Bank ABC is England's young and fastest growing bank. In a little over two years since its inception it has in the Top 10 list, in terms of lending. We are dealing in consumer and wholesale banking in all over UK.
We are going to launch an online saving (e saving) product very soon. In the current market scenario, where many large bank collapsed and there is significant outflows of funds from Building Societies, we believe that this is the best time to launch a saving product with a minimum balance requirement with high interest in return together attractive rewards on the prizes on quarterly balloting.
Our target audience will be the middle income people from UK and non resident of UK, the residents of Scotland, Ireland and Wales.
This plan will analyze our aggressive marketing strategy designed with the contribution of our most competent marketing team.
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This plan will also discuss the current scenario of UK Banking Industry. In SWOT analysis we will explain competitor's analysis along with our strengths and weaknesses.
We cannot take our decision without clear targeted financial budgets. So this plan includes budget of expected income for the next three years and detailed budget of marketing expenses for the proposed product.
If we implement this plan, it is expected that we will achieve the desired market share and profitability.
Name and Introduction of Bank
• Bank ABC is England's young and fastest growing bank.
• In a little over two years since its inception it has in the Top 10 list, in terms of lending.
• The Bank also reported very healthy half year earnings achieving a net profit against a backdrop of unprecedented economic turmoil reflecting the bank's innovative approach to financial services and customer acquisition.
• Bank ABC has a network of 13 branches spread across the UK and has the unique distinction of 24/7 access to customers through its own and ATM work at free of cost.
• The Bank employs over 540 staff and developing the banking professionals of tomorrow across the Country.
• A conservative approach to risk management has limited the impact of the sub-prime crisis on the bank.
• We took advantage of our strength to add businesses and talent, wherever appropriate.
Opportunity and Current Scenario
We are a growing bank and have developed a team of top quality professionals working dedicatedly. We also have the advantage of having ample liquid resources despite liquidity crisis all the UK and the world. We are in TOP 10 in terms of lenders and still we earned a good profit. We think that this is the biggest advantage we are having in comparison to other banks in the market. We are fully equipped with e-banking resources and having most satisfied e-banking customers in the region.
Sufficient Information to Make Decision
Bank ABC is planning to launch Online E REWARD SAVING PLAN in 2010 to reward savers and encourage the customers to save more and give them the opportunity to win exciting prizes on a continuous basis in addition to the comfort of security for their savings.
Senior Bank ABC officials say that the E REWARD SAVING PLAN will be one of the very popular prize schemes in the country.
The collapse of firms such as Royal Bank of Scotland, HBOS and Bradford & Bingley has profoundly shaken faith in the UK financial sector. Mutual's faced a £2.2bn outflow over the last few months.
Savers withdrew more money from building societies in June than at any other time since records began. June's 2009 outflow, which represents nearly 10% of the £240bn savings held in building societies, towers over the previous high of £811m in April. It is the most taken out of building societies in more than 50 years.
This report focuses that outflow of money from Building Societies and Banks during the last few months can be attracted again.
UK Market Analysis
The collapse of firms such as Royal Bank of Scotland, HBOS and Bradford & Bingley has profoundly shaken faith in the UK financial sector.
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Marked to Standard
Landsbanki (Iceland) owns the Icesave savings bank in the UK as well as Heritable Bank. This was very worrying for anyone with money in Icesave and Heritable's accounts that Icesave's UK websites were not allowing customers to withdraw money. Icelandic savers, however, were free to withdraw their money from Landsbanki's domestic branches, cash machines (ATMs) and internet operations. It is just non-domestic customers who have been cut off from their cash.
Government bailouts and guarantees worth hundreds of billions appear to have done little to reassure international observers. It may be cold comfort, but the UK was not the only nation to tumble down the league table. Switzerland clocks in at 44th place, while the U.S. is at 108th position, nestled just behind Tanzania and Azerbaijan. Ukraine ranks rock-bottom at 133, just below Iceland, Zimbabwe and Mongolia. Partly as a result of local problems with its financial markets, Britain has slipped a notch in the overall competitiveness league table to 13th place.
Mutual's faced a £2.2bn outflow over the month, according to figures by the Building Societies Association (BSA), compared to a net inflow of funds in June last year of £419m. Savers withdrew more money from building societies in June than at any other time since records began.
June's 2009 outflow, which represents nearly 10% of the £240bn savings held in building societies, towers over the previous high of £811m in April. It is the most taken out of building societies in more than 50 years.
The BSA blamed the figures on Britons paying off mortgages. Brian Rising unemployment, subdued income growth and the official bank rate at an historic low, it is very difficult to attract retail savings.
Households are looking to take advantage of the low interest rates to pay off debt rather than save. These conditions are expected to persist into 2010.
The BSA also published figures on mortgage lending today, which were £1.98bn in June, up almost a third on May, but still 40% lower than the £3.25bn recorded at the same time last year.
The outflow of funds is in stark contrast to a general trend over the past two years: savers have been flocking to the perceived safety of the mutual sector after the fall of mortgage bank Northern Rock in 2007 and the collapse last year of Bradford & Bingley.
However, the demise of several mutual's this year, including Catholic, Cheshire, Derbyshire and Dunfermline, may have changed savers' views on the overall safety of building societies.
National Savings & Investments (NS&I) said in its annual results last week that it saw net outflows of £1bn between April and June this year, compared with net inflows of £1.1bn over the same period last year.
The Government-backed savings provider said this signified an end to the 'flight to safety', in which anxious savers flocked to apparently 'safe' institutions over the past 18 months. It said savers are now redistributing their cash back to its original home before the banking crisis jarred them into action.
Data in June from the BBA showed savings deposits with banks rose substantially during the month - by £3.2bn, compared to £0.3bn the month before.
However, this did not account for the huge volumes of cash flowing out of building societies. One possible explanation is that income-starved savers are switching money from low rate accounts into bond funds. Sales of corporate bond funds have hit record highs this year. Equity income funds have also seen increased demand.
Other Details of the Scheme
The new E REWARD SAVING PLAN offers bigger prizes, better chances and more winners and we are confident that it will prove very attractive to our existing customers and help to attract more customers. We are committed to encourage a culture of responsible saving in the residents of all ages to save for the future.
For the monthly bumper draws of 10 prizes of 10,000 each during the year customers earn 4 chances for every minimum average balance of 1,000 in their savings account. We offer our customers a unique range of prizes and offers including free shopping vouchers, attractive cars to 10 winner, guaranteed winners for each branch and high value cash prizes.
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• Minimum balance only £1,000 for eligibility for Prizes Balloting.
• View and manage your account exclusively online.
• Annual, monthly or on-closure (deferred for tax-planning) interest options.
• Access your E REWARD SAVING PLAN Account 24 hours-a-day, 7 days-a-week.
E REWARD SAVING PLAN account opening requirements
• You must hold a personal bank account in your name for withdrawals to be paid into.
• You must be aged 18 or over and hold a current full passport.
• You must be able to apply for and operate the account in English.
• You need to be able to open your account with a minimum of GBP 10 via electronic funds transfer.
You will need access to a computer with internet capability and a printer as well as having a valid email address. This email address must be personal to you and not shared - for example with your family and friends.
Our account opening procedure is quick and simple. From the time that we receive your signed application form and relevant documents we can usually have your account open within 4 to 5 days.
We are already working on e banking and the technology and the software required are already in working with trained staff for supporting the transaction and the online help line for guidance of the customer.
As explained in the earlier in that many bank and building societies are not working very well. After two years of the economic crisis, many banks are planning again to regain the confidence of the lost customers. Unemployment has increased. Competition to survive in the market is too much high.
How to Exploit Opportunities
1. There are opportunities available, especially in the saving scheme, due to unemployment and uncertain conditions of the business, SME investor are reluctant to start new businesses.
2. The outflow of money from Building Societies and Banks during the last few months can be attracted again.
This is the best time to attract all those above explained target audience by proper marketing plan.
How to Handle Weaknesses
Weaknesses from existing competitors may prove challenging but can be overcome by portfolio segmentation, decisions and actions to control and manage customer relationships and client base and improve the quality of risk management.
The prime objective was to define a target audience to define expected number of customers. As indicated by our marketing team that most of the people from third world living in UK and the middle class are looking for the opportunities to invest in such option of prizes and high interest rates.
For market research we will go for both primary and secondary research. All sources of Secondary research have been used like news, news paper, special journals and electronic media programs.
For Primary research we plan to hire the services of professional market research companies.
Outdoor interviews of People were conducted by our Marketing team in the various areas of London and Manchester. The results are very encouraging regarding our planned activities.
The Marketing Strategy will include phases of 2 campaigns conducted throughout the year. These aim to compare different modes of the campaign strategy and customer feedback.
The Duration shall last for a period of 6 month for each campaign which will be the crucial phase determine the response of the launched product and its feedback. The second strategy will be a marketing campaign aimed at growing market share and increasing cross-sell ratios among key customers
The first campaign
It will be focused on introduction of the product in the market including a range of various sub campaigns within the major campaign.
1. The initial phase will be the Advertising Mode backed by print media and radio advertising guaranteed to reach millions. The adverting will include information about the product and highlight its benefits.
2. TV-commercials of 60 seconds will be encouraging to make the product the only solution for a real life time rewarding product on investment for long-term saving.
3. Press-releases in major business newspaper will be a considerable campaign in the third month of the campaign.
4. Viral Marketing shall be used throughout the whole campaign including Web-marketing like as in pay/click advertising and web-site advertising.
The 2nd Campaign
Incentive deposit campaign will offer cash to new customers in an effort to grow its business. Up until second month of the second campaign we will reward customers with cash for placing fresh deposits into saving Account. The cash rewarded is proportionate
8,000 (5,000) gets a £50 Bonus: 15,000 gets £150; While 50,000 gets £600.
A Seminar will be held to cross sell the product and initiate strategic partnership with large MNCs and local companies to penetrate the market thus promoting it. This presentation shall be offering promotional giveaways for the guests and an interactive session to book the product for near future investment.
Leaflet having information regarding the incentives offered will be used and will be kept in all our branches.
The Advertisement on internet will be our main area to focus and our advertisement will appear on the various popular search engines like GOOGLE.
Measurement of Strategies
The financial approved budget will be constantly monitored and compared with the actual results of operation to follow the plan and if require suggest for the improvements and changing in the plans.
The following operational budget will be more emphasized:
Realistic Implementation Schedule
Once the scheme is approved by the Management, we will start our process to launch the product. The following steps are involved. Updating of accounting software to be used for this scheme Updating online facilities to open and register for the scheme Training of employees for online help for the proposed scheme Training of employees for accounting of the proposed scheme Printing of necessary documents and advertisement material for the proposed product launch
Approximate human resources
We will require 50 members of staff for this proposed scheme. It is recommended that 45 of existing employees for the purpose and new hiring of 5 employees should be made to fill the gap.
What if's scenario
"What-if" scenarios (sensitivity analyses) showing what happens if forecasts and profit margins are lower or higher than expected.
We will continue to follow the events. If the results will go wrong way and product launch fails, we can offer fix deposit saving accounts on more interest, which may decrease the profits estimated but the number of customers and the overall profit and the activities of the bank will increase in any case.