Introduction

1.1 Introduction to the Task

Nowadays customer is becoming more sophisticated about their choice and quality of service being served
to them. Throughout the life, customers try their best to fulfill their demands. The place where things are
swapped or say common needs are fulfilled is called the market. The efforts to make people aware of your
offerings inspiring them to deal with you and let them believe that in doing so, they are fulfilling their needs at
its best is called Marketing. After the banking sector improvements, marketing has established as a more
combined function within financial service. Financial institutions as banks have done rapid changes in the
operational environment. The marketing of bank products has become a very difficult subject as it involves
the knowledge of economics, sociology, psychology and also essential marketing idea. In marketing, it is the
customer who has the personal choice and the intention of effective marketing of banking products lies in the
regular and professional tactic towards fulfilling customer’s needs.

Banking sector is one of the main financial sectors, which have much contribution to the domestic
economy. The banking industry includes a number of banks in numerous groups. By the ownership, banks
can be categorized in to four major categories - such as State-owned Commercial Banks, Specialized Banks,
Private Commercial Banks, and Multinational Banks. To observe the present marketing,
promotion,developmental strategies of financial products and evaluate the activities.And to apply theoretical
knowledge in the practical field.

1.2 Introduction to the Industry

Financial Service Industry in India

As per the Reserve Bank of India (RBI), India’s banking sector is sufficiently capitalised and well- regulated.
The financial and economic conditions in the country are far superior to any other country in the world.
Credit, market and liquidity risk studies suggest that Indian banks are generally resilient and have withstood
the global downturn well.
Indian banking industry has recently witnessed the roll out of innovative banking models like payments
and small finance banks. RBI’s new measures may go a long way in helping the restructuring of the
domestic banking industry

The digital payments system in India has evolved the most among 25 countries with India’s Immediate
Payment Service (IMPS) being the only system at level 5 in the Faster Payments Innovation Index (FPII).
Market Size
TheIndian banking system consists of 27 public sector banks, 21 private sector banks, 49 foreign banks, 56
regional rural banks, 1,562 urban cooperative banks and 94,384 rural cooperative banks, in addition to
cooperative credit institutions.^^ In FY07-18, total lending increased at a CAGR of 10.94 per cent and total
deposits increased at a CAGR of 11.66 per cent. India’s retail credit market is the fourth largest in the
emerging countries. It increased to US$ 281 billion on December 2017 from US$ 181 billion on December
2014.

Investments/developments
Key investments and developments in India’s banking industry include:
 As of September 2018, the Government of India launched India Post Payments Bank (IPPB) and has
opened branches across 650 districts to achieve the objective of financial inclusion.
 The total value of mergers and acquisition during 2017 in NBFC diversified financial services and
banking was US$ 2,564 billion, US$ 103 million and US$ 79 million respectively.

 The biggest merger deal of FY17 was in the microfinance segment of IndusInd Bank Limited and
Bharat Financial Inclusion Limited of US$ 2.4 billion.

 .In May 2018, total equity funding's of microfinance sector grew at the rate of 39.88 to Rs 96.31
billion (Rs 4.49 billion) in 2017-18 from Rs 68.85 billion

Government Initiatives
 As of September 2018, the Government of India has made the Pradhan Mantri Jan Dhan Yojana
(PMJDY) scheme an open ended scheme and has also added more incentives.
 The Government of India is planning to inject Rs 42,000 crore (US$ 5.99 billion) in the public sector
banks by March 2019 and will infuse the next tranche of recapitalisation by mid- December 2018.

Road Ahead
Enhanced spending on infrastructure, speedy implementation of projects and continuation of reforms are
expected to provide further impetus to growth. All these factors suggest that India’s banking sector is also
poised for robust growth as the rapidly growing business would turn to banks for their credit needs.
Also, the advancements in technology have brought the mobile and internet banking services to the fore. The
banking sector is laying greater emphasis on providing improved services to their clients and also upgrading
their technology infrastructure, in order to enhance the customer’s overall experience as well as give banks a
competitive edge.
India’s digital lending stood at US$ 75 billion in FY18 and is estimated to reach US$ 1 trillion by FY2023
driven by the five-fold increase in the digital disbursements.
Exchange Rate Used: INR 1 = US$ 0.0139 as on Q3 FY19.

1.3 Introduction to the Company

IIFL
Group of passionate entrepreneurs started IIFL in 1995. IIFL was the pioneer in the retail broking
industry with its launch of 5paisa trading platform which offered the lowest brokerage in the industry
and the freedom from traditional ways of transacting. IIFL’s strength has been to continuously innovate
and reinvent themselves. Their evolution from an entrepreneurial start-up in 1995 to a full range
diversified financial services group is a story of steady growth by adapting to the dynamic business
environment, without losing focus on their core domain of financial services. Today, IIFL Holdings
Limited (Bloomberg Code: IIFL IN, NSE: IIFL, BSE: 532636) is India’s leading integrated financial
services group with diverse operating businesses, mainly, Non Banking and Housing Finance, Wealth
and Asset Management, Financial Advisory and Broking, Mutual Funds and Financial Product
Distribution, Investment Banking, Institutional Equities, Realty Broking and Advisory Services.
IIFL serves more than 4 million satisfied customers across various business segments and is
continuously building on its strengths to deliver excellent service to its expanding customer base.
Vision

 To be the most respected financial services company in India.

