Monzo Ltd.: Strategic Recommendations for Geographical Market Entry

This presentation provides a comprehensive strategic analysis of Monzo Ltd., an online banking company. It begins with an introduction to the company's vision, mission, and values, followed by a discussion of its generic strategies and strategic positioning. The presentation evaluates the macro-environmental factors, including changes in trade agreements, socio-demographic trends, the role of informal institutions, and the impact of political, regulatory, economic, and financial conditions. It also analyzes the competitive dynamics within the industry, including internal and external factors affecting competition, market structure, and stakeholder analysis. Furthermore, the presentation explores the industry's globalization drivers and recommends appropriate entry modes for geographical market expansion, considering the alignment of these recommendations with Monzo's products, goals, and mission. It also anticipates potential responses from existing competitors and highlights the cultural challenges the firm may face during international expansion. The presentation concludes with a summary of findings and references used.

Individual presentation

Table of content
 Introduction
 Discussion of the company’s strategy of Monzo Ltd.
 Evaluation of macro-environmental aspects in the region that Mozo bank operates in
 Evaluation of the competitive dynamics in the industry -both global and local
 Strategic recommendations to enter a geographical market for the firm
Conclusion
 References

Introduction
The vision of the company refers to what the company wants to accomplish for the success
of the organization and Mission is a statement of how the company will achieve the vision.
Strategies refer to the series of methods to accomplish the vision by using the mission of
the company. It is imperative for all the business organizations to analyze their external
environment to measure the impact of macro-environmental factors on the performance of
business and to take corrective measures to improve it.

Identification and discussion of a chosen
company’ strategy
Identification and relevance of vision, mission and values
 Vision – To expand the banking and financial services in the cities of US. To be the
best community bank in every community , ensuring safety of the finances of
customers and to provide accurate and prompt services through online transactions.
 Mission – Monzo’s mission is to make money work for everyone. It includes
supporting the customers’ needs and making its online banking app as accessible as
possible to the maximum customers. Its mission is to offer maximum help to support
the customers in controlling their finances.
 Values – The bank holds high standards of ethical behavior by supporting its employees
and by creating a positive and hassle-free working environment for them.

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Evaluation of the strategic positioning in terms of generic
strategies
Strategic Positioning – The current strategy of Monzo is focused
on attracting new quality users who use prepaid cards. Its main
generic strategy is to is to put emphasis on word of mouth
advertising and having a loyal customer base. Its key strategic
positioning includes community meet ups and hackathons to be
stable in the banking industry by strong positioning of the firm.
The focus of this company is on cost controls to support the
customers effectively.

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Evaluation of the key stakeholders
The key stakeholders of Monzo bank include Shareholders, investors, employees,
regulators, government, and customers or clients etc. The major and most powerful
stakeholders are its shareholders (with more power and more interests) who consist of
Thomas Blomfield , Paul rippon etc. who collectively hold more than 17 million shares of
the company. Its other investors include Vanderbilt university and Octrahedron capital.

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The alignment of entry modes to the firm’s visions
Alignment of Entry modes to Firm’s visions – The Monzo
bank will enter the US market through partnership and
strategic alliance. It is a long-term and multi department
commitment for the companies entering in the
international market that defines goals for both companies.
It will enter the international market through partnership
alliance with Onio-based Sutton bank but it will not offer
money lending services for its US customers.

Evaluation of macro-environmental
aspects in the region that Mozo bank
operates in
Changes in trade agreements and regional blocs
Brexit had impacted the banking industry in terms of loss of bank assets and loss of
financial services jobs. In context with Monzo bank, it was not much affected by Brexit as
the company faced no changes to the working of its cards in UK or abroad due to Brexit.
Also, the bank ensures that the deposits of customers are protected by the Financial
services compensation scheme of the value 85000 Euro per person that will remain safe
even after Brexit.

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The influence of socio-demographic trends
The demographic changes such as change in population growth rates and disposable
income of people impact the demand for consumer credit and mortgages that in turn impact
the interest income for the banks. Monzo needs to consider this aspect. Migration of people
to another country also does not impact much on Monzo as it offers Monzo card exchange
rate to be used online in a foreign currency.

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The role of informal institutions
The culture delivers the values and behaviors that contributes to creation of trusts in banks
and ensures positive image of banks among its employees , investors and customers. A
strong culture reflects how the employees are hired, resources are allocated and it links the
banks with employees who have similar beliefs. Monzo ltd. encourages an open and
collaborative working environment. It impact the company in a positive manner by
contributing to its brand image in the banking industry

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The impact of the political and regulatory systems
The political factors of the macro environment include political stability, change in the
trade agreements, trade restrictions, tax policies, trade reforms, tariffs etc. But the Monzo
bank did not face the impact of political instability such as Brexit as the company is
regulated by Financial conduct authority and prudential regulation authority that ensures
safety of the finances of its customers. But the bank needs to comply with the laws of these
regulators otherwise it will have to face the penalties in case of any violation of the
regulations set by these regulators in the interest of customers or employees or country. The
bank will also have to comply with the regulations of US because of its expansion there.

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The impact of economic and financial conditions
The economic factors such as interest rates, inflation rates, foreign exchange rates ,
disposable income of people, population growth rates etc. impact the functioning of banks.
In context with Monzo ltd. , economic factors such as interest rates affect the functioning
of this bank. Also, the disposable income of people impact consumer credit demand that
impact interest incomes or the banks.

Evaluation of the competitive dynamics in
the industry -both global and local
The concentration and the internal/external causes leading to it
Three are various internal and external factors which affect the business to take the
advantages of the competitions. In context to the Monzo bank, the factors are as under:
Internal
 Money and resources
 Company culture
External
 Politics and policies of government
 Competition from other businesses

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The market structure of Monzo bank ltd
The market structure of the company explained
that there is perfect competition in the industry as there
are many competitors of the Monzo bank ltd like
Monese, Revolut, Starling bank and so on. Therefore it
falls under the perfect competition market as the bank
offer similar products as the other bank offers. The
consumer are aware about the products that are offered
by the bank and also get satisfied with their services.

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The analysis of stakeholders
The stakeholder analysis is a framework that prioritizes the stakeholders of company on the
basis of their degree of interest and power. The stakeholder analysis of Monzo bank is
explained below –
Keep Satisfied
(Government and Regulators)
Manage Closely
(Shareholders, Investors)
Monitor
(Employees )
Keep Informed
(Clients and customers)

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The industry globalization drivers
Each industry create the potential to become global for which it approaches to the various
strategies. With reference to Manzo bank ltd. the globalisation drivers are as under:
 Market drivers
 Cost drivers
 Competitive drivers

Strategic recommendations to enter a
geographical market for the firm
Identify the most appropriate entry mode for the firm
The most appropriate entry mode for Monzo bank ltd. is partnership as it is an
online bank provide its services to the customers for paying anything from the account.
Thus the firm can enter to the new market or region by making partnership with other
banks that are already exist in that particular region. As the firm enter in US market
through the partnership with the Ohio-based Sutton bank. It is the best strategy for the
company to enter in the foreign market because the local partner are aware with the culture
prevailing and the customers as well.

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Discuss the alignment of your suggestion to the product/service; the goals and the mission;
the current strategic positioning
The company can offer its products by keeping the goals, strategies and
customers in mind so that the target of the business can be achieved. Thus, the firm offers
its products according to the needs of the customers and communicate about their products
through marketing and make them aware about the features. The improvement also made
in the products and keep the stakeholders informed about the changes. Therefore, Monzo
has adopted traditional marketing strategy to connect with its customers.

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Anticipate the potential response of existing players competitors
Monzo can deal with its competitors by making the market research before
launching its products so that it can be aware about the competition and the products that
are offered by the competitors in the same region. The firm should analyse the strength and
weakness of the competitors to gain the competitive advantage. It can bring the different
products and services to engage in the counter attack for the competition. It should track its
competitors and avoid the noise of their new launching products and bring the innovative
ideas to overcome the competitors.

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Highlight the cultural challenges the firm will face
With reference to Monzo, the firm can face the cultural challenge while
expanding its business globally which are depicted as under:
 Fail to adapt the global business model to the local market
 Fail to identify the regional and subcultural differences

Conclusion
From the above discussion it has been concluded that the firm should analyse the
competition prevailing in the market before expanding its business globally. The
presentation has discussed about the Monzo bank ltd. and the marketing strategies adopted
it. The macro environmental analysis has been done in respect of the company and
discussed about the internal and external factors that can affect the business. Further, the
presentation has explained the stakeholder analysis and the market structure of the
company. In addition to this, it has discussed about the drivers of the globalisations.

References
Ali, M., Ibrahim, M.H. and Shah, M.E., 2022. Impact of non-intermediation activities of
banks on Economic Growth and Volatility: An Evidence from OIC. The Singapore
Economic Review, 67(01), pp.333-348.
Bajaj, V., Kumar, P. and Singh, V.K., 2022. Linkage dynamics of sovereign credit risk and
financial markets: A bibliometric analysis. Research in International Business and
Finance, 59, p.101566.
Dumit, J. and Sanabria, E., 2022. Set, setting, and clinical trials: colonial technologies and
psychedelics. In The Palgrave Handbook of the Anthropology of Technology (pp. 291-308).
Palgrave Macmillan, Singapore.

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