25-08-2017, 09:32 PM
Comparison Of Service Marketing By SBI And ICICI Bank
Comparison Of Service Marketing By SBI And ICICI Bank.pdf (Size: 319.58 KB / Downloads: 218)
ABSTRACT
Nationalized banks have dominated for decades in India. However, the new generation banks are
now taking their services to a larger market and gaining a larger customer base year after year.
Nationalized banks still have a larger market share, but lack the capability of service delivery in
terms of the new technologies in banking. Although the Government allowed new generation
banks to operate only after 1990s, they have delivered better quality services than what
nationalized banks have been able to deliver since 1969.
Many corporates choose to get their banking services done through new generation banks mostly
because of convenience and choice of services which are enormous. The irony is, many
nationalized banks have the same services which new generation banks offer, but are
unfortunately not marketed so well.
New generation banks have their disadvantages, the major one being, in case of a „run on the
bank‟ or severe losses they would have to rely on their own funds. They may if luck favors them,
obtain a bailout from the government.
INTRODUCTION
No doubt it was a revolutionary move by the late Prime Minister Indira Gandhi to take up
nationalizing banks in 1969. There were more Indians saving money, availing the wonderful
services of the banking industry and eventually improving this economy.
Banks like State Bank of India (SBI) and its subsidiaries are one of the largest banks in the
world. SBI alone has a 20% market share in the retail banking business. Other banks such as
Canara Bank and Syndicate Bank have a large share in the retail banking business. All
nationalized banks have a strong presence in the rural market as well which makes their services
accessible to the remotest parts of India.
Although nationalized banks have made significant contributions for the development of India,
customers today seem to choose private banks to open their accounts than nationalized banks.
This has a background due to IT companies improving their business in India. Consider the case
of Infosys, and IT major. It has more than 1 lakh employees, all of whom have a salary account
with ICICI Bank. ICICI also manages salary accounts of HP India (P) Ltd and Mindtree
Consulting.
DEFINITIONS OF SERVICES
“Activities, benefits and satisfactions, which are offered for sale or are provided in connection
with the sale of goods” (American Marketing Association, Committee of Definitions 1960, p.
21).
“Services include all economic activities whose output is not a physical product or construction,
is generally consumed at the time it is produced, and provides added value in forms (such as
convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns
of its first purchaser” (Quinn, Baruch and Paquette, 1987).
STATEMENT OF THE PROBLEM
New generation banks have marketed their services to a larger audience. Nationalized banks
however are yet to realize the benefits of good service marketing, which is slightly complicated
in this case since they find it difficult to reach a wider segment of customers. Educating them
about new banking products is the challenge.
OBJECTIVES OF THE STUDY
1. To compare the strategies of how nationalized banks and new generation banks market
their services.
2. To compare the variety of services between nationalized banks and new generation
banks.
METHODOLOGY
The study is exploratory in nature. Sources of data are employees of banks, customers, and
experiences of the researcher.
LIMITATIONS OF THE STUDY
The study focuses only on the marketing strategies of SBI (State Bank of India) and ICICI Bank.