This assignment mainly will talk about proposal to the Bank of Maldives on how it could sustain its position as the market leader by using various branding and differentiation strategies. In addition to this a brief introduction and a situation analysis of BML will be covered.

The first part of this assignment will give comprehensive introduction covering company background, products and services, the purpose and scope of the assignment. In addition to this the vision, missions, core values and the proposed service to introduce will be discussed.

The second part of the assignment will give all elements of situation analysis of BML. The assignment will show the survey of the target market which will be presented. This part will include SWOT analysis, BCG matrix and the porter’s five forces.

The third part of the assignment will analyze and give explanation on how the BML should position its new product in the market. All strategies will be justified with relevant examples.

The fourth part of the assignment will analyze and give explanation on how the BML should manage its product or service brand and how to focus on providing differentiation services. All these strategies will be justified with relevant examples. Lastly the all of the key points of this assignment will be summarized and some recommendations will be given.

Introduction

Bank of Maldives was registered as a company on 23rd May 1982 and it was listed on 10th November 1982. After the registration they were given the license to provide banking services in Maldives. Bank of Maldives Plc was inaugurated on 11th November 1982 and started business process as a joint venture bank with 60% of shares by the Government of the Maldives and 40% shares owned by IFIC Bank Ltd from Bangladesh. Maldives government decided to restructure the BML and purchased the 40% shares held by IFIC Bank Ltd. The Government decided to sell BML shares in December 1992 to the public in order to develop the Bank’s capital. Today, the BML has 25 branches in Maldives (Bank of Maldives, n.d.).

The vision is to lead the way through quality of service and dedication of their staff. The missions include becoming the leader in the financial industry in Maldives by spreading its presence in all key economic geographies in Maldives and promoting long term saving culture in the nation. The values are integrity, innovation, respect, communication and service (Bank of Maldives, n.d.).

Currently, the BML is providing the services like various bank accounts, card services, transnational travel and payments, internet banking, bill pays, personal loans, prepaid recharge, mobile banking, ATM services, direct debit, business card solutions, loan and leasing and merchant service solutions (Bank of Maldives, n.d.). For this assignment I am going to propose a new service for BML which is Islamic Banking. The main difference between conventional and Islamic banking is charging of interest by conventional banks (Maldives Islamic Bank, n.d.). Since most of BML customers are Maldivians and Muslims Islamic banking service is very important for its customers.

Situation analysis

SWOT analysis

Bank of Maldives SWOT analysis
Strengths	Weaknesses
1. They are financially stable, their bank is well capitalized, they have high market share and they can get government assistance.	1. There is less number of staffs to deal with their daily transactions and customers problems.
2. They have more effective recruitment and selection process.	2. They have limited US dollars to provide their customers.
3. They are awarded for 3 years about their customer satisfaction methods.	3. They have difficulty to get loans compare to their competitors.
4. They have easy transactions for its clients.	Threats
5. They have latest technology as leader in electronic banking.	1. Recently they have stopped providing some cards to the customers.
6. They are the most trusted company with the highest transactions in Maldives.	2. The economic crises had bad impact on the business.
7. They have 27 years banking service in this market and are well branded.	3. There are more competitors such as state bank of India and Maldives Islamic bank.
Opportunities
1. Since they have good financial stability, they can develop their business in other islands.
2. They can sell additional shares to the public to gain more customers and to have an enough capital to provide more services.
3. They can deal with their daily transactions and to get experience from developed banks like Swiss bank and they may ask from the Maldives government talk about it with them.

(UKessays.com, n.d.).

BCG Matrix

When looking into individual services the online banking and mobile banking are in question mark but the prepaid recharge service is in dog quadrant. The ATM services and different loan schemes are in star quadrant while the bank accounts and bill pays are in cash cow quadrant. Also, when comparing the whole bank of Maldives with the BCG matrix, it is clear that it is in star stage because it has high market share and high market growth. So it is evident that Bank of Maldives has the potential with essential huge investment to grow market share at the expenditure of more strong competitors.

Porters Fives Forces

Threat of new entrants: BML is a local bank in Maldives. However, there are other banks in Maldives like State bank of India, Habib Bank, HSBC bank in Maldives, Maldives Islamic Bank but they do not have more than one branch in Maldives. Therefore, it is very challenging for new entrants to come in this banking industry because the threat of new entrants mainly depends on the barriers to entry. In order to enter into the banking industry in Maldives for local businesses, it is very difficult due to high capital requirement they need to invest on the business and also it is challenging to achieve the economies of scale. Similarly Bank of Maldives is one of the main suppliers with 25 branches across the country (UKessays.com, n.d.).

