Strategic Planning for New Financial Institutions in Omani Market

New institutions in Oman's market should follow the example of conventional banks and prioritize customers by enhancing their knowledge about services and products. This will lead to brand recognition, reducing dependency on oil revenues, and achieving Oman's Vision 2020 goal.

MARKETING
MANAGEMENT

Table of Contents
SECTION 1......................................................................................................................................1
Introduction.................................................................................................................................1
SECTION 2......................................................................................................................................1
Overview of article......................................................................................................................1
SECTION 3......................................................................................................................................2
SECTION 4......................................................................................................................................4
SECTION 5......................................................................................................................................5
Conclusion...................................................................................................................................5
REFERENCES................................................................................................................................7

SECTION 1
Introduction
The current report emphasizes upon the significance of marketing with reference to
Sultanate of Oman. Herein, the developments in the field of Islamic finance have been taken into
consideration. The marketing developments in the Omani market has been taken into account to
analyse the occurring uptakes within the Islamic services & products (Aremu and Saka, 2014).
However, there is a possibility that presence of certain factors like having insufficient knowledge
about products are often hindering the marketing procedures. Adding more to this, significant
impact of these is there upon brand recognition as well. To carry out the assessment three articles
based of financial terms of Omani marketing have been taken in consideration. Henceforth,
article of development in Oman's Islamic Finance sector will be evaluated. The other two articles
which have been taken in consideration are about Bank Muscat. So, the report will be
emphasizing upon the assessment of risk imposing factors that lead to much up-downs in the
marketing of Islamic products as well as services in Oman.
SECTION 2
Overview of article
The article taken in consideration lays emphasis upon the developments in the Islamic
finance sector covering the different barriers. Within the sultanate of Oman, newly introduced
Islamic Bank Sector is likely to face barriers in terms of competition from the already established
conventional-banks. These type of banks often take in account the windows-model according to
which market entry is done by offering products that are compliant with Shariah. Such type of
Islamic_Financial_Sector tend to be driven by the ample of demands emerging from the local
markets and on its basis they aim to comply with trend of global market. The Sultanate of Oman
is likely to adopt this financial system. However, it is not suggested that all Muslim Banks would
be adopting this system. Although no such type of financial system is present there currently in
the Sultanate of Oman, but efforts are consistently being made to reduce the dependency upon
oil-revenues. This has been clearly stated in the principles laid by their framework 'Oman Vision
2020' (Magd and McCoy, 2014). Majority of the customers in Oman have expressed their high
rates of interests within the Islamic range of products within the financial sector. And these have
also demanded the opening of special savings Islamic accounts. Most of them have emphasized
upon using products that were based upon Riba also known as interest.
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Th main reasons for preferring Islamic banking is because of being motivated in religious
terms. Since there is a significant emphasis by the religious obligations, the customer services,
pricing of products and ample of other issues are interrelated with the conventional banking
system. In the quality of service being offered in banks the most significant barriers are lacking
leadership, empowerment as well as centralisation. As per the reports of IFAAS, the Islamic
finance based institutions that are likely to get established tend to be at potential disadvantage.
The most significant barrier is the well established conventional bank who aim at market entry
via windows-model. These banks already have a large customer base who would be immediately
convert their interests towards Shariah complied products offered from windows model (Kothari,
Mizik and Roychowdhury, 2015). Although, these conventional banks are likely to face other
significant barriers as well which might be hindering their activities. These include staff training,
new operational-system implementation. Also, in order to establish a supervisory board based
upon Shariah, significant time duration as well resources are taken away that cannot be justified
by aid of an underperformed windows-operation. Henceforth, it can be said that customer
services and the institutional branding are the two most potential barriers.
SECTION 3
Within the Omani market adoption of dual financial-system is likely top impose a
potential barrier upon the Sultanate as stated by Ahmad, Shafique and et.al., (2015). The most
significant barrier is likely to be imposed by already established conventional-banks who have
consistently kept their customers preoccupied with their financial based products. Although
Oman is majorly Muslim-country, the up-taking of Islamic products as an assumption is still
challenged. The brand new Islamic banking sector that is likely to get introduced in the Sultanate
of Oman, will definitely be seeking a competition from the already well established conventional
banks like the Bank of Muscat. This bank has been providing quality financial services to their
customers in the Omani market and seeking its records, strong presence is shown within the
sectors of banking in retail, private, investment, corporate along with the asset-management as
well as treasury. Since 7 years Muscat has been majorly voted as one of the best banking
institution in Sultanate of Oman.
