This book is a comprehensive guide to decision making for students of
Financial Services Marketing, or marketers working within the financial services sector.
The second edition is fully comprehensively revised and updated, with a new structure,
many new chapters, a range of international case studies and vignettes and well-developed
pedagogical features.
JILLIAN FARQUHAR is Reader in Marketing at the Business School, Oxford
Brookes University, UK. She leads research in the Marketing & Operations area and
teaches marketing strategy at undergraduate and postgraduate level. She is currently
Editor of the International Journal of Bank Marketing and a member of the editorial board
of the Journal of Financial Services Marketing.
ARTHUR MEIDAN is Emeritus Professor of Marketing at Sheffield
University Management School, UK. He has lectured, consulted and taught extensively on
bank and insurance marketing throughout the world. He has also published widely and
currently serves on the editorial board for both the International Journal of Bank
Marketing and the Journal of Financial Services Marketing.
Table of Contents
List of figures
List of tables
List of exhibits
Acknowledgements
Introduction 1
Background to the book 2
Core themes 2
Who is the book intended for? 2
Distinctive features 3
Pedagogy 3
Contributors 3
About the authors 4
1 Marketing and financial services: an overview 5
Learning outcomes 6
Introduction 7
What are financial services? 7
The financial services industry 12
Marketing 13
Marketing services 16
Components of services marketing 18
Financial services 20
Technology 22
Corporate social responsibility 22
After the credit crunch 22
Summary 23
References 24
Further reading 24
Exercises 25
Case study: Long live mutuality! The friendly society 25
2 The financial services environment 29
Learning outcomes 30
Introduction 31
The financial services environment 32
Political/regulatory environment 33
Regulatory bodies 34
Europe 36
Basel Accord 38
Economic environment 39
Eurozone 39
The natural environment 43
Recycling and green behaviours 44
Sustainability 44
Socio-cultural environment 46
Technology 47
The stakeholder environment 49
Competitors 49
Brokers and intermediaries 50
Suppliers 50
Employees 51
Management 51
Strategic partners 52
Customers 52
Shareholders 53
Summary 54
References 55
Further reading 55
Exercises 56
Case study: Financial services in China - a case study of the credit card 56
3 The financial services customer 65
Learning outcomes 66
Introduction 67
Consuming financial services 68
Taking decisions 69
Decision-making units 72
Alternative perspectives on consumption 72
Risk 74
Involvement 76
Satisfaction and dissatisfaction 77
Customer loyalty 81
Customer switching and inertia 83
Persistency 84
Business behaviour 86
Summary 89
References 89
Exercises 92
Further reading 92
Case study: Consumer attitudes to finance and pensions - a Swedish case study 92
4 Segmenting and targeting the financial services marketplace 97
Learning outcomes 98
Introduction 99
What is segmentation? 99
Consumer segments 100
Predetermining segments 100
Behavioural segmentation 104
Dynamic segments 108
Internet users 110
Segmentation practice 112
Business segments 113
Organizing segmentation 115
Organizational structure 115
Double-checking 116
Targeting 117
Positioning 118
Summary 121
References 121
Exercises 123
Further reading 123
Case study: Customer segmentation in Swiss retail banking 124
5 Information regarding marketing financial services 133
Learning outcomes 134
Introduction 135
Researching the marketplace 136
Organizational learning 137
Customer relationship management (CRM) 139
Customer value 143
Size of wallet 143
Share of wallet (SW) 143
Cross-selling and up-selling 145
Customer attrition 146
Customer persistence 147
Satisfaction and share of wallet 148
Loyalty programmes 149
Organizing information 152
Ethics in research and information management 154
Summary 155
References 157
Exercises 157
Further reading 157
Case study: Expatriates 157
6 Relationship marketing in financial services 163
Learning outcomes 164
Introduction 165
Relationship marketing 165
Developing a central element to the relationship 166
Personalize the relationship 166
Increasing the central element by offering extra benefits 167
Making employees aware that they are immediately responsible to the customer 167
