International marketing strategy in

the retail banking industry: The case

of ICICI Bank in Canada
Received (in revised form): 15th August, 2008

Leighann C. Neilson*
is Assistant Professor of Marketing in the Sprott School of Business at Carleton University (Canada). Her research interests are related to
social and cultural influences on marketing, interpretative and qualitative research methods, marketing history, and marketing in cultural
institutions.

Megha Chadha
is a Master of Business Administration graduate from the Sprott School of Business at Carleton University (Canada).

Abstract This study presents an overview of the marketing strategy that a retail bank may
pursue when it targets home country nationals in a foreign market. An analysis of the
marketing strategy of ICICI Bank in Canada reveals that a transnational strategy coupled with
an ethnocentric staffing policy allows the parent firm to retain control, while the choice of a
subsidiary as an entry mode allows for local responsiveness. Further analysis illustrates that
the blend of various variables in the services marketing mix (ie price, place, promotion,
participants, physical evidence, and process) can help in attaining customer satisfaction.
Journal of Financial Services Marketing (2008) 13, 204–220. doi:10.1057/fsm.2008.21

Keywords International bank marketing, customer satisfaction in banking, retail banking

INTRODUCTION retail banks, therefore, may choose to expand

into new international markets.5
In the context of retail banking, customer
A retail bank considering international
satisfaction has been found to be the ultimate
expansion faces several obstacles including a
measure of service performance.1 Once
lack of cultural awareness and understanding
customer satisfaction has been created, loyalty
of the market, and language differences that
is often formed, which in turn enhances firm
may hinder effective communication.6 One
profitability.2 Over the past few decades, retail
strategy retail banks could adopt to overcome
banks have faced an increasingly dynamic
these obstacles is to target home country
environment that has heightened standards
customers in the foreign market. Although
for attaining customer satisfaction, making it
revenue can be enhanced by targeting similar
difficult to sustain growth in the existing
markets, careful analysis suggests that
marketplace. In response, banks could choose
similarity alone is not sufficient to ensure
to diversify into new product lines or expand
success. Customer needs are a function of
into new markets.3 Since customers, however,
their socio-economic status, culture, and the
believe that product offerings across banks are
environment of the country in which they
similar,4 the option of product diversification
are residing.7 Since these elements are
would likely be an inefficient strategy. Many
continuously changing, it will be necessary to
adapt certain elements of the retail banking
marketing mix in order to create a more
*Correspondence: Sprott School of Business, Carleton University, localised approach. By employing a case
1125 Colonel By Drive, Ottawa, Ont., Canada K1S 5B6. study of ICICI Bank Canada, this research

204 Journal of Financial Services Marketing Vol. 13, 3 204–220 © 2008 Palgrave Macmillan 1363-0539
www.palgrave-journals.com/fsm
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
illustrates how an international bank that
targets home country nationals in a foreign
market can successfully adapt its marketing
mix. In doing so, this research seeks to
answer the following questions: When a retail
bank targets home country nationals in a
foreign market, which of the marketing mix
variables are customised? Of the variables that
have been customised, why have the
adaptations been made?
The paper is organised as follows: first, an
overview of the retail banking environment
in North America and new opportunities
arising in Canada are discussed. Then, a
literature review develops a conceptual
framework of marketing in the retail bank
industry. Next, the research methodology is
described and results of the data analysis are
presented. Finally, implications for managers
and future research are identified.
THE CHANGING NATURE OF THE
RETAIL BANKING INDUSTRY
Over the past two decades, retail banking
institutions in North America have been
facing an increasingly competitive and
dynamic business environment. First, there
has been a reduction in government
regulation creating a hybrid industry
structure.8,9 Second, new technologies, in
particular the internet, have facilitated the
entry of foreign banks into new markets
irrespective of physical presence.10 And finally,
consumers are now more informed, face
lower switching costs, and are showcasing an
ever increasing set of diverse needs.11 The
combination of these various forces has
escalated the competitive forces faced by
retail banks. In order to sustain sales growth,
banks could diversify into new products or
expand into new international markets.3
Customers have been found, however, to
perceive little difference between banks in
terms of product offerings,4 making product
diversification less attractive. Banks therefore
may pursue the second alternative, and in
fact, it is common to see international
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
expansion as an opportunity to increase sales
of existing products.
When expanding into new geographic
markets, a retail bank needs to ensure that it
is knowledgeable of the target market so as
to cater to customers’ needs appropriately.
Gaining knowledge of an international
market, however, requires a greater
investment. This is because the firm lacks
competence with the foreign market due to
the unfamiliar culture,6 buyer loyalties to
other service providers may already exist,12
language differences may hinder effective
communication despite translation
techniques,13 and extensive resources such as
management capacity and capital will be
required to be firmly established.12 To
mitigate the risks, firms may choose to target
markets similar to their home country’s
market.
Research suggests that market similarity,
defined as the degree of resemblance
between a foreign market and a firm’s home
market,14 could be a vital criterion for
market selection. Banks may choose to target
similar markets because the similarity creates
an opportunity to standardise some elements
of the marketing strategy15 and share
knowledge between subsidiary and parent.7
Demand for a product will tend to be
greatest in countries with markets similar to
that for which the product was originally
developed16 and greater brand awareness may
exist.17 Although revenue can be enhanced
by targeting similar markets, a careful
evaluation suggests that this alone can be
misleading;7 only considering potential
cash flows may mislead firms into
standardising their marketing strategy.
Excessive centralisation of marketing decision
making at the parent and failure to adapt
marketing strategy to subsidiary market
conditions has been found to contribute to
poor performance of subsidiaries.15 This
apparent conflict exists because customers’
needs are a function of their socio-economic
status, culture, and the environment of their
country of residence,7 which are always
Journal of Financial Services Marketing 205
 Neilson and Chadha
developing, that is, changing from what they
were in their country of origin. Therefore, it
will be necessary to adapt certain elements of
the marketing mix in order to create a more
localised approach.
The international strategy of retail banks
targeting home country customers in a
foreign market will entail a focused
approach. The service encounter is more
personal than the purchase of a good and at
least some portion of the service must be
produced locally.18 As such, exporting is not
an entry mode option that retail banks could
pursue. Banks also face strict regulations;
many countries limit the entry of foreign
banks to subsidiaries, while others may prefer
branches. Research suggests that if a bank
wishes to operate in retail banking and target
a focused clientele, a strategy of organic
growth (ie subsidiary) is most profitable
and an appropriate vehicle.19 This way, the
bank can differentiate itself from existing
competition. This mode also allows for
greater response to changing market
conditions, which is necessary now with
the increasingly dynamic environment
faced by retail banks.
The Canadian opportunity
The Canadian marketplace is changing.
Census data reveal that the visible minority
population is growing faster than the total
population; between 1996 and 2001, the total
population increased by 4 per cent while the
visible minority population rose 25 per cent.
It is estimated that by the year 2017, visible
minorities will account for between 19 and
23 per cent of the country’s population.20
The visible minority population consists
mainly of three segments: immigrants
successfully settled in Canada, immigrants
that have arrived recently and immigrants
that are still in their homeland and are in the
process of relocating to Canada. The latter
two segments have been found to have
special banking needs largely unfulfilled by
traditional bank offerings.21,22
206 Journal of Financial Services Marketing Vol. 13, 3 204–220
Researchers have found three primary
stages through which a typical immigrant
proceeds in order to adapt to his/her new
country. The first two years of the stay is
phase one, and the immigrant’s major
preoccupation is finding a job, maintaining
contact with family members back home, and
sending money to relatives back home.
During this phase, immigrants’ banking needs
are typically focused on financial remittance.
Phase two begins in the following three or
four years. If things are going well, the
immigrant will apply for consumer loans to
purchase a residence, and will get used to
having an account and a credit card. In Phase
Three and onwards, the immigrant requires
the full range of financial products and
services that a retail bank normally offers.21
Domestic banks usually do not recognise
the international credit history of new
immigrants. This lack of a credit history
prevents immigrants from accessing personal
credit, which in turn inhibits their ability to
integrate into Canadian society. Without a
credit history, immigrants are unable to
obtain a credit card, a mortgage, and educate
themselves in order to obtain the appropriate
certification for suitable employment. This
situation creates a vicious circle, wherein the
immigrant needs employment to develop a
credit history, credit history to obtain a loan,
a loan to enrol in studies, and studies to gain
employment. Without a credit history,
immigrants are also unable to obtain a loan
to establish a business.22 Further, it is likely
that domestic banks may lack an
understanding of immigrants’ cultural values,
may not be present in immigrant
communities, and may not have personnel
capable of conversing in the language with
which the new immigrant is most
comfortable.22
These special needs require new marketing
strategies on the part of retail banks. For
example, the traditional approach to lending
money involves analysing the applicant’s
financial history. Although domestic banks are
attempting to capture this lucrative market
© 2008 Palgrave Macmillan 1363-0539
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
segment, senior levels of the hierarchy are
primarily Canadian, which limits
understanding of the appropriate ways to
tailor marketing strategies. In contrast, foreign
banks that belong to the home country of
the immigrants may have stronger ties with
the ethnic group, and are discovering this
area of opportunity. HSBC Canada, for
instance, has benefited by targeting the
Chinese community.23
One immigrant population that is
increasing in number in Canada is the South
Asian. Here, the descriptor ‘South Asian’
identifies individuals from a diverse set of
ethnic backgrounds, including Bangladeshi,
Bengali, East Indian, Goan, Gujarati, Hindu,
Ismaili, Kashmiri, Nepali, Pakistani, Punjabi,
Sikh, Sinhalese, Sri Lankan, and Tamil
ancestries.24In the 2001 Canadian Census,
South Asians numbered 917,100; representing
3.1 per cent of Canada’s population and 23
per cent of the visible minority population.25
The same census estimated that the Chinese
represent the largest visible minority group.
The South Asian population, however, is
forecasted to reach 1.8 million by the year
2017 (a 96 per cent increase from 2001),
and have a higher fertility rate than the
Chinese.25 Analysts forecast that the share of
South Asians in the Canadian population will
soon be on par with the Chinese, creating a
market opportunity for retail banks.
