Description
Marketing Strategy of SCB
Target Customer
Standard Chartered bank targets Enterprise and individual investors. They give special offers to
Enterprises and persuade them to give their employees’ wages through payroll from Standard
Chartered Bank. They visit different educational institutions and persuade students to open their
bank account in Standard Chartered. They target customer from which they can get maximum
benefit.
SWOT Analysis
The overall analysis of a company's strength, weaknesses, opportunities and threats is called
SWOT analysis. Strengths and weaknesses falls under company's internal environment and
opportunities and threats are company's external environment. These two categories is essential
for a company to figure out where it stands, strategic planning, potential market (opportunities)
and overall to maintain its financial position.
The SWOT analysis of Standard Chartered Bank is:
S = Strength
It is the largest International bank operating in Pakistan. It has a very strong wide range of client
base and is operating efficiently in this country. It provides the best online banking. The bank’s
internet banking is the fastest possible service allows their customers to bank from wherever they
desire, in total security and confidentiality. Standard Chartered Pakistan have very hardworking
and experienced labor force. They produce world class service. Their brand name is their biggest
strength.
W = Weakness
The weakness they are facing this year is their liabilities has increased. They don’t have a huge
number of branches. They have a large geographic distance between Head office and its
branches. Standard Chartered Bank has more and high fees and charges compared to its rivals.
They don’t do too much advertisement like their rivals do.
O = Opportunity
They have the opportunity to expand their business to compete with the top banks of Pakistan. If
Government will increase the commission rate, sales will be increase. If interest rate increases,
people will be attracted more and more and sales will be higher.
T = Threats
The greatest threat of the banks come from the competitors. As the competition increase
Standard Chartered Bank has a chance to lose its market share to the competitors like HBL, Bank
Alfalah, JS bank etc if it does not take necessary. People do not feel comfortable with the high
charges of SCB. The service charges of this bank are much higher than other banks and this can
cause them to lose their valuable customers.
Porter’s Five Forces analysis
Analyzing the Porter’s five forces model we can trace the position of Standard Chartered Bank at
baking industry.
Threat of a new Entry
The trend of new banks coming up shows that the threat of new entrants is high as there are more
banks that are coming up to satisfy customers. Emergence of some local banks following foreign
banking strategy and introducing foreign products creates competition. Moreover, some foreign
banks like JS Bank, Citibank, Barclays and Bank Alfalah started their operations in Pakistan with
a view to grab a large share of this emerging market share. The number of banks is increasing at
a faster pace for the last 6 to 7 years. The banking sector in Pakistan is under consolidation and
strong competition and is expected to continue to do so in the next few years. Because of that
threat of potential entrants is high.
Apart from these competitions Standard Chartered Bank enjoys early entrant’s facility and
market leader facility. Brand loyalty made it difficult for new entrants to take market share away
from Standard Chartered Bank. A large customer base contributed to economics of scale for
Standard Chartered Bank. So new entrants face the dilemma of suffering cost disadvantage.
The Power of Buyers
The power of the buyer can be viewed as a competitive threat when they are in a position to
demand lower prices from the company or when they are in a position to demand better service
that can increase operating costs. On the other hand, when buyers are weak, a company can raise
its prices and earn greater profits. For the banking industry buyer means customers who take
loans from the banks.
The power of the buyers depends on the following factors:
Number of loan applicants: There are closer to 52 banks in our banking sector including
multinational and nationalized banks. But, there are very few original loan applicants in our
country. The investment opportunity in the country is not growing as well. So, banks are sitting
with their money to service loans. As a result, competition for doing business is increasing 41
day by day among established companies. This means that banks have to provide loans at a lower
interest rate.
Switching Cost: Switching cost is very low in banking industry. Every bank is giving similar
types of loan at more or less similar interest rate. So, an individual who wants to take loan from
banks can switch to other banks if he or she doesn’t like the terms and conditions. Customers of
SCB may switching to other banks because of low interest rate, less rigid procedure for loan
applications and lots of other reasons. Lower switching cost makes the industry more
competitive.
