Ing direct ("ing-d”) case study – marketing fundamentals assignment

Channel Development ING-D traditionally operated a direct to consumer distribution channel. This had the benefits of maintaining control over the relationship with the customer ensuring that the brand values could be executed consistently. However, to address its balance sheet issues, in 2005 the direct distribution channel was supplemented with the introduction of intermediary agents in the form of wholesale mortgage brokers. Impact of Activity Growth was achieved quickly with effective diffusion through the market resulting in ING-D becoming the largest on line bank in the US.

However, the rapid growth strategy resulted in a more systems and process based organisation and challenging the maintenance of its trademark entrepreneurial culture. ING-D Competitors and the Evolution of Their Strategies. Key Strategic Changes By Competitors Considering Porter’s Model of Competitive Industry Structure, we can see that with high barriers to entry, and limited opportunity for substitution, the main factor affecting ING-D has been in the form of competition from existing US banks, (Appendix 2).

Benefits ??? Establishing primary customer relationship associated with Checking accounts ??? Removing an existing advantage for established competitors ??? Protecting market share by meeting its customers’ complete banking needs ??? Attracting new customers from an attractive, substantial (49% of bill payments in 2002) and profitable market sector ??? Doing nothing leaves bank open to continued risk of market share erosion ??? Removes reliance on maintaining the best rates as sole USP

Risks ??? Conflicting with the company’s core value proposition as a low-cost, simple, easy to use banking provider ??? Increasing customer support and training requirements leading to higher operating costs ??? Introducing a level of operational complexity and increasing operational risk ??? Requiring a more process and systems based environment contrary to its entrepreneurial culture Recommendation We believe the benefits outweigh the risks and recommend ING-D launches a Checking Account.

The site remains consistent with the ING-D brand values by being easy to navigate, in a clear font and with easy to find information such as contact details and frequently asked questions. The lead item on the homepage is mortgages which changed since the 31/10/09 when savings led. This doesn’t sit as well with the usual ING-D market positioning as a savings provider. It may well be that ING-D has a strategy to keep the website fresh by changing the offer and emphasis on a regular basis. However, the change may have resulted from the significant drop in interest rates between the two dates as the company attempts to drive mortgage business.

Other parts of the home page continue to focus on savings and therefore there is some consistency in reinforcing this position. Tick marks give an upbeat feel to the site rather than simply using bullet points and this fits with the less formal communication style. By delivering a differentiated offer to competitors through the provision of fewer products, a friendlier quality service and a fresh approach ING-D seeks to establish itself in the minds of consumers as a different type of bank with a clear brand personality. Competitiveness