizing existing ones Many firms now enjoy greater success than their click-only competition Trusted brand names, greater financial resources, larger customer base, industry knowledge, and strong supplier relationships were key advantages.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Advantages and Challenges of Online Marketing

The term online marketing is one that is simply used to define marketing on the internet. There are other related terms such as e-marketing and ecommerce that are often used as synonyms, too. Online marketing is a very dynamic, fast changing field, and there are many advantages and challenges to marketing on the internet. One of the great advantages of online marketing involves search engines. Only with search engine marketing can you promote your product or service directly to people who are actively looking for it! Another advantage of online marketing is that it allows you to easily track advertising, promotion, and sales. This means several things. First of all, you can easily moniter your advertising and focus your efforts on the most effective. Secondly, you can easily identify and target specific markets individually, resulting in more effective marketing. Another advantage to companies is that they are capable of offering bonus offers for purchases made online as they spend less overall on their marketing. They also use e-newsletters to get new customers and to keep old customers informed and updated on new products and thereby retain their customer base. E-newsletters are much less expensive that traditional newsletters. Another important aspect of online marketing is ensuring that the customer is always satisfied. This can be a great disadvantage in terms of online marketing as there is no in person to person interaction and this can be a serious disadvantage. It is crucial to keep customers coming back. It is often difficult to facilitate excellent customer communication via the internet, so often you will need to utilize offline methods to achieve greater customer satisfaction. Online marketing is a great opportunity for most businesses. It is possible to start online marketing with simple search engine advertisements and grow from there to other concepts such as funnel construction, buzz marketing and cool tools. However, it is important to note that there is a lot of competition on the internet already and you will have to continue to be up-to-date with your information, services and products.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

Challenges to Direct Marketing

Direct marketing requires careful planning, analysis and alertness in order to make it a success rather than frustrating the potential customers. There are even many people who consider direct marketing to be a marketing strategy that would work out the negative way and spoil the brand name. However, that cannot be true as there are several businesses who have succeeded by direct marketing. There are many challenges in direct marketing that the business owner needs to handle with caution and ensure that the customers do not get frustrated or irritated by the way you approach them. This is quite common in direct marketing, as no customer would want the marketer to target him or her personally and try to market something new. The situation would be totally different if the same product or service is presented to customers who are in need of the service or to someone who is looking for them. So, the secret lies in identifying the right group that would be interested in your products or services when you talk to them about your business. In order to be successful in direct marketing, you would certainly have to spend enough time in building a database of customers who would be interested in your service or products. Any marketing strategy would be useful and would make sense only when it results in sales or improvement in business. Similarly, direct marketing would also be helpful only when it is practiced with an accurately targeted group. Blindly contacting anyone and talking about your services would spoil your reputation and would irritate the customers. Though database generation is definitely not a simple task, a little more effort and time would help you generate a list quickly. Alternatively, you can also purchase contact lists from various database generation companies and start your direct marketing campaign. However, care needs to be taken in this regard as in many cases the database might contain contact details that are outdated. You can find the right company that has experience and reputation in database generation and purchase the list from them as cheap lists might go to waste and spoil your business reputation.

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

The approach that you use to contact your customers is also important as this would be the first meeting or discussion that your company would be having with them and this is what would help you to impress them. Therefore, any mode you use, whether it be a phone call or a personal meeting or an email, it should be well organized and appealing. You should already be prepared for the discussion and should have answers for all those questions that the customers might raise during the discussion. All possible questions should be predicted and the answers for them should also be ready. Preparation of a professional script would help for personal meetings and phone calls. You can even have an email template drafted for direct marketing through emails. However, a few things that would make the email look personalized and customized should be changed before sending it across. Contacting the customers can either be done directly by you or can be outsourced to other third party companies who have experience in direct marketing and dealing with customers without any problem. However, both the company and the sales representatives who deal with your customers should be experienced in handling direct marketing calls and with different types of customers. Their approach should be professional and they should have answers for all the questions possible. For this, you should first have these call agents educated on the various services and / or products that you sell. They should also know about your experience in the field, the quality of service or products, cost, guarantee if any and so on. The main thing in dealing with customers in direct marketing is that the information you give should be accurate and promises or assurance that you make should be true. Any fake promises and assurance would certainly spoil the reputation of your business and the customers would no longer trust you and your business. Finding the right call agents would be a great challenge and training them to talk about your company would definitely be a tough job. Once you are prepared and finished with all these preliminary arrangements, you can start calling or mailing your targeted customers by yourself or using call agents from other companies. Whatever the case, care should be taken to see whether it is the right time to contact

M.D.COLLEGE

MARKETING IN FINANCIAL SERVICES

T.Y.F.M.

the customers. For example, customers would not be interested in talking to a marketing person and in receiving a marketing mail when they are on vacation or during the weekends. Therefore, such private timings can be avoided and customers contacted during the weekdays. This would reduce a lot of disorder and would help them to keep your customers cool without frustrating them. After the initial discussion, if you are asked to contact at a particular time of the day, after a week or whenever it might be, remember to do it promptly and do not disturb them before that. Maintaining a tracking system that would remind you about the timing of returning calls would also help in building a good opinion about your punctuality and business amongst your customers. Direct marketing can generate more leads and end up as successful sales if only these few challenges in direct marketing are handled with care and thought. A professional touch in every step that you take in direct marketing would be the best way to go about it.