Marketing Plan: Bank of Cancer Research - Case Study Example

Marketing Plan: Bank of Cancer Research Name Subject & Code Instructor Institution Date Abstract Bank of Cancer Research experiences a relatively slow growth because of stiff competition from more than 20,000 social enterprises and well established traditional financial banking institution like National Australia Bank, ANX Bank, HSBC, Suncorp Metway, Commonwealth Bank and Bendigo Bank. This marketing plan sets up a road map regarding the marketing processes involving a variety of dimensions beginning with product design and ultimately providing services to customers. It suggests a marketing strategy for the Bank of Cancer Research allow it to expand its social enterprise activities successfully and to open up new branches, and to offer new products and services to end customers. At present, Bank of Cancer Research has achieved limited popularity as a commercial banking entity in the Australian market, as a majority of its customers are drawn from commercial customer segments. However, there is a significant potential in the retail banking sector, which it can exploit. This is because of the large Australian population that of the 18-36 years cohort, which currently makes up more than 30 percent of Australia’s total population. Emphasis should be on using quality differentiation strategy, to differentiate the brand from that of the traditional banks in the industry that use a profit-motivated model. This can be achieved through intense marketing promotion on the internet, social media, institutional magazines, sports facilities billboards, and television. The marketing message should send the message that the Bank of Cancer Research is a financial stable bank with a great potential to change the lives of Australians and with a great domestic and global appeal. Table of Contents Abstract 2 Table of Contents 3 1.0 Introduction 4 2.0 Micro factors 5 2.1 SWOT analysis 5 2.1.1 Strengths 5 2.1.2 Weaknesses 5 2.1.3 Opportunities 6 2.1.4 Threats 6 3.0 Macro factors 6 3.1 PESTLE Analysis 6 3.1.1 Political Factors: 6 3.1.2 Economic Aspect: 7 3.1.3 Social Aspect: 7 3.1.4 Technological Aspect: 8 3.1.5 Legal Factors 8 3.1.6 Environmental Factors 8 4.0 Market Segmentation 9 4.1 Behavioural: 9 4.2 Psychographic: 9 4.3 Demographic: 9 5.0 Overall Analysis 10 6.0 Proposed Marketing Mix Based on 4Ps 12 6.1 Price:  12 6.2 Place:  12 6.3 Promotion: 13 6.4 Product:  13 7.0 Conclusion and Recommendations 13 8.0 Bibliography 15 1.0 Introduction The Bank of Cancer Research is a financial bank that operates as a social enterprise, which makes profits for purposes of funding pieces of research in cancer. Consumers are provided with a choice regarding who should receive the profits generated from their banking, including choosing to fund researchers in cancer or to competitors' shareholders directly. The bank’s mission is to bring philanthropy to each one by enabling customers to donate the profits they can generate from banking services (Bank of Research 2017). It targets banking customers who can collaborate and utilise market–based ventures to fund a social cause – in this case, cancer research. The Bank of Cancer Research is registered as a charitable trading entity that sets up financial ventures to generate profits that are then directed to funding cancer research. In Australia, the Bank of Cancer Research operates through a single branch. The company’s growth has been relatively slow because of stiff competition from a traditional financial banking institution. Therefore, it requires an effectively planned marketing strategy focused on the provision of varied banking and financial products to its target market in Australia (Bank of Research 2017). The planned marketing strategy will, as a result, set up a road map regarding the marketing processes involving a variety of dimensions beginning with product design and ultimately providing services to customers. Therefore, purpose of this marketing plan is to suggest a marketing strategy for the Bank of Cancer Research allow it to expand its social enterprise activities successfully and to open up new branches and to offer new products and services to end customers. 2.0 Micro factors 2.1 SWOT analysis 2.1.1 Strengths International Finance: As Bank of Cancer Research operates using a global social enterprise model, it has a great potential to raise significant capital from across the globe. It carries a high good will on account of its social enterprise model and its mission of achieving a social cause, rather services its profit motive. It has a huge clientele made up of the world’s famous billionaires such as Bill and Melinda Gates and Warren Buffet. This provides it with a significant global appeal (Bank of Cancer Research 2017). 2.1.2 Weaknesses Although the Bank of Cancer Research had a global outlook, it is a late comer in the financial sector, and its brand is still not well established in the local and global market. It has no branches to tap into the entire Australian market effectively. This also makes it inaccessible to many potential customers who may want to seek the service of the bank. The Bank of Cancer Research has to contend with stiff competition from the well-established banks like Westpac and Commonwealth Bank, which already have a huge clientele alongside a high credibility status to Australian youth. This implies that the Bank of Cancer Research currently has a limited share of the market, and must, therefore, position itself in the market through intense marketing strategies to increase its market share (Petzer et al. 2008). The bank also faces still competition from more than 20,000 social enterprises that currently operate in Australia (Barraket et al. 2010). 