ING DIRECT CASE STUDY

ING CASE STUDY
MODULE NAME: MODULE CODE: MODULE TUTORS: INTERNATIONAL BUSINESS AND TRADE MGTMIM002-200809 JIM STOCKTON ERIC GOWLING LIHONG ZHANG

JEEVAN MATHEW MURALI KRISHNAN THAYYIL GOPAKUMAR NOUFAL POOLAKKAL KARATTUCHALI SREERAG THAZHISSERY GANGADHARAN

384608 393608 381879 393609

Liverpool Business School

1|Pa ge

ING DIRECT CASE STUDY

CONTENTS

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1.1 EXECUTIVE SUMMARY 2.1 INTRODUCTION 2.2 BUSINESS OBJECTIVES 2.3 SWOT ANALYSIS 3.1 FINANCE 3.2 FINANCIAL DATA EVALUATION 3.3 FUTURE IMPLICATIONS 4.1 MARKETING 4.2 IMPORTANCE OF MARKETING IN ING DIRECT 4.3 MARKETING MIX 4.4 ING DIRECT¶S MARKETING STRATEGY 4.5 STRATEGY ANALYSIS AND RECOMMENDATIONS 5.1 OPERATIONS MANAGEMENT 5.2 OPERATIONAL STRATEGY 5.3 ANALYSIS WITH SERVICE-PROFIT CHAIN MODEL 5.4 CRITICAL ANALYSIS AND RECOMMENDATIONS 6.1 INTERDEPENDENCIES OF MARKETING AND OPERATIONS 7.1 CONCLUSION 8.1 REFERENCE 8.2 APPENDIX

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Liverpool Business School

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2) BUSINESS OBJECTIVES ³Our purpose is to be a servant of the average person. The bank is one of the six business lines of ING Group and was established in 1997 and it celebrated its tenth anniversary as world¶s leading direct bank. We discuss the current situations of these functional units and their implications to the future. ING Direct has a unique approach in marketing and follows tightly controlled operational methods. home mortgages. and building a nest egg.ING DIRECT CASE STUDY 1. ING Direct is the world¶s leading direct savings bank. self-reliance. Unlike other banks ING Direct is keen on encouraging its customers to save. when entrepreneurs spent more time with venture capitalists than they did with customers.1) EXECUTIVE SUMMARY ING Direct is an online banking service provider. Definitely those records were the results of a revolutionary approach in the banking sector and aggressive marketing strategy. The report is based on the research on ING Direct.our approach is to get the Americans save moreto return to the values of thrift. President and CEO. is one of the six business lines of ING Group. ING Direct ING Direct¶s business objectives can be summarised as follows:  Increase in sales revenue and thereby profit through larger customer base  Efficient use of technology Liverpool Business School 3|Pa ge .´ ---Arkadi Kuhlmann. and when being clever got more attention than being authentic (Kuhlmann and Philp.2million customers worldwide. 2009). The bank was built on the foundation of being unconventional. It covers three functional units of the business which are Finance. no fees. The report concludes with recommendations to capitalise on the market and to achieve its long-term goals. 2. Rather than getting people to spend more . Ever since its establishment there has been a sharp growth in the company performance. Marketing and Operations. It sells a limited number of banking products with a simple slogan: ³Great rates. no minimums´. 2.1) INTRODUCTION ING Direct established in 1997 by Arkadi Kuhlmann. ING Direct declared itself a rebel with a cause in an era when elaborate business models were more the fashion.which is what most banks do . Starting at a loss of Euro 70 million it reported a profit of EURO 691 million in 2006. Presently. active in 9 countries with 22. It offers a narrow range of products such as savings account. home equity lines and mutual funds.

