Farina Malik

PROJECT ON PRESENTED TO: SIR HANIF SHEHZAD PRESENTED BY: FARINA MALIK MBA (Mor) Section-B DEPARTMENT OF MANAGEMENT SCIENCES NATIONAL UNIVERSITY OF MODERN LANGUAGES I take this opportunity to gratefully acknowledge the assistance and contributions of all the people who helped me with this project. Without their guidance and cooperation, this project could not have been completed. I would like to thank my respected teacher Sir Hanif Shehzad, while burdened with hazardous responsibilities, helped plan the layout of this project. I would like to thank Mr. Aftab Hussein Shah, Branch Manager allied bank F10 Markaz Islamabad, who referred me to the relevant people. 1 would also like to thank Mr. Syed Ali Raza , area sales manager and his team who are currently working on launching the visa credit cards and gave me detailed information regarding the project. EXECUTIVE SUMMARY Allied bank was the first bank to be established in Pakistan. Today, with its existence of over 60 years, it offers universal banking services with the largest network of over 700 online branches and offers various technology based products and services to its diverse clientele. Focus is on new product development. The selected product is visa platinum credit. It’s a new product of Allied bank which is going to be launched in May 2009.it has the lowest service charges in the market. The bank is offering two credit cards—visa gold credit card and visa platinum credit card. Our main focus is on visa platinum credit card. With allied visa platinum credit card you can enjoy exceptional benefits and host of local and international benefits. The bank has been working on this project for the last two years. All the development stages are discussed in detail. Finally, the marketing mix ingredients regarding this product are explained. TABLE OF CONTENTS Chapter1—About Allied Bank 1.1---Brief history and introduction 1.2—Banks business portfolio and financial services Chapter 2—New Product Development 2.1--Product in focus----introduction and features. 2.2---New product development stages. Chapter3--- Pricing 3.1--Pricing strategies. 3.2---Terms and conditions. 3.2—Discounts Chapter 4---Placement 4.1—Distribution channels and logistics chapter5---Promotion 5.1—Promotions mix. CHAPTER1-----ABOUT ALLIED BANK Brief History and Introduction:  Allied bank was the first bank to be established in Pakistan.  It started out in Lahore by the name Australasia Bank before independence in 1942; was renamed Allied Bank of Pakistan limited in 1974 and then allied bank limited in 2005.  In August 2004, because of capital reconstruction, the Banks ownership was transferred to a consortium comprising Ibrahim Leasing Limited and Ibrahim Group.  Today, with its existence of over 60 years, the Bank has built itself a foundation with a strong equity, assets and deposit base. It offers universal banking services, while placing major emphasis on retail banking. The Bank also has the largest network of over 700 online branches in Pakistan and offers various technology based products and services to its diverse clientele. To become a dynamic and efficient bank providing integrated solutions and the first choice of bank for all customers MISSION  To provide value added services to our customers.  To provide high –tech innovative solutions to meet customer requirements.  To create sustainable value through growth, efficiency and diversity for all stake holders.  To provide a challenging work environment, and reward dedicated team members.  To play a proactive role in contributing towards the society VALUES.  Integrity  Excellence in service  High performance  Innovation and growth. BOARD OF DIRECTORS  Pervaiz Iqbal Butt(director)  Mohammed Waseem Mukhtar(director)  Shekh Mukhtar Ahmed(director)  Abdul Aziz Khan (Director)  Tasneem M Noorani(Director)  Sheikh Jalees Ahmed(Director)  Nazrat Bashir (Director)  Mohammed Aftab Manzoor(CEO)  Mubashir A. Akhtar (Director)  Mohammed Naeem Mukhtar(Chairman) Portfolio and Financial Services The bank offers services in three main areas. Consumer The consumer portfolio consists of the debit card, credit cards, auto loans, personal loans and mortgages. Commercial The commercial and retail banking group offers a variety of assets and liability based products to its customers. The consumer portfolio consists of internet banking, online banking, profit rates, ATM Networks, unclaimed deposits, deposit accounts, SME, Agricultural finance and other services. Corporate the corporate investment banking group holds the bank loan portfolio these financial services include providing and arranging tenured financing, corporate advisory, underwriting, cash management, trade products, corporate finance products, customer services related matters. on all bank Chapter2—New Product Development Product in focus Allied bank is launching Allied visa credit card in May 2009.IT has the lowest service charge in the market. With allied visa credit card holders can spend at over 49000 merchants across Pakistan and 27 million merchant outlets world wide. They can also use their credit card at over 1 million ATMs internationally. The bank is offering two credit cards—visa gold credit card and visa platinum credit card Allied Visa Gold Credit Card With your Allied Visa Gold