2.1.3 Opportunities The growing Australian middle class and a new generation of youth who are high spenders provide significant business opportunities if targeted with bank accounts. The social enterprise model that the Bank of Research uses has a potential to make it a leader in corporate social responsibility in Australia. This will benefit the bank by expanding its brand repute in the Australian market. It has a potential to enlarge its customer-oriented clientele base by creating new branches in Australia to tap into the market. Embracing online banking will enable the company to serve more customers in Australia and abroad who cannot access its physical facilities. 2.1.4 Threats Potential investors in Bank of Cancer Research are wary of the viability of the social enterprise business model, particularly because of uncertain economic trends where fewer people would resort to saving. The banking sector is strictly overseen by banking regulations that are often changed time and again. This makes it unpredictable to investors who may consider investing in the Bank of Cancer Research. 3.0 Macro factors 3.1 PESTLE Analysis 3.1.1 Political Factors: As a free-market democracy, Australia has a banking industry that is well regulated with banking industries code of conduct in addition to other financial regulations set up by the Reserve Bank of Australia (RBA) (Heritage.com 2017). Bank of Cancer Research has to comply with the regulatory measures yet also formulate own protection strategies. 3.1.2 Economic Aspect: The downcast GDP as a result of declined commodity prices in the country and consequently lower income generation affects the growth of banks and social enterprises in Australia as few people resort to saving or engage in social entrepreneurship. While residential property prices have tended to increase in the recent past, other economic segments have performed poorly financially. This has led to significant law in the cash rate, hence preventing the Reserve Bank of Australia (RBA) from raising the cash rate for banks (IBISWorld 2017). 3.1.3 Social Aspect: Social dimensions in the banking industry like criminal money laundering have triggered more regulation of the banking sector to monitor new banks. Because of Australia’s economic volatility, banking customers’ purchasing power is significantly dropping. This has a positive effect in that as people’s purchasing power is reducing significantly, depending on banking products such as credit cards. On the other hand, declining purchasing power implies that retail banking customer’s saving pattern is reducing (Winchester & Lees 2011). There is also an increased interest in the community and corporate support for crowd-sourcing, fundraising, and social enterprises in Australia (McLeod, J 2015). In the financial year 2015-2016, more than 14.9 million Australians gave AUS$12.5 billion to charity organisations (Philanthropy.org 2017). Hence, the bank has great prospects to raise capital from social enterprise. 3.1.4 Technological Aspect: Significant technological advancements globally imply that more Australians prefer new technologically enhanced ways of doing business, including online banking and e-payments. This has increased the scope, speed, and scale upon which banks can take advantage of analytics, data, and communications to target more customers from isolated regions (Nawafleh 2015). This provides the Bank of Cancer Research with an opportunity to reach customers in isolated regions of Australia, without a need to establish physical points of operation. 3.1.5 Legal Factors The highly regulated banking industry exposes the Bank of Cancer Research to many legal obligations and greater possibilities imposition of fines, which may affect its profit potential and brand reputation. For instance, oversights in risk management measures in its internal audit may expose it to litigation in case of evidence of fraud (Heritage.com 2017). 3.1.6 Environmental Factors There is a greater emphasis by banks that operate on limiting their carbon footprints on account of the current environmental challenges like climate change. This implies a need for the bank to engage in recycling of waste, reduce emission during transportation, and invest in energy efficient buildings (Daly & Edis 2010). 4.0 Market Segmentation Bank of Cancer Research’s target group has no colour barriers. The customers have to be drawn from diverse cultural and ethnic backgrounds. The group consists of youth aged 18 to 36 years who are just beginning to seek banking services and prefer using online banking facilities and credit cards. The group is also interested in funding a social course. 4.1 Behavioural: Banking customers have become increasingly educated and technological literates. They do much of their business online. Customers, therefore, expect greater levels of mobile and flexible banking, which Bank of Research will need to incorporate (Chronican 2012). 4.2 Psychographic: In psychographic segmentation, consumers are categorised based on their lifestyles, values, and traits (Kotler et al. 2015). More Australian customers are showing a preference for self-service. They have a high sense of style and taste (Chronican 2012). Customers have also become increasingly confident with online banking yet also prefer being treated compassionately (PWC 2016). They are less likely to be committed to a brand as they are from the General Y and Millenials generation. 