• insurance

• Bank

• Money exchange

Business is different

Sustainable competitive advantage

Offer superior value

automated teller machine

1. Price

   • such as insurance , investment plan, etc

2. Product

   • the straegies ncludr fees, charges, and ir.

3. Place

   • nowadats, financial services can be found on the mobile apps, not only physical branches

4. Promotion

   • helps attract customers. For example campaigns , ads, loyalty program, etc

   
   

1. Demographic Segmentation-includes ages, gender, income , etc

   • aspects like address and location

     
     

2. Psychographoc Segmentation

   • Such as lifestyle, values, attitudes

   • Target indivudiual

3. Behavioral segmentation

   • such as brand loyaltu, buying behavior

     
     

Element of consumer segmentation

1. A priori - indicates something happened already

   • Demographic

     psychographic

   
   

2. Post hoc - such as past purchases

   • behavioural

2. Relationship Building: Focuses on creating long-term connections with customers through trust, loyalty, and personalized services, especially critical in financial services due to high involvement and trust requirements

Cannot be seen, touched, or tested before purchase (e.g., insurance policies).

2. Inseparability:

Production and consumption occur simultaneously (e.g., financial advice during a consultation).

3. Perishability:

Services cannot be stored for later use (e.g., a missed financial advisory session).

4. Variability:

Service quality depends on the provider, time, and context (e.g., differing advisor expertise).

5. Fiduciary Responsibility:

Financial providers must act in the client's best interest, building trust.

6. High Involvement:

Decisions involve significant risk and emotional investment (e.g., mortgages).

7. Complexity:

Financial products often require expertise to understand (e.g., investment portfolios).

-Inseparability: Requires well-trained staff to ensure consistent service

delivery.

- Perishability: Marketers must manage demand through promotions or scheduling.

-Variability: Standardized processes and training reduce inconsistency.

Fiduciary Responsibility: Transparency and ethical marketing are crucial to maintain trust.

- High Involvement: Marketers need to provide detailed information and reassurance.

-Complexity: Simplified communication and education are key to customer understanding.

2. Design a Customer-Driven Marketing Strategy: Segment and target (e.g., high-net-worth individuals) with clear positioning

3.Construct an Integrated Marketing

Program: Use the 4Ps (product, price, promotion, place) to deliver value

4. Build Customer Relationships: Foster loyalty through CRM and post-sale support

^{Long-term retention.}

5. Capture Value from Customers: Generate revenue and loyalty

^{Sustainable profitability.}

- Customer Expectations: Demand for personalized, transparent services pushes firms to adopt Al-driven solutions.

-Globalization: Cross-border services increase competition, requiring localized strategies.

- Regulation: Stricter compliance (e.g., Malaysia's BNM regulations) ensures consumer protection but raises costs.

-Sustainability: Growing demand for ethical investments influences product offerings.

-Impact: Firms must innovate, prioritize customer experience, and comply with regulations to stay competitive in the financial services economy.

-Enhance Customer Satisfaction: Tailored services meet specific needs, increasing loyalty.

- Improve Efficiency: Focused strategies optimize resource allocation.

- Build Competitive Advantage: Differentiation through niche targeting strengthens market position.

- Increase Profitability :Focused efforts on high-value segments yield better returns

e.g., online-only banks like Revolut with minimal fees

2.Differentiation: Unique offerings

e.g, Islamic banking with Sharia-compliant products.

3. Niche Focus: Target specific segments

e.g., wealth management for high-net-worth individuals by CIMB Private Banking.

How it works: Cost leaders attract price-sensitive customers, differentiation builds brand loyalty, and niche focus ensures deep segment penetration

Problem: Complexity makes it hard to recognize specific financial needs. <br> 2.

