Question

QUESTION 1

CAN THE GHANAIAN FINANCIAL SERVICE SECTOR WITHSTAND THE IMPACT OF COVID- 19?

COVID-19 and its impact

The impact of COVID-19 individuals, communities, and organizations is rapidly evolving from a mild and temporary hit to the worst-case scenario, a global financial crisis. While other industries such as the Travel, Transportation, Hospitality, Insurance, Retail, and Telco are severely impacted, it is the resiliency and continuity of the financial services markets that will support Governments and businesses during and post crisis; ensuring liquidity is available. All eyes will be turned to the financial services industry to see if they can respond in a manner that reduces the global economic impact of COVID-19.

The COVID-19 pandemic could be the most serious challenge to financial institutions in nearly a century. As the economic fallout spreads, retail banks find themselves juggling some big priorities that require concrete steps to reposition now while also recalibrating for the future. They are working to keep their distribution channels open, despite social distancing advice and supervisory and compliance functions that were never designed for remote work. They’re trying to manage revenue and customer expectations, despite near-zero interest rates and growing pressure on consumers. And, they need to keep an eye on strategy and brand issues that will define their future, as market forces and customer behaviors potentially change coming out of this crisis.

COVID-19 and the Marketing Environment

While definitions differ, there is consensus that the Marketing Environment is the combination of external and internal factors and forces which affect the company’s ability to establish a relationship and serve its customers. The Marketing Environment includes factors that surround the business and influence its marketing operations. Kotler (2019) posits that these forces remain outside the control of the firm and can upset marketing management ability to build and maintain successful relationships with target customers. Some of these factors are controllable while some are uncontrollable and require business operations to change accordingly. Firms must be well aware of the marketing environment in which they are operating to overcome the negative impacts the environmental factors are imposing on their marketing activities.

Against this background, PwC (2020) conjectures that the COVID-19 pandemic could be the most serious challenge to financial institutions in nearly a century. As the economic fallout spreads, retail banks find themselves juggling some big priorities that require concrete steps to reposition now while also recalibrating for the future. It implies that agile banks will survive by taking concrete steps right now; to support the communities and customers they serve while balancing medium to long term positioning; those that do not adjust may risk not surviving at all. Ghanaian financial institutions are not insulated from this reality.

REQUIRED

Drawing on this background and your knowledge of Marketing of Financial Services:

1. Provide a critical analysis of FIVE (5) Macro Marketing Environmental forces affecting the financial service sector today. The macro-environment refers to all forces that are part of the larger society and affect the micro-environment. They include the demographic environment, political environment, cultural environment, natural environment, technological environment and the economic environment. The purpose of analyzing the macro marketing environment is to understand the environment better and to adapt to the social environment and change through the marketing effort of the financial institutions to achieve the goal of the financial institutions marketing

2. With a critical analysis of the micro environmental forces which are forces close to the company that affects its ability to serve its customers; all those factors that are closely associated with the operations of the business and influences its functioning including suppliers, customers, marketing intermediaries, competitors and publics; discuss the effects of COVID-19 on Five (5) micro environmental forces within the financial service sector in Ghana today .

QUESTION 2

Financial services certainly have their hands full in the light of the novel coronavirus outbreak (COVID-19). Banks must also manage direct impact of COVID-19, put plans in place to protect its employees and customers from its spread. As the two months old newly appointed head of marketing for KANS Ghana Bank ( a local bank) critically discuss Five (5) out of the seven extended marketing mix strategies the bank can undertake in order to achieve medium to long term positioning and gain competitive advantage amidst COVID-19 pandemic. .

Answer 1

5 Macro Marketing environmental forces :

1. Demographic Environment : Demographic information include: age, race, ethnicity, gender, marital status, income, education, and employment. Due to the COVID outbreak majority of the population is forced to remain in quarantine situation hence adversly affect the financial service sector of Ghana.
2. Political environment : If the political environment of Ghana is in favor of financial services industry then it will be very beneficial during current times and vice versa.
3. Technological Environment : Since Ghana is one of the developing economies and needs better access to technology. Advent of technology is greatly beneficial to it's financial services industry as it will enable reach to financial services to people when social distancing norms are the need of the hour.
4. Economic Environment : The present state of the economy may not prove to be beneficial due to the current COVID 19 outbreak. A positive environment is a boon to such industry.
5. Socio-Cultural Environment : The growth of the Ghana economy will greatly depend on the socio-cultual aspects  of its population a positive approach would result in favor of the economy and financial services.

Effects on micro environmental forces :

1. Customers : Reduced borrowing and lending activities due to poor business conditions.
2. Employees : The rate of employment opportunities in financial services industries will go down due COVID 19 outbreak. It may also result in lay-offs and loss of emloyment due to poor business conditions.
3. Investors : Investors are always interested in the survivability and profitability of a concern. Such times would result in a poorer sentiments amongst investors and lower rate of investments.
4. Competition : The level of competition will be affected to the extent of how rivals cope up their business in the current situations.
5. Public : With the current outbreak the level of social distancing and work from home situations the public would prefer not much social interaction and visiting any institutions.

Five extended marketing mix strategies:

1)Promotion : The banks can promote their activties :

• Through internet using social media platforms
• Advertise through phones and newspapers to practice social distancing

2)Price : It would be beneficial to the banks to price their services a little lesser so as to improve the liquidity in the economy and improve their chances of business. Also online services to be provided at competitive rates.

3)People : Towards employees,management etc

• Promotion of work from home schemes .
• Essential infrastructure.
• Situation escalation.

4)Process : Process,how are services consumed? etc

• Target online services as priority.
• Back end processes to be done online.

5)Physical Environment : Practice of social distancing norms in office premises. And reduced staffing of offices to resume work.