RETAIL BANKING MARKETING
FRAMEWORK
This section develops a conceptual
framework of the marketing approach that
retail banks may pursue by drawing together
the main themes from the retail banking
literature that focuses on the marketing mix
and international strategies. Operating within
the services sector, the efficiency with which
retail banks conduct their marketing activities
through the ‘7 Ps’ of the services marketing
mix aids in creating customer satisfaction.
Results of the literature review are presented
in terms of the services marketing mix.
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
Product
When services offered match the needs of
the target customer, satisfaction results.26
When applied to retail banks, however,
customers have been found to perceive little
difference between banks in terms of product
offerings. A Canadian study found that the
personal relationships Canadians experience
with their retail bank outweigh the services
offered, and those banks able to manage the
customer experience stand a better chance to
develop relationships,27 denoting the lesser
importance of product differentiation.
Furthermore, banks that enter into a new
national market typically offer essentially the
same banking services provided by domestic
banks.28
Price
Customers are unwilling to pay a price that
is perceived as unfair because of the impact
on their financial situation.29,30 Previous
research has found that banks located in a
geographic region within which customers
are able to switch banks maintain similar fee
structures.31 Furthermore, even though banks
maintain divergent pricing policies across
countries, the overall structure manages to
converge within a country, including Canada
where the banks have focused less on pricing
as a strategy leading to competitive
advantage.32 Because of the similarity of
competitor offerings, customers are not likely
to switch banks regardless of any
dissatisfaction with the pricing policies of
their current bank.31
Place
There are several channels through which a
bank may offer its services, including branch
networks, automated teller machines (ATMs),
telephone banking, and internet banking.33
Research within financial services supports
the view that convenience is a criterion
customers utilise to select a bank so that they
Journal of Financial Services Marketing 207
 Neilson and Chadha
may easily conduct their banking
activities.34,35 Banks must consider such
factors as target market lifestyle, experience,
and buying habits when deciding through
which channels services will be offered,
because customers only adopt those
innovations that offer benefits.36
Promotion
Promotion is an essential component of a
retail bank’s marketing mix because although
people may purchase manufactured products
from an unknown vendor, they will always
look for a trustworthy bank.37 Marketing
communications, therefore, should maintain a
positive image of the bank and emphasise its
financial strength.37 Value-added promotions
are increasingly a useful means of obtaining
customer satisfaction. This is a legal form of
selling in Canada, and consists of offering the
customer a gift for purchasing a product or
service.38 Direct marketing is an effective way
to create a regular dialogue with customers
and update them on the latest offerings of
the bank. Research suggests that effective use
of direct marketing to an existing customer
base will likely increase customer retention
by at least 25 per cent.39,40
Participants
Customers consider it important to have a
relationship with their local bank;41 a
Canadian study found that it makes a
difference in customer satisfaction.42 Strong
relationships between customers and bank
personnel benefit the bank because they are
difficult for competitors to replicate.43 Several
personnel-related characteristics are key in
helping to achieve customer satisfaction.
These include ensuring the appropriate
appearance of staff by making certain that
fitting attire is worn;44 the need for
personnel to be sincere, demonstrate
enthusiasm in solving customer’s problems,44
and appear to be committed to giving their
utmost performance;43 a requirement for
208 Journal of Financial Services Marketing Vol. 13, 3 204–220
personnel to be competent, communicate
efficiently, and handle conflicts satisfactorily;45
the need for personnel to have the authority
to make decisions, so as to allow for
customisation to the particular needs of the
client;46,47 perceived employee effort to
reduce waiting times, and appropriate
employee interactions with customers (such
as attempting to apologise when customers
must wait to be served)48 and finally,
similarity of personnel with customers in
terms of appearance, lifestyle, social class, and
education level. When personnel are similar
to customers, interpersonal barriers are
reduced and trust is established.46
To ensure that these elements are
showcased by personnel, banks need to
employ internal marketing to instil a culture
that emphasises how every service encounter
with a client effects satisfaction. Employee
training should focus on educating service
personnel about the company’s services,
products, policies and practices, and providing
them with the necessary tools to solve
customers’ problems and respond to requests
efficiently.49
Physical evidence
Research has found that the physical
evidence at a bank branch has an influence
on customer satisfaction,50 likely because it is
one of the few tangible elements available to
evaluate a bank’s offerings.51 Figure 1 outlines
the various components of a retail bank
branch physical environment. Modern branch
styles are most effective at producing
customer satisfaction since they tend to have
more open layouts, a greater emphasis on
self-service terminals and technology
infrastructure, glass frontages, greater space for
customers, and limited use of bandit screens.
Larger windows are also present, and act to
promote the image and offerings of the
bank.51 Some features inherent in modern
branch styles, however, are associated with
customer dissatisfaction, such as the increased
presence of ATMs, and a clear view into the
© 2008 Palgrave Macmillan 1363-0539
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
Physical
Factors
Emotional
Stressors
Use
Facilitators
Service
Facilities
Figure 1 Key components of the branch environment adapted from: Greenland and McGoldrick51
branch. It is thus crucial that a bank evaluate
the preferences of its target market when
designing branches.
Process
Process in the services marketing mix refers
to the systems used to deliver services.