According to Rajasekar and Simpson, (2014), from such type of high brand recognition
banks, the newly established banking institutions are likely to face threats in terms of having
strong customer base. Henceforth, to penetrate the market significant barriers are likely to come
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in the path. One of the most significant barrier is the high brand recognition of conventional
banks like Muscat among the population. As observed in Article 1, Bank Muscat is highly
excellent in delivering services to their customers (BANK MUSCAT GIVES MAJOR THRUST
TO PROACTIVE CUSTOMER SERVICE, 2012). Based upon their vision We_Can_Do_More,
they are consistently interactive with their customers & accordingly they evaluate and assess the
customer's expectations. This bank has adopted the aid of website, diversified branches & call-
centres to stay in touch with their customers. All types of queries & feedbacks are readily
obtained from the side of customers through focus-group programs, official bank website and the
call centre. Customers are highly given priority and their responses are undertaken in proactive
manner. Adding more to this, their adoption of tiered-approach in selection of customer base has
approved a lot for assessment of the needs and demands of customers. They listen to each and
every viewpoint of their customers and accordingly provide them the services. This bank
consistently make efforts to make their customers understand the various ongoing processes
within the organisation for the purpose of simplifying the financial transactions. Also, they imply
innovative measures to enhance their services such as the mystery-shopper exercise which has
assist in providing a benchmark. This service assists a lot in evaluating the customer-services
which are followed by bank. Bank Muscat is highly committed towards their customers by
undertaking extra steps in satisfying their customers thereby maintaining effective & long-term
relationships. The new financial institution that is likely to get established in the Omani market,
is likely to face the adverse outcomes of these highly effective customer-service maintenance
from the conventional banks as argued by Ambler and et.al., (2016).
So, seeking out the enhancing developments in the way of banking by these conventional
banks like Muscat, newly established banks have to take an example from this to resist the
competition as contextualised by. The most significant barrier that might come in the pathway of
market penetration by the newly established Islamic Bank is the brand recognition. Since the
conventional banks are highly recognised among the population in Oman, it would be very
difficult for the newly established banks to penetrate in the markets as stated by Belwal and
Belwal, (2017). It would be very difficult to modify the perceptions of the population within the
Sultanate of Oman. Henceforth, vigorous branding technique needs to be undertaken by taking
an example from Bank Muscat. From the Article 2, it was found out that recently Muscat had
launched their customer services on the platform of social media that is Twitter (Bank Muscat
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launches customer service in Twitter, 2016). Seeking out the developments in the modern world,
social media emerges out to be an effective medium in connecting and thereby influencing a vast
majority of population. They seek out the queries and reviews from customers on twitter within
the timeline of 8 AM to 8 PM. Furthermore, through these platforms timely surveys are also
conducted among the connected customers. These surveys greatly assist in knowing their
opinions. Moreover, the bank even conducts awareness programs to make their customers aware
about activities, services and products offered by Muscat. According to Sandberg and Aarikka-
Stenroos, (2014), the managers here prioritise their customer relationships with the motto of
enhancing their customer-experiences. So, it would be critical situation for the population in
sultanate of Oman to adopt the services of newly established banks just because they would be
Shariah based. Another significant barrier determined was the lack of knowledge. Majority of
people might not be having deep knowledge about the services offered by newly established
financial institutions. So, they need to make the people Oman aware about these services and
Islamic product by utilising the platform of social-media. As observed in article 2, for Muscat
Twitter proved to be a great medium in enhancing their customer experiences. The financial
institutions that are going to be established within the Sultanate of Oman, first need to analyse
the overall functioning process of such conventional banks like Muscat and then only formulate
their market penetration strategies to influence a large spectrum of audience.
SECTION 4
From the evaluation of different articles in above section, it can overall be said the highly
recognized conventional banks such Bank of Muscat tend to be a hindering entity in the
functioning of new financial-institutions which are going to be established. After the evaluation,
two most potential barriers were emerging that were lack of product knowledge as well as brand
recognition. Since Bank Muscat has been the leader in the financial sector at Oman, the
population is more devoted to purchase their products in terms of quality assurance. Also, the
main factor which led to high brand recognition in case of Muscat was their procedures which
were prioritised upon customers. Moreover, they were consistently connected with their
customers by aid of social media such as twitter to get deep knowledge about their preferences
through survey conduction (Khadem, Shamsuzzoha and Piya, 2017).
