INTRODUCTION TO

FINANCIAL
SERVICES
MARKETING
DEFINING FINANCIAL SERVICES
• Financial services are concerned with individuals, organizations and their finances – that is to say, they are
services which are directed specifically at people’s intangible assets (i.e. their money/wealth).
• The term is often used broadly to cover a whole range of banking services, insurance, stock trading, asset
management, credit cards, foreign exchange, trade finance, venture capital and so on.
• The marketing issues that arise with such a variety of products are considerable:
• Some financial services may be very short term (e.g. buying and selling stocks), while others are very
long term (mortgages, pensions)
• Products vary in terms of complexity; a basic savings account for a personal consumer may appear to
be a relatively simple product, whereas the structuring of finance for a leveraged buy-out may be
highly complex
• Customers will vary in terms of both their needs and their levels of understanding – corporate
customers may have considerable expertise and knowledge in relation to the types of financial services
they wish to purchase, while many personal customers may find even the simplest products confusing.
DIFFERENCES BETWEEN GOODS AND
SERVICES
• Financial services are, first and foremost, services, and thus are different from
physical goods.
• Services are processes or experiences – you cannot own a bank account, a
holiday or a trip to the theatre in the same way as you can own a car, a computer
or a bag of groceries
DISTINCTIVE CHARACTERISTICS OF
FINANCIAL SERVICES
• Intangibility
• Inseparability
• Perishability
• Heterogeneity
• Fiduciary responsibility
• Contingent consumption
• Duration of consumption
MARKETING CHALLENGE

• The importance of people and the ways in which the service delivery process is
managed
• It requires internal marketing to ensure that staff have the motivation and
information to deliver the service offered.
• Interactive marketing between customer and employee also takes place during
every service interaction; in many respects, any service organization employees
who come into contact with a customer will find themselves in a marketing role.
CLASSIFYING SERVICES
• The nature of the service act (whether it involves tangible or intangible actions)
and the recipient of the service (people versus things)
• The nature of the relationship with the service provider (formal or informal) and
whether the service is delivered continuously or on discrete basis
• The degree of standardization or customization in the core service and the extent
to which staff exercise personal judgement in service delivery
• The capacity to meet demand (with/without difficulty) and the degree to which
demand fluctuates
• The number of outlets and the nature of the interaction between customer and
service provider.