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BY-GAURI
SURABHI DUBEY
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CONTENTS Distinguishing Characteristics of Services
How they are constraints to the banking services
Strategies to overcome the constraints
Private Banking in India
ICICI bank- brief introduction
STP of ICICI bank
How ICICI took on its competitors Catering to the rural segment
Conclusion
References
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DISTINGUISHING
CHARACTERISTICS OF SERVICES
Intangibility(cannt be felt,smelled or tasted
before purchase)
Inseparability(produced & delivered
simultaneously)
Perishability(cannt be stored or saved)
Heterogeneity(Depends upon who providethem,when & where they areprovided)
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HOW THE CHARACTERISTICS
ARE CONSTRAINTS
Intangibility
Marketers have nothing to show to theircustomers
Inseparability Less chance for improvement in the quality
Perishability
Marketers have less control for handling
demand and supply fluctuations
Heterogenity
Difficult to ensure consistency in servicequality
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DIMENSIONS OF SERVICE
QUALITY:S.NO. DIMENSIONS DESCRIPTION
1. RELIABILITY Ability of the company to perform the promisedservice dependably and accurately
2. TANGIBLES Appearance of the physical facilities, equipment,personnel, and communication materials
3. RESPONSIVENESS Willingness of the employees to help customersand provide prompt service
4. ASSURANCE Competence, courtesy, credibility and security
5. EMPATHY Individualized attention the firm provides to itscustomers, includes access, communication andunderstanding
Source: kotler & keller;2006
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ORGANIZATIONAL FEATURES:HR
TECHNOLOGY
PLANNING OPERATIONSORGANIZATIONAL RELATIONS
Dror Shuki, Deployment of Service Quality Characteristics, World Academy
of Science, Engineering and Technology-30,2007,pg31-32
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HR STRATEGIES:Service
FeaturesStrategies
Intangibility Good presentation & explanations of the product fromemployees
Perishability Customer conversation like problem identification &solving, Appropriate responses to customer complaints
Variability Gap analysis for identifying gap in quality
Improving services delivery
Inseparability Employee training
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TECHNOLOGY:Service Features Strategies
Intangibility Opportunities to show more additional evidence of servicesWell designed Websites
Frequently updated accurate information
Ease of navigation
Advertising
Perishability E-services available for 24*7More freedom for customers to select & purchase services &
marketers to handle supply & demand
Variability Less variations in the quality because of e-services beingelectronically based
Inseparability Easily customized since customers become more participated inthe process by providing more individual information
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OPERATIONS:Service Features Strategies
Intangibility Provide tangibility through : physical location of the facility Office layout and ambienceComfortable waiting areas that alleviates the distress of the
customerPerishability Capacity management- adjusting services to match demand
Adjust price to influence demand
Variability Improving services delivery
Inseparability Disintermediation
Reference: Dynamics of Indian banking: views and vistas, Manoranjan Sharma
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ORGANISATIONAL RELATIONS:Service Features Strategies
Intangibility Ensuring safety & security
Perishability Integrating internal quality improvements & externalcustomer measures
VariabilityService guarantees
Inseparability DisintermediationCRM
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PRIVATE BANKING IN INDIA: Initially all the banks in India were private banks, which
were founded in the pre-independence era to cater to thebanking needs of the people.
In 1921, three major banks i.e. Bank of Bengal, Bank ofBombay, and Bank of Madras, merged to form ImperialBank of India.
In 1935, the Reserve Bank of India (RBI) was established
and it took over the central banking responsibilities fromthe Imperial Bank of India.
In 1955, Imperial Bank of India was subsequentlytransformed into State Bank of India (SBI).
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Cont
On 19 July 1969, the Government of India nationalized the14 largest commercial banks of India.
In 1994, the Reserve Bank Of India issued a policy ofliberalization to license limited number of private banks,
which came to be known as New Generation tech-savvybanks.
Then Housing Development Finance Corporation Limited(HDFC) became the first (still existing) to receive an 'in
principle' approval from the (RBI) to set up a bank in theprivate sector.
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BRIEF INTRODUCTION:Promoted by ICICI (One of the leading Financial
Institution established in 1955 at the initiative of Govt. ofIndia and World Bank) in the year 1994.