Information Search: Seek advice or research (e.g., online reviews). Problem:

Intangibility and variability make credible information hard to find. <br> 3. Evaluation of Alternatives: Compare options (e.g., banks vs. fintech). Problem: High involvement and fiduciary concerns increase risk perception.<br>4. Purchase Decision: Choose a provider (e.g., signing up for a credit card). Problem:

Inseparability means trust in the provider is critical. <br>5. Post-Purchase Behavior:

Evaluate satisfaction (e.g., service quality).

Problem: Perishability and variability may lead to inconsistent experiences

2. Information Search:Provide clear online content, comparison tools, and testimonials to ease research.

3. Evaluation of Alternatives: Highlight unique features (e.g., no annual fees, travel perks) to stand out.

4. Purchase Decision: Simplify application (e.g., online forms, quick approval) and offer signup bonuses.

5. Post-Purchase Behavior: Ensure excellent customer service and loyalty programs to retain users.

- Supplementary Services: Additional features enhancing value. These differentiate the core offering and build customer satisfaction.

e.g., online banking, 24/7 support, or flexible repayment options

2.Technology-Driven: Leverage innovations

3. Competitor Benchmarking: Improve on competitors' offerings

4. Customer Co-Creation: Involve customers in design (e.g., feedback for app features).

5.Regulatory Adaptation: Create services compliant with new laws (e.g., ESG focused funds).

Introduction involves launching innovative products (e.g., digital wallets). Growth expands features (e.g., multi-currency support). Maturity focuses on retention (e.g., loyalty programs). Decline may see product replacement. <br>- Pricing:

Introductory low rates (e.g., 0% interest credit cards) attract customers. Growth stabilizes pricing. Maturity uses competitive pricing. Decline may involve discounts to retain users. <br>-Promotion: Heavy advertising in introduction (e.g., campaigns for new apps). Growth targets wider audiences.

Maturity emphasizes loyalty. Decline focuses on niche retention. ‹br>-

Distribution: Introduction uses select channels (e.g., online). Growth expands to branches and agents. Maturity optimizes omni-channel. Decline may reduce channels. Limitation: Long-term relationships and regulatory constraints slow PLC progression.

- How Intangibles Are Distributed: Through physical , digital, or human channels. Experiences are facilitated by creating touchpointsand ensuring seamless service delivery.

2. Reflect Value: Align pricing with perceived benefits

3.Competitive Positioning: Match or undercut competitors

4. Customer Retention: Use loyalty discounts to maintain

relationships.

5. Market Penetration: Offer introductory rates to attract new customers

- Online Platforms: Websites and apps for digital applications

- Mobile Apps: Dedicated apps for seamless access

- Agents/ Brokers: Independent agents for personalized sales.

- Partnerships: Co-branded cards with retailers

- ATMs/Kiosks:Self-service application points.

Trust (face-to-face agents build trust), complexity (policies require explanation, favoring agents), target market (high-net-worth prefer personal advisors), and technology adoption (younger clients use online portals). Banks prioritize scalability, while insurers focus on relationship-driven CHANNELS

Needs Assessment: Understand client goals (e.g., family protection). <br>4.

Presentation: Explain policy benefits clearly (e.g., term vs. whole life). <br>5.

Handling Objections: Address concerns (e.g., cost vs. long-term value).<br>6.

Closing: Secure commitment with clear terms (e.g., flexible premiums). <br>7.

Follow-Up: Provide ongoing support (e.g., annual policy reviews) to ensure satisfaction.

Choose methods (e.g., surveys, focus groups) and data sources. <br>3. Collect Data: Gather primary (customer feedback) and secondary (market reports) data.<br>4. Analyze Data: Identify trends (e.g., preference for digital banking). <br>5. Present Findings: Share actionable insights (e.g., target millennials with rewards).<br>6. Implement and Monitor: Apply findings and track results (e.g., campaign performance).

Satisfied clients refer others, reducing acquisition costs.

- Higher Revenue: Cross-selling and upselling boost income.

- Cost Efficiency: Retaining clients is cheaper than acquiring new ones.

-Resilience: Strong relationships withstand competitive pressures.