Alpen Bank Case

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Summary of the Case:
Alpen bank needs to launch credit card in Romania which is a matter driven by market dynamics, customer demographics, usage behavior and changing macroeconomic conditions. Formulation of an effective marketing strategy is inevitable for the introduction of the credit card in such an environment. 1. How should Alpen position its card, if it intends to launch it? Positioning is identifying a set of possible competitive advantages to build a position in the minds of the consumers by providing superior value. [1] Slide 32 Chapter 7 Credit card provides the consumers with ease of payments, use and reliability. The value proposition in this case is what really provides the card issuer with competitive advantage. As the case tells that historically, Alpen Bank faced issues launching card business due to low per-capita income, lack of awareness, poor quality of infrastructure of point-of-sale. Thus to position the credit card, Alpen needs to divide its market in two segments i.e. affluent premium and basic and build the services around these two identified segments. Premium Segment:

As the macroeconomic conditions were shifting accumulating wealth in top 10% of households which hold the 24% of the wealth, the premium customers with income 500 Euros per month seem to be the most affluent and potential customers for the credit card offered by Alpen. This segment in particular has customers who are career oriented professionals who are conscious of the status and image. They are less-price sensitive and can be charged on premium depending upon the value which is being offered to them. To target this market, Alpen must invest in providing and ensuring high value proposition. Package Offering for Premium Segment:

a. Introduction of Joining and Annual Fee: As Alpen Bank enjoys premium image in Romania, the introduction of joining and annual fee would not hurt customer acquisition and retention. b. Penalty Fee for late Payments: the package...
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