Threat of substitutes: The threat of substitute services depends on the buyers' willingness to substitute, the relative price, performance of substitutes and the costs of switching to substitutes. The threat of substitute services of BML is comparatively high because there are many substitute services provided by other competitors (UKessays.com, n.d.).

Bargaining power of suppliers: For BML, bargaining power of suppliers is less because there are more leading supplier like rainbow, all other brothers business in the market. Bargaining power of buyers: For BML, the bargaining power of buyers are less because BML is the only business that provides the customers throughout the country and they have branches in many atolls of the country and when looking to other competitors such as HSBC, they are the only branch situated in capital of Maldives. Intensity of rivalry: BML is the leading company of banking industry in Maldives. Also, for BML the degree of differentiation is higher than the other competitors in Maldives (UKessays.com, n.d.).

Positioning

The above perceptual map’s Y axis represents price of Islamic banking services and the X axis represents the quality of these services. Each axis has high or low levels. The above map shows that currently Maldives Islamic Bank (MIB) is positioned on high price and high quality quadrant. The price is high compared to the quality of these services provided by them. This might happen due to not having same type of competitors in terms of Islamic banking in Maldives. Therefore the customers might not get quality services at low prices.

Therefore, I am recommending a new service to Bank of Maldives (BML) to introduce its customers which is Islamic banking. The Islamic banking service to be provided by BML will be in high price and high quality quadrant but the price of this service will be lower and the quality of the service provided will be high compared to MIB. This is an achievable objective because the BML has enough funds and facilities to provide this service in Maldives more efficiently than MIB. In order to achieve this target the following strategies will can be used.

Positioning strategies

Positioning by corporate identity; this is relevant for BML because they have a domestic name and this corporate identity can be used to position this new service for the BML customers. The BML has home name (Bank of Maldives) and which is very much related to Maldives environment (Asikhia, 2010).

Positioning by brand endorsement; this is a positioning strategy which is used to grow the brand when these are existing successful brands. This will help the new brand to get into the perceptual space of the old brands in the mind of the consumers such as MIB. This strategy is very important for BML because they need to rebrand BML when introducing this new service in Maldives (Asikhia, 2010).

Price and quality positioning; consumers will have high expectations for the quality of the service at a certain level. This strategy can offer a better opportunity for BML to position their service through price and quality positioning because the changing price level and quality relationship of products frequently attract various consumers segments. Therefore, it is important to balance the price and quality ratio. Any imbalance in this ratio need to be adjusted by both increasing the benefits of the service through quality improvement or by increasing the price of the service to meet with quality (Asikhia, 2010).

Positioning by target segment; BML can use this strategy to position its brand to a set of consumers with similar needs and expectations from the brand because such consumers will have same characteristics in demography, behavior, satisfaction desired, and psychograph. The BML can find out the consumers that are linked together by satisfaction they come from the brand. Hence they can develop or modify their brand and can position to fit into this set of definite needs (Asikhia, 2010).

Positioning by new features; BML needs to position its brand by unique quality of features that can make it different from the other competition like MIB. These features must be able to provide more benefits to give it a distinct advantage at the market place. This will help BML to be positioned its brand against the competitive brands. This policy can compare the brand with other brands and show why the brand should be preferred to its customers (Asikhia, 2010).

Positioning with Non-functional Values; Products are bought not only for their physical benefits but also for their symbolic or non-functional ones. Some customers are ready to pay twice for the symbolic meaning of a brand than for the physical attribute. Others will see the result from the use of the product. The symbolic meaning that a brand commands is often called the brand image. Therefore, in positioning a brand with its symbolic meaning and such symbolism should support the self-concept of the consumer (Asikhia, 2010).

Stealing the unhappy customers from MIB by providing what they cannot offer. Each and every competitor has unhappy customers who are looking for other good options and services. This could be due to lack of personal relations with the consumers. It could be due to the prices are high and the service might be poor. So, BML needs to find the unhappy customer of MIB and deliver good alternative services to them (Lamos, 2009).

Becoming a community star; this is very important for them and they can do this involving BML business in public events. They can be a sponsor for a community carnival or they can contribute some of their services to a charity auction (Lamos, 2009).

Having the best website and making it easy to use; the online business is a more convenient for several customers. BML need to make the connection with these consumers by using their website. They can use e-mail marketing to give customers special encouragements to check on their position such as specific online sale events or holiday gifts. This can be a huge opportunity for BML in order to be a local or regional online service in future (Lamos, 2009).

Building an unexpected customer experience; it is very important to build an experience in order people to say “WOW.” It is essential to provide them more that they can’t find anywhere else such as free coffee and other benefits in BML lobby or they can extend delivery hours in a way which is more convenient to the schedules. It is necessary to go beyond the expectations of customers when providing a new service (Lamos, 2009).