4.3 Demographic: The banking industry customers are aging fast, diverse, richer, and greatly urbanised. They have also become greatly interrelated across state and national borders. As the wealthier older retiring generation (Baby boomers begins to transfer assets to younger ones aged between 18 to 36 years), banks need to attract the new generation (Consumer Victoria 2012; PWC 2016). 5.0 Overall Analysis At present, Bank of Cancer Research has achieved limited popularity as a commercial banking entity in the Australian market, as a majority of its customers are drawn from commercial customer segments. The Bank faces stiff competition from already established traditional retail banking players like National Australia Bank, ANX Bank, HSBC, Suncorp Metway, Commonwealth Bank and Bendigo Bank. Indeed, there are close to 56 commercial banks operating in the Australian market, whereby a dozen are domestic banks, nine foreign-owned subsidiaries while 35 full-fledged foreign-owned banks (Winchester & Lees 2011). When it comes to the leading banks, about four major banks namely CBA, ANZ, Westpac, and NAB dominate the commercial banking sector. They control up to 82% of all loans in the country (Tunley 2011). Toward this end, Bank of Cancer Research alongside other small-to-medium sized banks like HSBC own the small fraction of the remaining market share. This implies that it will be tricky for Bank of Cancer Research to seek significant market expansion in the commercial banking sector. On the other hand, there is a significant potential in the retail banking sector. This is because of the large Australian population that of the 18-36 years cohort, which currently makes up more than 30 percent of Australia’s total population. Therefore, Bank of Research can target this age cohort as a prospective segment for its retail business. The targeted age cohort is essentially made up of young people who are either in college or have recently completed college and are entering their career life. While this customer segment’s net worth may be currently small, they are huge spenders. This implies that compared to the older age groups, there is a significant business opportunity for Bank of Research in the area of saving accounts and credit card services. Bank of Cancer Research’s target segment should, therefore, consist of young people in the age cohort of 18-36 years. However, it should be remembered that this target segment may be the existing customers of other commercial banks. Within the targeted segment, other sub-segments still exist, including those in the age group of 18-27 years, who are new in the world of banking and may, therefore, demand credit banks and personal services. Another sub-segment includes the age cohort of 27-36 years who may demand requirements linked to financial products and services, including personal banks, credit cards, and mutual banks. Therefore, Bank of Cancer Research should target the two sub-segments simultaneously. A decision to position Bank of Cancer Research in the market is significant in defining whether it will succeed or fail in its expansion plan. Indeed, as it still has a very small market share in the Australian market, it is undeniable that it has not achieved much in terms of establishing itself as an authoritative brand. A clear reason for this is that of poor brand perception. Social enterprise, particularly in the commercial banking industry, is a new concept in Australia (Barraket et al. 2010). Already, traditional domestic banks in the country are projecting themselves as the most reliable, as they have a wide appeal and are highly accessible across the country. Hence, unlike Bank of Cancer Research, the traditional domestic banks provide customers with significant levels of trust, which Bank of Cancer Research along with foreign-owned banks do not enjoy. For this reason, Bank of Cancer Research should place emphasis on positioning itself as a financially stable bank with a great potential to change the lives of Australians and with a great domestic and global appeal. Already, Australian customers appear to be aware of an assortment of banks that function domestically and globally yet to do not use the social enterprise business model that Bank of Cancer Research is using. Therefore, there is a need for the bank to call upon its global appeal as an innovative banking product with a global mission to change the lives of cancer patients and to convince its target customers of its financial stability in the long run, as well as to position itself as a domestic bank yet a global brand. 6.0 Proposed Marketing Mix Based on 4Ps 6.1 Price:  Pricing element is a crucial factor that can decide the future of Bank of Cancer Research in the competitive banking industry. As the bank targets young customers with its personal banking services, providing highly competitive interest rates for customers with savings account is critical (Kotler & Armstrong 2009). 6.2 Place:  As the Bank of Cancer Research targets the youth aged 18 to 36 years, it should leverage technology to deliver banking services, particularly through the internet banking and mobile banking. The focus should further be on upgrading the bank’s online banking portal by including innovative services that differentiate it from the traditional physical banks. This will assist in reducing the cost of operating business as well as help reach more customers across state and national borders. Bank of Cancer Research should make sure that it delivers efficient customer service to customers. It should invest in customer service training to its employees. This is because the targeted segment is highly volatile and selective, as they are less likely to be committed to a brand, whether a fashion or banking brand, as they are from the General Y and Millenial generation (Jegethesan et al. 2012). 