ING Direct¶s central objective is to grow and strengthen market share in the online banking industry.2006). ING Group.1billion at year-end.7billion or 9.75% in 2007 from 0.598million in 2007 from EUR 1. British pound and Australian currency zones and the intensified competition for retail funds.3) SWOT ANALYSIS SWOT analysis reflects the organisations existing position and viewpoint.196million in 2007 from 2.7%. And in 2008 it is EUR 1. Liverpool Business School 4|Pa ge . or EUR 93million. to EUR 2. Total income decreased by 1. This lies at the very heart of what business is about(Atrill and McLaney. The client retail balance in 2007 grew EUR 27. or EUR 60million. Financial ratios can be used to assess the financial health of a business(Atrill.ING DIRECT CASE STUDY  Minimising the cost  Delivering high value to customers and encourage them to save more  Simplicity in operation 2. This is done by minimising cost.883 a year earlier.538million in 2006. ING Direct is the world¶s leading direct savings bank. It further decreased by 60% to EUR 878million in 2008.8%.1) FINANACE Finance is concerned with the ways in which funds for a business are raised and invested. to EUR 310. ING Direct has a very strong financial background which was initially supported by the parent company. opportunity and threats in an organisation (Valentin. with competitors and with industry trends.5% increase.565. 2001).9%. Ratios can be used to compare the company¶s performance overtime. 3. and can also reveal profit and growth potential.289million in 2006.980 in 2008 from 8.2006). the number of full-time staff in ING Direct is increased to 9. ING Direct offer great value for their products along with making it as straight forward as possible.89% in 2006 as a result of higher central bank rates in the euro. Appendix 2 shows the global profit progression of ING Direct. This inquires into the strength. branchless operations and no hidden catches. A SWOT analysis of ING Direct is given in Appendix 1.750million recording a further 9. Operating expenses rose by 3. According to the annual report of ING Group. 3. weakness. The interest margin narrowed to 0. can point towards the necessary improvements and possible dangers. to EUR 1. The profit and loss account of ING Direct is shown in Appendix 3. Further they aim to keep their rates consistently competitive.2) FINANCIAL DATA EVALUATION Being a service based company. The number of full-time staff in 2006 was 7.

Net Profit Margin= Net profit before interest & tax Sales revenue NPM 006) = 31. From that the current ratio can be calculated as follows: Current ratio = Current assets Current liabilities ¦ £¢ ¢ ¥ ¤ £ ¢¢ ¡ Live   B siness Sc 5|Pa g e .1993). They express the profits made in relation to other key figures in the financial statement.66 Sales to Capital employed(2007) = 0.13 The decrease in NPM shows the rise in competition and the economic imbalances which the company had to face during the period 2006 -07. Appendi 4 shows the assets and liabilities of ING Direct. Net profit margin ratio relates the profit for the period to the sales revenue.ING DIRECT CASE STUDY Profit ilit ratio provi an insi t to t degree of success in creating wealt for t e owners. The higher the ratio. Return on Capital employed = Operating profit Capital employed Net profit before interest and taxation Sales X Sales Long term Capital employed = X 100% ROC = Net profit Margin x Sales to Capital employed ROC (2006) =20 ROC (2007) =19 The current ratio compares the li uid asse with the current liabilities and is a ts measure of short-term solvency.21 NPM 2007) = 24. Return on Capital employed is a fundamental measure of business performance which is concerned with returns achieved from all long term capital invested.79 The sales to capital employed ratio increased in 2007 as compared to that of 2006 and it implies the effective utili ation of capital employed in generating sales revenue. the more li uid the business is considered to be (Brockington. ales to Capital employed = Sales Capital employed Sales to Capital employed(2006) = 0.

