Citibank Case Study

Citibank is one of the leading banks worldwide. It is now planning to expand its credit card business to Asia Pacific area. There are surely threats in that market, but there are also excellent opportunities. In this article I will analyze the Citibank as a brand and will discuss possible solutions to the problems that might occur in the new market.

Brand of Citibank: Citibank has already been in banking operation in Asia Pacific and mainly has good relationships with large business houses. Also, for private customers, Citibank offers the Citi-one accounts with minimum deposit $10,000. In addition, in Hong Kong there are 7,600 Citigold customers who are required to deposit more than $100,000 in their accounts. Consequently, Citibank has been regarded as a prestigious, consumer-oriented international bank.

Clear Positioning: As mentioned above, clear positioning as a high-end bank for upper class and large business firms, Citibank could successfully create brand image in Asia Pacific.

Core Competencies: Citibank has managed properly these intangible resources with tangible resources such as banking by phone, overdraft protection and a designated customer service officer to manage their accounts. These resources have combined to create capabilities and become core competencies.

Competitive Advantages: As a result, Citibank has competitive advantages in the banking industry. By adding new financial products, continuing to improve technologies for providing better services and products, Citibank will strengthen its competitive advantages; they will become sustainable competitive advantages.

Recommendation

I would like to recommend launching credit card business by leveraging Citibank's competitive advantages. In order to successfully launch credit card business, I would recommend to implement the following strategies for Citibank.

Organizational Change: The root cause of country managers' resistance to issue credit cards is in organizational structure. Because they don't want to take risks which may cause future losses of their business. Therefore, Citibank has to change the organization: first credit card team of Asia Pacific should be in place and it should be responsible for building strategies for entire markets. And this team should work closely with regional offices. So-called matrix organization should be implemented. Specifically, the team will use current customer base of each country and establish most suitable marketing mix for each country under the cooperation with regional offices.

Marketing: In order to keep brand equity of Citibank, Citibank cannot conduct mass-marketing but more pinpointed marketing for target customers. Therefore, Citibank should not use Bind-Ins method. Also, to achieve effective marketing, Citibank should not use Direct Mail in this case. Consequently, Take-Ones and Direct Sales should be used to acquire new customers. However, location of Take-Ones is very important to access upper and upper-middle class people and high quality of Direct Sales are also mandatory for its success, because Citibank targets not only customers outside its branch business but also cross-selling other Citibank products and services to these customers.

Strategic shift from developed countries to emerging countries: Citibank should start from strengthen its business in Hong Kong then launch credit card business in Australia