Overview Of Metro Bank: Marketing Mix And Competitor Analysis

Understanding Customer Needs, Wants, and Demands

Metro Bank represents a retail bank launched in Holborn, United Kingdom in the year 2010. It is the first UK retail lender in a century and has a listing in the London Stock Exchange (metrobankonline.co.uk 2018). The Bank also known as the challenger ensures revolutionizing the banking sector and challenges the primary retail banks of UK with a customer service and customer centric focus. The bank provides necessary banking services to not only the business but also the personal customers. Metro Bank authorized and controlled by the Prudential Regulation Authority. However, Financial Conduct Authority also undertakes the control of the bank. The Bank in addition to providing traditional services also offers non-traditional banking services that include quoting a fifteen-minute time for opening a bank account, providing pet friendly policies and providing machine to the customers for depositing and sorting change. The stores of the bank are open on seven days a week and require no appointment for opening a bank account. Metro Bank aims at opening around twenty stores by the year 2020 (metrobankonline.co.uk 2018). The bank acquired SME Finance in the year August 2013 which it rebranded as the Metro Bank SME Finance in the year May 2014. Thus, through the Metro Bank, the customers knows where they are getting since it always keeps the customers first.  

The report aims at giving an overview of Metro Bank. Thus, the report focuses on the needs, wants and demand of the Metro Bank customers with respects to marketing. The report puts forward the situation analysis of the organization along with giving an overview of a technological as well as an economical factor that affects the business operations of the Metro Bank. The report also outlines the competitor analysis and identifies three competitors of the Metro Bank thereby highlighting the areas for the metro bank that requires consideration. The report also describes and identifies the current marketing mix using the seven Ps  of marketing.

Understanding the needs, wants and demands of the customer represents the fundamental concepts of the marketing. Needs represents the initial stage of marketing. Human needs are social, psychological, individual and cultural (Wilder et al., 2014). There are however, an innumerable human needs and most new inventions tries to satisfy human needs. In absence of human needs, there cannot be any existence of the marketing activities. Wants represents the desires that are the specific satisfiers of the needs. There are unlimited needs of a human that desires different services, products and method (Osterwalder et al., 2014). Such a desire for satisfying the customer needs is known as wants. However, individual personality, social class and culture determine wants. Marketers are able to influence the human wants through providing various objects that satisfies need. Demand represents the wants of the humans backed by the willingness and ability for buying. Those goods remain in demand that provides the maximum satisfaction. Marketer influences the demand by offering products of different quality and price (Porter and Kramer 2017).

Situation Analysis

The need of the metro bank customers revolve around opening a personal account or application for credit.  The Metro Bank puts forward hassle free and easier means for meeting the customer demand (metrobankonline.co.uk 2016). The only criteria remains in providing the right set of documents that will ensure smoother flow of the process. The customer stay far away from a bank store also wants to experience the bank’s service. Metro Bank thus addresses the wants of the customers by offering online service for the customers who does not live close to a branch. Mostly, the online service of the bank is targeted towards attracting the customers across Britain. The entire process completed within a period of ten minutes and requires no fee for the customers of the European Union. Customers have various demands in terms of bank account, borrowing, savings, mortgages and private banking. The Metro Bank meets the demand of the customer by offering bank account in the form of current accounts while the savings account made available with options like fixed term savings, instant access savings, instant access cash, young saver options. The borrowing facilities of the bank include personal loans and credit cards. In terms of mortgage facilities, the bank allows residential mortgages, buy to let mortgages and mortgages to the existing customers. Further, for meeting the customer demand, Metro Bank allows banking through online personal banking, app related to mobile banking and through the Apple and the Google pay (metrobankonline.co.uk 2018).

