marketing sbi sms unhappy

Marketing Case Study - SBI's SMS Unhappy

A C A S E S T U D Y O N M A R K E T I N G C A M PA I G N B Y S TAT E B A N K O F I N D I A

19 March 2014

SMS Unhappy

Prepared by-

Chanpreet SinghSachin Sharma

Surabhi KalaSwapnil Soni

DoMS, IISc

Course-Marketing Management

Instructor-Prof. R. Srinivasan

2Marketing Case Study - SBI's SMS Unhappy

Index

State Bank of India

Evolution

Present

Operations

Indian Banking sector-post

liberalization

Mobile Phone Proliferation in

India

State Bank of India- campaign

SMS Unhappy

Inception

Launch

Operation

Result

19 March 2014

Response to Questions of Case

Study

o Critical assessment of the SMS

Unhappy program at SBI (SWOT

Analysis)

o SMS Unhappy contribution to

improving retail operation at SBI

(AHP)

o National Level Implementation-

Concerns & Resolutions

(Marketing Environment)

o SMS Unhappy contribution

towards making SBI more

competitive (BCG Matrix)

References

3

State Bank of India- Evolution

Bank of Calcutta

1806

Bank of Bombay

1840

Bank of Madras

1843

Imperial Bank of India

1921

Purpose of Bank

Keeping Cash Account

Loan for Trade

Issuance of Cash Notes

Role of Imperial Bank

Commercial Bank

Bankers’ Bank

GOVT’s BankQuasi-central role

1935

Reserve Bank of India was formed

Imperial Bank of India turned agent of RBI & Commercial Bank

Bank: An establishment authorized by a government to accept deposits, pay interest, clear checks, make loans, act as an intermediary in financial transactions, and provide other financial services to its customers.


19 March 2014

State Bank of India- Evolution

Capital Base 11.85 Cr Advances 72 Cr

Deposits 275 Cr Branches 172 no.s

1947 Imperial Bank of India at the time of Independence

1951

1st Five Year Plan by Prime minister Pt J. L. Nehru

Rural development – highest priority

Failure of Imperial Bank of India in this agenda

1955Creation of state partnered bank by taking over Imperial Bank of India

State Bank of India Act 1955


19 March 2014

State Bank of India- Present

Industry Banking, financial services

Headquarters

Mumbai, India

Area served Worldwide

Chairman Arundhati Bhattacharya

Revenue INR 2,00,560 Crores

Profit INR 17,916 Crores

Total assets INR 15,66,261 Crores

Employees 295,696Domestic presence International presence

14,816 branchescontributed to 88.37% of total profits

180 overseas offices spread over 34 countries

Rank Bank Country M cap, US$b, 30/04/2013

1 Industrial & Commercial bank of China (ICBC) China 233.63 HSBC Holdings UK 202.4

55 State Bank of India India 28.58

http://www.relbanks.com/worlds-top-banks/market-cap


19 March 2014

Associate banks

State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of Mysore State Bank of Patiala State Bank of Travancore

Non-banking subsidiaries

SBI Capital Markets Ltd SBI Funds Management Pvt Ltd SBI Factors & Commercial Services Pvt Ltd SBI Cards & Payments Services Pvt. Ltd. (SBICPSL) SBI DFHI Ltd SBI Life Insurance Company Limited SBI General Insurance

State Bank of India- Operations


Indian Banking sector-post liberalization

19 March 2014

1947 – 1980

Remarkable growth in Indian banking sector

1991

•Import restricted•Export slumped•Gulf war- Oil price soar•Trade deficit•High inflation•Balance of payment crisis

Solution?

Request for bailout from IMF

Pledged 67T Gold with Bank of

England

Economic Reform- Liberalization

Economic Crisis

1991

Rao-Manmohan Plan


Post Liberalization FDI in Power, Hospitality, Software & Retail Changed nature of competition in Banking sector Entry of Private sector commercial Banks

19 March 2014

Indian Banking sector-post liberalization

Private Banks Established

Revenue Business Type

1994 US$ 6.5 bn Banking, Financial Services

Public

2008 US$0.7 mn Banking, Financial Services

Private

1993 US$ 80 mn Mutual fund Public

1954 US$ 13.52 bn

Banking, Financial services

Private

Competition

Capture Market share

Customer Satisfaction


19 March 2014

Digression….!


