CONSUMER PSYCHOLOGY AND MARKETING OF BANKING PRODUCTS
Karnataka Bank Staff Training College,
December 10, 2008
B.V.Raghunandan, SVS College, Bantwal
Consumer Psychology Individualistic
Need Based
Reacting to the Environment
Shaping the Needs to the Product offered in case of no choice
Both Rational and Irrational
Dominant Social Psychology
Marketing Concepts: A Business Attitude
Production Concept
Product Concept
Selling Concept
Marketing Concept
Societal Concept
Marketing Vs Banking
Marketing Banking
Product Research
Target Consumers
Market Study
Flexible Operation
Free Operating Atmosphere
Salesmanship & Promotion
Consumer Sovereignty
Standardised Product
Mass Consumers
No Market Study
Professionalism
Rigid Operation
Regulated Atmosphere
Social Banking
RBI Sovereignty
Consumer Psychology in Traditional Banking
No Choice Standardised
Service Robotic Response Parasite Endless Patience Resigned for
Production Concept
Choice Based on Caste or Regionalism
Convenience (Location)
Single Branch Monopoly
Generally Rational decisions
Change Agents Liberalisation Narasimham Committee BIS at Basel IT and Networking New Generation Banks Capital Market Reforms FII & Foreign Insurance Companies Business Groups setting up Finance Co Bank Subsidiaries Offering financial
services
New Age Banking IT Absorption &
Networking Cross Selling of
Products Agency Sale of Products Bancassurance Listed Entities Capital Adequacy Interest Rate Differential Financial Services Bigger Role of Insurance
Companies
Risk Management Consolidation Advertisement Aggressive Marketing Wasteful Marketing
Practices More Consumer Care Flexible Timing Lesser Procedure ATM as Delivery
Channel & as a Branch Expansion Strategy
Consumer Psychology in New Age Banking
Spill over Effect of Traditional Banking Varied Needs of Customers Strong Segmentation of Markets Urban -Rural Divide Fusion of Marketing & Banking More Emotional Increased Distrust
Preferences of Urban Customers
Category I : Personal even if Inefficient
Category II : Impersonal & Efficient
Category III : Personal & Efficient
Preferences of Rural Customers
Relationship Marketing Early Banking Personal Service Higher Level of Patience Needs Guidance Basic Banking
Banking Products Own Products: Risk Free- Show the
superiority for Retirement Benefits and Free of Entry & Exit Load
Mutual Funds: Growth with Risk- Emphasise that it is not your product, suggest SIP for a Minimum of three years
Insurance Products: Risk Coverage with limited return
Conflicts
Profit Vs Customers Your Products Vs Third Party Products Dividing Marketing & Banking Rational Choice & Emotional Choice Consumer Sovereignty Vs Counselling Customer Service Vs Compliance with
Regulation
Agenda for Action
Investors’ Meet Creation of Database of Consumers Matching the Products to the
Requirement of Customers Creation of a Library at Branch Level Attending the Social Function
particularly in Rural Areas Joining Social Organisations and Social
Causes
THANK YOU