Relationships with stakeholders 168
Business relationships 170
Cross-cultural relationships 172
Relationship outcomes 173
Customer satisfaction 174
Trust and commitment 174
Relational benefits 175
Internal marketing 177
Relationship lifecycle 178
Digital relationships 181
Managing business accounts 182
Connecting with consumers 182
Summary 183
References 184
Exercises 186
Further reading and references 186
Case study: Managing customer relationships in Irish retail banking 187
7 Building and sustaining the financial services brand 195
Learning outcomes 196
Introduction 197
What is a brand? 198
Branding in financial services 198
Developing the brand 200
Extending the brand 203
Sustaining the brand 204
Corporate branding and identity 205
Product branding 207
Own label 208
Partnerships 209
Re-branding 209
Stakeholders 210
Communities 211
Branding to the customer 212
Branding responsibly 212
Stakeholder branding 214
Branding in a digital environment 215
Brands in a global environment 215
Brand equity 217
Summary 219
Exercises 219
References 219
Further reading 221
Case study: Re-branding a major Russian financial group - the Alfa Banking Group 221
8 Creating value: The financial services product 225
Learning outcomes 226
Introduction 227
The financial product 227
Value and benefits 229
Bundling 230
The service performance 231
Service setting 231
The customer experience 232
Value co-creation 234
New product development 235
Product elimination 241
Service quality and delivery 241
Service recovery 243
Affinity marketing 244
Summary 246
Exercises 246
References 246
Further reading 250
Case study: Pay as you go or not? 250
9 Pricing and value in financial services 255
Learning outcomes 256
Introduction 257
Costs 257
Pricing objectives 260
Increase market share 260
Profit maximization 260
Product quality leadership 260
Pricing strategies 261
Penetration or low pricing 261
Price bundling 262
Relationship pricing 263
Risk and pricing 266
Pricing by channel 268
Fixed pricing 268
The customer 270
New and existing customers 270
Perceptions and awareness 271
Evoked set 272
Price satisfaction 273
Perceived value and consumption 275
Summary 277
References 277
Exercises 279
Further reading and information 279
Case study: Price satisfaction in Austrian banks 280
10 Distributing financial services 287
Learning outcomes 288
Introduction 289
Distribution 289
Channel strategy 290
Adoption of channels 291
Branches 293
Financial services intermediary 296
Price comparison information 299
Remote banking 299
Automated telling machines (ATMs) 300
Telephone 302
Mobile banking 303
Internet 304
Multichannel banking 306
Managing multiple channels 306
Consumers and multiple channels 308
Summary 309
Exercises 310
References 310
Further reading 312
Case study: Credit Agricole - a multichannel mutual bank 312
11 Communicating in the marketing of financial services 319
Learning outcomes 320
Introduction 321
The communications loop 322
Message sender and recipient 322
Selecting the target audience 323
Source and interpretation of message 324
Did it work for you? 325
Marketing communication objectives 326
Needs recognition 326
Finding customers 327
Building the brand 327
Overcoming alternatives 327
Deciding to purchase 328
Retaining customers and relationships 328
Marketing communications strategy 329
Pull strategy 331
Push strategy 331
Profile strategy 332
Communications and quality 332
Determining budgets 335
Marketing communications mix 336
Advertising 336
Direct mailing 338
M-technology 339
Sponsorship 339
Word-of-mouth 341
Personal selling 341
Public relations 342
Blogging 343
Communicating in a global marketspace 343
Summary 345
Exercises 345
References 346
Further reading 347
Case study: The ASA and Alternative Finance Group Ltd 347
12 Marketing strategies in financial services 351
Learning outcomes 352
Introduction 353
What is strategic marketing? 354
Competitive strategies 357
Marketing strategies 359
Being offensive 360
Protection strategies 362
Social responsibility and stakeholder thinking 367
Relationships and brands 368
Brands as relationship builder 370
The immediate future? 373
The rise of the alternatives 373
Marketing more than ever 374
Summary 375
References 376
Further reading 378
Exercises 378
Case study: Tesco - the rise and rise of a food retailer 378
Index 383
350 pages, Paperback