 Not necessarily the largest or most profitable.
Mission
From an entrepreneurial start-up in 1995, IIFL have steadily grown to emerge as one of India’s leading
financial services group. Ever since their inception and strategy has been to align their capabilities and
market insights to the country’s rapidly changing business environment. Their growth trajectory has only
served to reinforce their focus on domain of financial services.

Values
Fairness
Fairness is their transaction with all stakeholders including employees, customers and vendors, bereft
of fear or favor.

Integrity
Integrity and the honesty of outmost nature, in letter, in spirit, and in all our dealing with people, Internal
or external.

Transparency
Transparency in all our dealings with stakeholder media , investors and the public at large.

Achievements

• Best Private Banking Services. Overall in India 2017- Euro money

• ET Best BFSI Brands Recognition

• Digital Innovation Champion Award – CIO Crown 2016

1.4 Introduction to the project

 Recent trends in Marketing Strategies of Banks

Traditionally, banks were seen as the holders of the money, which gradually changed their role as the creators of
money. Today, the scope of banks has widened phenomenally, now the banks are seen as the purveyor of finance for the
entire nation. A sound banking system is the life blood of any developing economy and it reflects the growth of the
economy. “Financial inclusion is a major agenda for the Reserve Bank of India (RBI). Without financial inclusion,
banks cannot reach the un-banked. It is also a major step towards increasing savings and achieving balanced growth. On
social media, clients can react to a change in conditions of use of particular products or service that they do not feel is
positive and banks on the other hand can give out information on the reasons for a change. there is still an ample scope
for the growth of banking sector. Hence, it requires sound and innovative marketing strategies to capture the untapped
market. Following trends have been observed in the marketing strategies of banks recently:

1. Advertising remains the undisputed promotional tool for banks so far among the other promotional tools.
Advertising, which includes direct mail, accounted for the largest share of marketing expenditures at 52
percent, compared to 58 percent.

2. Consumer expectations are growing. With the increase in the education of the consumers, they are now
demanding more and more value added services and are ready to pay premium for it.

3. Mobile banking is the need for today. It has become the blessing for the consumers who don’t have the time
to visit the bank personally. The biggest advantage that mobile banking offers to banks is that it drastically cuts
down the costs of providing service to the customers. Also service providers are increasingly using the
complexity of their supported mobile banking services to attract new customers and retain old ones.

4. The majority of financial institution did not reduce their broadcast and offline marketing budges over the last
12 months , according to the Digital Banking Report. As in 2017 , 34% of financial institutions allocated 50%
or more of their media budget to traditional media. As was the case last year , there was a lack of commitment
to digital channels, with only 15% of organisation committing more than 50% of their budget to online media,
compared to 14% in 2017.

5. Due to increased use of technological bases has increased the operational efficiency of the Indian banks.
all banks had embraced the Internet and most had websites. Marketers said e-newsletters were the most
effective form of Internet marketing, followed by search engine marketing and then sponsorships.

6. Marketing expenditure has witnessed the tremendous growth in last few years as the percentage of total
banking expenditure. Despite the overall state of the economy and the banking industry, marketing expenditures
were up. Nearly 60 percent of banks said they planned to increase their marketing expenditures, Most of the
banks view marketing as a strategic driver for their business.

7. Focus on Incremental New Customer Growth: Instead of generating as many accounts as possible, banks
will be focusing on the potential value of relationships including the likelihood of engagement and retention.

8. Gathering Email Addresses: With other communication channel cost increasing and the improved results
achieved when email is combined with more traditional channels, the importance of collecting (and using)
email addresses has never been more important.

Increasing Importance of Marketing in Banking Industry

The reasons for marketing scope to have importance in banking and for banks to interest in marketing
subject can be attributed to the following factors:

Change in demographic dynamics

 Cut throat competition in the service industry.

 Increased profit consciousness of the banks.

 Deregulation of interest rates.

 Entry of various private and foreign banks

 Increasing awareness, education and urbanization

 Indigenous growth of nonbanking financial Institutions Disintermediation

 Advent of the technology

 Increasing the reach of innovative banking products

Marketing approach

Banking is a personalized service oriented industry and hence should provide services which satisfy the customer's
needs. To meet these needs, bankers are expected to provide satisfactory benefits through provision of form, place,
time, and ownership utilities. The marketing approach involves anticipating, identifying, reciprocating (through
designing and delivering customer-oriented service), and satisfying the customer's needs and wants effectively,
efficiently, and profitably

Components of Marketing Approach

A marketing approach to banking includes the following components or activities

• determining in a rational, informed, and strategic manner the desired customer base

• identifying the current and future needs of desired customer and customer prospect segments

• creating need-satisfying benefits that respond appropriately and profitably to customer needs and which
positively dif ferentiate the organization from its com petitors

• communicating and delivering these benefits effectively and efficiently to the market place

• converting the employees of the organiza tion into a well-informed, disciplined, and professional force committed
to the organization's values and objectives. This is a comprehensive, responsibility-oriented approach towards
formulating a strategy for achieving the bank's performance objectives.

In the Indian context, the primary objectives of the marketing approach are as follows:

• To increase deposits

•To improve the quality of customer service

•To develop bank's image

• To report a marginal profit.