ING Group. non-banks have begun to integrate financial functions into their online offerings. Moreover. Competition with regard to other banking giants like HSBC. A source of growth could be the expansion of product range. The year 2007 witnessed the beginning of the credit crunch which in turn reflected in the annual result.ING DIRECT CASE STUDY Current ratio(2006) = 1. That is why they applied for aid from Netherlands government and received a capital injection of EUR 10billion (The Guardian). They have got a secured financial support from the parent company. capital and expense base. ING Direct need to strictly manage its risks. a higher current ratio might be thought to be preferable. and the competition has intensified because of increased reach and transparency of online offerings. But it will be a challenge to overcome the inherent problems in expanding the product range along with keeping the µsimplicity¶ of the company. Increase in operating expenses and the repositioning of UK market also accounted for the decrease in profit. Liverpool Business School 6|Pa ge . (Dewan and Seidmann. it has clearly been hit by the general loss of confidence. Even though ING insisted its declining profits were a result of loss of shares and not related to US sub-prime mortgages. For preserving its position in the worsening economic condition. µsafe¶ and µsavings¶ bank reputation as not any of the competitors are as half strong as they were used to be.3) FUTURE IMPLICATIONS The sales to capital employed ratio shows ING Direct¶s capability of using its capital to the maximum for generating revenue from it. The recent downturn implicates that in future ING Direct has to be more careful as the credit market is very weak at the moment and the liquidity in the market is at its lowest. a current ratio of around 2 is generally considered to be about right and so in the future bank should try to bring that up so that it can give confidence to short term creditors. Yield curves remained flat or inverted in all currency zones. 3. Fluctuating exchange rates is another reason.013 Current ratio(2007) = 1.2001). it was decided early 2009 not to launch its operations in Japan. MetLife etc. In line with these priorities. ING Direct also incurred a start up cost of 22million in Japan which also added to the expenditure. while competition for deposits intensified as many banks faced tighter liquidity and increased funding costs on the wholesale markets. They scrapped its dividend payments to the share-holders and senior executives have agreed to forfeit their annual bonuses. ING Direct has to capitalise on its µsimple¶.011 As liquidity is vital to the survival of a business. According to Brockington(1993). focused on online banking making it tough for ING Direct in 2007. The bank already took measures to stabilise the financial conditions.

4) ING DIRECT¶S MARKETING STRATEGY Marketing strategy is concerned with looking into the future and developing and implementing the plans that will drive the organisation in the desired direction (Brassington and Pettitt. Some of the marketing tactics that they used are: Liverpool Business School 7|Pa ge . 4. ING Direct¶s marketing strategy was the combination of µaggressiveness¶ and µsimplicity¶ by consistently offering high rates and excellent service quality. Their marketing tactics was the key factor to attract many customers and make them aware of the combination of rates and its hip brand. 4. ING Direct had a strategic marketing thinking in which they focused on their customer¶s needs by making them save more through their products rather than to make them spent more. goods and services to create. (Kotler and Armstrong. people and promotion are the extended tools which are used in the marketing mix to make further analysis. no fees. no minimums¶. 4. pricing. exchange and satisfy individual and organizational objectives¶ (AMA. Cost leadership. promotion and distribution of ideas. tactical marketing tools that the firm blends to produce the response it wants in the target market. ING Direct sells its product with the simple slogan µgreat rates. physical evidence.1) MARKETING µMarketing is the process of planning and executing the conception. Product. 2000). One-third of its budget was allocated to marketing and it was possible because it had adequate financial support from its parent company. ING Direct used innovative marketing approaches which differentiated themselves from their competitors. 1985). moreover.2) IMPORTANCE OF MARKETING IN ING DIRECT Unlike the traditional banks. The marketing mix consists of everything the firm can do to influence the demand for its products. and focus are the three generic strategies that any business should pursue to attain competitive advantage (Porter and Millar. price.ING DIRECT CASE STUDY 4. differentiation. 2001). 1960). ING Direct¶s marketing mix is illustrated in Appendix 5. place and promotion are the set of controllable marketing tools that an organization use to achieve its objective in the market. ING Direct achieved competitive edge and competitive advantage by differentiating themselves from their rivals in the overall marketing strategies they used and focused on the customers that they can handle easily. 1985). They had a clear focus on their customers and were not suffering from marketing myopia (Levitt.3) MARKETING MIX Marketing mix is a set of controllable.

