Critically Analyse the Marketing Strategy and Marketing Mix of a Recent Successful Marketing Innovation in the Financial Services Industry.
Critically Analyse the Marketing Strategy and Marketing Mix of a recent successful Marketing innovation in the financial services industry.
According to the OECD Oslo Manual, a marketing innovation is “the implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing”. Research and development to create new marketing innovations in the services industry, and in particular, the financial services industry, is largely experimental compared to the tested scientific processes that have been created for product innovations. This is because a service is intangible, meaning that it cannot be readily displayed before it is bought. Brainstorming, trial and error and innovation teams are some of the informal methods used to develop occasionally successful marketing campaigns for the services sector.
Bank of America: “Keep the Change”
Bank of America has been at the forefront of product and marketing innovations in the financial services industry. In an effort to encourage more customers to open a bank account and to use its products and services, it wanted to break away from its competitors and the structured products of the conservative banking industry. It started by experimenting with products and services conducted live with real customers engaged in real transactions. Twenty branches in Atlanta were set up with different gimmicks and promotions to determine what appealed to customers. The results were then measured, developed, re-tested and compared with control branches much in the same way as a scientific laboratory.
In the month of October, 2005, after a number of years of experimentation, Bank of America had a breakthrough. It released a unique and radically different banking concept that broke the traditional product mould. This breakthrough concept was called “Keep the Change”. While investigating and researching methods by which the bank could improve its services to
According to the OECD Oslo Manual, a marketing innovation is “the implementation of a new marketing method involving significant changes in product design or packaging, product placement, product promotion or pricing”. Research and development to create new marketing innovations in the services industry, and in particular, the financial services industry, is largely experimental compared to the tested scientific processes that have been created for product innovations. This is because a service is intangible, meaning that it cannot be readily displayed before it is bought. Brainstorming, trial and error and innovation teams are some of the informal methods used to develop occasionally successful marketing campaigns for the services sector.
Bank of America: “Keep the Change”
Bank of America has been at the forefront of product and marketing innovations in the financial services industry. In an effort to encourage more customers to open a bank account and to use its products and services, it wanted to break away from its competitors and the structured products of the conservative banking industry. It started by experimenting with products and services conducted live with real customers engaged in real transactions. Twenty branches in Atlanta were set up with different gimmicks and promotions to determine what appealed to customers. The results were then measured, developed, re-tested and compared with control branches much in the same way as a scientific laboratory.
In the month of October, 2005, after a number of years of experimentation, Bank of America had a breakthrough. It released a unique and radically different banking concept that broke the traditional product mould. This breakthrough concept was called “Keep the Change”. While investigating and researching methods by which the bank could improve its services to
Bibliography: 1. OECD, 2005, “The Measurement of Scientific and Technological Activities: Guidelines for Collecting and interpreting Innovation Data: Oslo Manual, Third Edition” prepared by the Working Party of National Experts on Scientific and Technology Indicators, OECD, Paris. 2. Thomke, Stefan. (April 2003) “R&D Comes to Services: Bank of America’s Pathbreaking Experiments”. Harvard Business Review. pp. 71-79. 3. Anderson, J. (2007) “Keep the Change” Program, Pangea Organics Top BusinessWeek/IDSA Business Catalyst Competition. Ergonomics Today, 20 July [Online]. Available at: http://www.ergoweb.com/news/detail.cfm?id=2129 (Accessed: 26 February 2010). 4. Warner, J. (2007) Financial Services Marketer of the Year: Bank of America. MediaPost News Marketing Daily, 2 January [Online]. Available at: http://www.mediapost.com/publications/?fa=Articles.printFriendly&art_aid=53205 (Accessed: 26 February 2010). 5. Ante, S.E. (2006) Case Study: Bank of America: How it learned that what customers really want is to Keep the Change. BusinessWeek, 19 June [Online]. Available at: http://www.businessweek.com/print/magazine/content/06_25/b3989445.htm?chan=gl (Accessed: 26 February 2010). 6. Bruene, J. (2005) Bank of America’s Unusual Automated Savings Plan. Netbanker, 5 October [Online]. Available at: http://www.netbanker.com/2005/10/bank-of-america-unusual-automatic-savings-plan.html (Accessed: 6 March 2010). 7. Bruene, J. (2006) Bank of America’s “Keep the Change” Banner on MSN. Netbanker, 13 February [Online]. Available at: http://www.netbanker.com/2006/02/bank-of-america-keep-the-change-banner-msn.html (Accessed: 26 February 2010). 8. Bank Marketing International (2006). Keep The Change Crosses The Atlantic as Save The Change. 31 December.