Customers may not instantly switch banks
after experiencing a problem during service
production, but may respond in the form of
making a formal complaint. Customer
satisfaction in such cases depends upon the
efficient and effective response of bank
personnel.52 Strategies for establishing and
maintaining a robust service delivery process
are predicated on effective communication to
develop shared understanding. This is
achieved by implementing an open dialogue
with customers, resolving complaints received,
and keeping customers informed of changes
to product and service offerings.53 Banks
need to signal commitment to the customer
by showing responsiveness to their changing
needs and by investing in the relationship.53
For conflicts that arise on a day-to-day basis,
it is important that personnel are empowered
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
1. Visual (e.g. lighting, colors, view into branch)
2. Aural (e.g. music, background noise)
3. Olfactory (e.g. air conditioning)
4. Tactile (e.g. materials, texture, comfort)
1. Aesthetics (e.g. pictures, plants)
2. Safety (e.g. bandit screens, cctv)
3. Modernity (e.g. age of layout)
4. Space (e.g. branch volume, branch area)
5. Privacy (e.g. desk spacing)
1. Information factors (e.g. displays, signs, zones)
2. Staff factors (e.g. uniforms, name badges)
3. External factors (e.g. frontage, entrance)
4. Internal factors (e.g. queue lines)
1. Personal (e.g. staff, service desks)
2. Impersonal (e.g. ATMs, pens & writing surfaces)
to take corrective action.53 In unexpected
circumstances, the bank should accept
responsibility and where possible offer
compensation to the customer.53
RESEARCH METHOD
The context of the case study was ICICI
Bank Canada (hereafter referred to as ‘the
Bank’). The Bank is a wholly owned
subsidiary of ICICI Bank Limited. ICICI
Bank Ltd., headquartered in Mumbai, India,
offers a wide range of banking products and
financial services to corporate and retail
customers, and, through various subsidiaries
and affiliates, is also active in the area of
investment banking, insurance, and wealth
management. The company is India’s second
largest bank, the country’s most valuable bank
in terms of market capitalisation, and is
ranked third among all the companies listed
on the Indian stock exchanges in terms of
Free Float Market Capitalisation.54 (Free
Float Market Capitalisation is defined as that
proportion of total shares issued by the
company that are readily available for trading
in the market. It excludes promoters’ and
Journal of Financial Services Marketing 209
 Neilson and Chadha
government holdings, strategic holding, and
other shares under any type of lock-in clause
that would not come into the market for
trading in the normal course.55) The brand
equity ICICI Bank has developed in South
Asia positions it as a bank that has the
potential to successfully target home country
immigrants in a foreign market.
ICICI Bank Canada is licensed as a foreign
bank subsidiary (Schedule II Bank) under the
Bank Act (Canada). Since its entry into the
Canadian market in December 2003, the
Bank has been successful in constantly
increasing returns. As of November 2007, the
Bank had seven branches and $2bn in assets,
over 125,000 customers across Canada, an
ATM network, and a robust direct banking
platform, all of which it achieved within two
years.56 ICICI Bank targets South Asians
with the goal of positioning itself as not only
an Indian financial institution, but as a
premier South Asian bank.57 The Bank’s
marketing strategies will help exemplify the
key success factors.
Data collection
To explore those marketing mix variables
that are of most significance for a retail bank
targeting home country nationals in a foreign
market, a case study approach was adopted. A
case study approach was appropriate because
the research focused on determining how and
why the marketing mix variables were
adapted — questions that had to be traced
over time, rather than through incidence.58
Although direct observation provided useful
and relevant information, the case study
approach also allowed for the use of a variety
of other evidence including content analysis
of the Bank’s marketing communications,
which helped to round out the kinds of data
collected.
To facilitate an intensive, detailed analysis,
multiple data collection methods were
employed. In the first method, data were
collected through personal observation of the
marketing strategy of ICICI Bank Canada.
210 Journal of Financial Services Marketing Vol. 13, 3 204–220
The second author completed a 2.5-month
internship (45 h/week) at the Bank’s
Canadian head office, working on projects in
the areas of marketing management and
customer complaint processing, interacting
primarily with the senior manager and
assistant managers of the Department of
Marketing & Public Affairs, assistant managers
of the Customer Service department, and
managers of Product Development. In-depth
discussions allowed the researcher to develop
a coherent understanding of the marketing
strategy of ICICI Bank in Canada. The data
that will be utilised to interpret the
marketing strategy, however, are those which
are available for access to the general public.
The Bank’s branches located in one of
Canada’s largest cities were also visited so as
to develop a deeper understanding of the
physical décor at the branches. All relevant
information observed and obtained was
documented in a research journal. ICICI
Bank Canada’s television advertisements were
viewed and analysed over an extended time
period, totalling over 40 viewings. Additional
materials, such as white papers published by
private firms, government policy documents,
and information contained on retail banking
industry websites helped to round out the
contextual information necessary for
analysing this case.
Data analysis
A grounded theory approach to data analysis
was employed.59 The grounded theory
approach is appropriate for open-ended
research in order to generate theory out of
the data collection,60 and was therefore a
relevant basis for attaining the research
objectives. During analysis, data were broken
down through coding whereby those
marketing variables identified as important
during the review of the bank marketing
literature guided the labelling process.60,61
The literature review also served as the basis
for exploring relationships between categories
in order to determine the relative importance
© 2008 Palgrave Macmillan 1363-0539
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
of each of the marketing variables and its
sub-elements. Following the constant
comparison method, new data being
collected were evaluated for its potential to
illuminate the concepts being coded. Data
collection and coding ended when a degree
of certainty had been reached with respect to
the research objective and theoretical
saturation had been achieved. This approach
allowed the researchers to determine those
marketing variables that are of most
significance when targeting the same
customer base as the home country in the
context of retail banking.
