Hongkong and Shanghai Banking Corporation - Case Study Example

Executive Summary The banking sector all around the world is undergoing changes and banks are looking to strengthen their hold in the market by offering more products and services reforms that helps to satisfy customer. HSBC Bank has also ensured to bring the necessary changes by improving their services and marketing the products to ensure growth. The report looks into various aspect of HSBC bank by gathering information from their websites and journals which supports the marketing program of the bank. The report looks into the target customer base for HSBC bank and the positioning strategy taken by bank. The report also looks in the marketing mix and dwells upon the marketing environment by looking into the delivery of services by the bank. The report also looks into the manner the bank has been able to deliver on it. The report thus highlights the area that needs to be worked upon so that HSBC bank is able to deliver better services. Content Introduction 3 Purpose of the report 3 HSBC Bank 3 Macro Environmental Analysis 4 Buyer Behavior 7 Target Market 8 Positioning 8 4P’s of Marketing 9 Marketing Strategy 10 Conclusion 11 References 12 Introduction The banking sector all around the world is undergoing changes and the major factor contributing towards it is the recent financial crisis which has resulted in bank failures. HSBC bank in United Kingdom is also looking towards the marketing program so that they are able to deliver better services and win customers. The report presents the manner in which the HSBC bank has developed its marketing program which is helping them to improve their customer base. Purpose of the report To identify marketing environment of HSBC bank in United Kingdom. To identify the manner in which HSBC bank satisfies the different customers through their services by identifying the target customer and positioning To identify the marketing mix followed by HSBC bank HSBC Bank HSBC bank is a United Kingdom bank and has the more assets than other banks. The strong network and connectivity has ensured that the bank is situated even at the far of places. (Company Website, 2010) The bank being in the service sector has ensured quality in service. For this the bank has a code of conduct which employees need to follow. (Company Website, 2010) Doing so has earned the bank a good reputation and is establishing branches overseas thereby showing the growing popularity and strong reforms followed by the bank. Macro Environmental Analysis This analysis will help to identify the potential United Kingdom has for HSBC bank. Since, these are factors beyond control so it influences all other companies in similar business similarly. This will thus act as a tool to decide the strategy to enter the Indian market. Political Political situation plays a very important role for any industry and more for a developed country. UK has a very high influence of “political factors and any changes in decision affect the overall bearing in the sector”. (OPpapers, 2010. This calls for an understanding of the scenario. Recently, the policy changes have affected the growth pattern. (OPpapers, 2010) The political situation has also been affected by the recent economic recession. In spite, of such situation the stability of the government at the centre has ensured reforms to allow more investment in the banking sector. Economic The economic situation affects the number of commuters. The banking industry for a developed country like UK gets affected by “the growth rate and the business cycle as during recession people don’t invest in different banking products during recession”. (Justin, 2009) UK, slowly coming out of recession provides an opportunity. The number of people investing in different banking products like insurance, mutual funds has increased. The income level and the growth rate also affect people investing in different products. (Justin, 2009) Social The United Kingdom culture is strongly influenced by culture prevalent is social environment. UK being a diverse country this plays a prominent role. “With different people from different backgrounds, religion, income level, and habits affect the way a person stays and brings a change in a social outlook”. (Justin, 2008) Service industry ensures that such an environment is created. This helps to ensure that customers are high on satisfaction and remain loyal. This is a common phenomenon seen in UK that “they remain loyal to the services which satisfy them and don’t switch easily even for a price”. (Justin, 2008) Thus, social factors have a huge role in UK. Technological UK has moved ahead in technological advancement. “The increased use of internet and the penetration level has acted as a boost for banking industry to get even the far of customers”. (Justin, 2008) This is allowing people to transfer funds online. This has increased as the literacy level has raised giving rise to more people using it as a medium to book tickets. HSBC bank has ensured a high technological level. The bank has been able to integrate the different functions to improve efficiency. It is seen from their website that HSBC bank has functions where their customers can transfer electronically, check their balances, request for cheque books, and similar other functions. (Company Website, 2010) The integration of technology and better service highlights high congruence achieved by the bank. Environment The UK government has also framed laws for the environment. A cap has been put and steps taken to keep it within limits. The government has also taken steps for cleaning the rivers and companies are also helping in it. The banking sector has also contributed to it by banks ensure that the paper used are eco friendly and recyclable. This is a step in the right direction and the banking sector can bank on it. Legal The UK government has rules in place regarding the entry and exit of players. “The government has put a cap on foreign investment in domestic players for the banking sector”. (Justin, 2008) This is ensuring that banking which comply with those is allowed a stake. HSBC bank has been able to comply with the compliances laid down by the government. This has been the reason for the success of the bank. Their website demonstrates that the banks have different committee like audit committee, risk management committee, and nomination committee along with other similar committees (Company Website, 2010) which looks into the aspects. This helps to ensure that the bank complies with the requirements. Buyer Behaviour The competition in the banking industry is putting pressure on each company to influence buyer. Their buying pattern is affected by “social factors, cultural factors, personal, environmental and others which determine their pattern”. (Kotler, 2001) The buying behaviour according to Kotler is influenced by the following Complex Buying Behaviour: Marketers need to provide more information to consumers so as to retain them (Kotler, 2001) which HSBC bank has been able to do well by informing the customers about their different products and the advantage and benefit they will achieve in the long run. Dissonance-reducing Buying Behaviour: “Providing consumers with quality service and product so that they don’t feel like leaving the product”. (Kotler, 2001) HSBC bank has been able to achieve this by providing various insurance and mutual fund products which suits different customers. Variety-seeking Buying Behaviour: “Provide services to ensure that customer don’t switch products”. (Kotler, 2001) HSBC bank has done it by having different type of products like savings account, current account, loans and others. They at the same time offer interest rate and incentives to those who are elderly. Habitual Buying Behaviour: “Encourage more consumers to try the product so that they develop this habit of using it”. (Kotler, 2001) HSBC bank is working on it by ensuring that they have the regular savings and current accounts and at the same time coming with new innovative ones so that the regular customers a product which offers better return and has safety of funds. Pursuing, this buyer behaviour is helping HSBC bank to understand the customers and come up with products accordingly. Target Market The target market for HSBC bank is people in the age bracket from 5 to 60 and even higher. HSBC bank has defined a target market for itself by concentrating on all age groups by having a different product for all age group. The target market for HSBC bank has further being divided into two following Corporate Sector: This sector contributes the most towards the growth of the bank. Banks provides loans and accounts to the corporate sector. The interest rate charged is lower and helps the bank to gain maximum leverage Individuals: The bank looks towards individuals who want to have a savings account or current account or want to purchase product from the bank. This helps the bank to ensure that they are able to target the different group of customers Positioning HSBC bank has positioned their product for “all category of customers starting from the tender age of 5 to 60”. (Dylan, 2007) The company has various products suiting very customer thereby ensuring that “every customer who wants the product can have it”. (Dylan, 2007) For this the company designed various products attracting the retailers, investors, business houses and individuals. HSBC bank has ensured that they are able to penetrate the market by providing something for everyone. HSBC bank for this has ensured that they eye the family, children and people of all age group. HSBC bank has an environment where the parents of the children can plan for their child by investing in schemes which promote long term growth. (Narula, 2007) HSBC bank thus has been able to develop its positioning strategy based on the customer base it wants to target. 4 P’s of Marketing Product (Developing Value Offerings): The product offered by HSBC bank provides high return on investment. They offer a wide range of insurance products, mutual funds, loans against fixed property and so on. (Company Website, 2011) The bank has also ensured that they keep along with their regular products like savings and current account thereby offering a lot of products to choose from. Pricing (Capturing Value): The return on investment provided by HSBC bank is competitive and higher than that offered by other similar investment avenues. (Company Website, 2011) The bank also provides value by offering a lot of free services like online payment, free issue of cheque books and so on. Place (Delivering Value): HSBC bank has ensured smooth delivery. This has been done by ensuring that HSBC bank products are available even to the far of places. (Company Website, 2011) The bank has its presence over entire UK and has ensured to keep uniformity in services. Even the personnel hired by banks ensure that they satisfy the customers by solving their problems. Promotion (Communicating Value): The Company has laid stress on promotion. On store promotion is used as a weapon and along with it paper space and also advertisements where they use athlete to promote the product. (Company Website, 2011) The bank looks to advertise all the new products and ensure that the products provide good return to the customers. Marketing Strategies Marketing of HSBC bank holds an important aspect and will help HSBC bank meet its objectives. HSBC bank which offers variety of products like savings account, current account, loans and other facilities look towards marketing their product to differentiate from the customers. To market HSBC bank will look forward to create brand awareness. “HSBC bank will advertise the product through commercials, newspaper advertisement and hoardings”. (Bristow and Frankwick, 1994) It plans to have “television commercial as the viewership is high for such advertisement”. (Bristow and Frankwick, 1994) HSBC bank provides an integrated marketing communication to make the customer aware of the services and ensure that they remain loyal. HSBC bank offers advertising on television, radio, billboards, newspaper, hoardings, and public relations, personal selling, direct mail and internet. (Justin, 2008) Conclusion HSBC bank thus has been able to market itself properly by working on different areas which contribute towards the success of the bank. The bank has been able to ensure that they retain customers from every age group by offering different products to different people thereby enabling the bank to grow. The bank needs to perform and develop new products by marketing those so that the bank is able to grow and achieve its objectives in the long run. References Bristow D and Frankwick G, “Product manager influences tactics in marketing strategy development and implementation”, Journal of Strategic Marketing, Volume 2, Issue 3, 1994 Company Website, “HSBC Bank”, 2011 retrieved on January 3, 2010 from http://www.hsbc.co.in Dylan W, “Even HSBC bank has a market positioning”, Times Group, 2007 Justin A, “Banking Industry”, Service Sector Management, Business Week, 2008 Kotler P, Marketing Management, page 201, 11th edition, Prentice Publication, Upper saddle River, New Jersey, 2001 Narula A, “HSBC bank positioning what do you think”, customer & management consultancy services, 2007 OPpapers, “PEST Analysis UK Banking Sector”, Research paper, OPpapers.com, 2010 Read More