All business firms are conscious of the requirements of the customers and they always consider meeting the customers’ requirements. Then only they can make maximum earnings from their business. The marketing manager aims to identify the current trends in sales in the field of marketing by analyzing the current market situations. The successful and useful way of marketing always adds value to their business. Bank of America is a famous financial group that provides all kinds of financial support to clients. They offer financial support to various small and medium enterprises. High-quality employees of Bank of America help the customers by clarifying their doubts regarding assets, investments, etc. They also provide various solutions to avoid risks in their business
Environmental analysis
Environmental analysis means the identification of all external factors which affect the performance of a business organization.
The services of Bank of America include “Asset –Based Finance, Asset management, Card solutions, Debt and liquid products, Electronic Trading Services, Foreign Exchange, Investment solutions, Equities, Futures, Endorsed programs, Leasing, NYSE specialist firms, Private Equity Investments, Research, Trade services, Treasury Management Services, Merchant Services, Mergers& Acquisitions Advisory, etc.” (Products & Services).
Currently, Bank of America provides services to millions of customers around the world. The ATM of this bank is suitable for the easy transaction of money. Online banking is another service offered by this bank. Safe pass is a free security service used for online banking. The privacy policy of the Bank offers securities to their clients. The employees of the bank are responsible to keep the customers’ details secret. Through email also the bank provides clarification to the customers’ doubts.
There are variously internal and external factors that affect the performance of an organization. But the external forces are considered as major environmental factors which affect the concert of Bank of America. Both macro and micro environmental factors are considered external factors. The macro-environmental factors include regulatory, economic, socio-culture and technological factors. Competitors, consumer trends, and market trends are considered as the major micro environmental factors which affect Bank of America.
The effect of socio-culture plays an important role in business. Globalization is the main factor that influences the services of Bank of America. Globalization helps an organization to expand its business worldwide. Another advantage of globalization is to make partnerships with other countries like Europe, Asia, etc. which help them increase their revenue and resources to great extent. Online banking is a service that comes through globalization. Through online banking, customers can make their transactions very easily and effectively.
Environmental scanning helps to identify the changes that are occurring in an organization. By analyzing these collected results Bank of America tries to make different strategies for its better performance and adopt various methods for reducing risks. Environmental scanning helps organizations to identify the external factors which affect positively and negatively to achieve their objectives and it also gives an idea about their partners. By doing environmental scanning they can identify the current business positions and to what extent they achieve their objectives. It also helps identify their competitors. Through environmental scanning Bank of America is identifying their competitors like Citigroup Inc and its performance. Environmental scanning also gives an idea about their own performance.
Industry Information
Bank of America provides various financial services and solutions to customers. They offer various online services to the clients, which helps easy transaction of their investments. It includes provisions for checking customers’ balances through online services. Bank of America facilitates various openings for the clients to achieve their targets.
Bank of America gives suitable services to business and individual clients. Therefore, it became the best in the financial sector. In order to make consistency in its business activities, Bank of America always gives preference to the needs of the clients. The financial observers can predict the future performance of Bank of America. The prediction of its future performance points out several risks. Sometimes there are lots of differences when we compare actual value to the expected value. To improve its business activities Bank of America tried to eliminate additional members in their business.
The authorities of Bank of America mainly focus to increases their asset up to $680 billion in the future. To achieve that target they introduced several technologies and products in the market. They not only introduced new techniques to improve their asset but they also give more care to the customers’ demands. Various new technologies like videoconferencing are introduced to create new accounts in the bank. This is really helpful in our busy life. Bank of America also gives high importance to the opinion of the employees, and in the future Bank of America is planning a partnership business with some small business firms which will help them to raise their value to a higher level.
The entry barrier of an industry is always helpful to block the entrance of other similar industries. This will help to maintain the organization’s revenue at a steady state. Entry barriers are beneficial to those firms who have already got a steady place in the market. But it is difficult for those firms who want to take an entry into the global market. Different existing investment policies of the government, management of assets, customers fidelity, etc are considered as major entry barriers. Also in a business, several factors affect a firm when they want to leave the market. All these factors are together known as exit barriers. If a firm in a market realizes that its business is going to be a failure, then it wants to quit the current market. But, several barriers arise when it wants to exit from the market. That is the regular customers, financial partners, etc act as exit barriers.
