THE MARKETING OF BANKING SERVICES (A CASE STUDY OF FIRST BANK OF NIGERIA PLC)

ABSTRACT

            This study – investigated the marketing of banking services with it problems and prospects within the socio-economic environment Bank of Nigeria (Plc) as a case study.

            The main purpose was to find out the effectiveness of the marketing of banking services as it affects the bank itself and the banking industry, the customers welfare and profitability of the bank and national economy in general. There is however a rapid increase in the number of banks and this led to number of banks and this led to competition among banks. This competition became so fierce that banks began to seek means of survival.

            In the course of achieving the above objectives both primary and secondary data were used to gather information. For the primary method data collection, both questionnaires and interview method are used. Whereas for the secondary data collection, information were sought from Bank libraries, journals and text books.

The questionnaires used were distributed to both bank staff and customers of First Bank of Nigeria Plc.

            After the analysis of data collected, the researcher ascertained that commercial banks face competition in marketing of their services. Banks conduct marketing research as to achieve their target profit motive; banks have some problem that preventing them form rendering efficient banking services to their customer.

            However, some recommendations were made based on the finding above. That bank should organize more training for their staff especially concerning their attitude towards banks customers; Banks should also embark on research that will enable them identify their customers needs and the ways of meeting such needs.

TABLE OF CONTENTS

CHAPTER ONE

1.1         Background of the Study

1.2         Statement of the Problem

1.3         Objective of the study

1.4         Research questions

1.5         Research hypothesis

1.6         Significance of the study

1.7         Scope, limitations and delimitations

1.8         Definitions of terms

CHAPTER TWO 

2.1       Review of related Literature

2.2       Nature of Marketing of banking service

2.3       Purpose of marketing bank service

2.4       Services Rendered by banks

2.5       Current Accounts

2.6       Saving Account

2.7       Fixed deposit account

2.8       Night safe facilities

2.9       Safe custody

2.10    Leasing

2.11    Loan Syndication

2.12    Telegraphic mail transfer

2.13    Cheque clearing

2.14    Bank draft

2.15    Standing orders

2.16    Investment services

2.17    Problems facing marketing of bank services

2.18    How to improve marketing of bank services

2.19    Marketing management concepts

2.20    Production concepts

2.21    Products Concept

2.22    Selling Concept

2.23    Marketing Concept

2.24    Societal marketing concept

2.25    Marketing Mix

2.26    Product

2.27    Place

2.28    Promotion

2.29    Pricing

2.30    Strategic marketing process

2.31    What are survivals Strategies?

2.32    Techniques for survival

2.33    Scientific management approach

2.34    Strategic Planning

2.35    Public relation

2.36    infrastructure and modern technology

2.37    Banking regulations

2.38    Human Resources   

CHAPTER THREE

Research design and methodology

3.1       Research Design

3.2       Area of study

3.3       Population

3.4       Sample and Sampling Techniques

3.5       Instruments of Data Collection

3.6       Methods of Data presentation

3.7       Methods of Data Analysis

CHAPTER FOUR

4.1       Data Presentation of analysis

4.2       Analysis of response Rate

4.3       Presentation and analysis of data

4.4       Testing and interpretation of hypothesis

CHAPTER FIVE

5.1         Summary of findings

5.2         Recommendations

5.3         Conclusion

            Bibliography

            Questionnaire

PROPOSAL

            Most banks have taken great emphasis on the marketing of bank services in the economy. The First Bank of Nigeria (Plc), is the main body concern in this write up. They have taken a very important steps and strategies recently and presently in a bid to improving their operations and liquidity strength, customer relations, credibility and effective participation in the resuscitation of the economy. The research work takes a detailed look of the role of marketing management services at First Bank of Nigeria (Plc), with the retention of exposing the relevance of their services in the economy and the problems preventing them from the effective actualizations of the various functions.

            The work is divided into five chapters. Chapter one is the introduction and discusses such issues as the background of the study, statement and purpose of the study as well as the scope of the study, limitation and delimitation and definitions of terms. Chapter two looks at related literature review while chapter three discusses the design ad methodology of the research. Chapter four discusses data presentation and analysis and finally, chapter five summarizes the findings in the previous chapters as well as the recommendation and conclusion.

CHAPTER ONE

INTRODUCTION

1.1       BACKGROUND OF THE STUDY

            In any economic set up, there are various institutions engaged in Commercial activities with the cardinal aims of strengthening their financial base and quality service to the society through the marketing of their products and services; thereby establishing themselves firmly within the given economic environment.

            Before the Mid-1950’s banks had no understanding or regard for marketing because they were supplying needed services. Marketing came into banks in the late 1950’s not in the form of “Marketing Concept”, but in the form of advertising and promotion concept. The financial institutions especially the banks feature prominently in competitive economic atmosphere principally focusing their operations in the marketing of their services to the general public.

            However, some of these services include among other, the granting of loans and overdrafts, issue and purchase of securities, provision of sate depositories to customers as well as facilities for making payments through bank notes and cheques. It is therefore a simply obvious that an institution like bank should evolve sound management techniques coupled with effective marketing and services strategies within its socio-economic and political ambient. It also follows that certain operational problems may try to impinge on the efforts of the Bank to stand firm amidst the winds of economic vacillation and constant policy changes.

            The First Bank of Nigeria (Plc) one of the leading Banks in the marketing of Bank services has taken various strategic steps in a bid to improving  its marketing operations and liquidity strength, customer relations, credibility, and effective participation in the resuscitation of the economy. This will receive due attention in the course of this work. Suggestions and recommendations will also be given to the possible way of solving the various problems affecting the marketing of banks services within the system.