6.3 Promotion:  As the Bank of Cancer Research targets the youth aged 18 to 36 years, marketing promotion should be done in learning institutions, sports centres, and shopping centres that the youth tend to frequent. A social media campaign should also be used to reach the youth who have built significant present in social media networks. The promotional strategy should be on building up the image of the brand. It should also come up with regular highly creative television and internet commercials, including through a YouTube channel (Pereira & Almeida 2014). 6.4 Product:  Bank of Cancer Research should use a linear strategy by focusing on consolidating its current product portfolio, including credit cards and personal banking. It should make its online transactions more secure and convenient to use online as well as through mobile apps, including activating credit cards, applying for new accounts, transferring funds, and setting up direct deposits (Jain 2013). 7.0 Conclusion and Recommendations As established in this marketing plan, the Bank of Cancer Research is yet to attain a significant success in the Australian domestic banking sector because of high competition from the traditional banking institutions. This implies that it will be tricky for Bank of Cancer Research to seek significant market expansion in the commercial banking sector. On the other hand, there is a significant potential in the retail banking sector. This is because of the large Australian population that of the 18-36 years cohort, which currently makes up more than 30 percent of Australia’s total population. Bank of Research can target this age cohort be as a prospective segment for its retail business. The bank’s target segment should, therefore, consist of young people in this age cohort of customers who have a spirit to run a social cause. While this customer segment’s net worth may be currently small, they are huge spenders. This implies that compared to the older age groups, there is a significant business opportunity for Bank of Research in the area of saving accounts and credit card services. Emphasis should be on using quality differentiation strategy, to differentiate the brand from that of the traditional banks in the industry that use a profit-motivated model. This can be achieved through intense marketing promotion on the internet, social media, institutional magazines, sports facilities billboards, and television. The marketing message should send the message that the Bank of Cancer Research is a financially stable bank with a great potential to change the lives of Australians and with a great domestic and global appeal. 8.0 Bibliography Bank of Research 2017, Which would you choose, viewed 17 May 2017, Barraket, J, Collyer, N, O'Connor, M & Anderson, H 2010, Finding Australia’s social enterprise sector: final report, FASES, viewed 18 may 2017, Chronican, P 2012, Banking on Australia, Australia And New Zealand Banking Group Limited, viewed 17 May 2017, Consumer Victoria 2012, Consumer outlook: the baby-boomer generation’s implications for consumer policy, Consumer Affairs Victoria, Melbourne. Daly, J & Edis, T 2010, “Markets to reduce pollution: cheaper than expected," Grattan Institute Report No. 2010-7 DEC 2010 Heritage.com 2017, 2017 Index of economic freedom, viewed 17 May 2017, IBISWorld 2017, Finance in Australia, viewed 17 May 2017, Jain, M 2013, "An Analysis of Marketing Mix: 7Ps or More," Asian Journal of Multidisciplinary Studies, vol 1 iss 4, pp.23-28 Jegethesan, K, Sneddon, J & Soutar, G 2012, “Young Australian consumers’ preferences for fashion apparel attributes,” Journal of Fashion Marketing and Management, vol 16 no 3, pp.275-289 Kotler, P & Armstrong, G 2009, Principles of Marketing, Prentice Hall, New York Kotler, P, Burton, S, Deans, K, Brown, L & Armstrong, G 2015, Marketing, Pearson Higher Education, Frenchs Forest McLeod, J 2015, Australian giving trends signs of life, JBWere, viewed 18 May 2017, < https://www.jbwere.com.au/content/dam/jbwere/documents/JBWere%20Report_Australian%20Giving%20Trends_Dec%202015_FINAL.pdf> Nawafleh, S 2015, "The effect of information technology on the bank profitability empirical study of Jordanian Banks," International Journal of Business and Management, Vol. 10, No. 2, pp.170-175 Pereira, L & Almeida, P 2014 “Marketing and promotion in the hotel industry: A case study in family hotel and hotel group,” Tourism and Hospitality International Journal, 2(1), 92-105 Petzer, D, Steyn, T & Mostert, P 2008, "Competitive marketing strategies of selected hotels: an exploratory study," Southern African Business Review, vol 12 no 2, pp.1-22 Philanthropy.org 2017, Fast facts and statistics on giving in Australia, viewed 17 May 2017, PWC 2016, Escaping the commodity trap: the future of banking in Australia, PriceWaterHouseCoopers, viewed 17 May 2017, Tunley, S 2011, The big banks have large fingers in your financial wallet – how big are they and is it good for you? viewed 17 May 2017, Winchester, M & Lees, G 2011, Profiling consumers of Australia’s top ten banks, viewed 17 May 2017, Read More