DISCUSSION
Results from the analysis of ICICI’s retail
banking marketing strategy are presented in
this section. The discussion is organised into
three parts. The first part will discuss the
international strategy of the Bank, and then
part two will discuss the strategies that have
been pursued for the various marketing mix
elements. This will be followed by a brief
examination of performance management
variables to determine whether the strategies
have been successful in achieving customer
satisfaction.
Strategy of ICICI Bank in Canada
Mode of entry
The Canadian government has established
that foreign banks wishing to operate in the
retail banking sector need to enter either as a
subsidiary or as a branch.62 ICICI Bank
elected to enter as a subsidiary, a decision
influenced by several factors. Under Canadian
regulations subsidiaries are able to offer the
full range of retail banking services, allowing
the Bank to act as a one-stop solution for
the banking needs of new South Asian
immigrants. Foreign bank subsidiaries are also
eligible for insurance provided by the Canada
Deposit Insurance Corporation.62 Canada
Deposit Insurance Corporation (CDIC) is a
federal Crown corporation that insures the
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
savings of Canadians (up to $100,000) in case
their financial institution fails or goes
bankrupt.63 Being insured with CDIC
enhances the perceived trustworthiness of the
Bank, thereby enhancing its ability to attract
market share. By entering the Canadian
market as a subsidiary, the Bank also has
greater control over strategic decision
making, which allows for swift response to
changes in the external market.64 A strategy
of organic growth allows for autonomy
in decisions pertaining to the marketing
mix, which in turn allows the Bank to
differentiate its offerings from the
competition. By attracting customers at the
early stages of entry into Canada, or as they
are preparing to enter, the Bank hopes to
establish long-term relationships with clients,
recognising their banking needs will change
as they integrate into the new society. The
organic entry mode allows the Bank to
exploit the long-term potential of its
investment in Canada.
International strategy
The international strategy of ICICI Bank in
Canada resembles a transnational strategy. The
Writing Lab, located in India, is mandated to
make a content quality check on all written
customer communication such as service-
related responses to customers, marketing
communications, web content, internal
promotional e-mails, and welcome letters to
customers sent when an account has been
opened with the Bank. ICICI Bank has
implemented a policy for corporate
branding entitled ‘ICICI Bank Corporate
Brand Guidelines’, which outlines the
ways in which the ICICI Bank corporate
brand name and image may be utilised
throughout the international operations.
The policy helps ensure a consistent brand
image on all marketing communications.
The subsidiary monitors the local market
environment to decipher emerging
customer needs and possible opportunities
for growth. It then determines the
appropriate marketing strategies it would
Journal of Financial Services Marketing 211
 Neilson and Chadha
like to pursue (eg a campaign that promotes
money transfer to India versus a campaign to
promote the mortgage business). The
subsidiary also has autonomy in prioritising
campaigns.
The transnational strategy allows ICICI
Bank to exploit core competencies
throughout the subsidiary and parent firm.
A centralised policy for corporate branding,
written communications, and creative
development allows the Bank to maintain
cohesion with respect to maintaining a
consistent brand image. This allows the Bank
to exploit the relationships it has developed
with South Asians back home. The autonomy
given to the subsidiary in terms of
determining appropriate marketing strategies
allows the Bank to respond to the needs of
the local market.
Organisational factors
The human resource policy of the Bank is
categorised as ethnocentric, whereby home
country personnel are selected for
management jobs.65 Benefits of this approach
include enhanced marketing communications
— managers are largely familiar with the
culture and customs of customers and can
implement effective marketing strategies, and
enhanced control — employing home
country nationals allows headquarters to
replicate its policies and practices.66
Maintenance of control is necessary because
the subsidiary is currently in its early stages
of growth and depends on headquarters for
direction with respect to corporate strategy.
According to Hofstede’s cultural
dimensions,67,68 Canada is ranked as a society
with a more individualistic attitude, with the
populace being more self-reliant and private.
In contrast, India has a high power distance
and is more collectivist. Owing to such
differences, it is likely that employing
Canadian managers could result in cross-
cultural conflict.
The disadvantages to this strategy are that
flexibility to new management approaches is
reduced, and training expenses increase
212 Journal of Financial Services Marketing Vol. 13, 3 204–220
because expatriates are unfamiliar with the
Canadian environment.69 To mitigate the
risks, the Bank holds training sessions
throughout the year for new expatriate
arrivals. These sessions are hosted by
Canadian consultants and provide an
overview of the local business environment,
along with the areas where business practices
differ between India and Canada.
Marketing framework of
ICICI Bank Canada
Product
ICICI Bank Canada has positioned itself as a
full-service bank by offering the full range of
retail banking products. The Bank has
attempted to build relationships with new
South Asian immigrants by offering
innovative products, such as the ‘Hello
Canada’ account that allows immigrants
coming to Canada to open a Canadian bank
account from a foreign country and transfer
funds into the account prior to arrival.70
A second product, the ‘Hello Canada
Newcomers Account’, permits customers to
obtain credit cards, and car and house loans
prior to arrival.71 ICICI Bank Canada targets
this market niche by recognising the credit
history of the South Asian immigrants from
their home country.70 These specialised
products allow customers to access money
upon arrival, easing their transition to
Canadian society.
