Marketing in Microfinance Institutions

This technical note defines marketing for a MFI as an analytical tool to study and know the client. It states that MFIs have had to come up with marketing programs due to growing competition, slowing growth rates, increasing client desertion, and the recognition that they need to be more client-led.

The presentation discusses the various aspects of marketing:

• The 7 principal components of a marketing program: Market research and analysis, competitive analysis, customer behavior analysis, strategic planning and positioning, product analysis and product differentiation, promotion and outreach communications and the marketing plan;
• Different levels of marketing: Two factors determine the overall level of development of the marketing program in MFIs. Depending on these criteria, MFI marketing programs could be elementary, intermediate or advanced:
  • The nature of the market,
  • The type and the level of sophistication of the institution;
• Organizing the market effort: The key issues here are the marketing plan, the staff, information flow, costing and internal preparation.

The presentation concludes by listing some key lessons about marketing:

• Marketing is about knowing the client, the competitor and the business environment;
• MFIs should analyze marketing information, but should tailor their efforts to match the institutions resources;
• Loan officers should be carefully chosen;
• Marketing should be an integrated function within an MFI, where everyone in the institution has an important role to play.