Axis Bank - Consolidated

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Banking in India

Market Environment

Axis BankMarket Survey

Customer

Competition Segmentation, Targeting and Positioning

4Ps

Brand Axis

OBJECTIV

E


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Originated in the last decades of 18th century (General Bank of India 1786 and Bank of

Hindustan - 1790).

Presidency Banks (Bengal, Bombay and Madras) under charter of British East India

Company.

Banking in India remained the exclusive domain of Europeans for next several decadesuntil the beginning of the 20th century.

The period between 1906 and 1911 - Swadesi movement.

The presidency banks merged in 1921 to form Imperial Bank of India. After Indiasindependence it came to be known as the the State Bank of India (SBI). Hence SBIbecomes the oldest bank in the country.

B

ankinginIndia-History


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P-E-S-T Analysis : Socio-Political factors

The economic effects of partition on Punjab and West Bengal.

The Government of India envisaged a mixed economy.

Greater involvement of the state in banking and finance.

Nationalisation of The Reserve Bank of India, India's central bankingauthority in 1949.

By the 1960s, the growth of Indian banking industry and emergence ofbanking as a large employer prompted the government for nationalizingbanks.

The Government of India issued an ordinance and nationalized the 14 largestcommercial banks in 1969. A second dose of nationalization of 6 morecommercial banks followed in 1980.

M

arketEnviron

ment


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P-E-S-T Analysis : Economic factors.

Until the 1990s, the nationalized banks grew at a pace of around 4%, closer to the averagegrowth rate of the Indian economy.

In the early 1990s, the then Narasimha Rao government liberalized the crippled Indianeconomy and introduce banking reforms, licensing a small number of private banks tocome into market which included Oriental Bank of Commerce, UTI Bank(now Axis), ICICIBank and HDFC Bank.

With the opening of economy the foreign banks also jumped into the market. This move,

along with the rapid growth in the economy of India (7 %), revitalized the banking sectorin India, which since then has seen rapid growth with strong contribution from all thethree sectors of banks, namely, government banks, private banks and foreign banks.

M

arketEnviron

ment


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P-E-S-T Analysis : Technology factors.

Come 21st century in which internet and mobiletechnology revolution changed the waybusiness was done.

ATMand

Internet Bankingbecame the norm.

The rise of plastic money in credit cards and debit cards.

The new tech-savvy methods of working of traditional banks.

Hence all the politico-economic changes, coupled with technological innovations in IT andmobile communications, set the pace for the banking industry to grow at acceleratedrates and private banks made the most of it.

M

arketEnviron

ment


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The UTI Bank was one of the first private sector banks which were set up after the reforms

in the banking sector in India. UTI Bank was formed in 1994. The Bank was promotedjointly by Unit Trust of India (UTI), LIC and General Insurance of India (GIC).

On July 30, 2007, UTI, the third largest private sector bank in India officially changed itsname to Axis Bank.

The decision for rebranding.

The opportunity from rebranding.

A

xisBank(Ers

twhileUTI)


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CHALLENGES FACED :

Rebranding Case for Mergers and Acquisitions only.

Impression of fundamental changes in the company as part of name change.

Well established brand of UTI(Top 50).

Quasi Government Connotation of UTI.

Protecting customers from fraud;

MARKETING CAMPAIGN

The bank hired Ogilvy & Mather (O&M) to design and implement the rebranding campaign.

In addition to changing its name, the bank also changed its logo. The banks concern.

The marketing budget was raised to thrice that of 2006.

A

xisBank-Re

branding


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MARKETING CAMPAIGN

The integrated marketing campaign titled 'UTI Bank is now Axis Bank;Everything is the same except the name'.

Twins both Equal.

Mass media campaign.

Leveraging on its 2,500-odd ATM locations.

Communication through account statements.

A

xisBank-Re

branding


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Axis Bank Company Facts

Chairman / Chair Person : Adarsh Kishore

Managing Director & CEO: Shikha Sharma

Website : http://www.axisbank.com

BSE Code : 532215

NSE Code : AXISBANK

C

OMPANYFAC

TS


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Consumer Survey

Online survey

Customer feedback Bank visit

Presentation of survey results

C

ONSUMER

S

URVEY


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SURVEYRE

SULTS


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SURVEYRE

SULTS


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REASONSFORCLOSINGANACCOUNT


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CUSTOME

RSATISFACTIONLEVELS

FORTHE

SERVICESPROVIDED


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CUSTOM

ERSATISFAC

TIONLEVELS

FORTHE

SERVICESPROVIDED

Source : National Journal of Technology and Management


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Axis Bank HDFC ICICI

Expectation 5.5 5.7 5.7

Perceived 5.1 5.4 5.4

4.84.9

55.1

5.25.35.45.55.65.75.8

TANGIBLES



Perceived 4 5 5.4

0

1

2

3

4

5

6

RELIABILITY



Perceived 3.6 4.7 4.8

0

1

2

3

4

5

6

RESPONSIVENESS



Perceived 4.3 5 5

0

1

2

3

4

5

6

ASSURANCE

COMPARISONBETWEE

NAXISHDFC

ANDICICI

BANKS


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ROLE OF CRM IN BANKING SECTOR