Mobile Phone Proliferation in India

Post Liberalization 1990s -Telecom sector open to FDI 2000-10 decade extreme growth in this sector Growth rate- 18 million/month

19 March 2014

Deregulation

Market Competition

Population growth

Opportunity for Economies of

Scale

Result:Cheapest Tariff (in the

world)


19 March 2014

Mobile Phone Proliferation in India


19 March 2014

Mobile & SBI….!


Friday, March 12, 2010Raja Releases Citizen Moments Book

19 March 2014

State Bank of India- campaign

Campaign Year & Media coverage

Purpose

Parivartan2007(http://www.thehindubusinessline.in/2007/08/03/stories/2007080352210600.htm )

•Retain potential human resource•Centralized computerized system•Large & midsize corporation- Treasury, trade finance

Citizen SBI

2009(http://www.business-standard.com/article/finance/sbi-launches-fresh-hr-initiative-109090200055_1.html)

•Attitudinal change and transformation of its employees through a series of human resources activities•Behavioural transformation by seeking more active role from the employees

Udaan

2010(http://epaper.timesofindia.com/Repository/getFiles.asp?Style=OliveXLib:LowLevelEntityToPrint_ASCENT&Type=text/html&Locale=english-skin-custom&Path=CAP/2010/12/03&ID=Pc02215)

•Apprising the employees about the outstanding achievements of the bank over the last four years •Grooming them for their total transformation towards achieving the bank's aspirations to be amongst top 25 banks globally

Results

SBI superseded ICICI in terms of Market capitalization in 2008

SBI entered into Fortune Global 500 Listing


Solution?What’s problem

SMS “Unhappy”- Inception

19 March 2014

Competition in Market

Control the Input

Respond to the Output

Fiscal & Monetary policies control

Customer Satisfaction

Issues with conventional SBI system for attainment of “Customer Satisfaction”

Complaint Initiation

Lack of system awareness among customers

Lengthy procedure- high time & energy cost

Complaint Resolution

Public sector- Red tape & bureaucracy

Lack of accountability & transparency

Solution for attainment of “Customer Satisfaction”

Complaint Initiation

Create awareness

Easy to use- less time & energy cost

Complaint Resolution

Automation- speed & accuracy

Accountability & transparency


Solution to attainment of highest customer satisfaction 1st time realization by GM Lucknow, UP branch 1st time utilization of Automation in customer complaint resolution Exploitation of proliferated technology to reach & connect customers

Up gradation of semi-automated system with web-based technology in Bhubaneshwar, Odisha

Finally launch of Fully Automated Customer complaint resolution system in Hyderabad on 11th Dec 2009

19 March 2014

SMS “Unhappy ”- Inception

SMS <Unhappy>& be Happy


SMS Unhappy- Launch

19 March 2014

Mr Siva Kumar at the lauching of SMS “Unhappy”Media Source: http://www.financialexpress.com/news/SBI-launches-SMS-Unhappy-Service/758039


19 March 2014

SMS Unhappy- Launch

Launch region Andhra Pradesh

Regional circles 14 no.s

Branches 1100 no.s

Customer coverage 14 million


19 March 2014

SMS Unhappy- Operations


19 March 2014

SMS Unhappy- Result

SBH

Survey conducted by MARS on Customer satisfaction

Source: Hindustan Times 29th Mar 2010

Status Complaints per year

Prior to program

1600

After program

22,209

Addressed 21,805 (98%)

Complaints resolved

Timeframe

64 % Within 48 Hrs

11 % Within 3 days

9 % Within 5 days

16 % Within 10 days


CRITICALLY ASSESS THE SMS UNHAPPY PROGRAM AT SBI ? WHAT ARE ITS STRENGTHS AND WEAKNESSES ?

