banking loyalty
Post on 21-Oct-2014
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BANKINGUnderstanding the Loyalty Programs in Banking
Presented By:
Dheeraj Meshram Kinnar Majithia Akankasha Sharma
(P1053) Nishad Banodkar Nirav Doshi Ebrahim Noorani
Contents
Structure of Loyalty Programs
Reasons Behind Structure
Program Execution Benefits Challenges Faced Promotional Activities Budget Database Marketing Customer Feedback
STRUCTURE OF LOYALTY PROGRAM
SBI FreedomRewardz (Debit
Card Plan)
HDFC Divided into 3 Programs
1. Classic2. Preferred RM3. Imperia
‘FreedomRewardz’ BY SBI
Customers are rewarded points for using the SBI Debit card
All State Bank Group Debit-card holders are pre-enrolled into FreedomRewardz, on individual basis
2.5 points provided for every ` 100 purchase using the debit card
Additional points for using the card at SBI’s partner outlets
Special promotions during holidays and festivals
‘FreedomRewardz’ BY SBI
Points can be redeemed till 36 months from the time they are accrued after which they expire
Points can be redeemed for Gifts, merchandises and services in the domains of: Personalized products Airline tickets, Bus tickets Movie tickets Entertainment products, Electronic items Family, Home, Fashion & Beauty products Music and Sports products Limited-time Seasonal Rewards
SBI FreedomRewardz Partners
LOYALTY PROGRAMS AT HDFC BANK
HDFC bank has 3 distinguished loyalty programs for customers based on the balance in their CASA account
Classic banking (min. ` 1 Lac) Preferred Banking (min. ` 2 Lac) Imperia Banking (min. ` 5 Lac)
HDFC BANK CLASSIC BANKINGHIGHLIGHTS:
Free EasyShop Gold Debit card
50% waiver on annual locker rental rates
Annual waiver of `25 on Utility BillPay
Improvement of 5 paise over the day’s rate for Forex transactions
HDFC BANK PREFERRED BANKINGHIGHLIGHTS:
Dedicated Relationship Manager
Customized Investment Solutions
Relationship pricing – Credit card, Loans, Securities Trading account
No charges on NEFT and RTGS transactions, Free ‘At Par’ cheque books
Multiple Demat accounts free of charge
Waiver of up to `2000 on service charges like Duplicate statement, DD cancellation etc.
HDFC BANK IMPERIA BANKINGHIGHLIGHTS:
Imperia client Relationship Manager/Private banking advisor
In-house research-backed investment advice
Exclusive Imperia Phone-Banking Service
Loans, Gold bars at preferential rates, hassle-free foreign remittances
Free combined monthly statements of Savings, Current and Fixed Deposit accounts
HDFC Loyalty Program Partners
REASONS BEHIND STRUCTURE
SBI “FreedomRewardz is an exclusive loyalty program
initiated by State Bank Group for its debit card holders to reward them with points accumulated over transactions and redeeming the same for a wide range of consumer products.”
HDFC Based bank balance kept by customer with the
bank Program Name Balance
Required in CASA Account
(Rs.)Classic 1,00,000
Preferred RM 2,00,000
Imperia 5,00,000
PROGRAM EXECUTION
SBI Every new SBI customer is made aware
of the scheme All State Bank Group Debit Card holders
are pre-enrolled into FreedomRewardz, on an individual basis,
Existing regular customers (without debit card) are tapped
HDFC Monitor the balance of the customer
over the quarter If criteria satisfied, call customer and
brief about the program Old loyalty program customers refer new
customers, pitch the same program
BENEFITS
SBI Customer Retention Increased business
opportunity HDFC
Business growth Retains old customers Word- of-Mouth publicity
CHALLENGES FACED
SBI Creating awareness is difficult
due to a huge customer base Difficult to train illiterate
customers Changing habits: shift from
traditional cash withdrawals to Debit Card use
Unable to make customers aware of the security provided by them
Negotiating and maintaining relationship with retail partners
CHALLENGES FACED
HDFC New customer asks for
customization Imperia customers may ask for
certain customized financial services
Keeping service charges down to make the program viable
Extra staff employed, dedicated relationship manager
Costs incurred by bank to reimburse RM’s travel expenses
Negotiate and maintain relationship with retail partners
Q7 Ans
PROMOTIONAL ACTIVITIES
SBI Dedicated site for
Freedom Rewardz
HDFC Quarterly Events Seminars/ Workshop Get-togethers Donations to CRY, other NGOs
BUDGET
Operating Expenses (for the period April’09 to March’10)
SBI 20318,68,00 (in ‘000 Rs.)
HDFC 57,644,827 (in ‘000 Rs.)
DATABASE MARKETING
SBI None identified
HDFC Email Marketing Sending free gift vouchers
CUSTOMER FEEDBACK
SBI
HDFC
THANK YOU!!!
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