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Marketing Strategy - Axis Bank

Historical background
The first major event of Indian banking was the creation if Imperial Bank of
India by merging Bank of Bengal, Bank of Bombay and Bank of Madras in 1920
Between 1906 to 1913 Bank of India, Central Bank of India, Bank of Baroda,
Canara Bank, Indian Bank and Bank of Mysore were setup
Other two banks setup under colonial rule are Allahabad Bank and Punjab
National Bank
The Current Banking regulator came in to existence on April 1, 1935
In 1949 Government of India promulgated Banking regulation Act 1949 through
which RBI was vested with extensive powers for the supervision of banking in
India as the Central Banking Authority
In 1955 the Imperial Bank was nationalized and State Bank of India along with
its subsidiaries were nationalized
In the year 1969 all other private banks were also nationalized and the private
banking in India was almost reduced to zero
It was post liberalization in 1991 when the banking sector was opened-up again
for private players
Today we have 23 Private bank and 29 foreign private Banks having their
operations in India
Axis Bank (Formerly known as UTI) begun operations in 1994
It got itself renamed as Axis Bank from UTI Bank in the year 2007
SMP09 : Marketing Strategy - Axis Bank

Marketing trends in banking sector


Banks approaches towards customers and market underwent changes and
focus was gradually shifted to marketing their products.
Bankers Major Orientation

Disintegration

Selling Orientation

Bank
Operation

Consolidation
of

Development Banking period


1969 to mid 1980s

Bank Marketing period


After mind 1980s

Targets

Social Banking

Accounting Orientation

and Branch
Expansion

Bank
Nationalization

Traditional Banking Period


up to 1969

Rising
Customer Needs

Period

Towards Marketing Orientation

SMP09 : Marketing Strategy - Axis Bank

Marketing trends in banking sector .contd.


The fantastic increase in needs and expectation of banking
customers, important factors for this change are
The spread of Television, including access to
international channels,
Rise of Indian middle-class with considerable financial
resources and higher propensity towards consumption,
Entry of foreign and private sector banks in India,
Break-up of the joint family system in urban India,
Govt. intervention for protecting the interest of
consumers.

SMP09 : Marketing Strategy - Axis Bank

Origin
The Bank was promoted jointly by the Administrator of the
specified undertaking of the Unit Trust of India (UTI) and

Life Insurance Corporation of India (LIC).


General Insurance Corporation Ltd (GIC).
National Insurance Company Ltd.
The New India Assurance Company.
The Oriental Insurance Corporation.
United Insurance Company Ltd.

It got itself renamed as Axis Bank from UTI Bank in the year
2007.
Oglivy and Mather was the company engaged for this
rebranding exercise.

SMP09 : Marketing Strategy - Axis Bank

Growth

Third largest Private Sector Bank in India


1947 Branches and 11,245 ATMs spread across the country
Has operations in Singapore, Dubai, Hong Kong, and Abu Dhabi
Balance sheet size of over 3.4 lac crores in Mar 2013
Vision
To be the preferred financial solutions provider excelling in customer
delivery through insight, empowered employees and smart use of
technology.

Core Values
Customer Centricity, Ethics, Transparency, Teamwork, Ownership

Business

Retails Banking: Personalized Banking services for individuals


Business Banking: Covering SME segment
Corporate Banking: For large corporate
Treasury operations
Agri Loans: Rural presence
Mutual fund and asset management
Financial consultancy
SMP09 : Marketing Strategy - Axis Bank

Annual Results - 2013


Snapshot (As on March 31, 2013)
Total Assets
3,40,561 crores
Net Advances
1,96,966 crores
Total Deposits
2,52,614 crores
Net Profit (Q4FY13)
1,555 crores
Net Profit (FY13)
5,179 crores
Shareholders Funds
33,108 crores
ROA (for FY13)
1.70%
ROE (for FY13)
20.51%
Net NPA Ratio
0.32%
Capital Adequacy Ratio 17.00%
Tier 1 CAR
12.23%
Saving Bank Accounts
127 lac
(No.)
Branches2
1,947
Foreign Offices
7
ATMs
11,245

Performance Highlights
Net Profit
Net Interest Income
Fee Income
Operating Revenue
Operating Profit
Net Interest Margin
CASA1
CASA (Daily Average)

SMP09 : Marketing Strategy - Axis Bank

Q4 FY 2013

FY 2013

22% YOY
24% YOY
22% YOY
25% YOY
37% YOY
3.70%

22% YOY
21% YOY
17% YOY
21% YOY
25% YOY
3.53%
23% YOY
14% YOY

Performance Overview
Operating Revenue grew 25% YOY,
stood at Rs. 4,672 crores
Operating Profit rose to Rs. 2,800
crores, registered growth of 37%
YOY
Return on Assets stood at 1.94% and
Return on Equity at 21.38%
Well positioned for future growth
with Tier I CAR of 12.23% and Total
CAR of 17.00%.