Marketing Strategy System

For developing strategies relating to deposit mobilization and improving customer service, market research has to be
conducted for market segmentation and targeting (as illustrated in Figure 1) broadly covering the following categories.

Determinants of Deposits There are several factors which influence the growth of bank deposits. Some of them are:

• Higher industrial and agricultural produc tion

• Increasing savings rate in the economy

• Development programmers of the government to boost rural economy and small scale industries. Factors having
adverse effect on deposit mobilization are:

• Setback in the agricultural sector during poor monsoon years

• Rising cost of hiring

• Government reducing its budget and restricting money supply

• Growing competition from other channels of investment which offer higher interest rates

• Government’s control on branch expansion of banks

• Non-recovery of loans.

A statistical analysis of the determinants of deposits had been performed to measure the magnitude of influence of
different environmental factors on deposit mobilization. Regression analysis on secondary time-series data has been
conducted at all-India and state levels to achieve the above objective.

Trends and Patterns of Savings and Deposits

This involves estimating current and potential markets for deposits and segmenting the market in terms of
geographical location, customers, socioeconomic characteristics, and other related factors.

Customer Behaviour, Attitude, and Perceptions

This involves understanding customer profile, their socio-economic and demographic background, their psychographic
make-up, motivations behind their savings, awareness of and attitude to various modes of savings, and reasons for
their preference for one form of savings over another. This will help bankers in providing new banking
services/products through which even non-bank customers can be adopted.

Customer Services

Launching new schemes with advertisements attracts new depositors. However, what ultimately sustains the process
of generation of new deposits and continues the acceleration of deposit mobilization is the quality of customer service
as perceived by customers. Bank's performance in different banking services like withdrawal of cash, collection of
cheques, quality and adequacy of infrastructural facilities available to customers, attitudes of bank employees towards
customers, promptness, and general attitude have to be analysed and evaluated before strategy formulation.

The promotion Mix for Banking Services

Promotion is direct way in which an organisation communicates the product or service to its target
audiences. promotion has categorized the tools into five main elements.

Advertising

Sales Promotion

Public Relations

Personal Selling

Direct Marketing

 Advertising- Advertising directed towards target audiences and transmitted through various mass
media in order to promote and present a product ,service or idea . The key difference between
advertising and the other promotional tools is that it is impersonal and communicates with large
number of people through paid media channels .

Financial service organisation can use its service for either its short term or long term objectives. A
bank attempting to generate a long- term build- up of its name would use institutional advertising,
while bank interested in promoting its brand name and its different service would use a brand
advertising policy.
Institutional Advertising consist of promotion of the firms image as a whole, and promotion of the
products offered , with extra emphasis on the specific firm’s name organisation. The organisation
seeks through it’s marketing communications, to build awareness and to impress customers looking
for the best range of financial service. Due to the former impression of banks as impersonal
institutions with no interest in their customers as people, and of financial service as abstract and quite
similar, the institutional advertising has become more and more important. Brand advertising follows
closely in the footstep of institutional advertising. Its purpose is to create awareness of banks name
and to advertise the different services it is offering.

Since financial service is serving for mass of people, the problem of brand advertising are to know
who to advertise to, and how to advertise. While institutional advertising is directed towards the whole
population, the brand advertising of particular products has to be much more selective, since it has to
show that the consumer will benefit from service. Furthermore all the individual’s campaign of brand
advertising have to be compatible in tone and presentation, and match the image the bank has
created through its institutional advertising.

The important part of advertising is to make the service tangible in the mind of customer in order to
reduce perceived risk and provide a clear idea of what the service comprises. it is important to
advertise consistently, with a clear brand image, order to achieve differentiation and encourage word
of mouth communication.

There are two types of advertising channels appropriate for financial advertising . that is “above-the-
line” and “under-the-line” advertising. Above- the- line advertising contains different channel of
communication, such as television, radio, papers, magazines and newspapers. Under- the -line
advertising constitutes a huge part of financial organisation’s advertising activities . it is the invisible
advertising of the bank’s service including leaflets , pamphlets, explanatory guides and manuals that
can be used to support selling of specific service. it is hard to draw a definite distinction between
under-the-line advertising and sales promotion. Under –the-line advertising is very easy and cheap
to produce, but it must be use discreetly. Furthermore, this kind of marketing does not attract new
customers, and it is depending on personal selling for its effectiveness.

Sales promotion

Sales promotion is different tactical marketing technique with mostly short –term incentives, which are
design to add value to the product or service, in order to achieve specific sales or marketing
objectives. There are two distinctive qualities , firstly it provides a “bargain chance”, since many sales
promotion tools have an attention-gaining quality that communicates an offer that will not be available
again to purchase something special. The disadvantage, however, is that although they appeal to a
wide range to buyers, many customer tend to be less brand loyal in the long run. Secondly, if sales
promotion are used too frequently and carelessly, it could lead to insecure customers, wondering
whether the service is reliable or reasonably priced. Due to the conflicting ideas concerning the
benefit of sales promotions , a financial service organisation must base its decision upon relevance
and usefulness on sales promotion, as well as cost effectiveness. Price based promotion are difficult
and probably dangerous to use for financial service markets .This due to the fact that the price setting
of a financial service is already a difficult process and that consumers often see lower price as a
result of lower quality. Sales promotion within financial services appears to be most effectively used
in combination with advertising. The primary objective with sales promotion within financial services
are to attract new customers; to increase the level of deposit accounts, thereby increasing the banks
share of savings; to increase market share in selected market segments and to lower the cost of
acquiring new customers by seeking to avoid direct price competition with other financial institutions.