Porter’s “Five Forces” model is used to identify the causes of competition in the banking sector and by analyzing all these causes they find solutions to produce maximum quality services to their customers. The five factors which will impact the performance of the organizations are “customers, substitutions, suppliers, new competition and existing competitions.” (Evans 10).
To get benefit from the global investment market the role of Porter’s “five force model” is important. In the banking sector, consumers can have the right to explain their needs, and if their needs are not satisfied it will affect the overall performance of the organization. Suppliers and substitutions are the other factors that impact the performance of Bank of America. Suppliers can have the power to decide some of the policies and related offers regarding the investments which help an organization to improve its business to some extent.
Substitutions mean the emergence of similar firms, which will seriously affect the performance of the firm. Substitutions are the competitors of Bank of America. If the competitors of Bank of America start a suitable investment plan the customers are ready to accept it. This affects the performance of Bank of America. The emergence of new competitors in the investment market is also considered an important factor that influences the performance of Bank of America.
Competitor Analysis
The major competitors of Bank of America are” Citigroup Inc, JPMorgan Chase &Co, Wells Fargo& Company.” (Bank of America Corporation: Competition para 3).
To survive a business in a global market, it is necessary that always give great care to the needs of the customers. If the customers analyze the product and if it is the right one to meet their requirements, they start to buy that product. Then the sale of the particular product increases and profit also increases. Effective marketing and successful planning of the business always play a key role in the success of every organization.
Citigroup Inc
This is one of the major competitors of Bank of America. It is one of the highest financial enterprises in New York. Its main services are similar to the services of Bank of America. It provides various financial solutions to the customers. Because of its high-quality customer service, it also has billions of customer accounts. Citigroup Inc has several branches all over the world. It offers various loan facilities at low interest. This policy is attracting several customers and they became the clients of Citigroup Inc. Also, it offers various security services to the customers.
JPMorgan Chase & Co
This is also one of the leading financial organizations in the USA and a well-known competitor of Bank of America. Similar to Citigroup Inc and Bank of America, it also has several branches all over the world. It acts as the global finance lender and it also serves as the issuer of the credit card. The services of JPMorgan Chase & Co mainly give preference in the field of investment banking. It has high-quality employees for suitably managing its assets, which helps increase its profit and also it helps make a consistent position in the global market. But above all, it is always aware of the requirements of the customers, then only it can maintain its position in the financial market.
Wells Fargo& Company
It is considered the leading financial competitor of Bank of America, situated in San Francisco. Similar to the above two firms it also has several branches which offer various solutions to the financial problems of the customers. It also adopts a customer-friendly approach which makes it a top competitor of Bank of America. It has top-quality employees for managing clients’ investments. Capital investment is another service of the organization. It is one of the main financial servers of the US. It also provides online banking facilities and mutual funds to the customers which made them a major competitor of Bank of America.
Corporate Mission
If a financial organization is able to maintain its customers, then it is the main advertisement to attract new customers without paying an additional cost for advertisement purposes.
The mission of Bank of America is as follows.
- “Serve low- and moderate-income individuals and families.
- Improve underserved low- and moderate-income communities.
- Create sustainable practices for the long haul.” (Community Development: Community Impact para 2).
Value orientation plays a key role in the development of an organization. To run their activities in a competitive way the authorities of Bank of America planned to include some brilliant employees in the banking field to make their work faster and in a positive way. The small and medium-sized business firms are in partnership with Bank of America in different ways. The different types of partnerships affect a lot in the performance of the whole business. Similarly, the global economic changes that are occurring in large enterprises may also influence the working of small and medium-sized enterprises. They are also considering how these business firms respond to value orientation. Using the concept of value orientation Bank of America is trying to introduce a new model of business among small enterprises without considering market-oriented finance.
General marketing strategy
Marketing strategy is the different kinds of action plans that are put forward by a company so as to promote its products and to create awareness of the product and aim for maximum profitability and to be a success in the market. Marketing strategy is a long-term plan.
Bank of America makes use of the social network. Networking as the product promotion technique is the kind of technique where it makes the common people participate in the social networking and has the liberty of presenting the ideas, stories or the sharing of the information, it is optional for that the members to be the customer of the bank. It also has a mentorship policy where it has the quality transfer of the information and the product.