Credit Card every Pakistani can now enjoy the benefits of a Gold Card internationally with unmatched savings greater flexibility, convenience and security Features Buy Now, Pay Later With your Allied Visa Gold Credit Card, your free credit period allows you to pay for your purchases up to 50 days after the date of purchase. So now you can buy all the things you want - whenever you want - at your own convenience. Flexible Repayment When paying your credit card bill, your Allied Visa Gold Credit Card gives you the option to either pay the entire amount according to your statement or a minimum of 5% of your total outstanding balance. Cash Advance Facility As an Allied Visa Gold Credit Card member, you are entitled up to 75% of your available credit limit in cash. Just go to your nearest ATM with the VISA or PLUS sign and avail the facility of withdrawing cash 24 hours a day. Allied Easy Installments (AEI) The Allied Easy Installments (AEI) plan provides you with the facility to pay your outstanding card balance in equal and affordable monthly installments spread over 3, 6, 12, 18, 24, 30 or 36 months. So now you can easily afford anything from everyday household appliances to exotic vacations abroad. Supplementary Cards Want to share the benefits of your Allied Visa Gold Credit Card with others? Now you can! Treat up to two people with supplementary credit cards and pass on the many privileges of your Allied Visa Gold Credit Card to your chosen friends and family members. Balance Transfer Facility In case you have outstanding balances on other cards, consolidate these onto your Allied Visa Gold Credit Card with the lowest BTF rate and save more on your outstanding payments than ever before. Credit Protection Plus With Credit Protection Plus, your Allied Visa Gold Credit Card provides payment cover against:  Death, due to accident or sickness  Permanent and Total Disability, due to sickness or accident  Temporary Total Disability, due to sickness or accident  Terminal Illness Zero Loss Liability The Allied Visa Gold Credit Card’s Zero Loss Liability feature protects you from paying for any unauthorized transactions on your Card in the event that it is lost or stolen. Please notify Allied Phone Banking immediately on- (within Pakistan) or on- (outside Pakistan) in case your Card is lost or stolen. 24-hour Allied Phone Banking For any information and queries about your Allied Visa Gold Card, call Allied Phone Banking on-. If you are calling from outside the country, please dial-. Free CIP Lounge Access As an Allied Visa Gold Credit Cardholder, you are eligible to avail the free lounge facility at Quaid-e-Azam International Airport, Karachi and enjoy a variety of complimentary features. Relax while you watch leading television channels or select something to read from an updated library of newspapers and periodicals. Also feel free to plug in your laptop and mobile phone into the charging facilities provided or browse the internet or send and receive faxes while you wait. You can also treat yourself to a wide assortment of high quality snacks, beverages and fresh fruits. Visa Platinum Credit Card With your Allied Visa Platinum Credit Card you can enjoy exceptional benefits and a host of local and international benefits like never before! Features Visa Platinum Golf Fancy a game of golf? With your Allied Visa Platinum Credit Card, you can enjoy golf at its best with complimentary tee-offs, discounted green fees and access to some of the world’s most celebrated golf clubs. Platinum Life Platinum Life is a unique platform that showcases exclusive programs and events specially designed for Visa Platinum Credit Cardholders. With your Allied Visa Platinum Credit Card, you are eligible to join this exclusive platform and avail many exciting services like Platinum Club, Platinum Dining, Platinum Golf, Experiential Travel and much more. Visa Platinum Club As a member of the Visa Platinum Club, you are part of an internationally reputed rewards program that provides an unmatched quality of services and customized luxuries to all Allied Visa Platinum Credit Cardholders. The Visa Platinum Club rewards you with exclusive perks such as complimentary room upgrades at five-star hotels, spa treatments, attractive retail discounts, special rates on car rentals, professional golf coaching and much more. Furthermore, unlike other card reward programs, being part of the Visa Platinum Club means that you can start enjoying these privileges immediately without having to earn or accumulate reward points on your credit card. Visa Platinum Dining Your Allied Visa Platinum Credit Card can turn any meal into a dining experience to remember. The Visa Platinum Dining Service offers special dining privileges at over 200 restaurants throughout the AsiaPacific region. Through this program, you can avail special features such as priority reservations, complimentary meals at selected restaurants, and much more. Visa Experiential Travel Your Allied Visa Platinum Credit Card now takes you further than ever before. With the Visa Experiential Travel Program, choose the package of your choice as you travel the world and enjoy exotic travel adventures catered especially to your taste. Priority Pass Airport Lounge Program Traveling with your Allied Visa Platinum Credit