Public Relations

Public relation is to lookafter the nature and quality of the relationship between the organisation and
its different publics and to create a mutual understanding .PR cover a range of activities, for example
the creation and maintenance of corporate identity and image; charitable involvement ,such as
sponsorship ,and community initiatives; media relation for the spreding of good news , as well as for
crises management , such as damage limitation. An organisation can attend trade exhibitions to
create stronger relationships with key suppliers and customers as well as enhancing the
organisations presence and reputation within the market. Financial service obtain considerable
 publicity in so called quality press, such as different financial journals. In popular newspapers the
publicity is ,in country to the quality press , often negative from the financial firm’s point of view.

Personal Selling

Personal selling is two way communication tool between a representative of organisation and an individual or
group, with the intention to inform, persuade or remind them, or something serve them to take appropriate
actions. Personal selling is a crucial element in ensuring customers’ post purchase satisfaction , and in
building profitable long-term buyer-seller relationships built on trust and understanding.

Increasing competition within the fast changing environment of financial service has lead banks to develop
and maintain comprehensive relationship with their customers. Long-term person- to-person relationship is
an important factor for a retail bank to achieve a a competitive advantage. Personal selling is probably the
most important element in the communication process within the financial service industry. it can be perform
either face to face or through technological aids such as the internet. The relationship between the
salesperson and the customer is perceived as being of great importance for the marketing of a bank. Hence
the sales force within the financial service industry need not only to be trained in the art of selling , but also to
be aware of all the services available and be able to clearly explain what each service offers. Since
customers needs and motivation are likely to be complex, and their ability to assess alternative course of
action without professional assistance is likely to be limited , it is of great significance for the sale force to
know their customer as well as their products . banks should see selling as a problem -solving process in
which the sales force engages and co –operate towards the customer , trying to find the solution to the
customers problem rather than only perusing him to purchase the product or services .

Direct Marketing

Direct marketing is an interactive system of marketing, using one or more advertising media to achieve
measurable response anywhere, forming a basis for creating and further developing an on-going direct
relationship between an organisation and its customers. To be able to create and sustain quality relationship
with sometimes hundreds or even thousands of individual customers, an organisation needs to have as
much information as possible about each one, and need to be able to access, manipulate and analyze that
information, thus the data base is crucial to the process of building a relationship.

Computer literacy and availability of computer increase and the cost decreases, internet banking
consumers are increasing considerably. Through the internet banks, the customers can identify what
interest them. The internet technology makes it possible to follow individual customer usage. With the
information gathered in an integrated data base it is possible to read the customer’s needs and
satisfy them. This knowledge can be used for different kind of direct marketing

Adaption and Standardisation of promotion strategy

Adaption

Marketers in favour of adaption strategy tend to argue that advertisers have to take differences
including culture, stage of economic and industrial development, stage of product life cycle, media
availability and legal restriction into consideration. Every organisation always have to consider to
which degree a customers needs and wants are different from those on the domestic market , and if
adaption is necessary .

Promotion mix have to be adjusted to suit the local environment and reflect the target markets
preferences. promotion has to take language as well as local regulations, in terms of both media
choice and content , into account .sales promotion is also affected by local regulations ; therefore the
choice of activity must respect these regulations and consider the preference of customers.

Marketing communication might have to be adapted ,due to consumer readiness stage. A product
that is mature in one market might be totally unknown in another market , and therefore promotional
mix will have to be adapted. adaption of promotion includes the cost of using different promotional
message , appeals, packaging /labelling and media. there are four variable which impact the
 promotion adaption. These are the firms international experience , technology orientation of the
industry, product exclusivity and the competitive intensity of the market.

further state that both reactive and proactive approaches of promotional adaptation exist. Proactive
harmonizing with the characteristics of the market includes modification of positioning, packaging,
labeling, and promotional approach. Firms may also choose to reactively adapt their products in order
to improve their competitive position, especially if competition in the market is intense, the industry is
technology intensive, or the product is unique.

There are three basic conditions, that have to be fulfilled in order to use a standardized approach, and if these
are not realized adaptation should be considered.

1. A brand’s advertising cannot be universal if different national markets are in diverse stages of
maturity.
2. A brand’s advertising cannot be universal if the idea depends on a large budget which is
unsupported in some markets
3. A brand’s advertising cannot be universal if it defies local customs and regulations and
ignores the efforts of the competition.

Arguments in favor for choosing an adaptive promotion strategy:

1. The heterogeneity of the countries concerned.

2. The “not invented here” syndrome: the desire to create own campaigns.
3. Differences in the media scene.
4. Differing regulations regarding service or advertising.
5. The nature of the competition in different markets.
6. The service is at different stages of its life-cycle in different markets.
7. The danger of being seen as a foreign company.

