Case analysis for Hyundai Card Essay

As a latterlycomer in Korean quote waggle market, Hyundai carte has gradually increased the market parcel of land since it entered the business in 1999. With its tie with Hyundai motor group, the party branded itself as Hyundai M instrument panel. It started off by attracting buyer to consider using the measure to purchase Hyundai cable car by offering discount. In later stages, the teleph iodinr has adopted the guest segmentation dodge to diversify its target groups of clients.With the emphasis on market segmentation based on various groups of taunt holders, utilizing clients witticism usage data, it has led to the unique customized service via alphabet humor marketing activities. The strategy has led to great mastery, Hyundai Card received a procedure One ranking in the Koreas National Customer Satisfaction Index.The Korean address identity card market has experienced a current of overheating due to a rapid expansion in the number of cards, reduced standards f or issuing cards, etcetera However, in recent years, Korean government has tighten up the policy in the credit card indus pronounce, and it results in lower % perishs for the card issuer. The market has become saturated, consumers be having too many different options in card for different needs. But the fact is that most people be only using 1 or 2 cards, and the rising cost of operating business in any case presents an area of concern for major(ip) card player care Hyundai Card.BackgroundHyundai Card is a credit card go with in South Korea. Hyundai Motor Group and GE Capital are two of their largest shareholders. The participation entered the credit card business in 1999 through the acquisition of Diners Card as a subsidiary. In 2001, the cards name was changed to Hyundai Card.Credit card business in South Korea is a competitive market. harmonise to a report of The Economist, Korea has the equivalent of 4.4 cards for everymember of the labor force. And Koreans made frequen t exitings with credit card, on average, each Korean swipes card for 129.7 times in 2011. That number has well exceeded Ameri tooshies (77.9) and Canadians (89.6).Hyundai Card is the fourth biggest credit card issuer in South Korea. As per stats in May 2007, it captures a 9.96% share of the market. The Korean credit card market is led by Koomin (16.21%), LG (16.08%), Samsung (12.33). Among the major players in the credit card market, Hyundai is considered as a latecomer.Current SituationHyundai card has continued to increased its market share in the competitive Korean market. As per stats at the end of 2012, Hyundai Card had a market share of 14.3%. And Hyundai Card has also received a steady-going market character being ranked as Number One in the Koreas National Customer Satisfaction Index.Critical Marketing IssueThe credit card industry has underwent an adjustment period. Credit card company experience a growth in the number of late payment and bad debts. And the card market has become saturated, as there are too many card products in the market, which card caters for different need. In fact, most card holder only uses 1 or 2 credit card to purchase. Another is the political factor of the change government policy, it has also present a problem to card issuers as they are having lower % of return in the business. In 2012, the government barred card companies from extracting higher fees from smaller merchants. And it also make it easier for customer to compare interest rates across products and harder for less credit worthy borrowers to spend beyond their means. As a result, many card issuing companies started to cut the cipher and become more conservative in doing their card business.Alternative Solutions1. Try to move out of the business by transporting it to a fitted buyerPros If the company can find a suitable buyer and sell the business at a good price, once and for all, the company does not need to face the problem in the market. The proceed of selling the business may help raise substantial fund capital and enable the company to invest in other business with higher return.Cons With the end of the credit card business era, Hyundai may suffer certain degree of reputational loss in the domestic market, people may start to mystify about the future of the company, it may cause bigger problem to other core business such(prenominal) as the automobile business.2. Down size the business by cutting costPros The company can remain as a player in local card business, and the company can portion out additional budget to invest in other areas of business with higher returnCons With less budget allocated, the company may start to lose the status as one of the four biggest player in Korean card business3. Stay aggressive in card business but try harder to expand the international marketPros While the company remains its presence in its domestic market, the company will develop more profit growing point in overseas marketCons The ske pticism in less mature overseas market may not guarantee profit, it can also lead to unexpected loss for the companyDecision MatrixThree options may be good options for different companies. For prestigiousbrand name like Hyundai Motor and GE, it is always not a all-knowing choice to come up with a answer with the aim of securing short term profit at the expense of sacrificing the brand equity. As a late comer to the card market, Hyundai card has experienced success by capturing larger market share. And the good reputation of customer satisfaction is also an important asset. and so there is no way for the company to sell or downsize their business. With less promising future in the local market, the company should start to concentrate to fathom into other markets in order to develop more profit growing points and remain as a leading brand name in the credit card business. The company has the experience in automobile business in overseas and relevant expertness in Korean credit ca rd, those are the intensiveness that can help the company to capture the opportunities in those less mature market at the like minimizing the chance of failure.RecommendationTarget MarketsMainland China, other ontogeny South East Asia countriesPositioningWith its tie with the branded name in Hyundai Motor, it should position itself as one of the premium brand in the market.Marketing Mix Elements ( 4 Ps)Price Should aim at customers at high end with high social statusProduct Black and Purple card are issued for high social status people in Korea, it can also be used in other marketsPromotion Seek cooperation with branded companies such as winery, golf club,etc. Try to offer card holder with incentive using the card to purchasePlace Golf club, luxury suitesEvaluation The company should conduct effective marketing survey at least once a year to mensurate the effectiveness of marketing campaign and the overall strategyConclusionFor prestigious brand name like Hyundai Motor and GE, i t is always not a wise choice to come up with a solution with the aim of securing short term profit at the expense of sacrificing the brand equity. As a late comer to the card market, Hyundai card has experienced success by capturing larger market share. And the good reputation of customer satisfaction is also an important asset. Therefore there is no way for the company to sell or downsize their business. With less promising future in the local market, the company should start to concentrate to penetrate into other markets in order to develop more profit growing points and remain as a leading brand name in the credit card business. The company has the experience in automobile business in overseas and relevant expertise in Korean credit card, those are the strength that can help the company to capture the opportunities in those less mature market at the same minimizing the chance of failure.BibliographyHyundaiCards Marketing Strategy, by Chan Soo Park and Ronald D. Camp II, 2009Hyun dai internet home page (http//ir.hyundaicard.com/ceh/ho/cehho0101_01.hc)http//totalidentity.com/hyundai-card-innovation-growth-activation-rebrandinghttp//www.economist.com/news/finance-and-economics/21589470-it-getting-harder-make-money-worlds-most-prolific-card-users-swipe