An advertisement is a promotion tool; advertisement in the print media, internet, and web marketing is given much importance. Web marketing focuses mainly on giving information than on getting it. It concentrates more on online marketing strategy. It makes use of search engine marketing (SEM) and search engine optimizing (SEO) as these tools have now become the choice for acquiring the technique from the search engines.
Bank of America is much focused on the customers. It provides 100% commitments to the customers; hence it is known as the bank of opportunity. This is the result of its high reputation.
The product and the services offered by Bank of America are:
- Business checking.
- Business check cards.
- Business savings.
- Online Banking.
- Treasury management.
- Merchant services.
- Business cards(debit/credit).
- Maintenance services.
The leading products, services, and product diversion is the strategy of the bank for its wide mode of operation. It has a presence in 5,000 locations and 35 ATMs, it is also much close to the nationalized banks and it has the ability to lend in 20 other locations in the form of loans, mortgages, home loans and equity. It has the aim of diversification of the workforce. Bank of America acquired MBNA, the world’s largest credit card manufacturer, after acquiring them they became the major producer of credit cards.
The competitor’s point of view considers the demand for the products. Increased demand from the customers depends on the efficiency and effectiveness in marketing and in the good functioning of the system.
The Mission Statement
“We believe, very simply, that it is the actions of individuals working together that build strong communities, and that business has an obligation to support those actions in the communities it serves.” (Lewis para 5).
The banking industry is a much competition-oriented industry; its success of can be achieved only through opportunity, innovation, and service to the customers. Bank of America has a separate division for its research and development with the objective of increased profitability and productivity.
The market research
Research is an integral part of any organization; the research constitutes the different areas of the primary research to be focused on. The different research should be properly seen – whether it is the internal research or external which may interact with the other organization. In Bank of America, there is a separate department for innovation and development which analyses the different upcoming trends and the needs and how they may be useful to the customers and the organization. Bank of America has turned its branches into service development laboratories, as the I&D department finds it very difficult to conduct the research in the confined space provided to it.
It also has redesigned the different centers with the most modern techniques available for the better transaction facility of the customers. Intense research is conducted for the development of the product for which different methods are implemented. There are transaction zone media that may be useful in the innovation process. It also incorporated different steps for the implementation process. Market research is very useful in knowing the current situations and the stand of the company in the market. It also helps in the identification of the problems of the company and in knowing the emerging trends. It helps the organization to grow much better in productivity, profitability, accuracy, financial forecasting, etc.
There are different steps in market research; they are the identification of the problem, determining the research design, collection of information, sample testing, analysis and interpretation, and the final report generation. Market research consists of different types; they are exploratory research, descriptive research and casual research. The exploratory research consists of exploring the different kinds of concepts, gatherings, insights, manipulation, case studies, and hypothesis formation. They may be different case studies including the present kind of the situation; they can be different contrasting situations. The descriptive research consists of describing them in the longitudinal and the cross-section analyses. This includes the time involved in the system and how the different kinds of results are obtained. Casual research consists of the casual method of talking to people and enquiring about problems.
Competitor Analysis
Competitor analysis plays an important role in the business. It has its origin from the market research; it may also depend on the analysis done on the organization, it is the analytical kind of research useful in knowing the company, its performance, and the level of the market share. It has a keen analysis of the competitors’ products and their stand in the market. It makes use of the key strategy and how they make use of the different kinds of action plans and how they implement them. The competitor analysis also consists of the customers, suppliers, competitors which are the threat that is faced by the organization. The analysis of different kinds of players in the market gives a clear idea of the competitors’ strategy. This may also consider the different kinds of strengths and the weakness identification of the competitor.
Market Segmentation
Despite the recession and lay-off problems, Bank of America is the second-largest bank in America. Market segmentation of the company is considered to be good. There are different kinds of uses and the need of the customer is found out. There is a long-term commitment to the customers. They have many branches and where they concentrate on marketing investment. This sector gets equal treatment from the customers and they lack in the competition related to the customers, they face a lot of internal and external challenges, they have the criteria like the low-cost transaction and major banking applications to be considered.