Reduced economic advantage because of higher co-ordination costs

Adaptation also has to be carefully investigated in emerging market economies, where the consumers are
more likely to be interested in rational advertising that has a clear message. They see advertising as
information, which they can use in order to sort out between the numerous and sometimes confusing
offers. This has led to the fact that many consumers tend to prefer advertisements in newspapers to
those on television, particularly if they are well organized and informative. (ibid)

Standardization

the development in communication and transportation technologies, together with the increased
travel contributes to the globalization of markets, has resulted in emerging global customer groups.
Therefore, in a market where needs and preferences of the customers are largely universal,
standardization might be preferable. In order to succeed in the global market is important for
companies to be able to deliver high-quality products at a competitive price. Standardization of
marketing programs might be crucial to achieve a low-cost competitive position.

People favoring a standardization approach believe that differences between countries are more a
matter of degree than direction. That is why advertisers should focus on the similarities of the
consumers in the international marketplace rather than the differences.

Following arguments are a reason for choosing a standardized promotion strategy:

1. Cost reduction is the most important argument for standardization.

2. A uniform brand image and corporate image worldwide avoid confusion.
3. The globalization of media.
4. Simplified planning through uniform objectives.
5. Maximum use of good ideas and transmission of know-how.
 6. Centrally managed international enterprises.
7. Better use of manage abilities and resources.
8. Universal guidelines and quality standards.
9. Better access to know-how and experience of other countries.
10. The main characteristic of global marketing tends to be to standardize the elements of the
marketing mix as much as possible. The advantages are economies of scale within the three
elements product, place and promotion, which are captured in the marketing mix.
11. The amount of standardization needed depends on the type of product. Industrial products are
seen to be more suitable than consumer products for standardization, since industrial buyers
tend to be more rational in their purchasing behavior and demand for industrial products is
more homogenous across markets.In a captive market, where the product already has achieved
a leader position, a higher degree of standardizations may be advantageous.

The Promotion Mix for Banking Services

We will apply theories regarding promotion of financial services. We will use the five general promotional
tools, which are advertising, sales promotion, public relations, personal selling and direct marketing. For
the characterization of each tool, we will use the definitions provided by these authors. The theories we
will rely on for describing the five tools are theories concerning promotion of financial services, presented
mainly by Meidan (1996), but also by Julian & Ramaseshan (1994), Peatti & Peatti (1994), Verhallen et al.
(1997) and Lee (2002). We believe that with these theories as a foundation, the comparison with our
research findings will be facilitated and more accurate, and that we will be able to describe the promotion
mix of a bank’s services.

Concerning advertising, we will look at institutional and brand advertising, which according to
Meidan (1996) covers advertising of the company image as a whole versus advertising the brand
name and the different products. He also talks about above-the-line advertising as channels of
communication that can be applied, and under-the-line advertising as a discreet but significant part
of a financial services organization’s promotion. These two communication approaches will also be
considered.

Meidan (1996) also presents a number ways to use sales promotion, such as through coupons,
special offers and other forms of price manipulation. This will also be of relevance for our research.
Moreover, he describes to what extent sales promotion can be used by financial institutions, which
also will be of interest.
With public relations, we will look at significant issues, which according to Brassington & Pettit
(2000) are relationships building, image maintenance, charitable involvement, sponsorship, and
community initiatives. We will also consider Meidan’s (1996) statement regarding the importance
for financial institutions to appear in financial magazines.

Concerning personal selling, we will look at the importance of interaction and relationships with
customers, which according to Verhallen et al. (1997) is increasingly important for banks due to the
competition intensity.

Lastly, within direct marketing our concerns will mainly include measurable response achieved
through different tools such as the Internet, which according to Lee (2000) and Mools (2000) is to a
large extent replacing face-to-face interaction.

A new product in corporate perception

New products can be classified using two dimensions;

1. Original products – new, innovative products which create absolutely other
market. This product group is the most risky one since they are neither known
for a company, nor for the market. Furthermore the costs are the highest, be-
cause very often the technologies are unknown and they require big invest-
ments and research. As an example can be mentioned the appearance of per-
sonal computers on the market in the 70’s of the 20th century as well as that
of cell phones in the 90’s. Original innovations make up about 30 per cent of
all new products on the world market. (Kotler 2006, 354).
 2. Extension of product category – new products which give a company an op-
portunity to create the diversity and first time to enter an already existing
mar- ket with already known product categories. These products are not
absolutely new for the market, but before a company did not have the
appropriate experi- ence or technology in order to offer it. The more original
this extension is, the more successful the entrance of a company onto the
market will be.
3. Product line extension – the new products which supplement the already
exist- ing product line of a company. Line extension also includes
improvement of the models, price reduction as well as repositioning.
Sometimes companies tend not to use their already existing brand but to
create new ones, cognate brands in order to attract the corresponding market
segment (for example, Co- ca-Cola’s sub brands Sprite and Fanta or BMW’s
sub brands Mini and Rolls- Royce).
4. Model improvements are new and full-fledged versions which replace the ex-
isting ones because they are of a higher manufacturing quality, with the addi-
tional options or receivable value, for example, Microsoft’s new operating
sys- tem Windows 10 which when compared to the previous versions offers
many relevant improvements for the users.
5. In case of price reduction the new products are offered which replace their
previous versions offering the same or even better quality at a lower price or
with lower costs.
6. In case of repositioning the existing products are directed onto the new mar-
kets or to the other market segments (for example, the repositioning of John-
son & Johnson shampoo for kids into a shampoo for both adults as well as for
kids) or which are offered from other competitive positions. (Zikmund and
d’Amico 1993, 385)

When extending a product line, the main marketing goal is to let consumers know
about these modifications and new opportunities and, what they offer, since quite of-
ten the buyers do not see the new products as something unique, unusual or radically
different from the previous offer.