Differentiation and brand management strategies

Differentiation Strategies

Kotler defines the differentiation as “the process of adding a set of meaningful and valued differences to distinguish the company’s offering from competitors’ offerings’. Therefore, BML can differentiate its offering along five dimensions which are product, services, personnel, channel, and image (Razak, & Ilias, 2011).

Service differentiation: BML need to design their services to induce the consumers, to be eye catching of their services, to compete with other competitors like MIB and to sell their services quickly. The BML can differentiate the new Islamic banking service by using their online facilities. They can improve this service by adding more attractive features such as introducing more Islamic banking services which are not provided by MIB like Diminishing Musharaka. Also, BML can improve the customer service by introducing customer feedback through email in 24 hours a day when the telephone operators and the customer service staffs are not available. This will help them to reply more rapidly to customer concerns in future (Razak, & Ilias, 2011).

Personnel differentiation; in these days, it is not required the costly skilled personnel to provide personal service and to have one to one relations among BML and its consumers. Since the BML has good internet facilities, it can help them to deliver their services through low cost channels and can automate the process by removing the expensive staffs. Meantime, the reduction of company’s reliance on staffs to handle business transactions, their internet facilities can help to decrease the transaction cost by allowing the cost leadership advantage over the other companies like MIB (Razak, & Ilias, 2011).

Channel differentiation; their internet facilities can act as a communication channel as well as a location free and time free distribution channel. By using their internet facilities, they can develop their business from local to worldwide for 24 hours a day with an unlimited range of services. Their customers can order a more variety of services at any time during day or night (Razak, & Ilias, 2011).

Image differentiation; BML can differentiate itself by creating a new customer experience such as greater customer service and new brand the experience. Their internet interaction can help them to answer more rapidly to its customer requests. Besides, the high speed internet can assist them to communicate faster with present and potential customers. As a result they will be able to retain its current customers and to attract new customers (Razak, & Ilias, 2011).

Site environment; BML can different their website by providing customers with a helpful environment to visit, search and purchase what they want. BML need to confirm that their website helps to easy downloads, to offer correct information, to clearly shows the services existing and to easy navigation of the links. If their customers view their homepage and like what they see will assist them more possible to check on the additional webpages and eventually the customers will be buy the services (Razak, & Ilias, 2011).

Building trust; since the trust is one of the main issues on the internet mostly when customers are likely to pay online and when their information is used for personal service. BML need to describe their confidentiality policy and need to confirm whether it is strictly applied. They need to retain the balance between privacy and personalization which will increase the customers trust level. Also, they need to assure that whether the customers are using a safe and encrypted payment process for their transactions (Razak, & Ilias, 2011).

Pricing; when this new service is first offered on their website, the company need to offer price discounts as an incentive to regular customer. Since the BML has enough facilities and funds, they can provide some services at low prices than MIB and other competitors to differentiate their business (Razak, & Ilias, 2011).

People differentiation; BML can hire more qualified and experienced persons than its competitor to interact with their customers. Offering better customer service and making fewer mistakes than its competitors, BML can make repeat their business because doing business to satisfy the customers is a segmenting aspect for some customers (Entenmann, 2007).

Brand management strategies

Establishing and maintaining the brand: when management of the brand, it is suggested to BML to adopt a general approach or an “overall brand strategy”. This complete brand strategy needs to be implemented with complete recognition of BML’s different services and geographic regions like in different atolls. In order to adopt the overall brand strategy, they are required to know whether their brand is applicable to both the traditional selling and the online market. Therefore, it is suggested to have a new brand name when introducing the Islamic banking service to the customers in order to reflect their overall brand in Maldives (Klosek, & Hildebrand, 2003).

Ensure the stability between the brand licensing strategy and their overall business goals; in order to this they are required to stress on confirming the consistency between the brand licensing strategy and their general business objectives. They should also take efforts to ensure that their brand is reflecting positively on their business and to continue profitable with other services of their business (Klosek, & Hildebrand, 2003).

Successful brand licensing policy needs devoted staff; the BML’s staffs need to have an essential role in the business’s general brand licensing initiatives. The staffs are required to organize, control and coordinate all the actions of the licensees. In addition the other important staff members need to be trained and encouraged to have an active part in the efforts of general brand licensing efforts (Klosek, & Hildebrand, 2003).

Finding the correct marketing vehicle; There are many marketing vehicles that BML can use for the brand messaging such as public relations and publicity, trade shows, phone directories, online ( such as website, blog, social media like twitter and Facebook, advertising), broadcasting media ( such as television, radio), print media (such as newspapers, magazines, specialty publications), print displays and direct mail ( such as brochures, fliers, signage) and professional assistance ( such as consultants, designers, and agencies). They need to choose the communications vehicle that are more comfortable for applying and that will reach their future audience such as online media (Porter-Rockwell, 2010).