19 March 2014

Question-1


Critical assessment of the SMS Unhappy program at SBI

19 March 2014

Strength Weakness

SBI’ s brand image & credibility Lack of accountability

Huge market share including rural area Inadequacy of efficient mechanism

Experienced & dynamic OrganogramRed tape & bureaucracy

Opportunity Threat

Good market response assessed by Pilot program in AP Reputation at stake

Expansion of Telecommunication market

Frivolous complaints & Unpredicted scalability of complaints & operational challenges

Precise market segment- young professionals & students Competitors’ strategy

SWOT Analysis


19 March 2014

Critical assessment of the SMS Unhappy program at SBI (cont.)

Perspective Cost Benefit

SBI

• IT Infrastructure• Trained personnel• Advertisement

• Customer satisfaction• Market share• Green Banking (sustainability)• Real time feedback on operation• Accountability & appraisal system

Customer Cost of 1st SMS• Solution resolution within 48 Hrs• Less time & energy cost• Personal touch

Cost & Benefit

According to Mr Siva Kumar

25% of customers’ angst came down by sending SMS

50% taken care by SBI by call back

Hence 75% angst disappeared within few minutes with little effort


CAN SMS UNHAPPY CONTRIBUTE TO IMPROVING RETAIL OPERATION AT SBI ? HOW WOULD YOU USE THE PROGRAM FOR THIS PURPOSE ?

19 March 2014

Question-2


19 March 2014

SMS Unhappy contribution to improving retail operation at SBI

Retail Banking

Deposits-Savings Account , Current Account, Fixed Deposit, PF Account, Recurring Deposit , Term Deposit SBI Freedom, Money Market , Deposit Certificate, Retirement Savings Plan

Loans-Personal, Home, Auto, Medical, Mortgage Loan

Value Added Services-Remittances, Internet Banking, Debit Card, Lockers

SBI - A brand, a legacy, a name to Bank upon

SBI-Largest and oldest retail banking player in India

Potential Customer Segment

Age group: 28 Yrs (average)Young Professionals & Students

Easiest & cheapest way to connect them


19 March 2014

Source: http://www.statcrunch.com/grabimageforreport.php?

Source: Experian Marketing Services

Usage of Mobile Phone Functions

Usage of Text message by demography

Inferences:•Considerably good %age (20%) of SMS function is used in Mobile

•SMS is good source of marketing & feedback

Inferences:•Age group 13-17 contributes major (49%) in overall SMS users

•Age group 18-34 is 30% contributor that can become potential customer to target for marketing & feedback actions



19 March 2014


Justification of utility of Mobile Phone SMS option to connect target customer segment

Evaluation of Alternatives Step1

SMS Email LetterTime 30 sec 5 min 1 HrCost Rs 1.0 0 0Reliability 2/10 8/10 10/10

Multi-criteria decision making:

•AHP (Analytic Hierarchy Process)•Heuristic approach supported by survey data and Satty approach

Factor Comparison Step2Factor Comparison Weightage

Time Cost Reliability Eigen VectorTime 1.0 7.0 1.0 45% 3.0Cost 0.1 1.0 0.1 6% 3.0Reliability 1.0 9.0 1.0 49% 3.0

2.1 17.0 2.1 1.0 3.0λmax

Size of Matrix n 3

Consistency Index CI 0.0035

Random Consistency Index RI 0.52

Consistency Ratio CR 0.01Since CR<0.1 So No Problem


19 March 2014


Level (of Factors) Comparison

Step3

Level (of each Factor) Comparison

Time Weightage

SMS Email Letter Eigen Vector Actual Weightage

SMS 1.0 7.0 9.0 77% 35%

Email 0.1 1.0 5.0 17% 8%

Letter 0.1 0.2 1.0 5% 2%

1.3 8.2 15.0 100% 45%

Cost Weightage


SMS 1.0 0.3 1.0 22% 1%

Email 3.0 1.0 1.0 46% 3%

Letter 1.0 1.0 1.0 32% 2%

5.0 2.3 3.0 100% 6%

Reliability Weightage


SMS 1.0 0.3 0.1 9% 4%

Email 3.0 1.0 0.3 24% 12%

Letter 7.0 3.0 1.0 67% 33%

11.0 4.3 1.5 100% 49%

RESULT

SMS Email LetterTime 35% 8% 2%Cost 1% 3% 2%Reliability 4% 12% 33%

40% 22% 37%Recommendation 1st 3rd 2nd

Mobile SMS seems to be relatively best option to target customer base for Retail Banking


WHAT MAY BE THE KEY CONCERNS WITH REGARD TO THE NATIONAL ROLL OUT OF THE PROGRAM ? HOW SHOULD THE MANAGEMENT AT SBI ADDRESS THESE CONCERNS ?

