Banking & Finance

Application of Marketing Concept in Commercial Banks

Application of Marketing Concept in Commercial Banks (A Study of Diamond Bank Limited, Enugu Branch)




The manufacturers of consumer products in Britain were the earliest to prosper. This was necessitated by their firm belief and adherence to their Business Philosophy which says: ‘‘You must give people what they want; the right product at the right price, in the right place at the right time, and with the right promotional tools”.

The Institute of Marketing defined marketing as satisfying customer requirements profitably. Kottler defined marketing as “customer orientation backed up by integrated marketing, aimed at achieving organization goal”. According to him, the purpose of business is to create and keep a customer. The objective of the marketing process is profitable sales of services that satisfy customer financial requirements and needs. The organization should learn to stop looking inwards at the company and concentrate on the outward aspect which is the customers with the sole aim of satisfying the customers. Organizations should stop thinking only about producing goods and services and selling them to satisfy customers’ needs.

Drucker, one of the world’s leading writers on business management made the importance of the customer and the marketing very clear when he said, ‘‘it is the customer who determines what business is”. His statement cannot be over-emphasized, this is because the maxim says that “the customer is always right” has its origin in the writing on economic and social theory.

Adam Smith who was known as one of the earliest writers on economics, recognized the importance of the marketing concept as far as 1770’s when he stated that consumption is the sole and only purpose of all productions and the interest of the producer ought to be attended to only so far as it may be necessary for promotion.

Therefore, the essence of the marketing concept is to eradicate:

(a) The business or organizations or firms with production as the overriding and main business activity. Production is only necessary to facilitate the achievement of marketing goals.

(b) The communication gap that forms the mass production of foods and employment of intermediary organizations, for example, wholesalers and retailers. The marketing concept services in this contact a set link, that is to bring the suppliers (company) and the buyers (customers) together in so doing, the customer’s knowledge about the company and its products is enhanced. And more importantly, the company

operates with a better knowledge of its target market and market requirements.

Drucker concluded by saying that, the purpose of a business or company has only two fractions and these include:

(a) Innovations;

(b) Marketing

He is therefore of the opinion that marketing and innovation produce results while all the others are regarded as a cost to the company. Marketing as a concept and a discipline is undesirably a central function of management at all levels, and for the specialist such as market researcher or advertising executive that might be found in the marketing department.

Nigeria has been characterized by a limited number of banks since 1892 when the first Nigerian bank, the African Banking Corporation was established. This exposed the public to only a few banks, where the problem is not selling but producing because anything and everything sells, therefore, leading to the total neglect of customers’ needs, which has 40 incessant condemnation and criticisms from people in all walks of life. The most notable condemnation came from the former President of the Nigerian/American Chamber of Commerce, Chief Ogunbanjo, who accused Nigerian banks of financial terrorism.

But it has become pertinent that banks should move away from the sales orientation which hitter has characterized the marketing of financial services in Nigeria and change over to the practicing marketing concept, because of the increasing rate of competition in the banking industry. The increasing number of banks in Nigeria in recent times has made the environment in-patient for stagnant banks that are hamstrung by age-long tradition.

The day is now being carried by the progressive and dynamic bankers improving their skills at all times and constantly scanning the environment and developing customers’ needs. Marketing for banks, therefore, is the creation and delivery of customer-oriented or satisfying services at a profit to the bank.

Some banks consider marketing as essentially advertising and public relations, which are only two tools of marketing out of many. Banks should try as much as possible to revise their parochial idea of marketing and start practicing marketing with all its components, and all techniques it embodies.

It is also necessary to stress that the tools of modern marketing, however elaborate and scientific are in the end no more than levers, inert and even dull artifacts when not in use, but are capable of reducing dynamics results when they have a point where they can be forced and an agreed direction in which the leverage should be exerted.

Finally, while marketing may not be the most important aspect of the banking industry, it serves as a major adopted and applied function in every banking environment.


Since the commercial banks in the country want to practice real marketing, there is every need for them to market their services to their numerous customers

The problem of poor quality services should not be found in the banking industry alone, rather, it should be seen as a general problem of this nation. The quality of services rendered by commercial banks in Nigeria, concerning the Diamond Bank Limited, has been attracting incessant criticisms from its customers. A notable one as stated earlier was that of Chief Chris Ogunbanjo, former President of Nigeria/America Chamber of Commerce; who described banks as “an instrument of financial terrorism”. According to him, “there is an urgent need for reform in the Nigerian banking industry and such reforms must fall squarely on the Central Bank and the entire banking industry.

