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B8609-001
Marketing of Financial Services
Spring 2016, A term
Professor Seshadri
Professor:
Raj Seshadri
[email protected]
Classes:
URI 140, 12:30 – 2:00 pm on Mondays and Wednesdays
Wed Jan 27 – Wed. Mar 2 (both inclusive), and Fri Jan 29
First class is Mandatory.
Office Hours:
After class
Class structure: Approximate schedule, may vary:
12:30-12:45 – Announcements and discussion of what we learned last time
12:45-2:00 pm - Content/case for today’s topic or Guest speaker
TA
Brian Biggins
COURSE DESCRIPTION
Marketing of financial services is unique in its incredible diversity, strict regulatory
requirements and unique challenges, even though many of the foundations of marketing in
financial services are similar to marketing in other industries.
Marketing and strategy are intimately linked in financial services, as marketing insights drive
strategy and strategic aspirations drive marketing. Marketing of financial services can be
Business-to-Business or Business-to-Consumer, and in many cases it is both. Marketing
often differs in an important way from other financial services functions, in that it is both
quantitative and qualitative – it is both creative and analytical.
The financial services sector is the set of industries that provide financial products and
services to consumers and businesses. Examples include credit cards, payments, merchant
services, retail banking deposits and lending, insurance, brokerage, asset management, wealth
management, hedge funds etc.
Marketing broadly is about developing intelligence and insights about customers,
competitors, and the business environment, and then using these to shape the business which
includes driving sales, profits, and perception. The overarching goal is to serve customer
needs profitably and differentiated from competition.
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Marketing is a very critical area that drives differentiation and distinctiveness in financial
services. Understanding and leveraging customer preferences, perceptions and behavior is of
key importance. Segmentation is critical. The availability of information provides for
sophistication, yet execution often requires simplicity. Strategic marketing plays an important
role during all stages from value proposition development to identifying sources of
competitive advantage. Product development, targeting, position and management as well as
pricing also involve a regulatory dimension. Translating all this into tactics requires crisp
messaging across a wide array of channels including traditional advertising, digital
marketing, direct marketing, promotions, collateral, event marketing, product marketing,
communications, and media relations.
The importance of reputation, particularly since the financial crises and through this
economic cycle, makes managing the customer experience and interactions across all sales
and service touch points an important element. The role of a brand – its relevance, ability to
drive differentiation and loyalty - is different from more traditional consumer businesses.
And ability to think globally together with understanding of local differences often matters,
as does managing through mergers and acquisitions, given the period of industry
consolidation.
This class will focus on a combination of interactive case studies, dialog on specific articles,
and conversations with guest speakers who work in this area. Students will improve their
ability and knowledge of marketing in this sector, and learn about careers in financial
services.
Students will be assessed based on (1) Case participation and preparedness – with a focus on
conduct and quality; (2) A written report and class presentation on a project (on the last day
of class) that critically assesses all the facets of marketing for a specific financial institution.
B6601 - the first part of the two-part core marketing sequence - is a prerequisite for this
course.
Course Objectives:
The main objectives of this course are to improve your ability to:
1. Assess strategic opportunities in financial services sector by analyzing customers,
competitors and the strengths and weaknesses of a company.
2. Design, communicate and defend effective marketing strategies to maximize a
company’s chance of success in the markets in which it competes.
3. Understand potential career paths in financial services.
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COURSE MATERIAL
Required Reading
The key resources for the course are B8699-001 Readings and Case Packet. Any readings
added during the term will be communicated to you in class.
STUDENT EVALUATION
Case Participation & Preparedness
Engagement with Guests in Class
35%
35%
Type B
Type B
Group Assignment
30%
Type A
These align to the assignment types delineated by the University
Type
Designation
A
group / group
B
group /
individual
C
individual /
None of any kind
Individual
individual
An optional category to be defined in detail by the individual faculty member
D
Discussion of
concepts
Permitted with
designated group
Permitted
Preparation of
submission
By the group
Individually (No
sharing of
any portion of
the submission)
Individually
Grade
Same grade for each
member of the group
Individual
The school laptop policy will be observed: laptops, cell phones, tablets, and any other wireless
devices are prohibited. Please print out whatever you need and bring it to class in order to
facilitate discussion.
You are expected to conform to the norms of behavior outlined in the Columbia Business
School Integrity Code. Any allegation of academic dishonesty will be forwarded to the Office
of Student Affairs for investigation. Any case of proven academic dishonesty will result in
failure of the course.
(1) Case Participation & Preparedness
A portion of class time will be devoted to analyzing assigned cases. The case method is one of
the most effective means of sharpening your decision-making abilities. A case discussion
requires that you be an active participant. The discussion format provides an opportunity to
argue for your position and to learn from others by listening to their comments, analysis, and
criticism.
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You will learn the most from the cases if you and your classmates prepare and participate fully.
For that reason, your class participation / class preparedness grade will be based on:

Attending class and being on time.