4. b) Bra di g: Branding is a way to distinguish the goods of one producer from those of another. Many customers were attracted by the combination of rates and its cool image. etc. President and CEO ING Direct Arkadi Kuhlmann introduced this unique and successful marketing tactics to make people think differently about how to manage their money and to make them save. c) Cafes: Another unique feature of the marketing strategy is ING Direct¶s cafes. market structure and opportunities Liverpool Business School 8|Pa ge . e) Gree fields: They used green fields like Canada to grow their business because there was small number of competitors and it was the ultimate place for them to grow. ING Direct invested one third of its budget in marketing programs to build the ING Direct brand. anti-establishment tone. They had a simple branding strategy with clear message and feature the bright colour orange (orange colour indicates cheap and reliable products according to the vision experts). 2000). d) Guerrilla: ³People are sleeping. Appendix 6 shows some of the guerrilla marketing campaigns of ING Direct. 1992). ING Direct continuously organized innovative promotion campaigns like free movie tickets. logo. or other attribute that identifies a product and distinguishes it from others (Keller.5) STRATEGY ANALYSIS AND RECOMMENDATIONS According to (Brassington and Pettitt. So we wake them up with one of our marketing campaigns. 1998). competitor¶s strategies. the various factors that may influence an organizations marketing strategy are the objectives and resources of the organization. which attracted new customers. symbol. They switch their money and go back to sleep´ ---Arkadi Kuhlmann. The cafes are the medium which introduced the customers to the brand. You have to shock people a little bit to get them to think differently about how they manage their money. package design. attitude to change and risk. free gas. they had a strong support from their parent company in establishing the ING Direct brand. capturing customer¶s attention by communicating in a humorous. Furthermore.ING DIRECT CASE STUDY a) Sales Promotio s a d Advertiseme ts: Sales promotion is a range of tactical marketing techniques designed within a strategic marketing framework to add value to a product or service in order to achieve specific sales and marketing objectives (Davies. The cafes offer the customers a place to speak and receive some financial advice with an ING cafe member who in turn is a trained banker. It is a name.

This helped to save enormous amount of money. The operational flow chart is illustrated in Appendix 8. It has already done a huge investment in marketing in the recent years so in this present financial condition they should concentrate more on cutting down cost in each and every functional area. Most of the banks have been stuck by these economic conditions and ING Direct is not an exception. They introduced a unique strategy µonline or internet banking¶ and produced a massive impact with a minimum time span.e. 1993). higher level of service. they are not paper Liverpool Business School 9|Pa ge . ING Direct¶s brand has been strongly established in the past and is a well recognized brand in the banking industry. here. Without an efficient and effective operational strategy no organisation can hope to retain market leadership.ING DIRECT CASE STUDY (Appendix 7). They reengineered the banking industry by replacing branches with cafes which made more customers attracted towards them and finally their marketing strategy improved their opportunities to grow. they used a different strategy to make people save more. They reengineered the industry to cut cost in three different ways. 1995). ING Direct¶s operational strategy is to cut down the cost to the bore with the support of strong investment in technology. 5. operating and controlling a transformation system which takes input of variety resources and produces outputs of goods and services which are needed by the customers (Naylor. Their strategy is to ³reuse before buy and.2) OPERATIONAL STRATEGY Operational strategy is the total pattern of decisions which shape term capabilities of an operation and their contribution ( Slack et al. ING Direct had strong objectives that has been already mentioned and had strong resources to support their marketing strategy from the ING group. but in this scenario it is not fair to do so.Another main problem is the queuing method of customers when they frequently contact the call centre. buy before build´. as there are many options for the customers to switch. ING Direct is a flat organization with few management layers.1) OPERATIONS MANAGEMENT Operations management is concerned with creating. price or quality or more probably on all three (Galloway. They have intensely analysed their competitor¶s strategy that was to make people spend more. so in future less investments should be made in marketing and key concentration should be given to retain their existing customers . Every operations in ING Direct is integrated to its ultimate objective ie minimising cost. i. since it will fail on delivery. ING Direct operates under the broad head of virtual banking system. and control their accounts which are rapidly increasing. They bought IT hardware centrally and made it available to various country organizations. 1993). Operations managers are responsible for producing the supply of goods and services in organisations (Schroeder. 1996). 5.