1.2 STATEMENT OF THE PROBLEM

            The Banking industry has been identified over the years as having the potential of transforming the basic economy of any community, state or nation, if properly established and well constituted, controlled and managed. In the banking industry today, certain problems affected the effective and efficient services; thereby preventing them from achieving their target aim.

            One of the major problems in the banking industry is the poor customer services shown by long but avoidable delays in accomplishing simple transaction. These transactions range from encashment of cheques, opening of new accounts to processing of loan and overdraft applications. This delay of services is obviously detrimental to office owners, international businessmen and students, as they sneak out of their different places of work to withdraw some small amount of money.

            Secondly, it appears that banks are face by incompetent staff carrying out infection transactions. This is because staff are not employed by merit rather they are more often employed by god fatherism.

            Another problem is the need to bring to the fore, a thorough understanding of the impact of marketing of bank services in the quest for continuous relevance and survival by banks.

            Finally, there is also the problem of the banks to turn the economic table around effectively, if the courage and the prudence are present to propel them into action.

1.3 OBJECTIVES OF THE STUDY

            As an organization the bank exists to achieve something in the society. It’s mission is the provision of credit and other financial services with the primary objective of making satisfactory returns on the bank’s capital. The purpose of this study include:

            The degree of awareness among the banks as to who their customers are, the quality of the services rendered and the profits recorded from marketing operations compared with their competitors.

            A redefinition of the Bank’s markets to be customers oriented rather then product or service oriented.

            The impact of the marketing of bank’s services on the development of the banking industry in particular and the Nigeria economy in general.

            An examination of the extent o which policy and regulatory guidelines affect market operations vis-à-vis the bank’s own marketing strategies and organizational policies.

            How the various related problems dully identified, can be addressed and the future prospects for a more economic within the system.

            Finally, to make recommendations and suggestion where necessary for the interest and benefit of the various target levels the stake holders’ customers’ employees, shareholders and the government.

1.4 RESEARCH QUESTIONS

            The study seeks to answer the following questions.

1.     The extent to which there has been improved quality of services rendered to bank customers due to the introduction of marketing of bank services?

2.     What are the prospects and problems posed to bankers by this marketing of banks services?

3.     What is the rationale for developing this marketing of bank’s services?

4.     The extent to which the marketing strategies adopted by commercial banks have helped to achieve maximum benefit and services to customers.

5.     How marketing of bank’s services are known to the external public and the extent to which they are known to them?

1.5         RESEARCH HYPOTHESIS

            In an attempt to reach decision, it is useful to make assumptions and guesses about the population involved. Such assumptions or statements which may not be true, are called statistical hypotheses. Generally, they are statements about the probability distribution of the population.

NULL HYPOTHESIS:

The null hypothesis is a hypothesis formulated with the sole purpose of rejecting or nullifying it.

Ho denotes it.

ALTERNATE HYPOTHESIS

            Any hypothesis, which differs from a given null hypothesis, is called the alternate hypothesis, denoted by Hi.

            For the purpose of this study, the following hypotheses have been formulated, which will be tested in the chapter four.

HYPOTHESIS

1.         Ho:      Commercial banks do not face competitions in                                     marketing of their bank’s services

            Hi:       Commercial banks face competition in marketing of                            their bank’s services.

2.         Ho:      Banks do not conduct marketing research as to                                    achieve their target profit.

            Hi:       Banks conduct marketing research as to achieve their                        target profit.

3.         Ho:      Banks do not have some problems that prevent them              from rendering efficient banking services to their                            customers.

            Hi:       Banks have some problems that prevent them from                             rendering efficient banking services to their customers.

1.6         SIGNIFICANCE OF THE STUDY

The economic transformation of the rural/urban communities in any state carries with it a lot of the relief of the burden which it has in the area of capital development. The Banks with the marketing of their services are capable of playing a vital role and have in fact played a vital role in the sustenance of the economy. This fact has a direct linkage to the importance of basic industries and small and medium scale enterprises to the industrial and technology advancement of any country.

The reason why most banks are into marketing of banks services is to face the high competitive nature of banking business as well as to achieve higher profit base. The success of this research project will help the bank to withstand further intense competition on marketing of bank services in acquisition of new customers and the retention of old ones.

The project work shall bring to the notice of the bank how much impact it has been able to make in the banking industry due to the development or introduction marketing of bank’s services.

It is also expected that the result of the study will help the bank to evaluate the strength of its staff, quantitative and qualitative to enable it adjust and re-adjust in their marketing services processes.

It will however bring to the notice of the bank how effective its marketing strategies have been so far and what it can do to improve on these strategies now and in future.

This research work shall also help the bank to actually know whether there has been improved customer bankers relationship or not and what it can do to further improve on this relationship.

The study will certainly be important to the Department of Banking and Finance, Institute of Management and Technology Enugu, as it may form a basis for further investigation on the subject.

The marketing of bank’s services in Nigeria generally will help to attract more awareness in banking operations.

1.7         DEFINITION OF TERMS

(a)       Marketing:                This is the management process                                                              responsible for identifying, anticipating and                                          satisfying customer requirement   profitability.  

(b)       Marketing Concept:           This is a management orientation that holds that the key task of the organization                                        is to determine the needs, wants and   alues of a target market, and to adopted                                                the organization to delivering the desired                                         satisfactions more efficiently than its    competitors.

(c)        Strategy:  This is a management process of achieving    desired objective.

(d)       Strategic Marketing:          This is the process of analyzing                                                   opportunities selecting objectives,                                                                        formulating plans and carrying out  implementation control.