Card means that you can now avail the optional facility of the Priority Pass Airport Lounge Program in your overall Visa Platinum product offering. Today, with over 500 exclusive VIP airport lounge locations around the world, the Priority Pass Service is the largest independent airport VIP lounge program in the world and you can now avail this facility regardless of your airline or class of ticket. Simply locate a lounge and present your Priority Pass membership card to gain entry, and relax in style as you wait for your flight. To avail this facility, please call Allied Phone Banking on-. New Product Development Stages 1. Idea generation: the systematic search for new product ideas. Allied bank was previously using master card as a credit card .it had no distinctive features and was not up to the mark to meet the needs of customers. Where as the competing banks were offering more value added services in terms of credit cards. There fore, the owners of the bank comprising of Ibrahim group decided to replace the master card with an up graded and improved visa credit card that would match the needs of its customers. 2. Idea screening: screening new product ideas in order to spot good ideas and drop poor ones as soon as possible. The idea was screened in the board of directors meeting. A write up described the product, the target market, and the competition. It made some rough estimate of market size, product price, development time and costs and rate of return. The directors evaluated the idea. 3. Concept development and testing: a detailed version of the new product idea stated in meaning full consumer terms and testing new product concepts with a group of target consumers to find out if the concepts have strong consumer appeal. The following product concept was created: A credit card with the lowest service charge ever---so now you can save money where it counts and spend lavishly at your favor tee places with greater flexibility, convenience and most important affordability. Allied bank tested the concept with its own depositor’s .important customers were contacted through email, telephone, face to face meetings. The idea was communicated to them and they were asked for suggestions and opinions. Most of the customers welcomed the idea and gave some useful suggestions. 4. Marketing strategy development: designing an initial marketing strategy for a new product based on the product concept. Salient features of allied bank marketing strategy regarding the credit card are: The target market is salary bracket 30000 for visa gold and high income salary bracket 75000 plus for visa platinum. Banks own depositors falling in this income bracket are the major target customers. The card will be positioned as a world of privileges, benefits and savings. The visa credit card will come in 2 forms. Visa gold and visa platinum and will have lots of benefits for the cardholders in the form of discounts, free gift packages and customer care services. Advertising budget will be 1 million. Advertising will emphasize the affordability and benefits of the card. 5. Business analysis: a review of the sales, costs and profit projections for a new product to find out whether these factors satisfy company objectives. A cost and return analysis was done by the management at the head office. Estimated cost was one billion and estimated profits were 10 billions. The project was approved. 6. Product development: developing the product concept in to a physical product in order to ensure that the product idea can be turned in to a workable product. The visa credit card is first printed out and then every printed card has to go through the embossment department in the head office at Karachi for its verification and authenticity. 7. Test marketing: the stage of new product development in which the product and marketing program are tested in more realistic settings. The card is currently being tested in the banks own employees and staff members. They are being distributed the cards with the exemption of the annual fees. 8. Commercialization: introducing a new product in to the market. Allied bank has decided to launch the product in Rawal pindi, Islamabad, Faisalabad and Karachi in May 2009. Chapter 3---Pricing Pricing Strategy of Allied Bank Market penetration strategy has been adopted.. Selling at lower price for a new product in order to attract a large no of customers. The bank kept the lowest service charges for the card, lower than any other existing credit card today. i.e 25% where as the market rate starts from 35%. The bank has used product line pricing. Annual fee for visa Gold is 200/- while that for visa platinum is 500/Payment terms and conditions. Buy now, pay later: card holders can pay for their purchases up to 50 days after the date of purchase. Flexible repayment: when paying the credit card bill the card holders have the option to either pay the entire amount or a minimum of 5% of the total outstanding balance. The Allied Easy Installments (AEI) plan provides card holders with the facility to pay their outstanding card balance in equal monthly installments spread over 3,6,12,18,24,30 or 36 months. Chapter 4---placement As it is a loan facility given through a credit card the placement or the distribution channels are limited to the bank