Backward Integration: In the banking industry, there is always a chance for threat of backward
integrations. Big multinational companies or corporations can be a threat to the commercial
banks through arranging their funds by forming their own banks where the cost of fund is low
compare to other banks. For this reason, giant customers of this industry always possess more
power than their banks.
Loan Amount: Creditors are considered to be the buyers of the banks. There are thousands of
creditors from all walks of life. Mainly businessmen are the major buyer of bank’s credit. Big
amount creditors have strong powers in determining interest rate of their credit amounts.
Likewise if a good collateral is provided then also the buyers bargaining power increases. Banks
distinguish their prime customers from others by setting a prime interest rate for them.
Therefore the bargaining power of buyer is also high. Market being competitive bargaining
power of the customer is very insignificant compared the total deposit. But some corporate
entities have large deposits in Standard Chartered Bank, so they possess strong bargaining power
and they get special rates from the bank. There are still very few foreign banks with wide range
of services like Standard Chartered Bank and the customers of foreign banks do not go for other
domestic banks. So their choice is limited and bargaining power lied with the bank to some
extent.
The Power of Suppliers
The power of suppliers can be viewed as a threat when they are able to force up the price that a
company must pay for its inputs or reduce the quality of the inputs they supply, thereby
depressing the company’s profitability. On the other hand, if suppliers are weak, this gives the
company the opportunity to force down prices and demand higher input quality. For the bank the
main supplier of fund is depositor. Bank also gets its funds from the shareholders or directors.
The power for individual customer and corporate customer is very different. The main reason
behind it is that the deposit of an individual customer is very insignificant compared to the total
amount of deposits. Some corporate entities do have large deposits in SCB, and exercise strong
bargaining power to receive special rates from the bank. SCB is currently market leader in
providing wide range of banking services as result of that they have strong strategic advantage.
Threat of Substitute
Standard Chartered Bank is greatest International Bank of Pakistan and right now they have no
threat from any of the other international bank who can take their place as the greatest
International Bank. Standard Chartered is old in market of Pakistan but international banks like
CitiBank, Barclays and JS Bank are still developing in Pakistan.
We also need to consider all types of substitute products for the banks. Different private and
nationalized banks are offering similar products, which are close substitutes. On the other hand,
some non-bank banks like insurance companies and leasing companies are also competing
indirectly with the commercial banks product. All the products of the commercial banks perform
similar functions. Taking the money from the depositor and sanctioning loan to investors are the
main functions. They all do it a similar manner. SCB is not any different from them. Since
functional similarity is high in banking industry, so competition is also high because customer
can switch at any time they want without incurring high switching costs.
Competitive Rivalry
Fierce competition is going on among the foreign banks for increasing their respective market
share. There are eight foreign banks in Pakistan. Standard Chartered is greatest foreign bank with
the greater number of shares. Market of the foreign banks is limited in our country because some
people or organization will not come to foreign banks. On the other hand, these banks are
sometimes not able to meet the large credit requirements of some big corporate client. So they
will prefer nationalized banks for their deposit as well as credit facility. Foreign Banks except
Standard Chartered are still developing in Pakistan. Whereas JS bank is developing rapidly. So
the sector became extremely competitive.
Conclusion
Presently SCB is doing excellent business in Pakistan. It is arguably the leader of foreign banks
in Pakistan but commercially it is far behind from banks like HBL. Although foreign bank like
Citibank is globally much bigger bank but in Pakistan they are far behind from Standard. When it
comes to serving local corporate clients, Standard Chartered Bank is in a good position, many
enterprises payroll accounts are there but they are still not better as they wanted to be. Bank is
facing much strong competition in this regard not only from local private banks.
Indeed, there is a trend among local corporate clients to switch to local banks as they are being
offered more personal attention, higher flexibility and better services at lower rates and charges
from local banks. SCB will have to focus more on this segment in order to improve its market
position by coming up with more competitive products and services and building up healthier
relationships with customers.
When it comes to consumer banking, SCB is leader among foreign banks but lagging far behind
local banks. SCB has to set up much more branches, cut down charges and fees and provide
more competitive products to gain a stronger foothold in this segment. Overall it is observed, that
SCB will continue to focus on corporate banking in the future just as other foreign banks, it will
simultaneously invest hugely in consumer banking and go for expansion through branch
openings and mergers to create a strong market position in that segment as well.
