Integrated Marketing Communication

Case Study: Strategic Alliance between Standard Chartered Bank

(SCB) and Kingfisher Airlines on Promotional Purpose

Dr. Md. Ridhwanul Haq

Professor

Institute of Business Administration,

University of Dhaka
About Standard Chartered Bank:

Standard Bank of British South Africa and Chartered Bank of India, China and Australia merged
together to form a new bank with the names of both the banks in 1969. The two constituent
banks were more than hundred years of age at that time. In early nineties of last
century Standard Chartered Bank (SCB) decided to develop its strong holds in Asia, Africa, and
the Middle East. It emphasized on consumer, corporate and institutional banking and also the
treasury services. SCB acquired Grindlays Bank from ANZ Group and Chase Consumer Banking
Operations, Hong Kong in 2000.

Considering the experience of ANZ Grindlays Bank SCB started its operation here in Bangladesh
in 1905 and first branch was established at Chittagong in 1948. Today, Standard Chartered Bank
is the largest international bank in Bangladesh with 26 Branches, 57 ATMs, and 7 Financial
Kiosks; employing over 1,300 people. They are the only foreign bank in the country with
presence in 6 cities – Dhaka, Chittagong, Khulna, Sylhet, Bogra, and Narayanganj.

Services

The services provided in Bangladesh by SCB may be categorized under several broad heads.
These are Personal Banking, Priority Banking, Islamic Banking, SME Banking, and Wholesale
Banking. The credit cards hold a strong share in the personal banking portfolio. Until mid 2012,
the Platinum card of SCB offered the greatest value to its customers with a more features and
benefits than any of their other cards and that of the competitors. They offered features like
hotel & hospital discounts both home and abroad, airport privileges, instant cash advances etc.
In an effort to make the card more lucrative to the target customers, the bank made an alliance
with Kingfisher Airlines offering one complementary ticket as a welcome gift.

About kingfisher Airlines:

Kingfisher Airlines was established in 2000. The airline started commercial operations in 9 May
2005. Kingfisher Airlines, through its parent company United Breweries Group, has a 50% stake
in low-cost carrier Kingfisher Red. It started its international operations on 3 September 2008
by connecting Bengaluru with London. The company launched daily direct flights connecting

2
Kolkata with Dhaka from May 15, 2009. The flights between Kolkata and Dhaka were operated
as Kingfisher Red service. The Kingfisher Red service is a unique class of low fare flying from
Kingfisher Airlines and offers guests a whole host of benefits besides the trademark Kingfisher
service at low fares. The purpose of offering the flight was to cater to the markets outside India
with attractive and comparable fees and to offer convenient connectivity to onward
destinations in India through Kingfisher network. According to the officials of the company the
initial response to the offer was extremely encouraging. The alliance with SCB was formed to
rapidly consolidate their market share on this new international route.

Until December 2011, Kingfisher Airlines had the second largest share in India's domestic air
travel market. However due to a severe financial crisis faced by the airline at the beginning of
2012, it has the lowest market share since April 2012. Following that the airline has temporarily
shut down its operations during late 2012 following the suspension of its flying license.

Why SCB launched this campaign:

Standard Chartered Bank (SCB) incorporated Kingfisher Airlines in their platinum card campaign
with a view that this collaboration would add value to their card. Offering a credit card with
high credit limit and esteem status is not enough to grab a substantial market share. The SCB
credit card team wanted their customers to feel like they are getting more than just a card. So
they introduced an optional offer for a trip to Kolkata in Kingfisher Airlines thinking this offer
would create a higher value of the package in the customers’ mind.

Another important reason behind choosing Kolkata as the desired destination is that, it is a
popular shopping destination for many Bangladeshis now-a-days. In addition many people go to
Kolkata for medical purpose as well. Having an international credit card on a trip to Kolkata
might ignite a good amount of card activity there.

Why Kingfisher got involved in this campaign:

From the Kingfisher Airlines perspective, since the Airline is relatively new in the market and
has not had a good run yet in Bangladesh, they could use some push start in this new venture
here. This offer could help its market penetration strategy and provide an easy promotional

3
access. Once the offer users, who belong to the upper class of the social pyramid and usually
travels abroad often, get a taste of the Kingfisher service would later choose the airliner as their
preferred carrier.

