A

REPORT ON

“SERVICE MARKETING IN BANKS”

SUBMITTED BY

GAUTHAM NITYANAND

FOR THE DEGREE OF BACHELOR OF COMMERCE

{BANKING AND INSURANCE}

SREE NARAYANA GURU COLLEGE OF

COMMERCE,

CHEMBUR, MUMBAI – 400089

 DECLARATION

I, GAUTHAM NITYANAND, student of bachelor of commerce

{BANKING AND INSURANCE} SREE NARAYANA GURU COLLEGE OF

COMMERCE of University of Mumbai declare that the work done on the project

Entitled is original. Any reference used in this report has been duly acknowledged.

To the best of my knowledge and belief the subject matter presented here is

Original.

DATE :
 ACKNOWLEDGEMENT

I Am thankful to SREE NARAYANA GURU COLLEGE OF COMMERCE for giving me an

Opportunity to work on this project. Because of this project I could relate to the investment
in India in a better way.

I like to thank our principal DR. RAVINDRA KARATHADI and I would also like to thank

Our coordinator DR. SUMI NIJITH & and my project guide ASST. PROF. JABIR MOHAMMED

For helping out with this project. Without their support, this project would not have

been possible . They helped me immensely by keeping me motivated throughout the

Course of the project.

Thank you

Date :

GAUTHAM NITYANAND

{BACHELOR OF BANKING AND INSURANCE}

 INTRODUCTION TO THE BANKING IN INDIA

Banks are the most significant players in the Indian financial market. They
are the biggest purveyors of credit, and they also attract most of the savings from
the population. Dominated by public sector, the banking industry has so far acted
as an efficient partner in the growth and the development of the country. Driven
by the socialist ideologies and the welfare state concept, public sector banks have
long been the supporters of agriculture and other priority sectors. They act as
crucial channels of the government in its efforts to ensure equitable economic
development.

Bank is defined as “one who in ordinary course of business honors the

cheques drawn upon him by person from and for whom he receives money on
current accounts”

“Banking means accepting for the purpose of lending or investment, of

deposits of money from the public, repayable on demand or otherwise and
withdrawable by cheques, drafts, order or otherwise”.

The Indian banking can be broadly categorized into nationalized, private

banks and specialized banking institutions. The Reserve Bank of India acts a
centralized body monitoring any discrepancies and shortcoming in the system.
Since the nationalization of banks in 1969, the public sector banks or the
nationalized banks have acquired a place of prominence and has since then seen
tremendous progress. The need to become highly customer focused has forced
the slow-moving public sector banks to adopt a fast track approach. The
unleashing of products and services through the net has galvanized players at all
levels of the banking and financial institutions market grid to look a new at their
existing portfolio offering.

RBI is the foremost monitoring body in the Indian financial sector. The
nationalized banks continue to dominate the Indian banking arena. Industry
estimates indicate that out of 274 commercial banks operating in India, 223
banks are in the public sector and 51 are in the private sector.
 The private sector bank grid also includes 24 foreign banks that have started
their operations here.

The liberalize policy of Government of India permitted entry to private

sector in the banking, the industry has witnessed the entry of nine new generation
private banks. “The major differentiating parameter that distinguishes these
banks from all the other banks in the Indian banking is the level of services that
is offered to the customer. Their focus has always centered around the customer
– understanding his needs and consequently delighting him with various
configuration of benefits and a wide portfolio of products and services” These
banks have generally been established by promoters of reputed or by ‘high value’
domestic financial institutions.
 OBJECTIVES

The objective of this project study is to enable the researcher:

 To understand what is Service Marketing.


 To know about service marketing in ICICI Bank.

 To know the importance of service marketing in banks.


 RESEARCH METHODOLOGY

 The study of Service Marketing in Banks requires technical &

conceptual understanding of term service marketing for which a good
deal of information need to collected.

 Researcher collects secondary data through various books and also from
websites (Internet).

 Secondary Data are those, which have already been collected by
someone else and which have already been passed through the statistical
process. This data is collected from the following sources.


a) Reports of ICICI BANK

b) Magazines

c) Journals

d) Newspapers
 SCOPE OF THE RESEARCH
 The scope of this project extends only upto ICICI Bank.

 Study is restricted only upto Service Marketing in Banks.

 It will help to understand the concept of service marketing in banks with
an example of ICICI Bank and to know the new trends in ICICI Bank &
Awards and Recognitions given to ICICI Bank.