AXIS BANK: THE RIGHT PHONE BANKING CRM

SOFTWARE

SEPARATION OF RELATIONSHIP MANAGEMENTAND TRANSACTION PROCESSING

CUSTOME

RRELATIONSHIP

MANAGEM

ENT


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Customerconvenience

Cost effectivecustomerdelivery

Advanced useof technology

CO

NSUMER

BE

HAVIOUR


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Competition

Who are Axis Banks major competitors

COMPETITIO

N


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Potential

Entrants

Threat

Low

Suppliers

Medium

Substitutes

High

Buyers

Medium

Industry

Competition

HIGH

PO

RTERS

5

F

ORCES


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(Data as of 22nd August 2011)

Last Price Market Cap.

(Rs. cr.)

Net Interest

Income

Net Profit Total Assets

HDFC Bank 453.05 105,735.33 19,928.21 3,926.39 277,352.61

ICICI Bank 851.00 98,046.21 25,974.05 5,151.38 406,233.67

Axis Bank 1,051.10 43,308.85 15,154.81 3,388.49 242,713.37

Kotak Mahindra 430.15 31,736.91 4,303.56 818.18 50,850.66

IndusInd Bank 236.95 11,041.14 3,589.36 577.32 45,635.85

YES BANK 266.20 9,267.55 4,041.74 727.13 59,007.00

Federal Bank 353.95 6,054.23 4,052.03 587.08 51,456.37

ING Vysya Bank 305.40 4,568.26 2,694.06 318.65 39,013.98

Karur Vysya 362.15 3,881.54 2,217.69 415.59 28,224.84

JK Bank 789.80 3,828.78 3,713.13 615.20 50,508.15

CO

MPETITION

:MARKET

PE

RSPECTIVE


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Private Sector Banks

Axis

Bank

Items 2005-06 2006-07 2007-08 2008-09 2009-10

Group

Aggregat

es

All

Banks'

Aggregat

es

2009-10 2009-10

No. of offices 352 501 626 786 1019 10387 71998

No. of employees 6553 9980 14739 20624 21640 182284 944620

Business per employee (in Rs. lakh) 1020.00 1024.00 1117.00 1060.00 1111.00798.37 873.32

Profit per employee (in Rs. lakh) 8.69 7.59 8.39 10.02 12.00 7.19 6.05

Capital and Reserves & surplus 2886 3402 8771 10215 16045 119984 430046

Deposits 40114 58786 87626 117374 141300 822801 4752456Investments 21527 26897 33705 46330 55975 354117 1719185

Advances 22314 36876 59661 81557 104343 632494 3497054

Interest income 2889 4462 7005 10835 11638 82874 415751

Other income 730 1010 1795 2897 3946 20180 78519

Interest expended 1811 2993 4420 7149 6634 51206 272084

Operating expenses 814 1215 2155 2858 3710 22676 99769

Axis bank with respect to other Private banks

STA

TISTICALCO

MPARISION


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Large retail andcorporate market

Wide scope in ruralIndia

Very high competitionwith Private sector orPublic sector bank.