The situation analysis represents the compilation of the methods used by the managers for analyzing the internal and external environment for understanding the capabilities, customers and the business environment of the organization (Cohn, Fehr and Maréchal 2014). The situation analysis is done based on several methods like 5Cs analysis, Porter’s five forces analysis and SWOT analysis. The five C’s represent the company, customers, competitors, collaborators and climate. The situation analysis refers to the second step in a marketing plan and is a vital step for establishment of lasting relationship with the customers. The analysis helps in getting an insight into both into the macro-environmental factors that influences the firms within environment and micro-environmental factors that exclusively influences the firm. The purpose of situation analysis lies in indicating about the product and the organizational position along with the overall survival of business within a particular environment. Thus, organizations must summarize problems and opportunities within environments to understand the capabilities within market (Fox et al. 2013). 

Technological and Economic Factors Affecting Metro Bank

According to the Treasury Select Committee the biggest technological barriers faced by the Metro Bank in United Kingdom was Information Technology (IT). Like United States, United Kingdom do not have outsourced providers and therefore requires undertaking of the construction challenges of IT from the scratch whenever required (Booth et al. 2015). The strategy of Metro Bank in adopting IT remained in minimizing the magnitude of the primary capital outlay thereby contributing to the profitability and cash flow of the bank. Therefore, Metro Bank preferred to work with the Temenos that enabled it with IT platform for a single customer view thereby underpinning the banking services. The bank selected Temenos since it put forward IT solution that was integrated and at the same time that lowered the barriers to entry through offering a massively scalable and flexibly scalable delivery model that reduced the outlay capital and the operating costs to minimum.

The economy and the banking industry remain somewhat tied. The capital access of the bank depends on income flow during economic prosperity or the times of recession. On the other hand, the borrowing and spending of funds by the customers depends on the spending habits. However, the economic factor that influences the operations of the Metro Bank has revolved around the significance of the expansion in the branch network. The more stores the bank is able to put up will up within the same market, the better they will be able to perform (Sassen 2013). The customer feedback put forward by the Metro Bank also portrayed the importance of the branches. Further, the customers of the Metro Bank is primarily based in the communities and the areas that surrounded the stores and the fact that the new customers needed to open the first account in the bank store reinforced the importance of the branches.

The importance of the competitor analysis lies in the determinations of the strengths and weakness of competitors within the market, strategies that provides distinct advantage and barriers that needs development from preventing competition from entering the market. It also helps in identification of the weakness that required exploitation within the cycle of the product development (Grant 2016). A competitor analysis also helps in trying to break into a newer market. Through conduction of a competitor analysis of an unfamiliar environment, one can easily model a newer business and understand the role of the competitors. It also helps in understanding some of the unique customers that drives customers away. Competitor analysis also helps in identifying the features preferred by the customers. If a particular company offers a   feature or products sold by none of its competitors then other companies must model their products, tools and features in a manner that provides it an equivalent position.  Competitor analyses represent the basic steps in the planning and research of a company and are one of the vital components in the development of effective plan for marketing. 

Competitor Analysis

	Metro Bank	Trustco  Bank	Territorial Bancorp	Salisbury Bancorp
Net  Income	£  16.8 million	$ 43.1 million	$15 million	$ 6.3 million
Valuation ($)	3.8 billion	831.4 billion	285.2 million	128K
Location:	London, Headquarters	Schenectady, US, Headquarters	Honolulu, US, Headquarters	Salisbury, US, Headquarters
Employees	2,831	808	265	159
No. of  Stores	55	145	29	14

Figure: Competitor Analysis of Metro Bank

Source: (Claessens and Horen 2014)