 LIMITATIONS:

 This project study is limited to the extent of guidelines issued by
University of Mumbai.

 Adequate primary data was not available.


 MARKETING OF BANKING SECTOR

The earlier days, bankers like any other private sector

organizations had their own plans of business development and adopted their own
ways and means to achieve their objective. The MARKETING concept was in
the form of advertising & promotion. This was the position till the middle of 20 th
century.

Gradually there was a change in the attitude of bankers with respect

to customers. In the late 1950s, new concept in the Marketing Services with
respect to banking profession arose in the West. Deryk-Weyer of Barcelays Bank
came out with a comprehensive definition of BANK MARKETING.

According to him, Bank Marketing consists of –

1] Identifying the most profitable markets now and in future,

2] Assessing the present and future needs of the customers,

3] Setting business development goals,

4] Making plan to meet them and managing the various services and promoting
them to achieve the plans- all in the context of changing environment in the
market. Thus, the idea of customer satisfaction arose in the 1950s, flourished in
the 1960s and became an integral part of Banking Services in 1970s. In the course
of time, the concept of Marketing widened further. From the stage of customer
satisfaction, the Marketing become more concerned with the well-being of the
“Society” as a whole & resulted in coining the term “SOCIETAL
MARKETING”. Hartley would call it as “Response Marketing” attuning with or
responding to the changing needs of customer’s society and environment.
 With liberalization and globalization of the economy, middlemen are
gradually emerging in the banking industry. Foreign banks and new private banks
like City Bank, Global Trust Bank and ICICI Bank are offering their franchise in
marketing their services. This has introduced the middlemen in marketing of
banking services.

In banking services, the marketing strategy starts with developing

customer profiles by which the bank can collect and analyze all relevant
information on customers. The preferences and prejudices of the customers are
identified with the help of these profiles and this enables the bank to enhance its
marketing activities. In order to satisfy the customers’ needs new services may be
introduced or the existing services of the bank may be modified. Customer
satisfaction plays an important role in banking services.


 ICICI BANK OVERVIEW

ICICI Bank is India's second-largest bank with total assets of Rs. 3,997.95 billion
(US$ 100 billion) at March 31, 2008 and profit after tax of Rs. 41.58 billion for
the year ended March 31, 2008. ICICI Bank is second amongst all the companies
listed on the Indian stock exchanges in terms of free float market capitalization.

The Bank has a network of about 1,308 branches and 3,950 ATMs in India and
presence in 18 countries. ICICI Bank offers a wide range of banking products
and financial services to corporate and retail customers through a variety of
delivery channels and through its specialized subsidiaries and affiliates in the
areas of investment banking, life and non-life insurance, venture capital and asset
management.

The Bank currently has subsidiaries in the United Kingdom, Russia and Canada,
branches in Unites States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and
Dubai International Finance Centre and representative offices in United Arab
Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia.
Our UK subsidiary has established branches in Belgium and Germany
 HISTORY

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian

financial institution, and was its wholly-owned subsidiary. ICICI's shareholding
in ICICI Bank was reduced to 46% through a public offering of shares in India in
fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in fiscal
2000, ICICI Bank's acquisition of Bank of Madura Limited in an all-stock
amalgamation in fiscal 2001, and secondary market sales by ICICI to institutional
investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative
of the World Bank, the Government of India and representatives of Indian
industry. The principal objective was to create a development financial institution
for providing medium-term and long-term project financing to Indian businesses.

In the 1990s, ICICI transformed its business from a development financial

institution offering only project finance to a diversified financial services group
offering a wide variety of products and services, both directly and through a
number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the
first Indian company and the first bank or financial institution from non-Japan
Asia to be listed on the NYSE.
 7 P’S OF MARKETING OF ICICI BANK
Marketing of services by ICICI bank:
1. Product Mix
i. Deposits:

ICICI Bank offers wide variety of Deposit Products to suit our requirements.
Coupled with convenience of networked branches/ over 1800 ATMs and
facility of E-channels like Internet and Mobile Banking, ICICI Bank brings
banking at your doorstep

Savings Account: ICICI Bank offers a power packed Savings Account with a
host of convenient features and banking channels to transact through.

Senior Citizen Services: The Senior Citizen Services from ICICI Bank has
several advantages that are tailored to bring more convenience and enjoyment in
your life.