Other better Saving,investment optionavailable

Market capitalization islow

Not having Image - UTIMutual fund scam

High level of services

Knowledge of Indianmarket

Strength Weakness

OpportunityThreats

SWOT

:ANALYSISOFAXISBANK


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Sustaining Competition

Blue ocean strategy

Red Ocean Strategy Priority Banking

Personalised Services

Priority Platinum Debit Card

Preferential Pricing Services on Priority

Flexible Eligibility Criteria

SUS

TAINING

CO

MPETITION


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Fee Profile Retail business

SEGMENTAT

ION


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Integratedchannelstrategy

No. of branches

and extensioncounters

SEGME

NTATION

:G

EOGRAPHY


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Go Reach Savour Cruise

Description For thosewho arejust startingout

For those whoare working outtheir dreams

For those whohave achievedtheir goals andhave room to grow

Well settled andwilling to enjoy thehigher flavours oflife

Principlebenefit

Low service

charge.Lowminimumbalance

Unlimited

transactions.Fixed fee.Deposit box

Interest on

accounts. Freenotary services.Investmentconsultancy

No charge on any

service. Unlimitedtransaction. Personalbanking. Clubbenefits

Demographiccorrelation

Studentsand youngadults

Young family inassetacquisition

stage

Well established.Mid-life. Buildinginvestments

50+

Behavioralcorrelation

Lowbalances

High spending,low balance,no investment

Have savings andinvestment

Moving intoretirement or semiretirement

Axis Banks

Offering

Azaadi - NoFrills

Account

Salary AccountWomen Savings

Account

Priority Account -Resident

Senior Citizen'sAccount

SEGM

ENTATION

:L

IFESTAGE


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Full Market Coverage

Differentiated MarketingMARKET

TARGE

TING


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Continue to build and

strengthen Retail

Banking franchise

Leverage leadership

position in

Infrastructure linked

Financial services

Build a full-service

offering to SME

customers

Capture end-to-end

opportunities in

Payments across

customer segments

MARKET

POSIT

IONING


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PRODUCT:

Accounts

Deposits

Cards

Mobile Banking

MARKETINGMIX

4Ps:PRODUCT


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Twins both equal

4Ps:PROM

OTION

Solution for every banking need
http://www.afaqs.com/advertising/creative_showcase/index.html?id=21572&media=TV&type=Indian


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4Ps

PROM

OTION


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largest ATM outsourcing deal-6270

Strategic location of ATMs

1411 branches across 932 cities and towns

Overseas Offices

4Ps:PLACE


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Suntecs relationship based pricing solution

8%-power-plus home loans

Platinum priveledge-2.5% on fuel

Lowered base rate to 10%

4Ps:PRICE


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In developing markets like Indiaproducts are competing in theexpected or augmented productcriteria .

Axis retail banking accounts wereupdated with net banking, phonebanking to deliver expectedproduct.

Specializing it further based ondemography to deliver augmented

product.Differentiation:

Customization Regular, Priority banking, Wealth, Privee

Performance Quality Mutual funds, Fixed deposits.

PROD

UCTLEVELS

AND

DIFFE

RENTIATION


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Brand equity: an increase of 50% in the brand value to US$ 652min 2011.

top 200 of global emerging market banks 2010 Global finance

Forbe Asias fab 50 companies

Branding Strategy: Brand resonance pyramid.B

RAND

VALUE


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Extension:

Line Extension Axis banks introduces multiple products underpersonal banking and credit card category to target differentuser groups.

Category extension Axis Bank to a total solutions provider.

Acquired Enam for Rs 2000 crores in November 2010 to becomethird biggest underwriter.

Insurance products under Max New York life insurance in March2010.

CO Branding:

Shriram Axis Bank Credit Card targeting transport operators inIndia.

LIC ties up with Axis Bank to offer LIC Axis bank credit card foreasy payment of premiums.

BRAND

EXTENSIONA

ND

COBRA

NDING


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Twin objectives

Tap semi urban and rural potential

Bring technology driven banking services to the hinterland

RBS branches opened in Punjab, Tamil Nadu, Rajasthan andGujarat and 100 more such branches across India soon.

extend foot print in Tier III, IV and V centres.

Financial Inclusion

More than 35 Lakhs No Frills accounts opened under the FinancialInclusion Initiatives

An online POS model involving POS terminals as the transactingdevice and bank issued debit cards as the transacting instrument.

Targets for 2013: 105 Crs of deposit base and 26 Crs Loan book

Agri Business

Finance for farm equipment and Cash credit facility forcommision agents

Loans to farmers for meeting cultivation and contract farming.

R

URALBANKIN

G

S

TRATEGY


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Axis bank has a very firm position in thePrivate banks segment

It is growing at a very fast pace since its

conversion (price more than doubled onstock exchange to current average of~Rs.1100 as compared to 2007 average)

CONCLUSION


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Team 7 Members:

- Vinodini C. B013

- Raghavendran R. B046- Kunal Gupta B020

- Ankur Gupta B021

- Kushal Bagadiya B006

- Nikhil Nagar B040

THANKYOU


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Axis Bank annual report

http://www.axisbank.com

http://www.rbi.org.in

http://www.moneycontrol.com/company-facts/axisbank

REFERENCES

Axis Bank - Consolidated

Documents

Transcript of Axis Bank - Consolidated