If a product is new and before unknown for a company and management, most likely
two essential matters must be solved – first of all, the technologies will be unknown
before or at least radically differing from ones used before and secondly, the consum-
 ers will have to be ensured about the uniqueness of the product and its distinction
from the products already offered on the market. And it is understandable, that in the
process of solving these issues additional investments will be needed.
In the figure one can see the division of new products depending on technological
similarities with the existing products and necessary for development investments.

Relevance between classification of new products and risk of

investments

In the picture is shown the relevance between the above mentioned product categories
and investment risk which depends on whether there are new technologies needed for
the product introduction into the market and how big the degree of novelty of the
product in consumer perception is.

As one can see, the smallest technology changes must be introduced extending the
product line – in the cases of price reduction, repositioning and model improvement,
while marketing actions will require additional investments, whose target will be to
make the consumers to notice appearance of these extended lines on the market. Also
the risk will be minimal since the technologies do not have to be significantly changed
and more or less the possible demand can be predicted. While the highest investment
risk is expected introducing the original products onto the market, un- known before
because first of all, in most cases new technological solutions are needed and
secondly, from the consumer side mistrust and often also incomprehension are to be
expected.
A new product in consumer perception

From the consumer or market point of view the term “a new product” is defined
by its innovation degree and is recognized as new only then, if the market
participants consider it innovative. As Bennett believes, regardless of how
inventive the changes a manufacturer offers are if in consumer perception, they
are not unique, then these changes cannot be called an innovation. (Bennett 1988,
328) Evans explains an innovation as anything (idea, concept, product or service)
which is considered to be new on the market. (Evans, Jamal and Foxall 2006,
243)As an innovation can also be defined a process, in which new scientific,
technical, social, cultural or other spheres’ ideas, developments and technologies
are implemented on the market in the demanded and competitive product or
service, while the final result of innovation is the novelties, improvements in
product and process quality and effectiveness.Looking at the definitions, which
are offered in different information sources, one can see that in all of them there is
one common feature – as innovations are defined every- thing that is offered as
new, regardless of whether an equivalent product has been found on the market
before.In the marketing theory there are three types of novelties – continuous
innovations, dynamically continuous innovations and discontinuous innovations
(Berkowitz, Kerin and Rudelius 1989, 233).
Radically new products, which did not have equivalent predecessors and which dis-
ruptively influence consumption habits with their appearance, are called
discontinuous innovations. As an example can be mentioned introduction onto the
market of televisions, cell phones, personal computers, microwave ovens, personal
autos, which have changed consumer behavior and influenced the lifestyle. From
the marketing point of view, these products require significant time resources for
educating the consumer and for correct usage.

In the course of time, new and improved versions of these novelties appear, which
do not seem anymore so radical, therefore they belong to the group of continuous
innova- tions (Evans, Jamal and Foxall 2006, 243).

Dynamically continuous innovations are the type of novelties, by which consumer

behavior is changed, but at the same time these changes do not make a dramatic influ-
ence on lifestyle and it is not necessary to acquire new, significantly different skills.
For example, electrical grass mowers perform the same what could be made before by
scythe or mechanical grass mowers, but it happens much faster, more effectively,
 with a better quality and with less effort. Thereby dynamically continuous innovations
do not offer revolutionary solutions, but noticeably facilitate the execution of various
tasks. Laptops do not have other functions as personal computers do, but their size and
functionality make them more convenient in usage and easier to store. Also electrical
toothbrushes do not require obtaining new skills, at the same time offering a better
final result (Zikmund and d’Amico 1993, 387).

Continuous innovation products do not require new behavior or additional skills from
a consumer. For example, all-weather tires ease the process of car maintenance for a
driver, but usage of that is not obligatory and additional special instruction for that is
not required. In this category are also included „new and improved” shampoos, wash-
ing powders, revised and improved books and similar, where the products get slightly
improved using a newer technology or equivalent imitations are offered.

Marketing specialists regularly try to improve products, introducing them as innova-

tive ones, because even small changes, for example, a lower amount of calories or less
salt can give competitive advantages. Although such improvements can technically be
perceived as simple modifications, however in the result of corresponding marketing
campaigns from the consumer point of view those become novelties – surely not radi-
cal or unique, but enough relevant in order to direct market and assured continuous
development.

So, to sum up information about a new product, its essence and types, it can be con- cluded that
before a company makes a decision on launching a new product development, it would be
advisable to define in which direction it wants to expand, what market share to obtain, to evaluate
its resource level and technological possibilities as well as target market special features in order
to be sure that the new product is quickly accepted and evaluated as necessary and helpful for the
consumers.
Concept development and check

Ideas which have survived from the screening stage are materialized and therefore it
is necessary to test them on the potential market. That can be done only if the
properties and advantages of a product are explained to the potential consumers.
Thereby it is important to define a product idea and its positioning concept.

A product idea is a possible product or service that a company could supply onto the
market. While a product concept as Kotler underlines, is a detailed variant of an idea
which is stated to the consumers in the meaning terms (Kotler and Armstrong 1991,
292). According to Praude, a concept is already selected and studied idea version giv-
en in the understandable product description (Praude and Belcikov 1999, 408).