Young Stars: It's really important to help children learn the value of finances
and money management at an early age. Banking is a serious business, but we
make banking a pleasure and at the same time children learn how to manage their
personal finances.

Fixed Deposits: Safety, Flexibility, Liquidity and Returns. A combination of

unbeatable features of the Fixed Deposit from ICICI Bank.

Recurring Deposits: Through ICICI Bank Recurring Deposit you can invest
small amounts of money every month that ends up with a large saving on
maturity. So you enjoy twin advantages- affordability and higher earnings.

Roaming Current Account: Only Roaming Current Account from ICICI Bank
travels the distance with your business. You can access your accounts at over
500 networked branches across the country.

.
ii. Investments

Along with Deposit products and Loan offerings, ICICI Bank assists you to
manage your finances by providing various investment options such as:

ICICI Bank Tax Saving Bonds

Government of India Bonds
Investment in Mutual Fund

iii. Anywhere Banking:

ICICI Bank is the second largest bank in the country. It services a

customer base of more than 5 million customer accounts through a multi-
channel access network. This includes more than 500 branches and extension
counters, over 1800 ATMs, Call Centre and Internet Banking. Thus, one can
access the various services ICICI Bank has to offer at anytime, anywhere and
from anyplace

iv. Loan:

Home Loans
Personal
Loans Car
Loans

Two Wheeler Loans

Commercial Vehicle
Loans against Securities
Farm Equipment Loans

Construction Equipment
v. Mobile Banking:

With ICICI Bank, banking is no longer what it used to be. ICICI Bank
offers Mobile Banking facility to all its Bank, Credit Card and Demat
customers. ICICI Bank Mobile Banking enables you to bank while being on
the move.

vi. Demat services:

ICICI Bank Demat Services boasts of an ever-growing customer base

of over 7 lakhs account holders. In their continuous endeavor to offer best of
the class services to our customers we offer the following features:

Digitally signed transaction statement by e-mail.

corporate benefit tracking
 e-Instruction facility - facility to transfer securities 24 hours
a day, 7 days a week through Internet Interactive Voice Response (IVR) at a
lower cost.

 Dedicated specially trained

 2. Pricing Mix:

The pricing decisions or the decisions related to interest and fee or

commission charged by banks are found instrumental in motivating or
influencing the target market.

The RBI and the IBA are concerned with regulations. The rate of interest is
regulated by the RBI and other charges are controlled by IBA.

The pricing policy of a bank is considered important for raising the number of
customers’ vis-à-vis the accretion of deposits. Also the quality of service provided
has direct relationship with the fees charged. Thus while deciding the price mix
customer services rank the top position.

The banking organizations are required to frame two- fold strategies. First, the
strategy is concerned with interest and fee charged and the second strategy is
related to the interest paid. Since both the strategies throw a vice- versa impact, it
is important that banks attempt to establish a correlation between two. It is essential
that both the buyers as well as the sellers have feeling of winning.
3. Place:

This component of marketing mix is related to the offering of services. The

services are sold through the branches. The 2 important decision making areas are:
making available the promised services to the ultimate users and selecting a
suitable place for bank branches. The number of branches OF ICICI: 1900 in India
and 33 in Mumbai

4. Promotion Mix:

Advertising: Television, radio, movies, theatres

Print media: hoardings, newspaper, magazines
Publicity: road shows, campus visits, sandwich man

Sales promotion: gifts, discount and commission,

incentives,etc.

Personal selling: Cross-sale (selling at competitors

place), personalized service

Telemarketing: ICICI one source Call center (mind space)

5. People:

All people directly or indirectly involved in the consumption of banking

services are an important part of the extended marketing mix.

Knowledge Workers, Employees, Management and other Consumers often

add significant value to the total product or service offering. It is the employees
of a bank which represent the organization to its customers.

In a bank organization, employees are essentially the contact personnel with

customer. Therefore, an employee plays an important role in the marketing
operations of a service organization.

To realize its potential in bank marketing, ICICI become conscious in its

potential in internal marketing - the attraction, development, motivation and
retention of qualified employee-customers through need meeting job-products.
Internal marketing paves way for external marketing of services. In internal
marketing a variety of activities are used internally in an active, marketing like
manner and in a coordinated way.

The starting point in internal marketing is that the employees are the first
internal market for the organization.

The basic objective of internal marketing is to develop motivated and

customer conscious employees.