SMP09 : Marketing Strategy - Axis Bank

Business Overview
Multiple channels drive business
growth
Extensive use of technology to
provide services

Expanding footprint across


centres
Largest ATM network in the
private sector

SMP09 : Marketing Strategy - Axis Bank

SWOT analysis

STRENGTHS
One of top three positions in terms of fastest
growth in private sector banks.
Has a network across India through Branches and
ATMs with its presence in 971 cities and towns.
Brand Name
Knowledge of Indian Market

THREATS
Growing competition from global players
Consolidation of public sector banks
Permission for new private sector players,
increase in competition: Customer retention will
be a key
ICICI and HDFC are imposing strong threats in
terms of their expansion in customer base by
their aggressive marketing strategies

WEAKNESSES
Majorly concentrated in corporate, wholesale
banking, treasury services, retail banking
Foreign branches constitute only 8% of total
assets
Customer service has to improve a lot in order to
be in race with other major players

OPPORTUNITIES
Acquisitions to fill gap
Multiple businesses synergies
Global foot print
Technology as a lever for differentiation and cost
reduction
Geographical expansion to rural market 80% of
them have no access to formal lending
Concept of ETM (Everywhere teller machine) had
a good response in attracting new customers in
personal banking segment

SMP09 : Marketing Strategy - Axis Bank

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Marketing strategies: 7Ps analysis

Product

Price

Accounts: Easy Access Accounts, Prime Savings Account, Salary Account,


Womens Saving Account, Senior Privilege Account, Defense Salary
Account, Trust & NGO Savings Account, Azzadi No frills RFC (D) Account,
Pension savings Account
Deposits: Recurring deposits, Fixed Deposits, Encash 24,Tax Saver Fixed
Deposits, Loans, Home loan
Loans: Personal loan, Loan Against Property, Loan Against Security, Car
Loans, Study Loans, Two Wheeler Loan, Consumer Loan
Investments: Online Trading, Mutual Funds, Fixed Income, Depository
Services
Insurance: Health Insurance, Family Health, Health Guard

Axis bank has developed innovative strategies against its competitors


with respect to pricing by use of technology.
The creation of centralized processing system linking all its branches has
been a major strategic move in this regard.

Promotion

Cross Selling exercises


Organizing school level painting competitions in order to create
awareness about the environmental concerns and the wild life to
promote kids advantage account.
Wheels of fortune - This promo are targeted at all those customers who
avail a personal loan, car or a two wheeler loan. There will be lucky draw
at the end of the promo and the winners would get exotic prizes.
Personalized promos by sending mailers about various products on offer
to all those who come in contact during the mass promotion strategies.

SMP09 : Marketing Strategy - Axis Bank

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Marketing strategies: 7Ps analysis ..contd.


Place
Axis bank is widely spread in India
947 branches and 11,245 ATMs
extension counters foreign offices

Process
Developed a robust internal as well as external business process and sales practices
focused on the process development and bringing transparency to all the
transactions

Positioning
Centralized phone banking centre
Centralized collection and payment hub

People
constant endeavor to continuously develop its human resources by laying strong
emphasis on training development
possesses a highly motivated team of professionals and has the lowest employee
turnover rate in the industry

SMP09 : Marketing Strategy - Axis Bank

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Other strategies
Segmentation Strategy
Demographic Variables - Demographic segmentation variables are amongst the most
popular bases for segmenting customer groups which include Location, Occupation,
Age etc.,
Psychographic Variables - Lifestyle, The people who believes in modern banking i.e.
internet banking (I-contact, mobile recharge, e-payment, travel currency card etc.)
Social class - Many Marketers believe that a consumers "perceived" social class
influences their preferences for products & services

Targeting strategy
Corporate banking market: this market target the industries
Capital market: this segmented is targeted on the long term needs of the individual
as well as of industries
Retail banking market: this segment is for the retail investor and provide them short
term financial credit for their personal, household needs

Selective specialization strategy


axis bank have different set of credit cards, each targeted at different set of people

Positioning Strategy
Customer centric
Service oriented
Product innovation
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Other strategies
Cross selling- Cost reduction strategy
It launched Airtel money Super Account powered by Axis Bank, a nofrills savings bank account of Axis Bank on Airtels mobile platform, in
partnership with Infosys.
Money transfer with cash-out now available across leading
remittance corridors; customers can save money and earn interest
too
Resulted in
Almost all SME customers have Current Accounts with the Bank
Nearly 1/3rd of SME customers avail FOREX products
Integration with Wealth Management resulted in high fee based income

Relationship marketing strategy


78% of SME Customers have rated overall quality of RM highly
Key strengths of RM model as per the IMRB survey are Availability,
Knowledge level, Timely product and service delivery, Promptness in
responding to queries

Internet Banking Strategy


offered a unique platform for all its customers
both the individual as well as corporate
customers to complete transactions online
presence on all the 4 major social media
platforms Facebook, Twitter, YouTube and
Linkedin
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Thanks

References
http://www.axisbank.com
http://www.rbi.org.in
http://business5.net/m/marketing-approach-to-promoting-banking-services-w321.pdf
http://www.jmijitm.com/papers/130082034035_42.pdf

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