Hence, as the author believes the consumers do not buy a product idea, they need
apprehension of what they will get into possession of. Since several concepts can be
developed for every idea, the task for marketing specialists is to check how attractive
every alternative seems to consumers and to choose the most suitable one.

When developing the concept it is important to answer the following essential

questions:
- Which is the potential target market and who makes the decision in the
process of purchasing decision making?
- Which properties and advantages must a possible product have?
- How do consumers react on the potential product?
- How is a product manufactured so that the costs are the lowest possible?
- What will a product placing on the market cost for a company?

One of the most widely used methods for the concept development is the use of a
product positioning map (Kotler 2006, 358). This is a process during which the market
situation is researched and information is obtained about the properties which seem
important to the consumers in a concrete product group (for example, price, quality,
etc.), which of already existing products on the market (similar to the potential idea)
meet the consumer requirements, what is according to the customer’s opinion the ideal
level of these properties and finally, how they estimate the existing offer according to
their own standards.

Afterwards information is gathered and set as a map so that it would be easier to make
comparisons, and an example of that is presented in the figure 4. Most often two
dimensions are used (two most important properties, which in the management’s
opinion a possible product would have to possess), although by computer it is possible
to generate complicated multidimensional product maps.

Examples of strategies and creative advertising which used to promote financial

products:

1. Content Marketing Case Study: How TVF created Yeh Meri Family to educate 90s kids

about Mutual Funds Investment

 Category Introduction

A large percentage of the AMFI’s TG (first time / early investors) are in the 25-40 age group. People
think about investments largely in the context of their families.

Brand Introduction

Association of Mutual Funds in India (AMFI) launched their mutual funds “sahi hai” campaign as part
of their investor awareness outreach program

In 2018, Association of Mutual Funds in India (AMFI) launched the next phase of their mutual
funds “sahi hai”campaign taking the narrative forward.

Objective

 Educating audiences about goal-based investing in mutual funds.

 Highlighting that not all mutual funds are impacted by market volatility.

 Explaining that for longer-term investing, mutual funds are the right choice.

 Bringing mutual funds into the consideration set for prospective investors.

Summary

 Created & directed by TVF’s Sameer Saxena, the heart-warming web-series Yeh Meri Family is set in
Jaipur over the events of the summer vacation of 1998. The show explores the sensibilities of a
quintessential Indian family as seen from the eyes of a 12-year old boy. The protagonist – street-
smart Harshu explores his relationships with the rest of the family – elder brother & adarsh beta
Dabbu, younger sister, 5-year old Chitti who is the apple of the family’s eye, the quintessential 90s
mom, Mummy, played by TV legend Mona Singh and the engine of the family, the father, Gupta.

 Problem Statement/Objective

The #MutualFundsSahiHai campaign raised the levels of awareness & interest in mutual funds as an
investment vehicle across the urban markets. AMFI worked

2. DHFL
Introduction to the company

DHFL has been providing easy access to affordable Housing Finance to realise home-ownership
aspirations of millions of Lower and Middle income families in semi-urban and rural India. DHFL was
established in 1984 with this goal, by a visionary leader Late Shri Rajesh Kumar Wadhawan. He
observed that most Indians were unable to buy their dream home and committed himself to
transforming the lives of Indian households by enabling access to home ownership through the
inception of DHFL.
 Brand Introduction
 Dewan Housing Finance Corporation Limited (DHFL), one of India’s largest housing finance companies in the
private sector, today launched its new ad campaign “Home Loan Dilse” which is an extension of the earlier
Ghar Jaisa Loan Campaign. This is the third ad campaign featuring its brand ambassador, Shah Rukh Khan to
increase awareness and reverse the dilemma among the LMI segment in India with regards to the decision to
own a home of their own.

Objectives
 To tell people what is right time to buy a home or avail of a home loan.
 To understand campaign communications relatable instances from various stages in people’s lives
and affirms that the right time to buy a house is when they dream of a home. Right from getting
married or after you have a child, from the desire to get rid of a nagging land lord to the need for more
space to accommodate a growing family.

Indian banks and social media: Real world examples 

The strategies of social media pioneers such as State Bank of India, YES Bank, HDFC Bank, and
ICICI throw light on how banks are using social media effectively to drive better outcomes.

Consistently ensuring high engagement on Twitter: 

Virtually every month, SBI figures among the top five Indian brands in terms of brand engagement on
Twitter, as per the Economic Times Brand Equity Twitter Advertiser Index. SBI’s campaigns, aimed at
creating customer interest in digital services, saw high engagement from August 2017 to November 2017.
A key aspect of SBI’s strategy is timely posts that educate and inform customers.

 Using festive occasions to build goodwill: 

YES Bank used the 2017 Diwali season to run a Digital Diya campaign that encouraged the Indian community to
contribute to spreading the light of financial literacy in rural India. The campaign invited users to visit a micro site to
light digital diyas. Enthusiastic users responded by lighting one million digital diyas and the bank contributed an equal
amount to spreading financial literacy, creating goodwill, and enhancing brand awareness.

 Making social media listening a core activity: 

In August 2017, HDFC Bank launched its in-house state-of-the-art Digital Command Centre (DCC) in Mumbai to listen,
understand, and acquire valuable brand insights by monitoring customer conversations on social media.  Using
dedicated real-time dashboards, the DCC serves as a business intelligence tool for the bank, with its top management,
central teams, and marketing department drawing upon its analysis. DCC insights help users realign campaigns and
also take corrective action based on what influencers are saying on social media.