19 March 2014

Question-3


National Level Implementation- Concerns & Resolutions

19 March 2014

Marketing Environment

GDP & Per capita income- public

savings

Private Banks- customer service

Fiscal & Monetary Policy- interest

rate

Banking infrastructure-

Building & location

Telecommunication- Internet, Mobile &

SMS services

Access & connection- Promotional medium

to be regional

Profession & Age- Target customers

Customers’ faith & asset security-

“Banker to Every Indian”

Source: Prof R Srinivasan, IISc


Key Concern Resolution

Pre-implementation

Return on InvestmentAccountability & Measurement of cost, complaint resolution and customer retention

Skilled Human resource availability Training programs

Demographic challenge- Language & culture Multilingual campaign region wise

Post-implementation

Exponential growth in complaints Prediction & estimation of customer volume region wise and monitoring

Surge in frivolous complaints Real time evaluation & closure

Competitors’ strategy Continuous feedback & up-gradation

Complaint management & accountability Regional limited complaint receipt

19 March 2014

National Level Implementation- Concerns & Resolutions

Source: http://www.business-standard.com/article/press-releases/sbi-launches-sms-unhappy-scheme-111032100061_1.html


HOW WOULD YOU ASSESS WHETHER SMS UNHAPPY CONTRIBUTES TOWARDS MAKING SBI MORE COMPETITIVE AGAINST ITS PRIVATE SECTOR RIVALS ?

19 March 2014

Question-4


SMS Unhappy contribution towards making SBI more competitive

19 March 2014

Source: Prof R Srinivasan, IISc

1 SMS

30 Seconds

Comfortable

Convenience

Reduced

Hidden Value delivered to SBI customer : “TRUST”


19 March 2014

SBI’s Market diversity Portfolio in India


Source: Wikinvest

Market Share of Banks in India (as on 2008)

10%

20%

1X10X 0.1X

Boston Consulting Group Growth–share Matrix

2007

2013


19 March 2014

Month-1Matrices Unit Region-1 Region-2

Customer Base weightage % X % Y%

Customers' Complaint received by Happy Room No.s A A

Customers' Complaint resolved No.s B B

Number of Transaction made by concerned customers after complaint resolution No.s C C

Failure Rate Index F1= (A-B)/A F2= (A-B)/ASuccess Rate Index S1= C/B S2= C/B

Consolidated MeasureFailure Rate X*F1 + Y*F2Success Rate X*S1 + Y*S2


Measurement of Effectiveness of SMS Unhappy (Proposed)

Periodical assessment on Success & Failure Rate would provide the real time feedback to measure Return on Investment of SMS Unhappy


19 March 2014

Websites www.google.co.in www.wikipedia.com www.isb.edu www.sbi.co.in www.financialexpress.com www.rbi.org.in www.trai.co.in

Books Strategic Management By Prof. R. Srinivasan Marketing Management By Philip Kotler

Tools used Microsoft Encarta (Encyclopedia for offline references) Microsoft Excel (for data analysis & graphs)

References

http://populationcommission.nic.in/








SBI SMS Unhappy Survey Time

19 March 2014


19 March 2014

Thank you!

Take Away….

• SBI IISc Branch is soon going to put poster to campaign “SMS Unhappy”• Our “Mobile Number Update” related concern resolved• Surveyed SBI customers got informed used “SMS Unhappy”

For you:

marketing sbi sms unhappy

Business

state bank of india

reserve bank of india

purpose of bank

bank of bombay

bank of madras

bank country

evolution bank of calcutta

sms unhappy program