Again performance measurement system is used to increase customer acquisition and to reduce costs. According to Kelly (2009). The various stages involved in product development are. interpretation and dissemination of appropriate data´ (Neely. sorting. Arkadi kuhlmann introduced a unique system called µOrange code¶ which indicates that all the employees have the same goal and removing all the titles and offices. They recruits people who are willing to do things differently. Every operation is closely and tightly controlled everybody in ING D irect measures and is being measured.1998). and those who can be easily trained and introduced to a competitive selling culture. Most of the employees consider ING Direct as an attractive employer for the strength of its business model. collation. 5. human capital is a source of sustainable competitive advantage as it is rare and difficult to imitate. financial and logical risks.ING DIRECT CASE STUDY based. people with right attitude. developing a business plan which includes the forecast of demand and marketing expenditures. and its non banking culture. ³Performance measurement enables informed decisions to be made and actions to be taken as it qualifies the efficiency and effectiveness of the past actions through acquisitions. Product development in ING Direct involves cross coordination with ma rketing and IT. evaluating the operational.3) ANAL WIT SERVICE PROFIT CHAIN MODEL © ©   ©© ¨§ Live B siness Sc Heskett et al. efficient use of call centre and they eliminated costly customers. but above all they choose people whose personal values fit with the values of ING Direct. which demonstrates the importance of IT and operational requirements. (1994) 10 | Page . analysis. Performance measurement is another important factor in its operations.

but in today¶s world customers are looking for wide range of products with quality service. which has a direct impact on customer satisfaction. Moreover the IT structure has to be updated regularly to the increasing demands In order to satisfy their execution strategy in future i. They emphasise on low product range and simplicity in their operational procedures.4) CRITICAL ANALYSIS AND RECOMMENDATIONS Some of the challenges ING Direct may face in future is regarding with their cost control in operation. they have to improve their operational performance (Refer Appendix 9). Profit and growth of the firm are boosted by customer loyalty. use of modern tools and techniques. ING Direct establishes a good and strong relationship with both these forces which in turn helps in smooth running of the firm. enable closed loop tracking and selling. and productivity in ING Direct. efficiency improvement. Again. 5. people involvement and on a horizontal focus to best suit and deliver customer requirements in an optimum and satisfactory way (Kelly. deliver better value to the customer. Employee satisfaction eventually results in high quality support services and policies that enable employees to deliver results to customers. As ING Direct is a flat organisation depending heavily on its technology for delivering high quality to its customers. loyal and productive employees in ING Direct. Business Process Management (BPM) model is used to improve the company¶s operational strategy which in turn may help to achieve their business objectives. that is influenced by the value of services to the customers and value is created by satisfied. controlling their operations is a critical task. make them unable to identify the customer¶s needs and ultimately reduce customer satisfaction. and higher cross selling rates. 2009). the employees concentrate more on reducing costs in operations which may. moreover the customer inflow may reduce because the customers want more face to face interaction rather than depending on the internet.ING DIRECT CASE STUDY This model establishes a strong relationship between profitability. Handling the technology efficiently is also an important concern that ING Direct may face in future due to Liverpool Business School 11 | Page . since their business is growing day by day. they depend on each other dramatically. Some of the key challenges that ING Direct may face in future is regarding the inter dependency of each other¶s functional units and cutting down their operational costs. The most exciting fact is that more than 90 percent of the customers of the company believe that they are getting a much better service than the competitors and 99 percent of the employees are proud about their employer. BPM is an approach dependent upon strategic and operational elements. increase revenues . customer loyalty. we suggest BPM for further improvement in ING Direct¶s operational strategy. 6.e. to reduce cost of operation.1) INTERDEPENDENCIES OF MARKETING AND OPERATIONS Marketing and operation in ING Direct cannot be considered as separate entities. generate superior return.

Earlier they were successful in managing their employees. but many new comers have made their job tough and the economic condition is effecting each and every financial organization day by day. 7. marketing and finance acts as supportive functions to operations management. In ING Direct. a change in strategy of any of these aspects will reflect on other.1) CONCLUSION As credit crunch prevails in the current economy. marketing and operational aspects of ING Direct was analysed in the report and few recommendations are suggested. that could use a little of both right now. Liverpool Business School 12 | Page . µsafe¶ and µsavings¶ bank image. ING need to capitalise on its µsimple¶. In order to maintain its image in the current business scenario.ING DIRECT CASE STUDY the increased amount of customers and their needs. customers and the operational policies. some much-needed inspiration to a business world. The level of success achieved by ING Direct holds some important lessons and offers. The financial. ING Direct need to be extremely careful in its future plans. As all these aspects are strongly inter-related.

