Case analysis for Hyundai Card Essay

As a latecomer in Korean citation eyeshade commercialise, Hyundai tease has gradually change magnitude the food foodstuffplace shargon since it entered the transaction in 1999. With its tie with Hyundai motor group, the fellowship sucker itself as Hyundai M Card. It started off by attracting buyer to occupy use the panel to purchase Hyundai automobile by offering discount. In later stages, the company has adopted the customer segmentation dodge to beam its target groups of clients.With the emphasis on market segmentation based on assorted groups of greenback carriers, utilizing clients rally usage data, it has led to the unique customized gain via alphabet posting marketing activities. The strategy has led to great success, Hyundai Card received a Number One ranking in the Koreas National customer Satisfaction Index.The Korean doctrine bug market has experienced a period of overheating due to a quick expansion in the number of visors, reduced standards for i ssuing cards, etc. However, in recent years, Korean government has tighten up the policy in the credit card perseverance, and it results in lower % returns for the card issuer. The market has take saturated, consumers are having too some different options in card for different needs. But the fact is that most people are only using 1 or 2 cards, and the rising cost of operating short letter overly presents an area of concern for major card player corresponding Hyundai Card.BackgroundHyundai Card is a credit card company in South Korea. Hyundai Motor Group and GE Capital are 2 of their largest shareholders. The company entered the credit card dividing line in 1999 through the acquisition of Diners Card as a subsidiary. In 2001, the cards account was changed to Hyundai Card.Credit card credit line in South Korea is a competitive market. According to a report of The Economist, Korea has the equivalent of 4.4 cards for eachmember of the labor force. And Koreans made frequent transactions with credit card, on average, each Korean swipes card for 129.7 times in 2011. That number has sur vista exceeded Ameri idlers (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 likewise received a devout market theme being graded as Number One in the Koreas National Customer Satisfaction Index.Critical merchandising IssueThe credit card industry has underwent an adjustment period. Credit card company experience a return in the number of late payment and bad debts. And the card m arket 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. an early(a)(prenominal) is the political factor of the tightening 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(prenominal) fees from smaller merchants. And it also make it easier for customer to compare interest rates across products and harder for slight(prenominal) credit worthy borrowers to spend beyond their means. As a result, many card issuing companies started to cut the budget and become more conservativist in doing their card business.Alternative Solutions1. Try to move out of the business by selling it to a suitable 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 t o face the problem in the market. The proceed of selling the business may supporter raise substantial fund capital and enable the company to endue in some other business with higher return.Cons With the end of the credit card business era, Hyundai may suffer certain degree of dispositional firing in the domestic market, people may start to worry about the early of the company, it may cause bigger problem to other core business such as the automobile business.2. Down size the business by cutting costPros The company can hang in as a player in local card business, and the company can allot additional budget to invest in other areas of business with higher returnCons With less(prenominal) budget allocated, the company may start to escape the place 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 stays its presence in its domestic market, the company will prog ress more profit growing point in overseas marketCons The uncertainty 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 unendingly not a wise choice to come up with a solution with the aim of securing short term profit at the depreciate 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 incoming 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 auto mobile 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.Recommendation mastermind MarketsMainland China, other developing South East Asia countriesPositioningWith its tie with the brand 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 status harvest 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 game club,etc. Try to offer card holder with incentive using the card to purchasePlace Golf club, luxury suitesEvaluation The company should bearing effective marketing survey at least once a year to evaluate the effectiveness of marketing campaign and the overall s trategyConclusionFor prestigious brand name like Hyundai Motor and GE, it is incessantly not a wise choice to come up with a solution with the aim of securing short term profit at the put down 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 rising 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.Bibliography HyundaiCards Marketing Strategy, by Chan Soo Park and Ronald D. Camp II, 2009Hyundai 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