ICICI Bank is India's second-largest bank with total assetsof Rs. 3,634.00 billion (US$ 81 billion) as on March 31, 2010
Largest new generation Bank in terms of branch network
The Bank has a network of 2,035 branches and about 5,518
ATMs in India and presence in 18 countries.
In May,2010 ICICI Bank announced merger with Bank ofRajasthan.
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All 463 branches of Bank of Rajasthan have started to
function as ICICI Bank's branches from Aug 13,2010, after
the approval of RBI.
The merger of Bank of Rajasthan would help ICICI Bankincrease its branch network by almost 25 %.
This will give greater visibility to ICICI Bank in western
parts of the country.
Source: The Economic Times, 14 Aug,2010.
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ICICI BANK TODAY:
Large capital base
Vast talent pool
Low operatingcosts
Technology focus
Strong corporaterelationships
Indias largestprivate sector
bank and one stopfinancialsolutions provider
with a diversifiedand de-risked
business model
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METROPOLITAN
(MAB-Rs. 10,000) URBAN
SEMI-URBAN RURAL(MAB-Rs. 2,500)
SEGMENTATION(Geographic &
Income)
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Occupation
Different products for different occupational segmentidentified
Power pay : salaried employees
Business multiplier: businessman
Attractive gifts offered depending on the segment
Currently, on opening savings account
senior citizen- ghazal CD
women-ladies magazines
College goers-rock music CD
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TARGETING:
TARGETCUSTOMERS
RETAIL
CUTOMERS
WEALTH
CUSTOMERS
NORMAL
CUSTOMERS
CORPORATECUSTOMERS
NON-EARNERS
SALARIED BUSINESSPERSON
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POSITIONING:
2003
Safer,Simpler,
Smarter
Hum HainNa
Opportunities
Unlimited
Vishwas hto sab kuchh
Khayalaapka
2001
2005
2008
2010
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HOW ICICI TOOK ON ITS
COMPETITORS1. Leverage on technology
2. Asset driven to liability driven bank
3. More customer oriented than others
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LEVERAGE ON TECHNOLOGY:
The first one to start Internet banking.
ATM, anytime ,anywhere banking.
First institution to start a web based securities trading
through its subsidiary ICICI Web Trade Ltd.
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Need to introduce TechnologyChanging lifestyle :
Increasing urbanization
Lowered transaction cost
MODE OFTRANSACTION
TRANSACTION COST(per transaction)
BRANCHES Rs 50
ATMs Rs 15
INTERNET BANKING Rs 4
MOBILE BANKING Re 1
Source: The Economic Times, Sept.21,2010
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Outcome
The clicks and bricks approach has led to:
increased business volumes,
lower service delivery time, increased business efficiency
reduction in the cost of client servicing.
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Mode of Transaction 2000 2009
Branches 94% 13%
ATM 3% 46%
Internet banking 2% 38%
Mobile banking 0% 1%
Call center 1% 2%
Source: The Economic Times, Sept.21,2010
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Use of UID
More transactionthrough bank
especially internet
Less fraud in termsof tax evasion
Estimated 4 timesincrease in bank
deposit base from46 lakh crore
(present) to 200
lakh crore (by 2020)
Role of technology in future
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HOW ICICI TOOK ON ITS
COMPETITORS CONT2.Asset driven bank to liability driven bank
From giver to taker
3. More customer oriented than others
From transaction oriented to relationship oriented
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CATERING TO THE RURAL
SEGMENT:Franchise Model:A one man office ( known as theKendra") in the village forms an interface between the
villagers and the banks products and facilities.
Use of Biometric system :can be operated on biometric
authentication.
Customised ATMs: battery operated,so that power failure
is not an issue.
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MICROFINANCE:
(i) Group delivery models
SHGs
JLGs
(ii) Individual banking
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CONCLUSION:With the continuous growth of competition in the
market place, understanding customers has becomemore and more important.
Technology has an important and positive effect oncustomer towards the banking services and the service
quality has been improved.
Rural market is having a large potential which is yet tobe tapped.
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References: Shuki Dror, Deployment of Service Quality Characteristics, World Academy
of Science, Engineering and Technology-30,2007
Chun wang, zheng wang, The impact of internet on service quality in thebanking sector, Master Thesis, Lulea University Of Technology,2006-07
Dynamics of Indian banking: views and vistas, Manoranjan Sharma Economic Times
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