A service company can be only as good as its people. A service is a

performance and it is usually difficult to separate the performance from the
people.

If the people don’t meet customers' expectations, then neither does the
service. Therefore, investing in people quality in service business means
investing in product quality.
 6. Process:

Flow of activities: All the major activities of ICICI banks follow RBI guidelines.
There has to be adherence to certain rules and principles in the banking
operations. The activities have been segregated into various departments
accordingly.

Standardization: ICICI bank has got standardized procedures got typical

transactions. In fact not only all the branches of a single-bank, but all the banks
have some standardization in them. This is because of the rules they are subject
to. Besides this, each of the banks has its standard forms, documentations etc.
Standardization saves a lot of time behind individual transaction.

Customization: There are specialty counters at each branch to deal with

customers of a particular scheme. Besides this the customers can select their
deposit period among the available alternatives.

Number of steps: Numbers of steps are usually specified and a specific pattern
is followed to minimize time taken.

Simplicity: In ICICI banks various functions are segregated. Separate counters

exist with clear indication. Thus a customer wanting to deposit money goes to
‘deposits’ counter and does not mingle elsewhere. This makes procedures not
only simple but consume less time. Besides instruction boards in national boards
in national and regional language help the customers further.

Customer involvement: ATM does not involve any bank employees. Besides,
during usual bank transactions, there is definite customer involvement at some or
the other place because of the money matters and signature requires
 7. Physical Evidence:

Physical evidence is the material part of a service. Strictly speaking there are
no physical attributes to a service, so a consumer tends to rely on material cues.
There are many examples of physical evidence, including some of the following:

 Internet/web pages
 Paperwork
 Brochures
 Furnishings
 Business cards
 The building itself (such as prestigious offices or scenic
headquarters)
The physical evidences also include signage, reports, punch lines, other
tangibles, employee’s dress code etc.

Signage: each and every bank has its logo by which a person can identify the
company. Thus such signage is significant for creating visualization and
corporate identity.

Financial reports: The Company’s financial reports are issued to the customers
to emphasis or credibility.

Tangibles: bank gives pens, writing pads to the internal customers. Even the
passbooks, cheque books, etc reduce the inherent intangibility of services.

Punch lines: punch lines or the corporate statement depict the philosophy and
attitude of the bank. Banks have influential punch lines to attract the customers.

Employee’s dress code: ICICI bank follows a dress code for their internal
customers. This helps the customers to feel the ease and comfort
 RECENT TRENDS IN ICICI BANK

ICICI Bank, India's largest private sector bank, has contracted with
Air2Web India to use their Mobile Internet Platform to provide ICICI Bank
customers with wireless access to their banking and credit card accounts .

"Our new wireless applications are going to help customers better

manage their checking and credit card accounts by allowing them to receive
and request pertinent information anytime, anywhere via their digital cell
phone," said Ms. Chanda Kochhar, Executive Director of ICICI Bank.

"With this wireless service, our customers can keep track of their
account balances, as well as request details on how to pay credit card balances,
confirm when they have been paid, and receive banking and credit card
statements. We feel this value added service will improve our customer service
offering."

"ICICI Bank has developed a wireless application which enables their

customers to get their banking and credit card account information when and
where they want it and from their most common wireless device, their digital
cell phone," said Sanjoy Malik, President and CEO of Air2Web India.

"ICICI Bank has always been known for its use of cutting edge technology.
So, it is no surprise that they are launching one of the first wireless banking
products to not only incorporate automated notifications of balances of both
your credit card and bank accounts, but one that also allows customers to
pull timely account information. This new wireless service gives ICICI Bank
customers substantially more control and flexibility over their accounts, thus
enhancing their customers' experience and another added value which sets
ICICI Bank apart from its competitors."
 Air2Web's Mobile Internet Platform provides businesses with a
competitive edge enabling its customers to wirelessly access critical back-end
information residing in existing CRM, ERP, SFA or SCM systems. Information
can be accessed across any network and with any carrier and via any digital
wireless device including Short Message Service (SMS) and web-enabled
phones, personal digital assistant devices (PDAs), and pagers. Air2Web's ability
to work with multiple data and audio formats streamlines integration with
existing applications.

