Introduction
Retail banking is a modern form of banking where by banks carry out transaction without having to use other intermediaries such as corporations and other banks. The elimination of such middle men is considered to be a strategy that will minimize on the general costs and also enhance the relationships that the bank has with its clients. Some of the services that can be provided through this type of services include mortgages, savings, credit cards, checking accounts, debit cards and personal loans, Stern, (2006, 130). Most banks have adopted this banking system considering the positive responses from the earlier banks that have achieved great results.
The royal bank of Scotland is one of the best performing banks in the world which has continued to attract clients all over. It is credited for new strategies that it is always employing to ensure that it is at par with the changes in banking technology (Chizek, 1991). The BNP is also another bank that has recently succeeded in its retail banking business.
Retail banking strategies
The royal banks of Scotland and the BNP Paribas have discovered strategies that have enhanced their business in retail banking. They seem to understand the needs of their customers and therefore provide them with the services that they require. Retail banking may not always work unless the management employs certain kind of strategies that have been tested for practicability, Payne, (1988, 78). This may be done by first identifying how the strategies will be of benefit to the bank and its customers. It will be meaningless for a bank to employ a retail banking strategy that will benefit the consumers but fail to uplift the status of a company and vice versa.
A bank is usually a profit making organization that needs to ensure that there is a reward for the services they provided. This should however not be done at the expense of its clients. What is required is for the bank to strike a balance between the two. This is basically what the royal bank of Scotland and the BNP Paribas are striving at, O’Reilly, (1992, 90). They have identified retail banking strategies that are both profitable to the organization and their clients.
We are going to look at the strategic measures that are being employed by this bank and see how they are beneficial both to the company and its clients (Brassington, 2006). The first consideration that the banks have put in place is to establish a strong organic revenue growth. The banks ensure that all their activities revolve around improving the revenue of both their clients and the organization. They are mainly to ensure that as they grow, their clients are also growing with them.
This is usually done by not only offering them loan facilities but ensuring that they provide them with financial advice on how to use the loan. Whenever a client comes to them for loan, they seek to find out why they need it, to give them the necessary advice which has always enabled them to keep coming for more services and hence promoting their growth, Lange (2007, 133). Another strategy that is employed by these banks is to improve the loyalty of their customers. Various strategies are employed to attract and maintain the customers that are received by the banks. The other strategies employed include growing the share that they have in the banking market as well as their share in the general market and finally to improving on their productivity.
Retail Banking Activities
To ensure that such targets are fulfilled and met, the banks realize that they have to be engaged in certain activities that will facilitate their best performances. Some of these activities are to improve the infrastructure (Essvale Corporation Limited, 2007). There is a need for them to ensure that the transport and communication network to and from their business premises is in good standards.
The banks also hold onto their culture of performance by ensuring that their activities are not hindered by improper performance of their employees. They engage in motivational activities that will ensure that their employees perform according to the requirements of the company. Sales promotion is a regular activity that the banks are involved in. even though they enjoy a great deal of customers, they have never ceased to engage in activities that are meant to promote their products and also inform their clients of the services that have been introduced by them. Sales promotion is also done to enhance the relationships that they have with their clients. By meeting them directly in the field, they can know their preferences (Robles, 2003). All this activities are centred on improving the productivity of the company and at the same time improving the status of their clients who are a representative of the whole society.
Customer Satisfaction
Customer satisfaction is an issue that can not be ignored by any organization that aspires to attract and maintain its clients. This is therefore something that the two banks have taken into consideration by improving their services to suit the changing needs of their customers. Even the banks were established some years back, their customers are enjoying modern facilities that the banks are quick to adjust to (Singer, 2001). The banks are always on the look out for the new technologies that are being invented and subsequently employing them.
To adequately satisfy the needs of their clients, the company has suggestion boxes where they allow their customers to leave their comments on how they look at the services that are being provided to them. They have also extended their banking services on the internet where they can also get connected to their international clients (Data monitor, 2004). There is a place on their websites where their clients can post their comments on what the banks can do to improve their services. The comments and suggestions received from their clients have been of great help in ensuring that they provide them with services that are satisfactory to them.
