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International Journal of Research in Management, Economics & Commerce

Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Dr. Deepti Gupta
Principal,Shree Satya College Of Higher Education,,Affiliated To Mjpru, Bareilly (U.P),India
Amar Singh
Research Scholar, Svu, Gajrula (U.P.),India
Mohd Rizwan
Assistant Professor, Shree Satya Institute Of Management,Affiliated To Uptu, Lucknow

State Bank of India (SBI) is the largest nationalized commercial bank in India in terms of assets,
number of branches, deposits, profits and employees. With the liberalization of the Indian
banking industry in the mid-1990s, SBI faced stiff competition from the private sector and
foreign banks which resulted in major loss of its market share. Therefore it becomes significant
for SBI to come with unbeatable marketing strategies. This paper shows all 7 P’s of service
marketing mix used by SBI. Marketing strategies of SBI revealed that banks can base their
marketing strategies on various parameters which are broadly in terms of 7Ps of marketing viz.,
Product, Place, Price, Promotion, People, Physical Evidence and Processes. This Paper also
analysis the trend of SBI expenditure on Promotion.. Researchers used graphical presentation to
represent the trend of Advertising and Publicity Expenses incurred from the period starting from
Keywords:- SBI, Marketing strategies, 7 P’s of Marketing Mix, Promotion, Advertising and

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Marketing strategy is defined by David Aaker as a practice that can allow an organization to
concentrate its resources on the optimal opportunities with the goals of increasing sales and
achieving a sustainable competitive advantage.
Marketing strategy comprises all basic and
long-term activities in the field of marketing that deal with the examination of the strategic initial
situation of a company and the formulation, evaluation and selection of market-oriented
strategies and therefore add to the goals of the company and its marketing objectives.
effectual marketing strategy combines the 4 Ps of the marketing mix. It is designed to congregate
the company‘s marketing objectives by providing its customers with value. The 4 Ps of the
marketing mix are related, and combine to create the product‘s position within its target markets.

The service marketing mix is known as an extended marketing mix and is an vital part of a
service blueprint design. The service marketing mix consists of 7 P‘s as compared to the 4 P‘s of
a product marketing mix. Simply said, the service marketing mix assumes the service as a
product itself. However it adds 3 more P‘s which are required for optimum service delivery.
To analysis the 7 P‘s of Marketing Mix used by SBI.
To study Advertising & Publicity Expenses of SBI.
To analysis the trend of Advertising & Publicity Expenses of SBI.
For this study we have collected secondary data through Internet, periodicals, news papers,
magazines and books. Internet and annual financial report of SBI are the main sources of data
collection. We have collected the data regarding the Marketing Mix of SBI and Annual
Advertising and Publicity expenses incurred from secondary data. We used graphical
representation to show the trend of expenses incurred.
State Bank of India (SBI) is a multinational banking and financial services company based in
India. It is a government-owned firm with its headquarters in Mumbai, Maharashtra. As of
December 2013, it had assets of US$388 billion and 17,000 branches, including 190 overseas
offices, making it the largest banking and financial services company in India by assets.

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

State Bank of India is one of the Big Four banks of India, along with ICICI Bank, Punjab
National Bank and Bank of Baroda.
The bank traces its origin to British India, through the Imperial Bank of India, to the founding in
1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent.
Bank of Madras merged into the other two presidency banks—Bank of Calcutta and Bank of
Bombay—to form the Imperial Bank of India, which in turn became the State Bank of
India. Government of India owned the Imperial Bank of India in 1955, with Reserve Bank of
India taking a 60% stake, and renamed it the State Bank of India. In 2008, the government took
over the stake held by the Reserve Bank of India.
SBI is a regional banking behemoth and has 20% market share in deposits and loans among
Indian commercial banks.
With numerous competitors gaining ground in Indian Territory, SBI
was facing steady threat of takeover. The exhibit below maps the banking industry using porter‘s
five forces model. The model shows that there is huge rivalry in the banking industry and that the
customer is the king. Banks that provide high-quality customer service and are responsive to the
market in the long run would win.

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Figure 1 - Porter’s Five Forces Model for Banking Industry

1.Product:- The product in service marketing mix is intangible in nature. Like material products
such as detergent or soap, service products cannot be calculated. Banking Industry can be an
brilliant example. At the same time service products are heterogeneous, perishable and cannot be
owned. The service product thus has to be designed with care. The given figure shows Product
Mix of SBI.

Figure 2 – Product Mix
2.Price:- Pricing in case of services is quite more difficult than in case of products. The price of
the product depends upon the services provided by the Bank on the individual product to the
customers. The pricing strategies of SBI are discussed below.
The pricing decisions and the decisions related to interest and fee or commission charged
by banks are found instrumental in motivating or influencing the target market
The IBA and the RBI are concerned with regulations. The rate of interest is regulated by
the RBI and other charges are controlled by IBA.
The banking industry is required to frame two- fold strategies. First, the strategy is
concerned with interest and fee charged and the second strategy is related to the interest
Another component to consider in the pricing of earning assets is the risk of loss. Most
notably, this is relevant in loan pricing. Many banks allocate a risk weighting to