Always keep a high profile; According to Smith there are several tips for keeping the brand top of mind in the marketplace. The BML can use these tips such as by networking with the specialized associations, by exhibiting at an expo or negotiating a trade of their services for advertisement space, by encouraging their workers to become active in the local charities and boards of directors and holding webinars for free or for a nominal fee (Porter-Rockwell, 2010).

Having an adequate budget; Since the BML has enough funds, it is recommended to have enough budgets for brand management activities because these activities require quite high costs (Mohamad et al. 2009, p. 32).

Logo and tagline; It is recommended to change their current logo to a new one when introducing Islamic banking. For instance, they can use a logo which shows an Islamic background or Maldives culture. Currently they do not have a tagline or slogan, hence it is recommended to have an attractive tagline. For instance, they can use a slogan of “customer satisfaction our priority” (Kotler, & Pföertsch, 2006).

Summary

In conclusion, Bank of Maldives is a successful bank in Maldives providing different useful services to its customers. The Islamic banking is a new service which is going to introduce by BML to its customers. The SWOT analysis of BML shows many strengths and few weaknesses, threats and opportunities. When analyzing the whole bank of Maldives in the BCG matrix, it is clear that it is in star stage since it has high market share and high market growth. The porter’s five forces analysis shows that there is a quit high competition in this market by other banks like State bank of India, HSBC, and Habib Bank.

The perceptual map shows that currently Maldives Islamic Bank is positioned on high price and high quality quadrant. The Islamic banking service to be provided by BML will be in high price and high quality quadrant. To achieve this target the position strategies like positioning by corporate identity, positioning by brand endorsement, price-quality positioning, positioning by target segment, positioning by unique feature and competitor, positioning with non-functional values, steal unhappy customers from MIB by providing what they cannot, become a community star, have the best website in the market and make it really easy to use and build an incredible customer experience.

The differentiation strategies that can be used are service differentiation, personnel differentiation, and channel differentiation, image differentiation, building trust, pricing, people differentiation and website differentiation. The brand management strategies include establishes and maintains of brand, ensure consistency between the brand licensing strategy and overall business goals, successful branding with dedicated staff, finding the right marketing vehicle, always keeping a high profile, having a sufficient budget and having logo and tagline. In my opinion, BML can introduce Islamic banking service in Maldives and can get high return if they are able to implement these strategies successfully.

References

Asikhia, O. (2010). Positioning a Bank Service in Nigeria: A Conceptual Framework. Retrieved February 02, 2013, from http://www.google.mv/url?sa=t&rct=j&q=Positioning+a+Bank+Service+in+Nigeria%3A+A+Conceptual+Framework&source=web&cd=1&cad=rja&ved=0CC4QFjAA&url=http%3A%2F%2Fwww.ccsenet.org%2Fjournal%2Findex.php%2Fijbm%2Farticle%2Fdownload%2F6921%2F5490&ei=PPQTUcifKs-PiAetioCgBg&usg=AFQjCNGpoQPpq2ELduHHRvNr-AHuZ2MCsA&bvm=bv.42080656,d.aGc

Bank of Maldives. (n.d.). Company Background. Retrieved February 01, 2013, from http://www.bankofmaldives.com.mv/INVESTORRELATIONS/CB/Pages/default.aspx

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Entenmann, B. (2007). Differentiate Your Product or Service. mktghelp.com. Retrieved February 02, 2013, from http://www.mktghelp.com/pdf/Differentiate%20Your%20Product%20or%20Service.pdf

Irwin & McGraw-Hill. (1998). Positioning Decisions (PowerPoint slides). Retrieved February 02, 2013, from http://www.google.mv/url?sa=t&rct=j&q=Positioning+is+the+act+of+designing+the+company%E2%80%99s+offering+and+image+to+occupy+a+distinctive+place+in+the+the+target+market%E2%80%99s+mind.+++&source=web&cd=5&cad=rja&ved=0CEQQFjAE&url=http%3A%2F%2Fwww.csupomona.edu%2F~hczepiec%2Fmkt525%2Flectures%2Fpositioning.ppt&ei=SscTUdzbE8TNrQftooGgDA&usg=AFQjCNHVIrn__KZ3Br0URDVby9CYbfCSxg&bvm=bv.42080656,d.bmk

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Mohamad, Z., Md. Said, N. P., Othman, A. R., Mokhtar, S. S. M., Ghani, N. H. A. & Wei, L. S. (2009). MARKETING MANAGEMENT II. Malaysia: Meteor Doc. Sdn. Bhd.

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Adam Khaleel

Wednesday, December 23, 2015

Module Name: Marketing Management 2

Executive Summary