Investments in the field of technology may prove to be costly at their establishment, yet convenient to the clients. These are some of the sacrifices the royal banks of Scotland and the PNB Paribas have had to make. They do not consider the expenses that will be involved in such establishment but the profits they will earn as many customers plunge in to enjoy such services (Roth, 1992). They consider such a development as a risk that is worth taking. This has subsequently made them soar higher in the field of technology compare to the other banks. They understood the need of personally reach out to their customers and provide them with services that will improve their lives.
To ensure that the customers are satisfied with the services that they provide, the banks are usually involved in regular training of their employees (Doscher, 1996). They consider them as the people that are frequently associating with them and thus giving them the skills that will enable them improve their services. They are given training on how they can handle the different situations and circumstances that may come their way.
They are also told to monitor and observe how their customers react to the different services that are provided by the bank (Violano, 1992). This is usually to know whether they are on the right track to customer satisfaction. Any negative remark that they may observe from a single client is not taken for granted, the bank will launch investigations unto the issue and ensure that it does not recur. There are also a number of customer care units where the customers can seek assistance on various issues. Customers can always make enquiries concerning the different services that are being provided by the bank and those that apply to them (McDonald, 2002).
The banks are also having twenty four, seven open telephone lines where their customers can call in to make enquiries. Some dedicated employees have been assigned to handle the work in shifts and thus allowing the customers to personally talk to them. Their phone lines are always under a technical operator who ensures that there is no communications break down.
Customer Loyalty
Having loyal customers is one of the best things that can happen to any business organization. These are customers that the company can rely on when they want to make some changes in the services that they are provided. Customer loyalty is something that is developed over a period of time which has to be cultivated through the provision of satisfactory services. Loyal customers are probably one of the treasures that the royal bank of Scotland and the BNP Paribas are enjoying. Customers that they have had for long have enabled them to get more customers (Wonglimpiyarat, 2005). This is basically because of the good report that they send to their friends and relatives and subsequently encourage them to be part of the bank.
In developing loyalty with their customers, the banks engage in different activities that generally strengthen their relationship. Some of such events are promotions where by their clients participate and win a number of goodies (Essex, 2001). There are also certain kinds of merchandise that the banks may give freely to their customers that have either been in the bank for a considerable number of years and those that increase on their bank savings. This is usually done to make their customers feel recognized and appreciated.
There are also different kinds of accounts that have been introduced in the banks to ensure that every member of the society is represen6teed.for instance, parents may be given bonuses if they open accounts for their children in the bank. This is done to ensure that even as the children grow up, they will recognize the bank and probably remain with it for the years to come (Shin, 2005). The banks also ensure that their customers are always attracted to the good services that they are always providing. Loyal customers are also provided with certain kind of bonuses for their savings, this is done to encourage the others that have just joined to maintain their loyalty with the customers.
Whenever the banks want to engage in an activity that involves their clients, they will consult their loyal customers to find out whether the deal is practical or not (Buckle, 2004). Loyal customers became the trusted contact the banks will reach out to whenever they need to make changes that will directly affect their customers.
Conclusion
The royal bank of Scotland and the BNP Paribas are the best example of banks that have succeeded in retail banking. They may be employing similar strategies as the other banks are doing but they have a unique way of implementing them. The banks do not employ strategies before they test them for practicability (Elsevier, 1996). They are engaged in field research where by they consider the needs of the people and thus give them exactly what they desire. The banks consider employees as an important asset that they have and thus do all in their capability to ensure that their needs are adequately met.
The banks have been credited for the advances that they are always making in the field of technology. Their service shave been expanded to the international world by not only through electronic banking, but also establishing physical branches there (Murinde, 2003). The banks have purposed to continually engage in activities that will ensure that they remain at the top in terms of growth and meeting the needs of their clients. The dedicated spirit of hard work and commitment that is employed by this banks can also be adapted by other banks that desire to succeed in retail banking.
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