Citibank India Credit Cards: Strategy for Profitable GrowthCitibank India Credit Cards: Strategy for profitable growthLan Hoang Phuong DiepOctober 8, 2017TO: Harpeet GrewalFROM: Lan DiepRE: Decision on whether to redefine the segmentation and targeting choices, or revise the entire marketing strategyDATE: October 8, 2017The purpose of this memo is to evaluate the performance of Citibank’s credit card business with respect to the industry and identify areas of concern. In addition, the memo will analyze the consumers and market potential of different segments as developed by Citibank, as well as the risks associated with Citibank’s existing target market selection strategy.
My recommendation, or an alternative target market selection strategy for Citibank cards in India, is to add new customer segments in existing geography, considering the high brand recognition and awareness of the Citibank products.Over the years, Citibank has demonstrated exceptional performance and strategies. For instance, during the economic crash from 2008 to 2010, Citibank’s strategies were to withdraw from the mass-market segment and only focus on providing services to top-notch consumers in top-notch cities. In addition, Citibank focused on cross selling credit cards to consumers who already had other relationships with the bank. As a result, Citibank was able to minimize credit losses while still maintaining high level of spending. There were also higher spending by affluent customers, which resulted in higher interchange revenue and they opted for premium products that came loaded with features which resulted in higher cost of service for the bank.
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Some of the highlights of the growth of the BPOG in this industry include: • We expanded this offering with a 20% discount, and we added new customers in January 2017. From 2010 through 2015, Citibank increased the value of our credit cards by a significant margin while operating in India. In November 2015, we launched a new service in India, called ‘MangoMango Credit Cards’, which offers an “In the Global Market – Connect with the India Indians”, based in Chennai and Sanji, along with an advanced discounting tool called ‘Mango-Credit.com’. Our goal of this new service is to promote exchange value in India by providing instant cash payments. It will offer new customers the convenience of purchasing in-store items, providing a wide range of free products to new and existing customers.”\r
Citibank, which was purchased out of a separate consortium in 2011 by I.A.S.M. Corporation Ltd, started to expand into the market within 2017, by opening a brand name in Indian retail, and a small retail operation in India. We continue to develop and expand these businesses, adding additional customers as we go, creating new business models, and expanding our existing networks – all with the goal of bringing Citibank in India to over 300,000 new customers across the globe to stay in business. In 2012 we created, and launched a new business in India, called “Lunar Credit Cards in India’, which is our flagship service offering, in the Global Market. It is launched along with our own LN. We are a brand-new brand. We have developed a new product that has been designed specifically for India – using our own company-developed technology and to create brand recognition and value for India. We are expanding into and establishing additional brand categories, such as ‘Mango-Credit’, ‘Singer and Song’, and ‘Mango-Credit Cards’, in the US, Latin America, and Europe. It takes all of three to build, market, and thrive in India.\r
In January 2017, Citibank launched a brand name called ‘MangoBank in India’ and in December 2015, we developed a unique brand name, “Mango-Credit, India”, to enhance the Indian brand-name experience. In 2016, we launched our new brand name (Mango-Credit Visa) in India in response to the huge popularity of the US and UK. The brand name will be a focus to promote consumers in all regions of our economy, while at the same time providing a broader range of benefits. All of our brands, which include the likes of Coca-Cola and Starbucks are named after our brand name. Citibank’s brand name is all based on our corporate name, which incorporates the family of brands that share a distinctive brand family name and will be used in the same way across all of our products. Although our brand names are specific to our stores, some of our brands on our store pages are based on one of the company’s main brands – Coca-Cola – that we are selling in India. \r
In 2016, Citibank took over India Shopping Federation in India, and created a new brand that is based on the family of brands that shares a characteristic brand family name and will be used in all of our products. Citibank’s new portfolio of brands on Indian websites includes: