Marketing Strategies: Case of ING DIRECT Bank


Marketing strategy is the set of mechanisms applied in an organization to help it in creating, communicating and delivering its commodities and value to the market it is targeting (El-Ansary, 2006). Literature has outlined a variety of tools and mechanisms which enable companies to achieve this objective. These include differentiating company products and services from those of its competitors, product positioning, segmenting company markets, and targeting various markets. Usually, companies will adopt a mixture of mechanisms at the same time. However, the literature postulates that a company can utilize a marketing mix program, where the 4ps (place, product, promotion and pricing) are carefully organized to enable product marketing.

The four Ps have been regarded as marketing management tools (El-Ansary, 2006). This means that literature does not differentiate properly, the difference between strategy and market management. Understanding marketing strategies is an important element to a firm, because it helps it to survive during an economic crisis (Koksal & Engin, 2005), as well as leverage on its resources all the time. The latter is because these strategies are linked to other aspects such as customer relationship, human resource management and management of supply chains and they help to improve their effectiveness (El-Ansary, 2006).

This paper analyzes the case of the ING DIRECT Bank institution based in Australia. The paper seeks to link literature on marketing strategies in view of the marketing strategies employed at ING DIRECT Bank. It also proposes some recommendations for alternative strategies for the bank, reviews the advantages and disadvantages of these alternatives.

Literature Review: Marketing Strategies

The literature demonstrates a variety of marketing strategies that are at the disposal of the firm to enable the process of creating, communicating and delivering commodities to its customers. Some authors such as Koksal & Engin, (2005) have studied the various factors affecting marketing strategies, as well as the linkage between marketing strategies and company performance. Marketing strategy plays a great role in expanding market share (Koksal & Engin, 2005).

The benefits and uses arising from ‘targeting’ as a marketing strategy mentioned in the literature, including reducing the costs of transactions and therefore, improving company efficiency. Targeting also helps businesses manage their relationships with their customers as well as their suppliers through e-business (Peppers and Rogers, 1993; El-Ansary, 2006). A marketing mix helps in branding, according to El-Ansary (2006), and this is very crucial as far as a firm’s performance is concerned.

Various authors recognize the fact that strategic marketing begins with the vision and mission statement. From here, the company goes on to select the target, then create a workable marketing mix, followed by choosing the position for each of its commodities (Restrepo, n.d.).

Through segmentation, the company can adapt to the current market demands. In this case, the organization needs to select a market segment and develop a particular mix which suits the segment (Restrepo, n.d.). A company can also choose to capitalize on a particular segment it considers competitively advantageous in, in relation to the present competitors, or where it perceives that it is well suited. This strategy can help firms incur lesser costs for adaptation. Market segmentation can help the company to provide high value for its commodities, because it concentrates on the specific needs for the specific segment. Different demand curves are adopted by the company for monopoly or oligopoly.

Through segmentation, the company is able to identify the target group to serve, adopt the behaviors for the system, and focus on the costs and feasibility of reaching the segment clients. However, the company must analyze to see that the segments in the market are stable over time. The stability condition need also be met over various conditions in the market.

In identifying the segment, the company may concentrate on a number of things, including using the behaviors of the consumer, the benefits the customer is seeking, as well as the characteristics of the customers in the segments. Since there can be different paths signaled by use of these options, it is advisable that companies adopt more than one strategy (Restrepo, n.d.). Segmentation through personal characteristics focuses on issues such as lifestyles and demographics, as well as psychological factors.

Differentiation depicts a manner that the company seeks to be distinguished from competitors. The company has to consider a variety of factors existing within the organization, including the cultures, human resources and its structure (Restrepo, n.d.). A company can use the brand equity (Aaker, 1991) differentiation technique to become distinguished from its competitors. Branding techniques can help a company create barriers in competition (Restrepo, n.d.).

Through proper positioning strategy, the company seeks to deliver a concept sought for by customers. This has been termed as a selling proposition (Restrepo, n.d.). The company constantly communicates this proposition as their value and brand identity to the customers. In fact, positioning has been expressed as an aspect that changes the minds of the customer. Positioning strategy may comprise various things such as an analysis of what the competitors are doing, what customers are seeking, and the competitive advantage, all integrated together.

Some other literature has concentrated on the exploration of customer choices and behaviors which are important to devising an effective marketing strategy. These include an exploration of who is buying, why (forces affecting buying) and how (buying stages) (Lilien & Kotler, 1983). This may enable the company to use its “industrial-marketing” utilities well (p. 31).

Product strategy focuses on organizing the various factors of the product (psychological, symbolic and physical) to create value to the customer (Kuan, 2006). According to Frazier (1999), there are various divisions of the “product”, including augmented, branded and core products. Characteristics such as the image, style and packaging are included in the branded category. Product benefits such as warranty, recall, and liabilities are included in the augmented category while the core product category includes the basic use and benefits of the products. A product should be designed to owe customers through the variety of benefits it presents in all these categories.

Low pricing strategy is implemented by companies to compensate for a product utility in the market (Kuan, 2006). In addition, pricing strategy becomes useful for a firm’s survival, growing the sales, competing, improving image and quality, as well as seeking to increase profits (Kotler & Armstrong, 2001). Companies can use a low-pricing strategy in the initial stages of entry into the market in order to penetrate markets more quickly and much inner (Kuan, 2006). In addition, at the initial stage, a company can win more market share and more buyers through a lower price strategy. Place strategy dwells on the “pull” and “push” strategies.

The “push” strategy is where the promotion practices by the sales force are used to create and promote demand for the commodity. In this case, each of the sales chain components, namely the producer, wholesaler and retailer is used to promote products to the subsequent component online up to the consumer. For the “pull” strategy, the company promotes demand through spending highly on consumer promotion and advertising (Kuan, 2006). The ordering begins with the customer all the way up to the producers (Kotler, 2006).

Evaluation of Marketing Strategies for ING DIRECT Bank

ING DIRECT Bank is based in Australia and is a constituent of the ING Group. The company has gained important marketing benefits such as high satisfaction levels for its customers. In addition, it became as one of the five largest retailers in the banking industry in the year 1999.

The bank has chosen to avoid direct competing with other players in the industry in the local market by selecting viable product niches. The company has concentrated on developing its product strategy to increase sales, through limiting its product range. The company has postulated that it aims at developing simple products which are preferable to customers. As discussed in the literature review, the company has therefore chosen its segments based on the simplicity of products and what the requirements of the customers are. The company then seeks to deliver the requirements of this segment or target customers. Thus, it can be said that the company has selected a given customer target (employing targeting strategy) in relation to the customer needs.

The company understands that complicated products are less preferable to customers and thus avoids the segments requiring these products. This means that the company has concentrated on developing what the Australian customer wants and what is demanded in a crowded market (Kotler, Brown, Burton, Deans, & Armstrong, 2010). It has devised less terms for its products such as the elimination of maximum and minimum value on deposits. Concentration in simple products which are less competitive in the market has made them avoid some products such as credit cards. The company has therefore considered the power of its competitors in developing its marketing strategies. Through product differentiation, the company aims to specialize in providing specific products to a specific segment in the market, as discussed in the literature.

The company seems to have developed this differentiation strategy after selecting the segment. Product differentiation is tailored by consideration of a variety of factors, such as the characteristics of the customers (what the customer wants) and the market demands. Product promotion through the call center is taken care of by developing employees well to deliver proper customer satisfaction. There is no location of the call centers to the offshore, but the company seeks to deliver high value for customer contact. The company hires employees in consideration of what it wants to deliver to its customers. This includes looking for simple and straight forward employees. Employee rewards are also tied to performance towards customer service (Kotler, Brown, Burton, Deans, & Armstrong, 2010).

The bank has also linked its marketing strategy with internal resources such as its employees. As postulated in the literature review, marketing strategies would help a company to manage relationships with customers, suppliers as well as its human resources. As such, the company uses its employees to deliver excellent customer satisfaction through its call centers since it does not have branches.

Alternative marketing strategies for ING DIRECT Bank: Advantages and Disadvantages

As can be learnt from the case study and the literature review, there are a variety of marketing strategies that are available for ING Direct Bank. The company appears to have concentrated on product range development as the strategy, to deliver what the market segment requires. Product development (which can also be used to deliver customer satisfaction according to Gale and Chapman, 1994) has worked well for the company, but there is need to extend in other fields such as place, promotion and pricing. The company does not appear to have fully developed its marketing mix strategies. A pricing strategy can help the company win more markets in competitive segments such as credit cards. As discussed in the literature review, companies develop pricing strategies to enter new markets and win more market share and more buyers. By developing a lower pricing strategy, the company can develop competence in the credit card markets and other areas/products in markets that are highly competitive. This strategy can help the company enter these new markets.

A lower pricing strategy would have the disadvantage of the likelihood of lowering company profits. New market segments will enable the company to push its profits high since it gains more customers. Place strategy would help the company focus on promoting the current products to the consumer as would the promotional strategy. This would carry the advantage of winning more customers in less competitive places. However, expanding markets through place strategies would mean that the company is prone to other challenges in the international markets away from home, which may negatively affect its sales (for instance negative customer cultures). Product positioning involves communicating the company’s value proposition to customers after selecting the segment. This strategy would help ING DIRECT to communicate its current value to the target customers. The company needs to adopt a variety of these marketing strategies to win more customers. This presents the challenge to manage customer relationships in more segments or widened markets, which requires more investment in capital and human resource or labor.

Recommendations for adoption and the expected Outcomes

ING DIRECT should expand to other strategies such as expanded marketing mix. This is because it has not exploited the various components of the marketing mix. As established in the literature review, positioning begins with the company analyzing the environments, competitors and fusing them with the current customer needs. It would be expected that positioning will help the company popularize its value and products by communicating them to the customers. This may result to increased sales. In addition, positioning would help the company to ease management of its customer relationships.

Devising the pricing strategy requires the ING DIRECT Bank to carry out a market research to determine what price competitors are offering for variety of products and then come up with reduced prices for the various products. Lower prices are expected to help the company win more customers in competitive segments such as credit card markets. Product promotion and place also requires market research to identify the areas of less competition for the various products. Market research can also help the company identify and understand customer purchase behaviors towards new products and in the new segments, which is an important factor to product promotion (Perner, 2010; Stallworth, n.d.). The company would also identify customer wants and preferences through market research and come up with appropriate promotion strategies. Proper branding can also help the company improve brand loyalty, which may render positive benefits through repeated product purchases, product preference and customer commitment (Oliver, ; cited in Sorce, 2002).


Various companies in the market are employing a variety of strategies available rather than employing only one. Literature supports the fact that there are various strategies available for adoption by companies to improve sales and performance, including targeting, differentiation and segmentation. In addition, a marketing mix can be utilized to manage marketing. ING DIRECT Bank was explored as a case study, and it was found that the company is exploiting part of the marketing mix by limiting its product range (product strategy). The company has also selected a particular target market and segment and seeks to provide products tailored for the specific market or by narrowing to provide particular products. This strategy has worked well for the company in a highly competitive environment. However, there is a need to expand in other areas such as place, promotion and pricing strategies.


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