So, the new financial institutions definitely need to lay their emphasis upon in-building of
deep knowledge regarding their services among the population in sultanate of Oman. If the
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people of Oman are aware about the beneficial assets of such type of products then they might
think towards trying out these new services and Islamic range of products. Campaigns need to be
organised to attract the potential customers in a significant manner. These campaigns and
awareness programs could be conducted on live social platforms like Facebook or twitter as used
which were efficiently utilised by Bank of Muscat, although influencing such type of highly
devoted customers would definitely be a challenge in penetrating the market. They overall need
to emphasize upon making their brand recognizable among the people of Oman for getting
successfully established. Also, another argument can be stated that it is not necessary that just
because offering Shariah complied products, customers preferences can be changed. Customers
need to be made updated with the knowledge regarding the services to be offered. Offering
beneficial services would not be the only factor determining the success of market penetration in
finance industry. Rather, maintaining effective relationships with customers to know their
preferences as well as queries would be effective in raising the brand recognition (Al-Badi,
Tarhini and Al-Sawaei, 2017). This was clearly observed in the two articles about Bank Muscat.
Since it had been prioritising their customers and also stayed connected with them, Bank Muscat
is the leader in financial industry since 7 years. So, the new banks that are going to be established
need to take example that has been set by such type of conventional banks.
SECTION 5
Conclusion
From the overall report, it can be said that the population of Oman could not be made
satisfied by just offering Shariah based products just because it is Muslim country. Furthermore,
due to the presence of effective conventional-banks like bank of Muscat, consistent barriers are
to be faced by those who will be establishing them in such an enriched financial market. The
main motto behind establishing these new financial institutions is to reduce the overall
dependency of upon the oil revenues. But penetrating a market already preoccupied by
conventional banks, challenging situations are likely to occur. So, these new institutions need to
take the functioning of these overall conventional banks as an example and according formulate
their strategies for successful establishment in Omani Market. Customers have to be prioritised
by enhancing their lacking knowledge about the services and products. Also, their queries need
to be assessed in consistent manner so that brand recognition also rises thereby leading to
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attaining the main motto of Oman's Vision 2020 that is to reduce the dependency of Oman's
market on oil revenues.
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REFERENCES
Books and Journals
Ahmad, N., Shafique, M. N. and et.al., 2015. Growth of Islamic Banking in Pakistan Using Aid
Model. Oman Chapter of Arabian Journal of Business and Management Review. 5(4).
pp.40-44.
Al-Badi, A., Tarhini, A. and Al-Sawaei, S., 2017. Utilizing Social Media to Encourage Domestic
Tourism in Oman. International Journal of Business and Management. 12(4). p.84.
Ambler, J. E. and et.al., 2016. New antimicrobial agents… but no susceptibility tests!. Clinical
Infectious Diseases, 63(11), pp.1530-1531.
Aremu, M. A. and Saka, H. T., 2014. The impact of information technology on library
management: a marketing perspective. Oman Chapter of Arabian Journal of Business and
Management Review. 4(4). pp.1-10.
Belwal, R. and Belwal, S., 2017. Factors affecting store image and the choice of hypermarkets in
Oman. International Journal of Retail & Distribution Management. 45(6).
Khadem, M., Shamsuzzoha, A. and Piya, S., 2017. Optimization Modeling of a Poultry Industry
Supply Chain Network. International Journal of Supply Chain Management. 6(2). pp.27-
32.
Kothari, S. P., Mizik, N. and Roychowdhury, S., 2015. Managing for the moment: The role of
earnings management via real activities versus accruals in SEO valuation. The Accounting
Review. 91(2). pp.559-586.
Magd, H. A. and McCoy, M. P., 2014. Islamic Finance Development in the Sultanate of Oman:
Barriers and Recommendations. Procedia Economics and Finance. 15. pp.1619-1631.
Rajasekar, J. and Simpson, M., 2014. Attitudes toward business ethics: A gender-based
comparison of business students in Oman and India. Journal of Leadership, Accountability
and Ethics. 11(2). p.99.
Sandberg, B. and Aarikka-Stenroos, L., 2014. What makes it so difficult? A systematic review
on barriers to radical innovation. Industrial Marketing Management. 43(8). pp.1293-1305.
Online
BANK MUSCAT GIVES MAJOR THRUST TO PROACTIVE CUSTOMER SERVICE, 2012.
[Online]. Available through : <http://www.muscatdaily.com/Archive/Oman/Bank-Muscat-
gives-major-thrust-to-proactive-customer-service-1ot7>. [Accessed On : 3rd August 2017].
Bank Muscat launches customer service in Twitter, 2016. [Online]. Available through :
<http://bankingfrontiers.com/bank-muscat-launches-customer-service-in-twitter/>.
[Accessed On : 3rd August 2017].
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