Although these products may seem novel,
further analysis reveals similar product
offerings are available through other
Canadian banks. For instance, the Royal
Bank of Canada has implemented a ‘Secured
Visa Option’ that allows immigrants to build
a credit history more easily. The company has
also launched an internet-based account
opening procedure that allows immigrants to
deposit funds prior to arrival.72 Thus, product
differentiation is not the primary basis
through which ICICI Bank competes in the
Canadian market.
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International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada

Price Canadian financial institutions. For each

In order to attract new immigrants, the Bank product, the price of the Bank is more
promotes its money transfer business by attractive than the average.
allowing customers holding a chequing The Bank’s competitive pricing is made
account to transfer money to South Asia possible by the cost savings it realises by
without any charge. In comparison, ICICI retaining some of its workforce in India,
competitor Bank of Montreal charges where wages are lower. While international
between $15 and $125 Cdn for wire banks such as HSBC and Citibank save
payments.73 This is a viable strategy because approximately 30 per cent by outsourcing
in the first few years after arrival customers low-end functions of data entry, call centre
are more focused on transferring money back jobs, and payment processing to India, ICICI
home. Bank claims to save as much as 70 per cent
In order to maintain relationships with with both low- and high-end jobs such as
new South Asian immigrants during phase product innovation and technology
two of the immigration lifecycle, the Bank development based in India.74
maintains competitive prices for various Additional benefits to ICICI’s pricing
investment and mortgage products by strategy can be observed. By offering free
offering a higher interest rate than other money transfers, the firm creates customer
Canadian banks.71,74 Specifically, mortgages satisfaction during the initial phase of
are priced lower, whereas investment products immigrants’ adjustment to Canada. Thereafter,
such as term deposits and GICs are priced competitive mortgages and investment
higher. Table 1 illustrates the interest rate product pricings help maintain satisfaction
offerings of ICICI Bank Canada, as of 17th during phase two. After this, immigrants enter
October, 2007, vis-à-vis the average for major into phase three, by which time they have
integrated and settled into Canada. At this
Table 1 Interest rate offerings (in %), on 17th October, stage, the Bank has also been able to develop
200775 customer loyalty, and therefore, customer
Mortgage Term GIC switching is less likely to occur allowing the
5 year deposit 5 year Bank to focus on other variables to maintain
1 year
satisfaction. Consider the pricing strategy the
Bank of Montreal 7.440 4.000 3.600 Bank pursues for traditional banking
Bank of Nova 7.440 2.350 3.600
Scotia products. From phase three of the immigrant
Comtech Credit 5.790 2.300 5.010 lifecycle onwards, a savings account or
Union
Equitable Trust 7.190 4.550 5.050
chequing account would be the primary
Grand River Credit 6.700 4.500 4.650 focus.76 At least one competitor, President’s
Union Choice Financial, provides a higher interest
HSBC Bank 7.440 2.450 3.600
Canada rate on savings accounts and charges no daily
ICICI Bank 5.750 4.300 5.000 banking or account maintenance fees on
Canada
ING Direct 5.790 3.900 4.650 chequing accounts.77
Laurentian Bank 7.100 2.750 4.500 Pricing is one variable through which
Canada
Libro Financial 7.100 2.750 4.500 ICICI Bank Canada maintains customer
Group satisfaction. By focusing on immigrants’
Manulife Bank 5.850 4.600 4.800
National Bank 7.190 2.450 3.700
changing needs, the Bank is able to develop
ResMor Trust 5.790 4.300 4.400 customer loyalty with the aim of building
Royal Bank of 7.400 2.350 3.600 relationships for the long term. The Bank, in
Canada
TD Canada Trust 7.440 2.450 3.600 a sense, defers profit taking until immigrants
Average of all 6.761 3.33 4.284 enter phase three when it is able to charge
institutions
more and not lose customers.

© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220 Journal of Financial Services Marketing 213
 Neilson and Chadha
Place
The Bank offers its products through
various channels. It has strategically
established seven branches in Canadian
cities that have a prominent South Asian
community.24,74 Moreover, the South Asian
population in these areas is expected to
increase,57 which makes the branch strategy
viable and sustainable. The Bank has
ATM machines located at each of its
branches which can operate in English,
Hindi, Tamil, Punjabi, Chinese, and
French.78 Operating machines in diverse
South Asian languages enhances customer
satisfaction. Customers are also allowed to
utilise ABM machines with the Interac
or Cirrus logo located worldwide. This is
an excellent strategy for satisfaction since
it is likely that customers travelling to their
home country will need access to their
accounts. The Bank offers credit card
products, and clients are allowed to transfer
funds to South Asia via their credit card,
enhancing customer convenience. As a sales
tactic, kiosks are placed at various South
Asian grocery stores in the Greater Toronto
District. These kiosks are staffed by South
Asian sales personnel whose primary role is
to attract customers to open accounts with
ICICI.