The ICICI Bank Credit Cards was launched in January 2000 with three
variants Solid Gold, Sterling Silver and True Blue. The card is now available in
36 cities across India. The customer base is over 6.5 million.
 AWARDS AND ACHIEVEMENTS BY ICICI BANK
2003

 "The Asian Banker Excellence in Retail Financial Services Program" by The

Asian Banker

2004

 Best Bank in India Award presented by Euromoney Magazine

2006

 Bank of the Year 2006 India by the Banker

2007

 ICICI Bank has been conferred the Euromoney Award 2007 for the Best Bank in
the Asia-Pacific Region
 ICICI Bank wins the Excellence in Remittance Business award by The Asian
Banker
 ICICI Bank was got the awards for 'Best Transaction Bank' in India,
 'Best Domestic Bank' in India,
 'Best follow-on offering'(US$4.94 billion), 'Best Investment Grade Bond'(US$2
billion, three-tranche bonds), Best Syndicated Loan Managers by Asset.

2009

 ICICI Bank bags the "Best bank in SME financing (Private Sector)" at the Dun &
Bradstreet Banking awards
 ICICI Bank won the Best Banking Security Systems Project Award and Best E-
Banking Project Implementation Award by the Asian Banker

2010

 ICICI Bank won the Best Banking Security System by the Asian Banker

2011

 ICICI Bank is the only Indian brand to figure in the BrandZ Top 100 Most
Valuable Global Brands Report, second year in a row
 ICICI Bank won the 'Best CRM Project' and 'Best Banking Security Systems'
by the Asian Banker
2012

 ICICI Bank received the Golden Peacock Innovative Product / Service Award.
 ICICI Bank received the Dataquest Technology Innovation Awards 2012 for
Data center migration by Dataquest.

2013

 ICICI Bank has been adjudged winner at the Express IT Innovation Award under
the Large Enterprise category
 ICICI Bank won the RMAI received the "Gram Samvad", Service for Low
cost/Small budget marketing initiative Award by Rural Marketing Association of
India (RMAI).
 ICICI bank won the 'Next Generation Banking solution' award by Celent

2014

 According to the Brand Trust Report 2014, ICICI Bank was ranked 28th
among India's most trusted brands, a research conducted by Trust Research
Advisory.
 ICICI Bank was ranked second at the 'National Energy Conservation Award
2014' under the office buildings (less than 10 lakh kWh/year consumption)
category.
 ICICI Bank was fifth in the world and second in India on the 'Top Companies
for Leaders' in a study conducted by Aon Hewitt.

2015

 ICICI Bank won an award in the BFSI Leadership Summit & Awards in the 'Best
Phone Banking for End-users' category
 ICICI Bank has been declared as the first runner up at Outlook Money Awards
2015 in the category of ‘Best Bank’

2016

 ‘Best Retail Bank in India’ at the Asian Banker International Excellence in Retail
Financial Services Awards 2016. ICICI Bank has won this award three years in a
row.
 Gold awards in the ‘Bank’ and ‘Credit card issuing Bank’ segments under
Finance category in the Reader’s Digest Trusted Brand 2016 Survey.
 CONCLUSIONS

“Change” is a continuous process and banking industry is no exception to

this law which is natural. Due to the implementation of the financial sector
reforms and policies for the country change in the banking industry is inevitable.

After liberalization and globalization process that was initiated in 1991, the
Indian banking industry has undergone tremendous transformation. These
changes have forced the Indian banking industry to adjust the product mix and to
remain competitive in the globalised environment.

The following are some of the vital challenges that threaten the Indian
banking industry:-

Competition from foreign banks and now new private sectors

banks Technological advancement

Innovation

Diversified Activities

Customer Awareness and Satisfaction

Development of skills of Banks

Personnel Profitability Nature

Corporate Governance

In order to survive and succeed the domestic banks must identify their
marketing areas, develop adequate resources, convert these resources into
efficient services and distribute them effectively so that the customers are
satisfied.
 ICICI Bank today services a growing customer base of more than 5 million
customer accounts and 5 million bondholders accounts through a multi- channel
access network. This includes over 400 branches and extension counters, 1080
ATMs, call centers and Internet banking.

Bank renders personalised services and the present emphasis in

marketing is customer satisfaction. The customer satisfaction, which must be
the ultimate goal of bank marketing, is achieved not only through creating
suitable products according to his need but also through delivering them in a
most satisfying manner.

In spite of the changing banking environment and newer challenges

emerging, Service Marketing by ICICI Bank will continue to remain popular.