Being prepared for class which will be necessary to participation.

Participating in class. This is the most important element and will be based on your
conduct in class and the frequency of quality comments. Sheer quantity is neither sufficient
nor necessarily desirable. Quality comments that are rare are not sufficient either.
Participation should productively move the dialog forward. Criteria include:
 Comments that add to our understanding of a case or situation.
 Comments supported with robust qualitative and/or quantitative reasoning
 Comments that take into account the comments of your classmates and are
relevant to the topic under discussion.
(2) Engagement with Guest Speakers
This class will give you exposure to successful professionals in financial services marketing.
They will speak about what they do, cases they have worked on and their career paths. Note the sequence of speakers will not always align to the sequence of class topics as the scheduling
of speakers is based on their calendar and availability.
You will be assessed on how you capitalize on this opportunity in the classroom. Always
remember that these are our Guests at Columbia and your conduct will shape their impression of
our school. Thoughtful listening, comments and questions supported by logical reasoning, and
participation that enables the whole class to get as much as possible from the Guest are key
areas of focus and assessment
(3) Group Assignment
The assignment is to be done in groups of 4 to 6 students.
For this assignment your group will select a financial services firm. The assignment should
include a description of the firm, the market it operates in and the core tenants of its strategy.
The assignment should then critically assess the company’s marketing efforts and their link to
the company’s strategy across as many dimension of marketing as are applicable. Constructive
observations on what they do well and what they could to better/differently will be expected.
You can communicate your preferences for being in a group together, but we reserve the right to
intervene and reassign you to balance all the groups out. Any group preferences need to be
communicated to us by end of class on Wed Feb 10. Final groups will be communicated to
everyone by Mon Feb 15. Once these groups are communicated no further changes to group
composition will be made.
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A one page written summary of the company and topics your group has chosen is due in class
on Mon Feb 22. Presentations will take place during class on Wed Feb 24 and Wed Mar 2.
The final written assignment is due by end of day on Mon Mar 7. It should not exceed 6 pages
of text and can also include up to 3 pages of exhibits. All assignments should be typewritten in
12-point font, double-spaced, with one-inch margins. No late submissions will be accepted.
Tentative Schedule (subject to change):
Regular class time is MW 12:30-2 pm - but not GSB schedule has a class on Fri Jan 29
Class
Topic
Wed
Jan 27
Introduction
Fri
Jan 29
Centering on the
Customer
Mon
Feb 1
Financial Services
Advertising
Wed
Feb 3
Marketing
Consumer Credit
Mon
Feb 8
Marketing in
Retail Banking
Required reading

Reading – Chapter 3, Marketing Financial Services by
Hooman Estelami


Case – Schwab & Co., Inc: The “Talk to Chuck” Advertising
Campaign
Reading – The Customer Has Escaped, HBR 2003

Guest Speaker

Guest Speaker
Submit group preferences

Guest Speaker
Case – Merrill Lynch: Integrated Choice
Reading – Chapter 8: The Discrete Charms of the CMA,
Joseph Nocera, A Piece of the Action
 Reading – A Logo is Not a Brand, HBR 2011
Groups defined


Wed
Feb 10
Segmentation,
Product, & Pricing
Mon
Feb 15
Group time

Class does not meet. Groups meet for working sessions.
Wed
Feb 17
The Impact of
Technology on
Marketers

Guest Speaker
Case – Citigroup: Re-Branding in 2007 (A)
 Reading – See Your Brands Through Your Customers Eyes,
HBR 2001
Group summary due

Mon
Feb 22
Branding in
Banking
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
Case – Customer Profitability and Customer Relationship
Management at RBC Financial Group (Abridged)
Reading – Why Fusing Company Identities Can Add Value,
HBR 2011
Reading – The Quest for Customer Focus, HBR 2005
Guest Speaker

Wed
Feb 24
Customer
Profitability: Data
and Analytics

Mon
Feb 29
Marketing of
Hedge Funds

Wed
Mar 2
Groups
Group Presentations
Monday Mar 7
Final Group Written Assignment Due
Recommended books (chapters above are required reading, others in the books are optional):

Marketing Financial Services by Hooman Estelami

A Piece of the Action by Joseph Nocera
Additional class (pending time availability):
Digital innovation: Man vs. Machine




Case – The Vanguard Group in 2015: Celebrating 40
Reading – The Virtual Financial Advisor: Delivering Personalized Advice in the Digital Age,
McKinsey, 2015
Reading – Hungry Robo-Advisors Are Eyeing Wealth Management Assets, Morningstar
2015
Reading – DOL Proposes Rule to address conflicts of interest in retirement advice,
www.dol.gov/protectyoursavings/FactSheet COI
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