In Pakistan there are lots of investment opportunities available for investors. But to achieve an
optimal portfolio requires having knowledge about all types of investment facilities available.
Through diversifying your investment into different classes of assets you can achieve a healthy
and secure portfolio. The benefits that these assets offers are quiet attractive and beneficial
compared to other assets of similar kind. However, people tend to neglect it mainly because of
lack of trust and inefficiency associated in government operations. But in recent times
institutional sale of government bonds has to a great extent diminished the hassle associated in
dealing with the government. Such types of assets are required in a democratic country to ensure
a constant source of income for those who do not have the ability to bear big risk.
Recommendations
? The communication between the intern and the supervisor should be quite clear and on
the regular basis so that the intern has the total understanding and control over the entire
internship program.
? A fresh intern is not always that keen to achieve full control on the program. He/she
might need some extra knowledge about corporate culture and some other things about a
work place and companies. In this regard the supervisor could be a big helping hand for
the intern. The supervisor can give initial view about corporate environment for a smooth
start of the program.
? The interns could get highly motivated by the supervisors while they will be performing
the internship program in some particular companies. This motivation will drive the
interns to get jobs from those companies. Also, the supervisors can arrange some group
discussion to share the information about companies and make the interns fully
understand.
? They should hire more employees and should expand their business. They don’t have so
much branches in Pakistan like other banks have. A large gap between their branches.
They should open more branches to satisfy their customers.
? Their service charges are very high which can swing the interest of their customers
towards local private bank. They should decrease their service charges so that everyone
can afford them.
? The IT department should make their service fast because if any kinds of hard ware
problem happen in the dept. then they get replacement after 24-48 hours of fiving
requisition.
? They should arrange more training for the employees of their branches.
? Although the officers of the Standard Chartered Bank have been very helpful, they didn’t
have enough time to provide, as they are very busy with their assigned works. So, in
some cases, observation was needed.
doc_136820139.docx
Marketing Strategy of SCB
Target Customer
Standard Chartered bank targets Enterprise and individual investors. They give special offers to
Enterprises and persuade them to give their employees’ wages through payroll from Standard
Chartered Bank. They visit different educational institutions and persuade students to open their
bank account in Standard Chartered. They target customer from which they can get maximum
benefit.
SWOT Analysis
The overall analysis of a company's strength, weaknesses, opportunities and threats is called
SWOT analysis. Strengths and weaknesses falls under company's internal environment and
opportunities and threats are company's external environment. These two categories is essential
for a company to figure out where it stands, strategic planning, potential market (opportunities)
and overall to maintain its financial position.
The SWOT analysis of Standard Chartered Bank is:
S = Strength
It is the largest International bank operating in Pakistan. It has a very strong wide range of client
base and is operating efficiently in this country. It provides the best online banking. The bank’s
internet banking is the fastest possible service allows their customers to bank from wherever they
desire, in total security and confidentiality. Standard Chartered Pakistan have very hardworking
and experienced labor force. They produce world class service. Their brand name is their biggest
strength.
W = Weakness
The weakness they are facing this year is their liabilities has increased. They don’t have a huge
number of branches. They have a large geographic distance between Head office and its
branches. Standard Chartered Bank has more and high fees and charges compared to its rivals.
They don’t do too much advertisement like their rivals do.
O = Opportunity
They have the opportunity to expand their business to compete with the top banks of Pakistan. If
Government will increase the commission rate, sales will be increase. If interest rate increases,
people will be attracted more and more and sales will be higher.
T = Threats
The greatest threat of the banks come from the competitors. As the competition increase
Standard Chartered Bank has a chance to lose its market share to the competitors like HBL, Bank
Alfalah, JS bank etc if it does not take necessary. People do not feel comfortable with the high
charges of SCB. The service charges of this bank are much higher than other banks and this can
cause them to lose their valuable customers.
Porter’s Five Forces analysis
Analyzing the Porter’s five forces model we can trace the position of Standard Chartered Bank at
baking industry.