Although the multichannel strategy
enhances market coverage, customer
convenience, and allows for cross-selling
opportunities, similar channels are also being
pursued by other banks to target the South
Asian immigrant market. For instance, the
Canadian Imperial Bank of Commerce
(CIBC) has located several branches in South
Asian neighbourhoods and also offers ABM
services in ethnic languages.79 Bank of
Montreal is also increasing branch penetration
in the ethnic communities to deepen
relationships with the local population.80
Thus, channel of distribution alone is not a
key source of competitive advantage and is
largely utilised as the foundation to enhance
market penetration and customer
convenience.
214 Journal of Financial Services Marketing Vol. 13, 3 204–220
Promotion
A strong corporate identity is seen as an
effective means for differentiation in retail
banking.81 The Bank creates and maintains a
strong image through marketing
communications and event sponsorship. To
create a trustworthy image, ICICI Bank
Canada showcases Shahrukh Khan, a well-
known Indian actor, in its marketing
communications. Khan is currently ranked as
one of the most famous and influential
celebrities in South Asia. Since the target
markets of the Bank are those people
preparing to immigrate, and those that have
recently immigrated, the audience is largely
familiar with, and likes, the actor. This makes
ads featuring Khan both persuasive and
effective.82 Research on the use of celebrity
endorsers finds that the symbolic properties
of the celebrity are transferred onto the
product, and thereafter onto the customer.82
Shahrukh Khan is believed to embody the
Indian winning spirit in terms of energy and
innovation.83 This image may fit with the
aspirations of the audience as they migrate
to a new nation.
In addition, the Bank is able to utilise
Shahrukh Khan in the explicit mode of
‘I endorse this product’. For instance, as a
commercial on money transfers to India
concludes, the actor states, ‘Take my word
for it’. Utilising a trustworthy source
enhances the trustworthiness of the product,
implying that it is safe, secure, and stable.84
The Bank emphasises television and radio in
its promotion strategy. These media are
effective for image advertising because they
enhance awareness and improve customers’
attitudes toward the advertiser.37
In print advertisements, the headline and
illustration are emphasised, highlighting
Shahrukh Khan and providing a broader
appeal.37 The ads are large sized, which has
the effect of making the audience feel that
the Bank is stronger and large and hence
trustworthy.37 The Bank’s membership in
CDIC is also stated, adding to the credibility
of the Bank.
© 2008 Palgrave Macmillan 1363-0539
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
ICICI Bank also sponsors various high-
brow South Asian cultural events. Immigrants
who are in phase two and onwards would be
attracted to these shows, because they have
the financial capability and leisure time to
attend. Linking the event experience to
the brand results not only in favourable
publicity and increased brand awareness but
also enhanced brand image,85,86 as an
impression of sophistication and seriousness
is formed.87
Participants
There are three primary ways through which
the Bank ensures that personnel are
competent, communicate effectively and
reliably, and handle conflicts satisfactorily.
First, upon selection, personnel are exposed
to various materials outlining the bank’s
history, industry overview, market reach, and
strategy. Second, training and guidance are
given on a regular basis to existing
employees, so as to instil a culture focused on
customer satisfaction. And finally, an internal
marketing programme has been implemented
which consists of distributing internal
newsletters to update staff on the latest
company developments, future objectives, and
success factors for customer satisfaction.
Similarity of personnel with clients also
effects customer satisfaction. The Bank
recruits South Asian personnel and ensures
that as a whole the staff speaks various South
Asian languages such as Arabic, Gujarati,
Hindi, Punjabi, Tamil, and Urdu.70 This raises
comfort levels,70 and helps in changing
attitudes and opinions of the clients.46 Other
Canadian banks, however, also recruit ethnic
personnel in order to attract ethnic markets.
For example, Toronto Dominion Bank
ensures that the branches located in
communities with high ethnic populations
are staffed with personnel able to speak
minority languages,72 and CIBC pursues a
similar strategy.78 These examples illustrate
that the element of personnel on its own is
not likely to allow ICICI to achieve
differentiation.
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
Physical evidence
Several components of the Bank’s branch
environment enhance its competitiveness.
Branches have a fairly modern layout with
open-space designs and limited use of bandit
screens. Spacing between the desks is
sufficient to ensure privacy. These elements
help to enhance perceived trustworthiness,
prevent robbery/fraud, and serve to reduce
emotional stressors. Brochures and posters
featured in branches focus primarily on
money transfers and investment products. This
is in contrast to other Canadian banks, where
posters designed to support cross-selling
activities focus primarily on traditional retail
banking products.
Process
Although ICICI strives to perform its
activities accurately, customers may sometimes
experience a problem during the service
process. Upon receipt, complaints are
reviewed by the Customer Service Group
located in India, who strive to address the
issue within two to three business working
days. In case the issue needs a localised
response, it is transmitted to the Customer
Service Team located in Canada. Customers
may be compensated for an error whose fault
lies with the Bank. And in cases where the
customer has significant business with the
Bank, a gift may be offered and senior
managers may also get personally involved.
