Case Study Description of Branding Citigroup's Consumer Business
In Spring 1998, Citicorp and Travelers merged to create a financial powerhouse that united the bank with Travelers' consumer finance and brokerage businesses, including Salomon Smith Barney and Primerica. It was the first U.S. financial services company to combine banking, insurance, and investments under one umbrella. Both entities historically had very different cultures, driving a radically different approach to branding. During completion of the merger, a team of managers was responsible for recommending to top management a new brand identity that would unite the entire organization and provide it with a strategic focus. The new brand also had to inform customers and shareholders of Citigroup's new financial capabilities and allow cross-selling without sacrificing the power of component brands. In a tense post-merger situation, decisions must be made early and decisively to prevent damaging brand equity.
Swot Analysis of "Branding Citigroup's Consumer Business" written by Rohit Deshpande, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Citigroup's Travelers facing as an external strategic factors. Some of the topics covered in Branding Citigroup's Consumer Business case study are - Strategic Management Strategies, Collaboration, Corporate communications, Customers, Entrepreneurship, Government, Leading teams, Mergers & acquisitions, Organizational culture and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Branding Citigroup's Consumer Business casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, geopolitical disruptions, increasing energy prices, increasing household debt because of falling income levels, increasing commodity prices, challanges to central banks by blockchain based private currencies,
supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Branding Citigroup's Consumer Business
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Branding Citigroup's Consumer Business case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Citigroup's Travelers, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Citigroup's Travelers operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Branding Citigroup's Consumer Business can be done for the following purposes –
1. Strategic planning using facts provided in Branding Citigroup's Consumer Business case study
2. Improving business portfolio management of Citigroup's Travelers
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Citigroup's Travelers
Strengths Branding Citigroup's Consumer Business | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Citigroup's Travelers in Branding Citigroup's Consumer Business Harvard Business Review case study are -
Analytics focus
– Citigroup's Travelers is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Rohit Deshpande, Carin-Isabel Knoop can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Low bargaining power of suppliers
– Suppliers of Citigroup's Travelers in the sector have low bargaining power. Branding Citigroup's Consumer Business has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Citigroup's Travelers to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Citigroup's Travelers is present in almost all the verticals within the industry. This has provided firm in Branding Citigroup's Consumer Business case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Training and development
– Citigroup's Travelers has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Branding Citigroup's Consumer Business Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Citigroup's Travelers has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Citigroup's Travelers in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Citigroup's Travelers are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Citigroup's Travelers has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Branding Citigroup's Consumer Business HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Citigroup's Travelers
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Citigroup's Travelers does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Citigroup's Travelers is one of the leading recruiters in the industry. Managers in the Branding Citigroup's Consumer Business are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Citigroup's Travelers digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Citigroup's Travelers has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
High brand equity
– Citigroup's Travelers has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Citigroup's Travelers to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Branding Citigroup's Consumer Business | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Branding Citigroup's Consumer Business are -
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Branding Citigroup's Consumer Business, is just above the industry average. Citigroup's Travelers needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Products dominated business model
– Even though Citigroup's Travelers has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Branding Citigroup's Consumer Business should strive to include more intangible value offerings along with its core products and services.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Branding Citigroup's Consumer Business, in the dynamic environment Citigroup's Travelers has struggled to respond to the nimble upstart competition. Citigroup's Travelers has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Branding Citigroup's Consumer Business HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Citigroup's Travelers has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Citigroup's Travelers is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Branding Citigroup's Consumer Business can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Citigroup's Travelers has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Low market penetration in new markets
– Outside its home market of Citigroup's Travelers, firm in the HBR case study Branding Citigroup's Consumer Business needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
No frontier risks strategy
– After analyzing the HBR case study Branding Citigroup's Consumer Business, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Slow to strategic competitive environment developments
– As Branding Citigroup's Consumer Business HBR case study mentions - Citigroup's Travelers takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Capital Spending Reduction
– Even during the low interest decade, Citigroup's Travelers has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Increasing silos among functional specialists
– The organizational structure of Citigroup's Travelers is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Citigroup's Travelers needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Citigroup's Travelers to focus more on services rather than just following the product oriented approach.
Opportunities Branding Citigroup's Consumer Business | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Branding Citigroup's Consumer Business are -
Using analytics as competitive advantage
– Citigroup's Travelers has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Branding Citigroup's Consumer Business - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Citigroup's Travelers to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Citigroup's Travelers has opened avenues for new revenue streams for the organization in the industry. This can help Citigroup's Travelers to build a more holistic ecosystem as suggested in the Branding Citigroup's Consumer Business case study. Citigroup's Travelers can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Citigroup's Travelers can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Learning at scale
– Online learning technologies has now opened space for Citigroup's Travelers to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Low interest rates
– Even though inflation is raising its head in most developed economies, Citigroup's Travelers can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Manufacturing automation
– Citigroup's Travelers can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Citigroup's Travelers can use these opportunities to build new business models that can help the communities that Citigroup's Travelers operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Citigroup's Travelers in the consumer business. Now Citigroup's Travelers can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Citigroup's Travelers to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Citigroup's Travelers to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Citigroup's Travelers to increase its market reach. Citigroup's Travelers will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Citigroup's Travelers can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Citigroup's Travelers can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Citigroup's Travelers can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Citigroup's Travelers has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Branding Citigroup's Consumer Business External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Branding Citigroup's Consumer Business are -
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Citigroup's Travelers business can come under increasing regulations regarding data privacy, data security, etc.
Shortening product life cycle
– it is one of the major threat that Citigroup's Travelers is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Citigroup's Travelers can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Citigroup's Travelers has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Citigroup's Travelers needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Citigroup's Travelers can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Branding Citigroup's Consumer Business .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Citigroup's Travelers in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Citigroup's Travelers needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Environmental challenges
– Citigroup's Travelers needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Citigroup's Travelers can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Branding Citigroup's Consumer Business, Citigroup's Travelers may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Increasing wage structure of Citigroup's Travelers
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Citigroup's Travelers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Citigroup's Travelers will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Citigroup's Travelers.
Consumer confidence and its impact on Citigroup's Travelers demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Branding Citigroup's Consumer Business Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Branding Citigroup's Consumer Business needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Branding Citigroup's Consumer Business is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Branding Citigroup's Consumer Business is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Branding Citigroup's Consumer Business is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Citigroup's Travelers needs to make to build a sustainable competitive advantage.