The three competitors of Metro Bank include Trustco Bank, Territorial Bank Corp and Salisbury Bancorp. Like Metro Bank, all three represents a public sector bank and offers various financial services to the customers in the form of payments, mortgages and loans. In term, of valuation Metro Bank is the leader and stands at 3.8 billion compared to Trustco which is
831.4 million dollar, Territorial Bank Corp which is 285.2 million dollar and Salisbury Bancorp which is 128 K dollar. They also vary in terms of headquarter location, as Metro Bank is located in United Kingdom, Trustco Bank is located in Schenectady, US, Territorial Bank Corp is located  in Honolulu, US and the Salisbury Bancorp is located in Salisbury, US. In terms of net income, Metro Bank stands at higher value of £ 16.8 million compared to its competitors. One can also see from the tabular representation that Metro Bank stands as leader in terms of employee strength that stands at 2831. However, the Bank lags behind in terms of the number of stores in comparison to the Trustco Bank. Therefore, Metro Bank must focus on increasing the store branches that will help it to become a leader in the banking sector.

The 7Ps represents a set of marketing tactics that one can utilize in any combination for satisfying the customer of the target market (Khan 2014). The Seven Ps of marketing mix can be controlled and depend much on the external and internal conditions for marketing. However, these seven Ps includes:

Product is referred as the products the company is selling including all its advantages, features and benefits that the customers are able to enjoy from the buying and selling of the goods and services. In terms of products, Metro Bank offers personal banking products, products related to savings and borrowings and mortgage products. While marketing the product Metro Bank thinks about the benefits and the features of the customer need and want.

This represents the pricing strategy of services and the products and the way it influences the customers. Metro Bank sets its pricing through identification of the willingness of customers for repayment, mark up for catering the overheads, payment methods, profit margins and other related cost. For attracting the customers and retaining its competitive advantage, the bank also considers the possibility of seasonal pricing and discounts. 

Place refers to where the services and the products are distributed and sold. Accessibility of the customers to the products is important so that the customers can easily find the products. In order to become accessible to the people of  Britain the bank has close to 55 stores which are open seven days a week thereby encouraging the customers to walk in anytime that they find suitable.

People refer to the salespeople and the staffs who work for the business. The staffs of Metro Bank render it the uniqueness. Being a community based bank, it primarily recruits local people who care about the customers and puts in 100 percent in supporting the colleagues for reaching complete potential. Moreover, each store of the bank has a deep rooting for the community it serves and the staffs possess a better understanding of the ambitions and needs of the customers.

Process deals with the methods involved in the delivery of the services and the products to customers. It also ensures doing easier business. Good processes helps in ensuring that there is repeated delivery of the same service standards to the customers along with increased efficiency. This also helps in saving sufficient money and time. In term of processes, Metro Bank stands apart from the conventional financial organizations in following a customer driven approach that put forward  services on 24/7 basis along with the facility of  opening an account within a matter of 20 minutes without having to fix prior appointment.

This referred to every possible thing that was visible to the customers while interacting with the business (Baker 2016). Metro Bank therefore made sure that it offered physical evidence in the form of an environment to the customers that not only took care of the interior design and layout but also the branding and packaging. They also make sure of selecting the staffs and the manner in which they act and dress.

Conclusion: 

To conclude one can say that the Metro Bank not only overcame all the obstacles but also flourished as a high street bank. Although the bank has several competitors but stands apart in gaining a competitive advantage through its customer centric policies and IT systems. The bank consider requirements of capital holding so that it is able to subsidize the newer customers and have indirect payment system access for ensuring further expansion. However, the Metro Bank chose to focus on the expansion of around the South East commuter belt of London. The bank adopted a branch based business model for not only promoting itself but also acquiring the customers. The bank also feels  that if it  is unable to open newer branches then it might influences its ability in acquiring newer customers and thereby reaching a specific scale.  

	Metro Bank	Trustco  Bank	Territorial Bancorp	Salisbury Bancorp
Net  Income	£  16.8 million	$ 43.1 million	$15 million	$ 6.3 million
Valuation ($)	3.8 billion	831.4 billion	285.2 million	128K
Location:	London, Headquarters	Schenectady, US, Headquarters	Honolulu, US, Headquarters	Salisbury, US, Headquarters
Employees	2,831	808	265	159
No. of  Stores	55	145	29	14

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