The Impact Of Marketing Strategy In Nigerian Banking Industry (A Case Study Of First Bank Nigeria Plc)
Chapter one of The Impact Of Marketing Strategy In Nigerian Banking Industry
INTRODUCTION
1.1 BACKGROUND INFORMATION
Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services, organization and event to create and maintain relationships that will satisfy individual and organizational objectives. It is fundamental to business growth. It basically includes getting goods and services to the final consumer satisfactorily.
The Nigeria banking sector has changed tremendously since the introduction of the Structural Adjustment Programme (SAP) on 1st July, 1986. Prior to this period, most Nigerian banks engaged in an effort aimed at encouraging certain classes of customer resulting in rejection of deposits or accepting them on dictated terms due to the fact that there were few banks to render services to a considerably large numbers of customers which led to a decline profit volume.
However, the period between the SAP and now has witness various amendments of banking laws and policies ranging from BOFID 1991, to universal banking policy of 2001, various increased in the capital base e.t.c. these changes have therefore necessitated the need to find a way of promoting banking services, which is possible with the impact of marketing strategies in the banking sector.
It is surprising that banks have not been able to come up with a competitive and comprehensive approach for marketing of banking services and product. A close look at the recently concluded re-capitalization process showed evidently the above assertion. This process witnessed what is called “Aggressive Marketing” which is not a replete of what banking stands for in terms of integrity and utmost good faith.
The trend of the introduction of marketing department (marketing strategies) in banks is a welcome development and has made arm-chair banking part of the history of the banking sector. Bank marketing was thus defined as “that part of banking services profitability to selected customers”. The need for marketing in banks evolved from the intense competition from not only rival banks but also non-financial institutions. Staffs are placed on target to be achieved and are compensated or promoted using their ability to or not to meet their targets.
However, customers should be at the forefront in terms of the banks planning and corporate thinking. An organization cannot be talking of profit without considering the customers patronage that yields that profit. The strategic or corporate planner therefore has to take cognizance that the survival of a business rest solely on the customer. It can be seen that the relevance or importance of marketing to the banking industry cannot be over estimated.
The banks needs to make adequate returns because they are accountable to their shareholders who have invested with the purpose of receiving good returns. Also, the substantial cost incurred in the day-to-day operation must be sufficiently covered from the profit earned. For any bank therefore to meet these needs, the bank needs to make adequate returns. Meeting these needs is termed maximizing the shareholder’s wealth.
1.2 STATEMENT OF THE PROBLEM
Despite the importance of marketing strategy in the banking industry, there is a problem in their financial services and activities with particular reference to First Bank of Nigeria Plc.
During the era of arm-chair banking, the banks were very few and patronized by the indigenous people with no option, but following the increment of indigenous ones between 1945 – 1960 and the recent re-capitalization of banks’ capital base to N25billion has necessitated a dire need for banks to take marketing of their products very seriously. It is obvious that competition amongst banks would increase and as such there is need for real marketing strategies to be applied to further professionalize the industry.
It is believed that banks with more funds would be well positioned to become one of the leaders in the dynamic and competitive sector and marketing plays a pivotal role in deposit attraction and sourcing of funds.
1.3 OBJECTIVES OF THE STUDY
The general objectives of the study is to determine the impact of marketing strategies in Nigerian banking industry and how they are used to attain stated objectives. This study will evaluate impact of marketing strategies in relation to external factors operation and proffer solutions based on the data collected and the scope of the researcher.
Other specific objectives of this study include:
1. To examine an existing marketing principles and theories.
2. To examine product marketing strategies of banks in relation to external factors.
3. To evaluate how these strategies has been in achieving their objectives.
4. To examine the associated constraints in the incrementation of these marketing strategies.
5. To make necessary recommendations for an efficient banking policy.
1.4 SIGNIFICANCE OF THE STUDY
All organizations are established to accomplish their set objectives; therefore, banking industry is no exception. For some of these set objectives to be attained, they must be converted into marketing objectives which calls for the development of a clear cut marketing strategy and well thought supporting programmes for their attainment.
The research work that has been done in the past on the marketing strategy to bring out and justify the importance of the study is not much.
However, it is important to note that with the present stiff competition among the banks, the researcher saw the need for the present day banks to adapt and be involved in marketing strategy.
1.5 SCOPE OF THE STUDY
This research work was restricted to commercial bank with reference to First Bank of Nigeria Plc as a case study, and only First Bank of Nigeria Plc, Ilorin branch was used for the purpose of the study, since the bank is making use of the policy that affects all the branches operation.
1.6 PLAN OF THE STUDY
This research work comprised of five chapters and all chapters were presented in a logical and sequential mode as follows:
Chapter one contains background information, statement of the research problem, objectives of the study, significance of the study, scope of the study, plan of the study and definition of terms (keynotes).
Chapter two contains the review of some related literatures on marketing strategies written by some authors and some other researchers on marketing strategy, scope and components of marketing strategies. It also studies the marketing strategies in banking industry, marketing research and the summary of the chapter.
Chapter three deals with research methodology which is made of history of First Bank of Nigeria Plc, Ilorin branch, sampling size, source of data collection and method of data analysis, research hypothesis.
Chapter four and five dwell on analysis and presentation of data and summary, conclusion and recommendation respectively.
1.7 DEFINITION OF KEY TERMS
MARKETING: This was defined by (Peter Drucker, 1973) as human activity directed at satisfying need and wants through exchange processes.
However, (Wroe Anderson, 1976) equally defined marketing as individual and organizational activities aimed at facilitating and expediting exchanges within a set of dynamic environmental forces.
MARKETING CONCEPT: This is a philosophy of business that states the customers’ want-satisfaction is the economic and society justification for a firm existence. It stresses that the emphasizes on all business activities should be focused or geared towards the satisfaction of the customers.
MARKETING ENVIRONMENT: This refers to all factors and forces both internal and external that influences the marketing decision making. The internal forces are controllable which includes the organizational structure, the 4M’s i.e. Man, Money, Machine and Materials.
However, the external forces which are uncontrollable falls outside the firm, constitute the greatest opportunities and threats to the firm. These include economic condition, socio-cultural influences, competitors, customers, political and legal environment, international influences, technological factors e.t.c.
PRODUCT: A product can be an idea, a service, a good or any combination of these three. It could also be defined as anything that can be offered to the market for attention, acquisition, use or consumption that will satisfy a need. This implies that product include physical, objects, services, persons, places, organization and ideas.
MARKETING STRATEGIES: This is a written plan, usually comprehensive describing all activities involved in achieving a particular marketing objective and their relationship to one another in both time and magnitude, it will include short and long term sales forecast, production and profit target, pricing policy, promotional and selling strategy, staffing requirement as well as the selected marketing mix and expense budget.
GET COMPLETE PROJECT MATERIAL (FILE)s NOW! >>>
See more Banking and Finance project topics here
Do you need help? Talk to us right now: (+234) 08060082010, 08107932631 (Call/WhatsApp). Email: [email protected].IF YOU CAN'T FIND YOUR TOPIC, CLICK HERE TO HIRE A WRITER»
