Innovation and New Product Launch at Mediolanum Bank

Innovation: innovate/offer new products/staying competitive (prices)
Innovation requires change in ideas, technology and strategy to meet market needs and changes.
Bank need to develop new offerings, implement change in pricing, process, enhance customer
satisfaction through various resources. Mediolanum bank focuses on business innovation by
developing advanced technologies for payment and deposit system, to enhance customer
satisfaction.
According to given scenario, Mediolanum bank is encountering financial issue due to recession,
failing to meet its growth potential. It aims to launch a new online account product that will
provide high interest rate to customers. Company aims to adapt changes according to market and
customer needs. With digitalization, there is need to enter in online business. It is also advised
that company should rethink to enter in online current account as it will help in gaining several
corporate clients, huge transactions and high profitability. Though it would also require
technological advancement, complex process and strategy but it will help in business growth,
enhancing profitability and customer base (Annushkina & Invernizzi, 2019).
Company can offer new product and service line such as payment wallets, apps to help customer
towards easy accessibility of banking transactions; enhancing security and ease of operations.
Innovation should also help in data and customer protection. By paying higher interest rate than
competitors, company is winning customer over price. Therefore, innovation requires integration
of price, new product, technology, continuous quality improvement and feedback.
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New product: making the new product useful and profitable
Another key factor was making new online product important for customer. Besides offering
high interest rate to customer, it was easy to access. Customers can easily open new account
through self-service; process was kept simple as if customer account is from traditional bank
then new account was opened on assumption that prior account verification has been done.
However, if online transfer occurs then customer was requested to contact family banker. To
make new product profitable, company offered 3, 5 percent, 0, 5 percent interest rate above
competitors. Major risk associated with new online product was cannibalization. It is advice to
offer new product to family bankers also but separate legal entity should be maintained. It will
help in keeping traditional family banker and asset management offerings separate and reduce
risk of cannibalization. The 5d strategy of bank helps in offering most appropriate business
solution to customers. it include investment on short, medium long term basis, diversifying
investing to various geographical regions to reduce risk and increase profitability; investing
customer money in various security to enhance profitability, company ensure that long term
value is included in all portfolios by investing in emerging markets and variety of investment
instruments. Telephonic assistance is the key business strategy that help in differentiating the
brand from others in the market, it ensure technology does not takeover human relationship. In
case of service delay, telephonic responses help in maintaining strong customer loyalty,
resolving issues better.
Marketing: adapting to changing customer consumption practices
Key objective of marketing department is to shape customer communication positively, create
awareness about new product launch to attract new customer. Present marketing strategies
implemented by bank include direct marketing, personal relationship and word of mouth. With
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