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

individual loans over a definite size or based on loan type and assign a credit risk charge
based on those ratings.
Asset and liability mix also impacts pricing results. Generally speaking, banks operating
with higher loan-to-asset ratios are able to afford to pay more for deposits. Likewise,
banks can afford to be further competitive with sure deposit products if they have fewer
maturities in a particular timeframe or less total outstanding balances in a product line.
Customer relationships are not easy to assign a value to in the pricing process. Customers
will generally press for some price concessions in consideration of other relationships
they have with the bank.
3.Place:- The place part of the marketing mix is where the customer receives the product or
service. Place in case of services determine where is the service product going to be located. SBI
has 17,000 branches in India, as on December 2013, of which 9,851 (66%) were in Rural and
Semi-urban areas
and had 190 overseas offices extend over 34 countries.
The selection of a appropriate place for the establishment of a branch is important with the
viewpoint of making places accessible. Researchers find the following reasons why SBI select a
specific place as a branch?
The safety and security provisions
Infrastructure facility
Market coverage
Convenient to both the parties, such as the users and the bankers
4. Promotion:- Strategies to craft the consumer aware of the existence of a product
or service. Promotions have become a serious factor in the service marketing. Visualization
tangibilizes services through hoardings, print and TV campaigns or advertisements. Physical
representation in services has a good promotional application to customers like use of colors to
symbolize status and wealth. Service providers use documentation in their promotions in support
of their claims for dependability, responsiveness and popularity. SBI incurred huge Advertising
& Publicity Expenses every year which is discuss in the next section of this paper in detail. The
given figure shows Promotion Mix of SBI.

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Figure 2 – Promotion Mix
4. People:- The word ‗People‘ is used in services marketing into two perspectives. One for
employees, i.e., internal marketing while another for customers, i.e., external marketing. In this
way the term people indicate both employees and customers in services marketing. All people
directly or indirectly involved in the consumption of banking services are an important part of
the extended marketing mix. Knowledge Workers, Employees, Management and other
Consumers often add significant value to the total product or service offering. It is the employees
of a bank which represent the organization to its customers.
SBI become conscious in its potential in internal marketing – the attraction, development,
motivation and retention of qualified employee-customers through need meeting job-products.
Internal marketing paves method for external marketing of services. In internal marketing a
variety of activities are used internally in an active, marketing like manner and in a coordinated
6. Process:- Service process is the way in which a service is delivered to the end customer. A
process is a particular operation or method of a series of actions, typically involving multiple
steps that often need to take place in defined sequence. Process is something related to:
How do people consume services?
What processes do they have to go through to obtain the services?
Process includes the way things are actually done and the steps taken to achieve bottom – line
results has been given considerable attention over the years in the areas of manufacturing,
engineering, computer programming and banking sector. The process of SBI possess following

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Flow of activities: All the major activities of SBI banks follow RBI guidelines. There has
to be adhered to sure rules and principles in the banking operations. The activities have
been segregated into a range of departments accordingly.
Standardization: SBI bank has got standardized procedures got typical transactions. In
fact not only all the branches of a single-bank, but all the banks have some
standardization in them. This is because of the rules they are subject to. Besides this, each
of the banks has its standard documentations, forms etc. Standardization saves a lot of
time behind individual transaction.
Customization: There are specialty counters at every branch to deal with customers of a
particular scheme. Besides this the customers can select their deposit period among the
available alternatives.
Number of steps: Numbers of steps are usually specified and a exact pattern is followed
to minimize the time taken.
Simplicity: In SBI banks a variety of functions are segregated. Separate counters exist
with clear indication. Thus a customer wanting to deposit money goes to ‗deposits‘
counter and does not mingle elsewhere. This makes procedures not only simple but
consume less time. Besides instruction boards on national boards in national and regional
language help the customers further.
Customer involvement: ATM does not involve any bank employees. Besides, during
usual bank transactions, there is definite customer involvement at some or the other place
because of the money matters and signature requires.
7. Physical evidence:- Physical evidence is the material part of a service. Strictly speaking there
are no physical attributes to a service, so a consumer tends to rely on material cues. The physical
evidences include signage, reports, punch lines, other tangibles, employee dress code etc.
Signage: Each and every bank has its logo by which a person can identify the company.
Thus such signages are significant for creating visualization and corporate identity.
Financial reports: The Company‘s financial reports are issued to the customers with
emphasis or credibility.
Tangibles: Bank gives pens, writing pads to the internal customers. Even the passbooks,
checkbooks, etc. reduce the inherent intangibility of services.

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Punch lines: Punch lines or the corporate statement depicts the philosophy and attitude of
the bank. Banks have influential punch lines to attract the customers.
Employee‘s dress code: SBI bank follows a dress code for their internal customers. This
helps the customers to feel the ease and comfort.
One of the most important Marketing Mix used by SBI is Promotion on which it spent lots of
money every year; therefore it is significant to discuss Promotion at a length. In this section of
the paper researchers study the Promotional (Advertising and Publicity) Expenses incurred by
SBI in last five years (2009 to 2013). The following table and figures show annual Advertising &
Publicity expenses of SBI and also shows the percentage change in expenses. Percentage change
in annual promotional expenses shows the trend of promotional expenses.
Percentage change in annual promotional expenses is calculated as -

Advertising Expenses of SBI
(000s omitted)
Year Amount Percentage change
2009 2512295 -
2010 2240452 -10.82
2011 2578761 15.1
2012 2066327 -19.87
2013 3843526 86

International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

Interpretation: In 2009 SBI incurred Rs.251,22,95,000 as Advertising and Publicity Expenses.
Significant increase in Expenses incurred can be noticed in 2011 and 2013. It is also worth
standing to notice that in 2010 and 2012 SBI incurred Rs. 224,04,52,000 and Rs. 206,63,27,000
respectively which were comparatively lower than 2009 and 2011. In 2013 SBI incurred most
heavy expense in last five year i.e. Rs. 384,35,26,000.
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International Journal of Research in Management, Economics & Commerce
Website: (ISSN 2250-057X, Volume 4, Issue 4, April 2014)

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