Another very imperative reason is that engaging with SCB which is one of the top banking
brands in the world would provide a robust brand image to Kingfisher Airlines. Of course, the
fact that getting a ready client base and easy access to the market as discussed earlier would
ensure that the booked seats are surely paid for.

All in all, it seemed like a win-win situation for both the brands considering the hypothesis that
in the minds of the customers the package is once in a lifetime opportunity.

The campaign:

Key role players

To run such a hefty promotional campaign, scores of qualified manpower was needed. It
involved quite a few members of the respective organizations. The primary concern team from
Standard Chartered Bank (SCB) was the Alliance & Chanel Support team of Credit Cards
department. The consumer bank marketing team played the supporting role in designing and
delivering the marketing collaterals.

From Kingfisher’s part, the senior manager from the country marketing team of Kingfisher
Airlines was responsible primarily for setting up the campaign details. He was supported by the
regional marketing team at Kingfisher Airlines head office at India.

Division of work

SCB’s Alliance & Chanel Support team and senior marketing manager from Kingfisher Airlines
were assigned the duty of setting up the overall campaign. They worked together to devise the
promotional offer in general.

4
 Budget

The promotion started out in a gigantic manner. The managers had their hopes high about the
offer. Therefore a substantial amount of money was allocated for the project. The overall
budget of the campaign was roughly BDT 3,200,000.

Fig. 1: Print advertisement for the campaign

Market response:

Unfortunately the response of the movement was not that noticeable. The outcome did not
materialize as anticipated. Details on the card sales are provided in the trend analysis table in
the following page:

5
 Campaign Phase 1 Campaign Phase 2

Jul Aug Sep Oct Nov Dec Jan Feb Mar

Platinum Card Count 4125 4317 4526 4725 4889 5125 5351 5520 5701

Kingfisher Airlines Offer

7 13 17 9 26 15
Availed

Table 1: Trend analysis

*Figures mentioned above are approximate number. To be only used for academic purpose only.

Problem of the campaign: What went wrong?

After launching the campaign the authorities soon realized that things are not going as planned.
As the numbers show the response of the promotion was not up to the expectation. The reason
for this unsatisfactory result lies in unwise choice of destination for the target group. The offer
involved giving away free air tickets to Kolkata to the platinum card holders. Now, the clients
who are taking platinum cards or already hold one must have a significant amount of deposit
with the bank. They are most likely from the upper class of the society. Presumably their
affordability of air travel is quite reasonable. They have the ability to fly to a range of places
across the globe. Therefore Kolkata does not stand as an appealing travel destination to this
class of people. They would have definitely preferred a more exotic location than this. So the
promotion did not fit. In a nutshell, the offer was not suitable for the client base.

Corrective measures:
Time extension of the offer
Originally the campaign was to exist from January to March. However, given the miserable
outcomes SCB authorities decided to extend the offer for three more months and keep it valid
till September after the first phase of the campaign did not work out very well. The result
achieved from extension phase was quite similar to the first period: disappointing. Only a
handful of the card holders availed the offer.

6
 Collaboration with hotels of Kolkata
SCB also collaborated with two hotels situated in Kolkata where the platinum card holders can
avail certain facilities while their trip. The hotels were Hotel Hindustan International Kolkata
and the Park Hotels Kolkata. Nevertheless, trying to attract the eligible clients through such
measure failed a great deal.

Outcome of the promotion:

SCB tried to lure the platinum card holders to get them fly to Kolkata via Kingfisher Airlines. But
the promotional campaign remained almost just in pen and paper. It did not turned up to be a
successful movement for SCB’s part. Overall the initiative did not become as winning as
expected.

Questions:

1. What benefits do you think SCB & kingfisher Airlines received out of the campaign?
2. How would you evaluate the step taken by SCB to promote its Platinum Card?
3. Please explain your thoughts on the helpfulness of the corrective action.
4. What would you suggest to SCB to solve the problem?