vanguard
TRANSCRIPT
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Marketing at the aanguard Group – A Case Study
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Our Journey
• Introduction• Where we are• The Way Ahead• Situation Analysis• Strategy and Risks• Action Plan• Contingency Plan
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• Market Leader• Low Cost• High Quality• Reliability• Decreasing Market Share
Vanguard in a Nutshell
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90%
60%40%
Rest of US MF Industry Vanguard Retail InvestorsVanguard Institutional Investors
US Mutual Fund Assets -year 2002
Our Market Share
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Our Footprints
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Turbulence Today!!
• Deregulation: Competitors entering into Markets• Fluctuating Capital Markets affecting MF returns• Higher redemption rates in institutional investor segment• US Market saturation
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The Way Ahead• Maintain our market share• Restrain Cash outflows• Attract new businesses
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• Large untapped market of customers• Growth potential in International markets
Situation Analysis
• Best products at lowest cost• Strong Brand Image• Customer Loyalty• Competitive Fund Performance• High Operational Efficiency
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• Poor Marketing Strategy
Situation Analysis
• Deregulation• Impact of fluctuating Capital Market• Saturated US Mutual Funds Market
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What we can do?What we can do?Leverage Strength: • Low cost high performance model
Exploit Opportunities: • Special Marketing campaigns for targeted customers• Alliance with Brokerage firms
Strategy to stay afloat
Address Weakness: • Revamp the marketing
strategy
Mitigate Threats: • Retain existing clients by becoming a one-stop shop for Mutual Funds.
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Risks in proposed strategyRisks in proposed strategy
• Abrupt increase in marketing spending may hurt existing cost-effective business model.
• Some customers may dislike the promotions as they do not match with company’s traditional brand image.
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Action PlanAction Plan• Focus on the core competency – Mutual Funds• Introduce attractive schemes for “emerging mass affluent level” segment ($50K –
$1M assets)• Tie-up with brokerage firms to attract new businesses• Aggressive Marketing
– Use service calls for advertising new products– Highlight recent performance of mutual funds on company web-site.– Effective use of technology for marketing
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Contingency PlanContingency Plan
• Diversification of portfolio• Enter into new International markets
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Thank You!!Thank You!!