Threat of a new Entry
The trend of new banks coming up shows that the threat of new entrants is high as there are more
banks that are coming up to satisfy customers. Emergence of some local banks following foreign
banking strategy and introducing foreign products creates competition. Moreover, some foreign
banks like JS Bank, Citibank, Barclays and Bank Alfalah started their operations in Pakistan with
a view to grab a large share of this emerging market share. The number of banks is increasing at
a faster pace for the last 6 to 7 years. The banking sector in Pakistan is under consolidation and
strong competition and is expected to continue to do so in the next few years. Because of that
threat of potential entrants is high.
Apart from these competitions Standard Chartered Bank enjoys early entrant’s facility and
market leader facility. Brand loyalty made it difficult for new entrants to take market share away
from Standard Chartered Bank. A large customer base contributed to economics of scale for
Standard Chartered Bank. So new entrants face the dilemma of suffering cost disadvantage.
The Power of Buyers
The power of the buyer can be viewed as a competitive threat when they are in a position to
demand lower prices from the company or when they are in a position to demand better service
that can increase operating costs. On the other hand, when buyers are weak, a company can raise
its prices and earn greater profits. For the banking industry buyer means customers who take
loans from the banks.
The power of the buyers depends on the following factors:
Number of loan applicants: There are closer to 52 banks in our banking sector including
multinational and nationalized banks. But, there are very few original loan applicants in our
country. The investment opportunity in the country is not growing as well. So, banks are sitting
with their money to service loans. As a result, competition for doing business is increasing 41
day by day among established companies. This means that banks have to provide loans at a lower
interest rate.
Switching Cost: Switching cost is very low in banking industry. Every bank is giving similar
types of loan at more or less similar interest rate. So, an individual who wants to take loan from
banks can switch to other banks if he or she doesn’t like the terms and conditions. Customers of
SCB may switching to other banks because of low interest rate, less rigid procedure for loan
applications and lots of other reasons. Lower switching cost makes the industry more
competitive.
Backward Integration: In the banking industry, there is always a chance for threat of backward
integrations. Big multinational companies or corporations can be a threat to the commercial
banks through arranging their funds by forming their own banks where the cost of fund is low
compare to other banks. For this reason, giant customers of this industry always possess more
power than their banks.
Loan Amount: Creditors are considered to be the buyers of the banks. There are thousands of
creditors from all walks of life. Mainly businessmen are the major buyer of bank’s credit. Big
amount creditors have strong powers in determining interest rate of their credit amounts.
Likewise if a good collateral is provided then also the buyers bargaining power increases. Banks
distinguish their prime customers from others by setting a prime interest rate for them.
Therefore the bargaining power of buyer is also high. Market being competitive bargaining
power of the customer is very insignificant compared the total deposit. But some corporate
entities have large deposits in Standard Chartered Bank, so they possess strong bargaining power
and they get special rates from the bank. There are still very few foreign banks with wide range
of services like Standard Chartered Bank and the customers of foreign banks do not go for other
domestic banks. So their choice is limited and bargaining power lied with the bank to some
extent.
The Power of Suppliers
The power of suppliers can be viewed as a threat when they are able to force up the price that a
company must pay for its inputs or reduce the quality of the inputs they supply, thereby
depressing the company’s profitability. On the other hand, if suppliers are weak, this gives the
company the opportunity to force down prices and demand higher input quality. For the bank the
main supplier of fund is depositor. Bank also gets its funds from the shareholders or directors.
The power for individual customer and corporate customer is very different. The main reason
behind it is that the deposit of an individual customer is very insignificant compared to the total
amount of deposits. Some corporate entities do have large deposits in SCB, and exercise strong
bargaining power to receive special rates from the bank. SCB is currently market leader in
providing wide range of banking services as result of that they have strong strategic advantage.
Threat of Substitute
Standard Chartered Bank is greatest International Bank of Pakistan and right now they have no
threat from any of the other international bank who can take their place as the greatest
International Bank. Standard Chartered is old in market of Pakistan but international banks like
CitiBank, Barclays and JS Bank are still developing in Pakistan.
