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1.1       Background of Study

The role of the financial sector in promoting rapid economic development cannot be undermined. Hence, for economic growth in a country, there should be proper functioning of the financial system. Donli (2005) observed that traditionally, the role of banks whether in a developed or developing economy, consists of financial intermediation, provision of an efficient payments system and serving as conduit for the implementation of monetary policies.

The financial service in general and banking services in particular are connected to the responsibility of banks in the management of their customers’ affairs. The Banking services are of intangible, which includes among others savings mobilization, adequate credit to the preferred sector etc. Pioneer contribution of Schumpeter (1934) was of the view that financial institutions are necessary condition for economic development. This view has been variously corroborated by other scholars like Goldsmith (1969), Cameron et al (1972) and Patrick (1966).


However, a product from the customer’s point of view is a package of benefits and satisfaction. Customers do not just want financial services, rather they count more on the benefits in which they will derive from the services. Hence, the need for marketing activities arises the financial services in general, Nwosu (1996: 72).

Marketing activities determine the needs and wants of target markets and adapts the organization to deliver the desired satisfaction more effectively and efficiently than its competitors, Kotler (1999:122). But

Sanusi (2010) says there is more cause for worry; that the Nigerian banking industry is riddled with high-level corruption, mismanagement of depositors’ funds and

falsehood in annual reports. Therefore, the aim of this study is to highlight the ways in which banks have been able to market their services in a competitive marketing environment. Attempts would be made in the study to expatiate on the importance of marketing banking services in Nigeria, making necessary reference to the existing literature.

In the marketing of financial services, banks must create and deliver customer satisfying services at a profit to the bank. In the last two


decades, banks all over the world have found it increasingly necessary to introduce marketing functions in response to an increasingly competitive market place, (Dwyer, 2009; Hopkins, 2009).

The banking failure in the 1920s and 1930s undermined the importance of the stability and soundness of national financial institutions and of maintaining public confidence in them, hence, the protective regulatory regime. A long process of deregulation and liberation started in the 1960s and accelerated through the 1970s and 1980s, Broker (1989).

In Nigeria in the 80s and 90s, the numbers of banking institutions were few. The market was regarded as given, what all the banks did, was just to make their services available to the public. Then it could be said that there was virtually no competition.

Before the deregulation of the banking system in 1988, marketing by Nigerian banks involved “armchair” banking and an oligopolistic sellers market, whereby few banks with huge resources dominated the market. The banking industry was highly regulated with no margins for price differentiation, homogeneity of services, little or no banking technology.


However, in line with the dictates of SAP, the government liberalized the licensing of banks, which increased the number of banks from 45 in 1985 to 120 in 1991.

The new entrants wanted to carve a niche for themselves and employed marketing practices such as market segmentation and timely services through modern banking technology. Thus new banking services were introduced. The old banks, Afribank Nigeria Plc inclusive, seeing their domain threatened embarked on strategies such as branch Network, complementary financial services, such as the sale of JAMB, GCE forms and NITEL bills, Afribank distributors exclusive payment and transfer scheme, Afribank cash evacuation scheme, etc, to market their services in the competitive marketing environment.

This strategy yielded great benefit to them. Through the introduction of some of the above measures, the revenue base of the bank improved tremendously. Apart from that, the bank embarked on personal selling, sales promotions and packing as well as re-branding of their services.

In their personal selling, some of their staff especially young ladies were detailed to move into town and offices to discuss one-on-one with


prospective customers especially the illiterate ones. They also went ahead to convince people who have account in other banks to bank with them.

That notwithstanding, the given out of free gifts such as calendars, biros hampers and some bonuses for customers attracted more customers to them.

Moreover, they went further to change their advertisement jingles and posters with more attractive ones. This make people believe that something was happening in the bank.

1.2       Statement of Problem

The growth in any industry is predicated upon the quality of the product provided for customers, the acceptance and appreciation of the product by the consumers. The bid to meet the expectations of the consumers by various participants in the industry, gave rise to a healthy competition. With competition, many products/services are striving for the attention and resources of the consumer. Hence the present level of


competition in the banking industry calls for strategies that will win the customers over. For any bank to survive and have a substantial share of the market, it must be able to properly and profitably market its products too. Uche (1997:11) alleged that some of the causes of distress or failure of Nigerian banks include outright embezzlement of depositors funds by bank directors, poor management and accounting procedures in the banks, all of which erode customers’ confidence in the banks.

The need to identify the marketing approach embarked upon by the Afribank to ensure improved patronage is one of the major reasons for their work. This research also aims to find out how far the approaches/ strategies adopted by the bank have helped to attract more customers.

It also aims to find out how the strategies affected the growth of the banking sector especially Afribank. The identification of the problems facing the bank will go a long way to finding new remedies/solutions that will facilitate the growth of the bank.

1.3    Objectives of the Study

. The objectives of this study include:


(1)             To evaluate the customer-friendliness of some selected marketing strategies of Afribank in its daily operations.

(2)             To find out the effectiveness of the marketing approach used in delivering the services to their customers.

(3)             To ascertain how far the customer-services strategies have assisted the bank in its operations.

1.5       Research Questions

The following research questions below will be answered in the course of the research?

(1)  Is there significant customer-friendliness in the selected marketing strategies of Afribank in its daily operations with customers?

(2) How effective are the marketing approaches used by Afribank in delivering the services to their customers?

(3) How far have the customer-services strategies assisted the bank in its operations?

1.6       Research Hypothesis

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