The bank concentrates on increasing the market segmentation by exhibiting the presence in different modes of operation, previously the bank was indulging in treasury application and mortgages just with the motive of profit and sustainability in the market. The bank sanctions credit to the 20 nearby countries.
The bank has mass-market segmentation, with the markets with less profit and the people with fewer investment prospects. With technology invasion of a different kind they have a lot of upcoming trends in the banking sector, like the automated teller instead of the teller of the bank, the relationship banking they maintain the accounts and the service of the other clients despite the distance by the relationship marketing. The innovations create an immediate parity between the exact work and the working with the duplication with the emerging offering with cost-effectiveness and reduced time. They care much for customer values and customer satisfaction.
Product analysis and strategy
Bank of America is the largest financial institution with a large number of retail branches, with more ATMs and the other functionality of the individual customers, small business group, credit analysis, risk management, mortgage loans, wealth management, etc. The positioning of the bank is important where they have much more product diversification. Internet is the major tool that promotes the company and it helps in getting a large market with the financial product innovation and the promotion of them.
The place of the bank should be understood well in advance as to where, when, which to sell depending on the geographic segmentation and keeping in mind the financial constraints. The bank should be able to drive different kinds of products, the negotiation among them in order to get the maximum value of the products in terms of product efficiency and productivity. They should have a separate policy to analyze the strengths and the opportunities and how they can position the product and how the changing needs of the customer are to be met.
The product design is done by the I & D department by research, analysis, and the design of the banking services that are helpful for the product development and for the success of the business. They are committed to the service, they offer high-quality customer service. They also concentrate on the products that are related to the small business groups or individuals that are useful for satisfying the needs of the people. they are much customer-centric they provide betters services to the customers for business continuity.
Financial and strategic analysis
Bank of America is the largest financial institution that provides a large number of services and the financial and strategic analysis help them to identify the strengths, weakness, opportunity and threats; it helps to have a better idea on the business intelligence and the continuity factors, financial forecasting, budgeting, potential investors and the achievable results. The analysis of the financial ratios helps to know the liquidity, leverage and net operating ratios.
Portfolio analysis
The business portfolio analysis of the company is the vital source of identification of the strengths and the upcoming opportunity of the organization. The portfolio consists of the identification of the business and putting forward the strategic plans for decision making and acquiring profit. Portfolio analysis can be down by the two matrixes they are the BCG matrix and the GE matrix.
Portfolio comparison with the BCG matrix
The portfolio matrix comparison gives Bank of America and its market a very high place in the evaluation, they form in the category of stars which is having a high market share and which is attractive for the other competitors in the market. They also have products that also form different kinds of products that are not attractive to the market and they may have different challenges to be faced.
Promotion strategy
The promotion strategy of Bank of America includes conducting different programs. Public relations is given a very important role. It helps in conducting the sponsored programs by them as they give the relationship among the company to the others in an effective manner. They project the sales potential. The positioning of the product is the main method of promotion as it may build an image among the people. The establishment of small business groups where the people have the liberty of writing articles, conducting interviews, or conveying any other information.
Channels of distribution
Any product in the market has to undergo different channels of distribution to reach the ultimate end user. As far as Bank of America is concerned, it uses different electronic channels for its products.
The different kinds of distribution channels are telephonic banking, internet banking, and pc banking. The internet and pc banking are useful when there is time constraint and the effective method of handling many complicated programs within a small-time limit. Telephonic banking helps the customers to have a call back to the bank regarding the doubts and also to have a word of say in the organization.
Conclusion
Bank of America is the topmost one in the country and also the most reputed one in the banking industry. It has its own standards and tactics in marketing segmentation which help in the building up of excellent products and to well flourish in the industry.
Works Cited
Bank of America Corporation: Competition. Hoovers: A D&B Company. 2009. Web.
Community Development: Community Impact: Our Mission. Bank of America. 2009. Web.
Evans, Matt H. Excellence in Finance Management: Course 12: Competitive Intelligence (Part 1of 2). Web.
Lewis, Kenneth D. Remarks to Bank of America Neighborhood Excellence Leadership Program. Bank of America. 2005. Web.
Products & Services. Bank of America, Merrill Lynch. 2009. Web.