it self. The end user gets the card by filling up an application form and depositing it in the area branch. The card for every customer is processed through the embossment department in the head office at Karachi. TCS is used as the logistics to deliver the card to the customer. Chapter 5—Promotion Promotion Mix Adverting Any paid form of non personal presentation and promotion of ideas, goods or services by an identified sponsor. A huge media launch is on its way’s million advertising budget is distributed between different regions. The communication message will emphasize benefits, privileges and savings. Advertisements will be given in all the major television networks, leading news papers and magazines, Fm radio, banners and billboards will be displayed on malls. Sales Promotion Short term incentives to encourage the purchase or sale of a product or service including discounts, coupons, displays and demonstrations. Various privileges and discounts have been Traveling Privileges Gerry's Holidays No surcharge on any transaction (International and Domestic air tickets, Marhaba Services and Holiday Packages) Up to 6% discount on International air ticket (65% discount on service commission/Fee) 17% discount on all Gerry's Holidays products i.e. Rail Europe, Royal Caribbean Cruises, Trafalgar Tours, DSF & Far East Leisure Packages, Hotel Bookings Worldwide and Hajj & Umrah 8% discount on International Marhaba Greeting services given to promote sales. These discount are region-specific for different countries. For example for Pakistan the discount and gift packages include the following:Leisure Royal Palm 10% discount on Premier membership Complimentary Gourmet Passport Shopping Privileges European Gallery 10% discounts on list price Shayanne Malik 45% discount on bridal dresses 40% discounts on full range Spend Rs25,000 and get free gift Buy online and enjoy 25% discount on casual suites and wedding dresses through the website www.ambreenkhan.com United Mobile 5% discount on wide range of selected mobile phones Gourmet Passport holders can use RPGCC golf and dining facilities Surcharge for non-member(s) will not be charged to Gourmet Passport holders Just present your Visa Platinum card and play golf by paying minimum charges. Kindly bring your golfer's handicap card with you. Hashoo Group (Marriott & PC) Visa Platinum cardholder privileges Rooms        Guarantee free room upgrade to the next category subject to availability at time of checkin Complimentary fruit basket Four hours free use of Wi-Fi Internet Complimentary pick and drop from airport by car Stay on Friday and Saturday (2 nights) and get the third night free on the applicable BAR Plan Express check-in facility 15% off BAR Plan on Suites Dining (applicable to all restaurants at Marriott & PC)   Complimentary dessert in restaurants (chef's selection) Priority seating when dining facility is full (advance reservation required)   Complimentary drink - one bottle (1.5 liters) of mineral water up to a maximum of 4 diners Complimentary meal for one child (up to 12 years of age) dining with couple Wedding (booked in Hotel Banquet / Function Faculties)     One complimentary room including a room service breakfast for bride and groom upon booking of catering in banquet hall (minimum 200 pax) One complimentary framed picture of bride and groom together Complimentary flower bouquet Complimentary cake Public relations Building good relations with various publics by obtaining favorable publicity, building up a good corporate image, handling or heading off unfavorable rumors, stories and events. Pr includes pressreleases, sponsorships, special events and web pages. The bank plans on several press releases for the promotion of the card. Visa platinum websites.  The visa platinum websites have been designed to ensure that visa platinum card holders around the Asia pacific region are up to date with the latest product offerings and benefits. the sites also include additional features like  The latest information on visa platinum regional programmed such as the visa platinum club, visa platinum golf, holidays and visa platinum experiential travel facilities.  The latest information on local country promotions and events.  Online applications such as concierge online.  A directory of toll—free numbers for reaching the VPCC from all key global destinations. Personal Selling and Direct Marketing personal presentation by the firm’s sales force for the purpose of making sales and building customer relationships. Direct connections with carefully targeted individuals and customers to obtain an immediate response and cultivate lasting customer relation ships, the use of direct mail, telephone, direct response television, email, the internet and other tools to communicate directly with specific customers. The bank is using personal and direct marketing for promotion. Targeted customers are pooled out; their data is collected by the head office team in Karachi and then sent to regional branches. The area sales manager involves his personal financial consultants (pfc) team in tale marketing. The targeted customers are contacted through telephone and then visited personally. They are given presentations on the new visa card and if they are convinced, application forms are filled up by them.