There is a need for banks to take an in-depth look to make necessary adjustments. The shortcoming of our banking system is that when customers go to banks to withdraw their money, they spend their whole day waiting to be attended to and when the customers complain or need inquiry, their complaints are met with rudeness from the staff, who seem to forget that they were employed to serve this customer, not minding how big or small the customer is. Based on the above allegations and experiences of bank customers, managers of banks are not sure of the extent to which banks practice the marketing concept.

Therefore, this topic was chosen in other to find out how the marketing concept can help Diamond Bank Limited and the entire banking industry in improving their market performances. The research went ahead to develop some research questions which are intended to give an insight into the problem when answered.


The main objective of this work is to carry out a critical analysis of the appraisal of the marketing concept in Diamond Bank Limited and to take an in-depth look at the operation of Diamond Bank Limited, as it relates to customer services. The objectives of this study include the following:

a. To ascertain the level of good customer relationship that exists at the Diamond Bank Limited.

b. To ascertain how customers get informed about the availability of services rendered at the Diamond Bank Limited.

c. To determine if Diamond Bank Limited is customer-oriented and if not, what are the possible solutions towards improving their operations.

d. To determine if marketing departments exist within Diamond Bank Limited and other Commercial banks, and if so, what are their activities.

e. Finally, to make recommendations about what can be done within the banking industry to improve the services extended to their customers.


The following are the research questions:

(a). Does Diamond Bank maintain a good relationship with its customers? (b). How do customers get informed about the availability of services rendered at Diamond Limited?

(c). Is Diamond Bank Ltd customer-oriented?

(d). Do Marketing Departments exist within Diamond Bank Limited?

(e). Are customers satisfied with the standard of services rendered by Diamond Bank Ltd?

(f). Are Customers’ problems solved within the shortest possible time at Diamond Bank Ltd?

(g). Is the employment of the marketing concept within Diamond Bank Ltd satisfactory?


To properly investigate the problems arising from the appraisal of the marketing concept in Diamond Bank Limited, the following hypotheses

have been made. The null hypotheses (Ho) and the alternative hypotheses (HI) are formed as shown below.

1. HO: Customers are not satisfied with the standard of services rendered by Diamond Bank Limited.

HI: Customers are satisfied with the standard of services rendered by Diamond Bank Limited.

2. HO: Customers’ problems are not solved within the shortest possible time

3. HO: The extent to which Diamond Bank employs the marketing concept in its operations is unsatisfactory.

HI: The extent to which Diamond Bank employs the marketing concept in its operations is satisfactory.


The result obtained from the study will be of benefit to the Management of Commercial Banks and the entire banking industry; the government; non-financial institutions; business entrepreneurs; students of the Marketing Department and other related courses and the general public as a whole.


The study centers on the marketing concept applied by the banking industry, with a particular focus on Diamond Bank Ltd.


The researcher achieved quite a great success with the use of the questionnaire since most of the respondents that filled the questionnaire were quite happy with Diamond Bank Limited and the entire banking industry in Nigeria.

They were eager to air views in this direction.

However, this study could have been more comprehensive and elaborate, but for the uncooperative attitude of the bank. The bankers found it difficult to give out vital information, which would have been useful to this study and the commercial banks in Nigeria.

Another limitation is inadequate funds at the disposal of the researcher also, the researcher was carrying out this study in her final semester and enough time was not available. Whatever information that is contained in this paper was made more possible by the fact that the researcher later assured all respondents that all information obtained will be treated with the strictest confidence and that it was a mere academic exercise.


1. Achukwu, M.A., “Developing Good Bank Customer Relation”, Business Times, Sept. 27, 1982

2. Emodi, E., “The Need for Effective Marketing” Business Times Dec. 3, 1984.

3. Erihri P., “Restructuring of Banking Industry in Nigeria” Business Times, Aug. 22, 1983.

4. Lawal, B., “Recruitment and Training Policy in Commercial Banks Financial Fund. Oct. 27, 1982.

5. Median, A., “The Role of Marketing Management in Banking” Institute of Marketing Quarterly Review, April 3, 1983.

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