Atrill. W. and Schlesinger. Kuhlmann.W. (1985). USA. 12. Dewan. µPutting the Service-Profit Chain to Work¶. 6. 5. Prentice Hall. pp 31 -32. 10. Prentice Hall. and Seidmann. United Kingdom. Heskett. (1994). (1993). µPrinciples Of Marketing¶.¶AMA Board Approves New Marketing Definition¶. R. M. 2. Cambridge University Press. 72(2). µInternational Business and Management¶. (2001). P. 44(6). DP publications.E.E. µMarketing Myopia¶. A. M. A. R. Brassington.45-56. 4. United Kingdom 11. and Miller. S. 1 March 1985. (1992).5-10. J.. Management Decision. (2001). B. F. 30(7). µPrinciples of Operations Management¶.L. (2000).O. A. (2006).1) REFERENCE 1. and McLaney. Levitt. T. Pearson education. µHow Information Gives You Competitive Advantage¶.B. Kelly. Jones. L. 14. United Kingdom 15.ING DIRECT CASE STUDY 8.. Porter. µPrinciples Of Marketin g¶ (Second Edition). (1998). AMA (1985). United Kingdom 16. pp. June 2001.. 8. and Philp. July/Aug 1985. (2009). Harvard Business Review. United Kingdom. Marketing News. pp. µFinancial Management for Decision Making¶ (4th edition). µFinancial Management¶ (6th edition). (1993). Harvard Business Review. Harvard Business review. pp. Prentice Hall. G. Communications of the ACM. United Kingdom. J. µSales Promotion as a Competitive Strategy¶. P. V. 7. And Pettitt. (2009).149-160 Liverpool Business School 13 | Page . P. µThe Orange Code¶. Sasser Jr. (2006). T. Davies. Kotler. 9.E. Prentice Hall. Atrill. Loveman. G. A. (1996). pp-1. µOperations Management¶. E. 3. P.. UK. Brockington. Neely. R. July/Aug 1960. µCurrent Issues in E-Banking¶. United States of America 13. John Wiley and Sons. (1960). United Kingdom. Inc. µBusiness Performance Measurement Theory and Practise¶. Cengage. pp 164-170. µAccounting and Finance for Non-Specialists¶ (5th edition). and Armstrong. Routledge. Galloway. Naylor.

and Johnston. A. (2001). Harrison.html 23. Slack. Schroeder R. Pitman publishing.ing. µSWOT Analysis from a Resource-based view¶. The Guardian | Monday October 20 2008 20.ing.. Singapore. http://annualreports.ing. Chambers. Journal of Marketing Theory and Practise. R. Valentin.bloomberg. µOperations Management: Decision Making in the Operations Function¶ (Fourth Edition). http://www. pp 54-69 21.jsp 22.com/group/index. N. (1995).G.K. 9(2).. 18. S. United Kingdom 19. E..com/apps/quote?ticker=ING%20direct Liverpool Business School 14 | Page . McGraw-Hill. http://www.com/xpedio/annualreport2007/report/ing_direct/index. http://www.html 24.com/2008/report/ing_direct/index. (1993). Harland.ING DIRECT CASE STUDY 17. C. µOperations Management¶.

ING DIRECT CASE STUDY 8.2) APPENDIX Appe dix 1 SWOT ANALYSIS OF ING DIRECT Strength y Strong brand image and customer focus y Support from parent company y Efficient use of technology Weakness y Declining revenues y Narrow product range y Less face-to-face interaction with customers Opportunity y y y y Threat y Intensified competition y Economic breakdown y Security threats Cross-selling Explore new markets Weak competitors Rising asset management market Liverpool Business School 15 | Page .