These gestures show that the Bank is
trustworthy and has accepted responsibility
for its faults,53 and allow stable relationships
to be built.88
To summarise, ICICI Bank is able to
leverage its cultural insights and knowledge
so as to successfully attract the South Asian
immigrant market in Canada. To create the
foundation for sustainable growth, the Bank
established itself as a subsidiary, operating as a
full-service bank and maintaining autonomy
in key areas of strategic decision making.
An ethnocentric staffing policy maintains
control with the parent firm, necessary as
Journal of Financial Services Marketing 215
 Neilson and Chadha
the subsidiary is still in its early stages of
growth.
In terms of the services marketing mix,
the product variable has been found to not
be a source of differentiation. On the other
hand, place and personnel are variables
through which the bank is able to enhance
market penetration and customer
convenience. In order to attract and retain
customers, the primary differentiators are
pricing, promotions, processes, and physical
décor. Specifically, a competitive pricing
strategy allows the Bank to attract its target
market at its early stages of entry into
Canada, creating the opportunity to form
long-term relationships. By emphasising the
trustworthiness of the Bank in promotions,
and establishing stringent processes for
addressing customer complaints, the Bank is
able to maintain clients. In terms of physical
décor, use facilitators and the presence of
ICICI Bank brand name and image, allow
for customer attraction and cross selling,
while modern branch styles help in
enhancing trustworthiness and prevent
robbery/fraud. The strategic blend of these
elements allows the Bank to achieve
customer satisfaction, which in turn generates
loyalty and bank profitability. The following
model summarises the findings from this
section (Figure 2).
• Subsidiary • Price
entry mode • Place
• Transnational • Promotion
strategy • Participants
• Ethnocentric • Physical
staffing Evidence
policy • Process
International Marketing
Strategy Mix
Figure 2 The marketing model of ICICI Bank Canada
216 Journal of Financial Services Marketing Vol. 13, 3 204–220
ICICI Bank Canada’s profitability
analysis
To determine the effectiveness of the
marketing strategy of ICICI Bank Canada, it
is necessary to measure whether customer
satisfaction has been produced. Research
suggests that the value of deposits is an
important way to determine whether a retail
bank has been successful in maintaining
relationships with its customers.89 Since
ICICI Bank entered the Canadian market,
the value of customer deposits, measured in
Indian rupees, has risen from 1,599,785
rupees in 2004 to 24,044,875 rupees in 2005
and 60,890,218 rupees in 2006. Interest
income (ie revenue from loans) measured
over the same time period has grown from
48,392 to 552,685 rupees in 2005 and
2,559,708 rupees in 2006.90 The rise in
interest income has reduced the Bank’s net
loss, with the likelihood of positive returns in
a few years. From our analysis, it is evident
that the marketing strategies that ICICI Bank
Canada has implemented are leading to
customer satisfaction and enhanced
profitability. It is likely that as immigrants
move through later phases of their integration
into Canadian society, they will continue to
conduct their banking activities with ICICI
Bank Canada, and augmented with positive
word of mouth, and innovative marketing
Customer Enhanced
Satisfaction Profitability
© 2008 Palgrave Macmillan 1363-0539
International marketing strategy in the retail banking industry: The case of ICICI Bank in Canada
strategies, the Bank will likely continue to
attract and retain its target market.
MANAGERIAL IMPLICATIONS
AND SUGGESTIONS FOR
FUTURE RESEARCH
ICICI Bank was able to expand into Canada
by targeting home country customers and
leveraging its home country success. Other
retail banks considering a similar expansion
strategy need to ensure that they have
established a successful network and presence
in the country of origin of the target market
and that the targeted segment has future
growth potential in the new country. In
addition, this research highlights the need to
showcase commitment to the target market
through various factors largely controllable
by managers. Managers should select staff
who are able to effectively communicate
with customers in order to meet the needs
of the target market. To allow for relationship
development at early stages of immigration,
new strategies to recognise the credit history
of applicants are required and changes to
pricing policies may be called for. Finally,
managers need to create a trustworthy
image, and instil a culture focused on the
customer through ongoing employee
training.
For domestic banks seeking to attract the
growing new immigrant segment, there is a
serious lack of academic research to provide
guidance and direction.22 Our research
highlights the need to understand not only
the differences between the banking systems
of the home and new country, in order to
understand the customer’s potential
confusion, but also the customer’s stage of
adaptation to the new country and
consequent financial service needs. Some
larger banks have initiated targeted marketing
campaigns that include new product lines
and websites especially designed for new and
potential immigrants, which might serve as
models (see eg the Royal Bank’s ‘Welcome
to Canada’ site).91 Additional guidance can
© 2008 Palgrave Macmillan 1363-0539 Vol. 13, 3 204–220
be found in Atallah and Rebelo’s 2006 report
based on research conducted within new
immigrant communities. They recommend
that financial institutions educate staff,
especially customer contact and marketing
employees, to understand immigrant markets;
provide cultural sensitivity training to all staff;
expand alternative credit measurements; and
develop partnerships with community-based
organisations in order to offer financial
literacy workshops to new immigrants.22
Future research should consider retail
banks that have been longer established in
new international markets, serving target
segments at more advanced stages of settling
into their new country. A multiple case study
design would allow for development of the
conceptual framework in greater detail.
Finally, a quantitative research design would
allow for the estimation of the importance of
the various marketing mix variables in terms
of the extent to which each determines
customer satisfaction.
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