 Using social storytelling to market niche products: 

ICICI Bank’s Fund Your Own Worth campaign promotes a savings account with special benefits for women
who want to empower themselves. The campaign smartly leveraged social media storytelling by using socially
curated real-life stories of successful women to sell a niche financial product, while also building brand affinity
among working women.

Social media marketing going to be even more critical to the marketing mix in the future 
Two-thirds of India’s population is below 35 years of age. Factors like growing smartphone usage and the availability
of affordable broadband data are increasing the number of active social media users. For banks, the social media
phenomenon presents remarkable opportunities to drive engagement with customers. A Facebook-Boston Consulting
Group Report on the state of social media in the financial services industry in India in 2017 revealed that there were 6
crore digitally influenced retail banking customers in India in 2016. By 2020, the number is expected to double to 12
crores. To meet the needs of customers who are comfortable using social media, it is vital for Indian banks to
accelerate investment in social media marketing strategies, solutions, and talent.

Banks take social media marketing to the next level

With decelerating economic growth and increasing margin pressures, banks are not only competing among
themselves, but also with disruptors like FinTechs. So how can they succeed with their social media strategies in this
environment? 
One option is to deploy a more integrated social media strategy by combining banking and social media analytics, text
mining and social media marketing to identify profitable customers, and cross-sell as well as upsell products and
services. 
Social media say American banks are using employee brand advocates to drive brand engagement on social channels –
something that Indian banks can explore. When banks post a picture of an employee or visually capture something
that they are doing, they see a huge lift in social engagement that drives more traffic to their website and other
channels.
Project Details
2.1 Literature review

2.2 Research Objectives

 To identify awareness about the financial products in the market.
 To identify relevance of financial products from customers perspective.
 To identify significance of advertising in buying decision of financial products by consumer
 To study if advertising based on emotions or advertising based on facts, which is more
accepted by customer for financial products.

Hypothesis

2.3 Study Methodology

The research method, which is frequently used for information gathering, is investigation or the
survey method, the use of which is associated with the collection of information of descriptive
nature. The most popular technique is to carry out a survey both in writing (questionnaires) and
verbally (interviews). With the help of a survey, it is possible to determine both the action and the
motivation of the respondent, as well as the opinions and views on different issues. Currently
survey methods are used to study.

Limitations

BCG Growth-Share Matrix

The Boston Consulting Group (BCG) growth-share matrix is a planning tool that uses graphical
representations of a company’s products and services in an effort to help the company decide what it
should keep, sell, or invest more in.

The matrix plots a company’s offerings in a four square matrix, with the y-axis representing the rate of
market growth and the x-axis representing market share. It was developed by the Boston Consulting
Group in 1970.

Understanding a BCG Growth-Share Matrix

The BCG growth-share matrix breaks down products into four categories: dogs, cash cows, stars, and “question marks.” Each
quadrant has its own set of characteristics. See below:
Dogs (or Pets)
If a company’s product has a low market share and is in a low rate of growth, it is considered a “dog” and should be sold, liquidated,
or repositioned. Dogs, found in the lower right quadrant of the grid, don't generate much cash for the company since they have low
market share and little to no growth. Because of this, dogs can turn out to be cash traps, tying up company funds for long periods of
time. For this reason, they are prime candidates for divestiture.

Cash Cows
Products that are in low-growth areas but for which the company has a relatively large market share are considered “cash cows,”
and the company should thus milk the cash cow for as long as it can. Cash cows, seen in the lower left quadrant, are typically
leading products in markets that are mature.

Generally, these products generate returns that are higher than the market's growth rate and sustain themselves from a cash flow
perspective. These products should be taken advantage of for as long as possible. The value of cash cows can be easily calculated
since their cash flow patterns are highly predictable. In effect, low-growth, high-share cash cows should be milked for cash to
reinvest in high-growth, high-share “stars” with high future potential.

Stars
Products that are in high growth markets and that make up a sizable portion of that market are considered “stars” and should be
invested in more. In the upper left quadrant are stars, which generate high income but also consume large amounts of company
cash. If a star can remain a market leader, it eventually becomes a cash cow when the market's overall growth rate declines.

Question Marks
Questionable opportunities are those in high growth rate markets but in which the company does not maintain a large market share.
Question marks are in the upper right portion of the grid. They typically grow fast but consume large amounts of company
resources. Products in this quadrant should be analyzed frequently and closely to see if they are worth maintaining.

Special Considerations
The matrix is a decision-making tool, and it does not necessarily take into account all the factors that a business ultimately must
face. For example, increasing market share may be more expensive than the additional revenue gain from new sales.

[Important: The matrix is not a predictive tool; it neither takes into account new, disruptive products entering the market
nor rapid shifts in consumer demand.]

Because product development may take years, businesses must plan for contingencies carefully.

Key Takeaways
 The BCG growth-share matrix is a planning tool that uses graphical representations of a company’s products and
services,
 The BCG growth-share matrix is used to help the company decide what it should keep, sell, or invest more in.

 The BCG growth-share matrix breaks down products into four categories: dogs, cash cows, stars, and “question marks.”