ING DIRECT CASE STUDY Appe dix 2 GLOBAL PROFIT PROGRESSION OF ING DIRECT in EUR million 800 700 97-99 2000 600 500 400 2001 2002 2003 2004 MTP '05 2005 97-99 2000 2001 2002 2003 2004 MTP '05 2005 2006 2007 300 200 100 0 -100 2006 2007 -200 -300 SOURCE: ING Group Liverpool Business School 16 | Page .

719 283 -1.155 2007 2.233 1.598 68 530 2006 2.ING DIRECT CASE STUDY Appe dix 3 PROFIT AND LOSS ACCOUNT (i EUR millio ) Total I come Operati g Expe ses Additio s to loa loss provisio s Total result before tax 2008 878 1.196 1.482 57 694 SOURCE: ING Group Liverpool Business School 17 | Page .

ING DIRECT CASE STUDY Appe dix 4 ASSETS AND LIABILITIES OF ING DIRECT (i EUR millio ) 2007 Assets Liabilities 2006 2005 2004 262560 259792 253160 249792 232773 229778 170001 167731 SOURCE: ING Group Liverpool Business School 18 | Page .

ING DIRECT CASE STUDY Appendi 5 E TENDED MARKETING MIX Price y High rates y Low interest for loan payback Product Place y Orange savings account y Home mortgages y Home insurance TARGET C STOMERS INTENDED POSITIONING y Internet banking y Cafes for customer interaction y Call centres Physical E idence Promotion y Cafes for customer interaction y Excellent marketing tactics y Advertisements y Sales promotions People Process y Hires people with right attitude y Targeting average customers y Eliminating costly customers      y Simple process in front office y Documentation in back office 19 | Page Live l B siness Sc l .

ING DIRECT CASE STUDY Appe dix 6 FEW OF THE GUERRILLA MARKETING STRATEGIES ING DIRECT FREE GAS ING DIRECT CASH COWS ING DIRECT HOT BALOONS Liverpool Business School 20 | Page .

ING DIRECT CASE STUDY ING DIRECT µSAVE YOUR MONEY AT THE MOVIES¶ Liverpool Business School 21 | Page .

ING DIRECT CASE STUDY Appendi 7 MARKETRING STRATEGY ANALYSIS (Modified from Brassington and Pettitt. 2000) ORGANISATIONAL OB ECTIVES Make people save more Provide high rates ATTITUDE TO CHANGE Branchless Operation Reenergised banking industry MARKETING STRATEGY COMPETITOR STRATEGIES Traditional banking style to make people spend more MARKET OPPORTUNITIES Weak competitors due to economic crisis " !  Live l B siness Sc l 22 | Page .

TELEPHONE. OR OTHER MEDIUM DELAY IN RESPONSE APPROVED NO END YES COLLECT MEMBERSHIP DETAILS CHOOSE PLAN NO END YES 1 % %' & %% $# Live l B siness Sc l 23 | Page .ING DIRECT CASE STUDY APPENDIX 8 OPERATIONAL FLOWCHART START VISIT CAFE START AN ACCOUNT NO END YES APPLY NEW ACCOUNT VIA INTERNET.

ING DIRECT CASE STUDY 1 ANY INTERNET BASED BANK ACCOUNT NO END YES LINK THIS ACCOUNT WITH ING SAVINGS ACCOUNT INVEST MONEY NO END YES TRANSFER MONEY FROM LINKED ACCOUNT TO ING ACCOUNT END 0 02 1 00 )( Live l B siness Sc l 24 | Page .

ING DIRECT CASE STUDY APPENDIX 9 CURRENT STRATEGIC MODEL Deliver better Value to customers -Convenience -Pricing Enable closed loop Tracking & selling Reduce cost of Operations Discipline Consistent Execution Drive lower acquisition costs by using database Marketing Improved Technology Platforms Integrated Call centre Marketing operations Generate Superior Returns Higher cross-sell rates through database marketing Adapted from case study 5 57 6 55 43 Live l B siness Sc l 25 | Page .

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