Problem Solution: Usa World Bank

Problem Solution: USA World Bank

Bruno Perreault, MasterCard's group head for small and midsize enterprises, said in an interview that the product is tailored for small businesses that charge at least $25,000 of purchases a year. "This segment is crucial to our customer financial institutions, because they make up 20% of the small-business card market" yet account for more than 80% of card spending" (Thompson, 2007). USA World Bank (UWB), a financial institution with branches throughout the United States as well as an international presence, offers a new financial product on a yearly basis. Return on investment is always a concern, and market research is expenditure. "The only automatic small business savings program for both credit and signature debit purchases, MasterCard Easy Savings offers cardholders an easy way to save on their business purchases. The program is an extension of our ongoing commitment to empower small businesses with innovative payment solutions that help them successfully manage and grow their business," said Bruno Perreault, Group Head, Small and Mid-Sized Enterprises, MasterCard Worldwide. "Easy Savings not only gives MasterCard business cardholders access to exclusive savings, but it also provides participating merchants and financial institutions with a unique opportunity to build customer loyalty" (M2, 2007). Several of these products have seen success, but recently the marketing initiatives have produced lower than average revenues and UWB needs to ensure a greater earnings ratio (University of Phoenix, 2005).

The present focus is on a credit card with rewards. New Product Development is driving a consumer-based credit card which offers rewards such as frequent flier miles or other travel related enticement. The marketing group focuses on a comparable credit card for small businesses with a larger credit limit and some reward components. Both financial products offer significant earning potential for UWB, provided the research data collected is valid, yet the Board of Directors generally only allows for one marketing incentive per year. The statistics collected by means of primary and secondary research must be quantifiable and match closely with the sampling and surveys of the population. Relevant research, scientific sampling and accurate statistical data collection guarantees UWB will expand market share with the successful introduction of their new product incentive of a rewards card that encompasses both small business and the consumer base.

Situation Analysis

Issue and Opportunity Identification

UWB is in business to increase revenue, and market share is essential for expansion. In order to expand UWB needs to recognize some factors related to consumer wants as well as the price consumers will pay for a product or service. Research allows a snapshot of the current market and potential trends. "Business research is of much more recent origin and is largely supported by business organizations that hope to achieve a competitive advantage" (Cooper and Schindler, 2003, p.14). The UWB Board of Directors expressed some concerns over the introduction of the new banking product (University of Phoenix, 2005). During the staging of the product, the data collected went under examination. Knowing what the market will bear is critical to the success of the product. The Edsel is a perfect example of why companies require valid, accurate, and current research. Corporations nowadays rely on data collected from numerous resources. Both primary and secondary resources assist to identify the target market and viability of the product. "Good research generates dependable data, being derived by practices that are conducted professionally and that can be used reliably for managerial decision making" (Cooper and Schindler, 2003, p. 14).

The marketing department of UWB is currently in the process of re-assessing their current processes and measures for the gathering of data and determining the top course of action with the established launch date forthcoming. In actuality, two separate departments within marketing have viable options for a credit card with rewards. Both departments used feasibly good methods for the data analysis; however, other circumstances also need strong consideration. The sampling size, and the target audience as well as the leading questions of the survey provided room for errors of margin. All the marketing executives need to become familiar with probability and statistics especially as it relates to sampling and inferential statistics. "A probability distribution gives the entire range of values that can occur based on an experiment. A probability distribution is similar to a relative frequency distribution. However, instead of describing the past, it describes how likely some future event is" (Lind and Marchal, 2004, p.181).

Opportunities abound once the executives familiarize themselves with best practices of managerial decision-making based upon statistics. An easy opportunity presents itself in the way of a course from the University of Phoenix, since both day and evening classes are available. An opportunity analysis of variance (ANOVA), allows for comparisons. "Another use of the F distribution is the analysis of variance (ANOVA) technique in which we compare three or more population means to determine whether they could be equal" (Lind and Marchal, 2004, p.392). Taking into consideration that both proposed credit cards could stir both business and consumer based offerings, ANOVA allows the marketing team to evaluate effectively the populations. At this point in the marketing process, UWB marketing team needs to learn from their previous samples by redesigning the surveys using descriptive data to match their needs and to conduct further qualified research into the viability of the rewards based charge card.

Stakeholder Perspectives/Ethical Dilemmas

The Board Members for UWB need to ensure that any new product launch is thoroughly examined to suit the needs of their customers as well as being beneficial for the financial institution and the shareholders. UWB must continue to grow its market share with their international affiliations in addition to their main domestic presence. Their yearly budget apparently is the drive force for the board believes to launch successfully just one new product, and the decision for which rewards card is chosen must be based on reliable data. The newest member of the board, Bea Hansen, seems to have the education and experience necessary to make recommendations and question the product statistics (University of Phoenix, 2005). Rather than go along with the status quo, Bea has the responsibility