Communication in Banking Sector
|✅ Paper Type: Free Essay||✅ Subject: Marketing|
|✅ Wordcount: 1705 words||✅ Published: 21st Jul 2017|
Developing a proper communication strategy in a banking sector must be built in the context of the customers expectations. In the current time, banking organizations are no longer interested in developing better communication strategies that will serve their clients. This is because they obsessed with making money, and maximizing on their profitability.
In view of this, most of this cooperation do not obtain their objectives because they are unable to attract new customers, and their normal customers run away from them, because of poor communication strategies.
During the current times, big organizations have a variety of employees who perform various jobs. The organizations employ marketing staffs, to market their services, and seek for clients. To increase their efficiency in communication, banking institutions employ company spokesmen to communicate their strategies and achievements to the stakeholders, to the government and to their shareholders (Bell and John, 23).
Communication is an important element that determines the profitability and efficiency of a banking organization. A banking organization cannot attract and retain a wide customer base without initiating better and effective communication strategies. Despite these realities, banking organizations maintain poor communication strategies. One of the main reasons is their desire to maximize profits, at the expense of customer satisfaction.
Trends in Communication Strategies:
In 1998, Citi Group merged with Travelers, and this made them as one of the largest banking organizations in the world. The company formed CEEMEA, its subsidiary which was in charge of looking for market in Europe, Africa and Asia. The organization realized the importance of communication in a business set up. To improve their communication capabilities, the company made a series of reforms, and introduced high end communication strategies such as the integration of information technology in their business set up.
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The results were immediate; the profitability of the company increased by more than 100%, and the company won numerous enterprise awards, for their introduction of information technology in the banking industry. The company managed to outperform established multinational business organization such as Barclays Bank, and Standard Chartered Bank. Other banking organizations followed the example of CEEMEA, and introduced information technology in their banking system. In the case of CEEMEA, customers could access their financial details, through the internet. An individual had the capability of opening a new account with the banking organization (Mohan, 20).
This made the organization to record an approximate number of two million banking accounts. This is the power of enacting proper communication channels in the banking industry. This is report outlining the effects of poor communication strategies in the banking sector. This report identifies the various needs of customers, and how the banking institution can satisfy these needs. This report identifies the strategies of competing banking organizations in relation to establishing proper communication channels, and thus creating customer satisfaction. It offers recommendations on better strategies, the business organization ought to implement.
Effects of poor communication strategies and customers’ expectations:
Banking cooperation’s will lose customers and fail to retain their existing ones if there communication strategies in inefficient and poor. This will most likely lead to reduced profitability, emanating from the reduction of their sales revenue. This will affect the objectivity of the banking corporation, and therefore give an edge to its competitors in the banking sector. Poor communication strategies will also affect the employees of the organization. For instance, withdrawing important information to the employees in regard to the objectives of the company, will make them loose focus, and concentrate on their desires at the expense of serving the customers. This will lead to poor and inefficient service, leading to loss of customers, and again reducing the profitability of the business organization.
Poor communication with a corporation will result to a culture of rigidity, and therefore limit the innovative capacity of its employees (Bell and John, 33). The competition in the banking organization is fierce, and to survive in the market, it is important for the bank to encourage innovation. Lack of it, is recipe for poor performance, therefore giving an edge to its competitors. To encourage innovation, the banking organization must initiate proper channels of communication, and increase incentives to anybody who comes up with better business ideas.
Customers expect so much from the banking corporation. One expectation of customers is honesty from the customer care staff, while giving information on certain services of the organization. For instance a customer might approach the customer care staff on the requirements of taking a loan, and how to repay the loan. It is essential for the customer care staff to act in a professional manner, and give out all the details concerning the issue at hand, and the expectations of the customer.
By doing so, the customer care staff will help the banking organization to create a brand name, that depicts honesty and reliability. This is an essential element in attracting and retaining customers. Another expectation of a customer is a speedy flow of information. Customers might require certain information from the banking corporation, and to get the information, they need to contact the customer care staff. The employee might need to consult, and gather the information. This process should not take long. This is because it will create anxiety on the employee, depending on the issue at hand.
There is also an issue of accessing their bank accounts. Customers require mobility in accessing their bank accounts. Their presence at the banking premises must not be essential, for them to access their banking account. They may need details of their transaction, or to check the balance in their accounts. The cooperation can device measures of ensuring that their customers can access their accounts through the internet or even their mobile phones. This will require a high degree of innovation.
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Solution to the Problem:
One of the most effective methods of solving the communication problem within the organization is to adopt the concepts of open innovation. The cooperation needs to conduct a case study, and observe how successful banking cooperation such as Barclays Bank, Citi Group developed their communication strategies. The organization will thereafter adapt the strategies that are beneficial to them. For example integrating Information Technology in the organization is essential. This is a strategy that CEEMEA, a branch of Citi Group Cooperation enacted as part of its communication strategies (Mohan, 27).
Another solution is to train its customer care staff on the better communication strategies. This is to impart on them the necessary skills required to interact with customers, and the various stake holders of the company. Customer care staffs have a responsibility to act as the public relations personnel of the banking cooperation. It is important to equip them with necessary skills of how to handle the various stake holders of the business organization, including the customers of the business (Bell and John, 31).
The cooperation should create a proper communication channel, between the top management, and the junior staff. Managers of the organization should act as coaches and not administrator. This will enable them effectively communicate the objectives of the company, and will motivate the employees to work hard, so that they may help the organization to achieve its objectives.
The Case of Barclays Bank:
Barclays bank cooperation realizes the importance of effective communication in a banking industry. To disassociate itself from poor communication strategies, the organization has merged the marketing department with the communication department. This is because proper communication influences the degree in which a banking cooperation will achieve success in attracting and retaining customers.
There is the department of internal and external communication. Internal communication has the responsibility of liaising with the marketing department to ensure the company says the right words concerning their achievements to the internal stakeholders of the company. This includes investors and various high skilled employees (Mohan, 49).
The company has integrated Information Technology in its operations. Through information technology, the company is able to develop digital images of its services, therefore attracting new customers, and retaining the existent ones. The cooperation uses websites, and search engine optimizations, to make its presence felt. As a result of these measures, the organization has managed to retain its customer base, and attract new customers.
In conclusion, the success of a banking cooperation depends on the superiority of its communication and marketing strategy. Without proper communication channels, the organization will struggle to market its services. In relation to this, it is essential for a banking organization to invest heavily in building proper communication infrastructure within its set up.
The organization must re-design its goals, create a channel where junior employees will access their senior partners, and chat on the best ways of creating customer satisfaction. To create an effective communication infrastructure, the cooperation must move from its notion of profit maximization, to customer satisfaction. This will ensure that the staffs are innovative enough to come up with better ideas on how to further advance the objectives of the company. On this note, a company without better communication strategy is a company designed to fail in business.
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