We also need to consider all types of substitute products for the banks. Different private and
nationalized banks are offering similar products, which are close substitutes. On the other hand,
some non-bank banks like insurance companies and leasing companies are also competing
indirectly with the commercial banks product. All the products of the commercial banks perform
similar functions. Taking the money from the depositor and sanctioning loan to investors are the
main functions. They all do it a similar manner. SCB is not any different from them. Since
functional similarity is high in banking industry, so competition is also high because customer
can switch at any time they want without incurring high switching costs.
Competitive Rivalry
Fierce competition is going on among the foreign banks for increasing their respective market
share. There are eight foreign banks in Pakistan. Standard Chartered is greatest foreign bank with
the greater number of shares. Market of the foreign banks is limited in our country because some
people or organization will not come to foreign banks. On the other hand, these banks are
sometimes not able to meet the large credit requirements of some big corporate client. So they
will prefer nationalized banks for their deposit as well as credit facility. Foreign Banks except
Standard Chartered are still developing in Pakistan. Whereas JS bank is developing rapidly. So
the sector became extremely competitive.
Conclusion
Presently SCB is doing excellent business in Pakistan. It is arguably the leader of foreign banks
in Pakistan but commercially it is far behind from banks like HBL. Although foreign bank like
Citibank is globally much bigger bank but in Pakistan they are far behind from Standard. When it
comes to serving local corporate clients, Standard Chartered Bank is in a good position, many
enterprises payroll accounts are there but they are still not better as they wanted to be. Bank is
facing much strong competition in this regard not only from local private banks.
Indeed, there is a trend among local corporate clients to switch to local banks as they are being
offered more personal attention, higher flexibility and better services at lower rates and charges
from local banks. SCB will have to focus more on this segment in order to improve its market
position by coming up with more competitive products and services and building up healthier
relationships with customers.
When it comes to consumer banking, SCB is leader among foreign banks but lagging far behind
local banks. SCB has to set up much more branches, cut down charges and fees and provide
more competitive products to gain a stronger foothold in this segment. Overall it is observed, that
SCB will continue to focus on corporate banking in the future just as other foreign banks, it will
simultaneously invest hugely in consumer banking and go for expansion through branch
openings and mergers to create a strong market position in that segment as well.
In Pakistan there are lots of investment opportunities available for investors. But to achieve an
optimal portfolio requires having knowledge about all types of investment facilities available.
Through diversifying your investment into different classes of assets you can achieve a healthy
and secure portfolio. The benefits that these assets offers are quiet attractive and beneficial
compared to other assets of similar kind. However, people tend to neglect it mainly because of
lack of trust and inefficiency associated in government operations. But in recent times
institutional sale of government bonds has to a great extent diminished the hassle associated in
dealing with the government. Such types of assets are required in a democratic country to ensure
a constant source of income for those who do not have the ability to bear big risk.
Recommendations
? The communication between the intern and the supervisor should be quite clear and on
the regular basis so that the intern has the total understanding and control over the entire
internship program.
? A fresh intern is not always that keen to achieve full control on the program. He/she
might need some extra knowledge about corporate culture and some other things about a
work place and companies. In this regard the supervisor could be a big helping hand for
the intern. The supervisor can give initial view about corporate environment for a smooth
start of the program.
? The interns could get highly motivated by the supervisors while they will be performing
the internship program in some particular companies. This motivation will drive the
interns to get jobs from those companies. Also, the supervisors can arrange some group
discussion to share the information about companies and make the interns fully
understand.
? They should hire more employees and should expand their business. They don’t have so
much branches in Pakistan like other banks have. A large gap between their branches.
They should open more branches to satisfy their customers.
? Their service charges are very high which can swing the interest of their customers
towards local private bank. They should decrease their service charges so that everyone
can afford them.
? The IT department should make their service fast because if any kinds of hard ware
problem happen in the dept. then they get replacement after 24-48 hours of fiving
requisition.
? They should arrange more training for the employees of their branches.
? Although the officers of the Standard Chartered Bank have been very helpful, they didn’t
have enough time to provide, as they are very busy with their assigned works. So, in
some cases, observation was needed.
doc_136820139.docx