Table of Contents

Abstract .................................................................................1 Introduction ............................................................................2 Managing Risks .....................................................................3

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Managing risks through Products Managing risks through Markets Steps Taken to avoid risk through products & Services

Conclusion .............................................................................6 Bibliography ...........................................................................7

Abstract

This report makes the understanding of the integration of marketing with business processes and shareholder value. The model redefines marketing phenomena which is embedded in three core business processes that generate value for customers, namely product development management, supply chain management, and customer relationship management, this generally creates shareholder value. Such a conceptualization of marketing has the potential to introduce dramatic shifts in the scope, content, and marketing influence in the organization. The authors highlight the implications of an organizationally embedded view of marketing for the future of marketing theory and practice so that it may gain profits, retain customers & secure their positions in respective markets.

Introduction
To, The Director of European Investments, As an intern with the Royal Bank of Scotland Group, I have studied & researched the anatomy of its retail subsidy The Royal Bank of Scotland & have done a report on the same which is given below. The Shareholder Value model is a unique model which is applied & should carefully monitor in all industrial markets. It is highly competitive in nature & frequently keeps on changing (can be termed as dynamic) with the change in the market environment. This shareholder value model consists of the marketing activities, with customer driven value drivers & shareholder driven marketing results & financial results & more broadly classified into marketing skills & marketing assets. The Royal Bank of Scotland is a state owned banking, investment & insurance company owning subsidies like the ABN Amro, Churchill insurance, privilege, direct line etc. It was founded in the 17th century by the Royal Charter of King George I; hence this company has a lot of brand name behind it & has seen through a lot marketing changes & diplomatic marketing strategies through centuries. As it is one of the biggest investment banks in the world it has undergone a drastic change economically. Last year the operating income of the company went up to 33,836 million with an operating income of 2,595 million. The Royal Bank of Scotland provided with 170,000 employments in 2008 with a net income of 2,323 million.

Managing Risks

RBS marketing activities includes marketing skills where people employed within the RBS in the different subsidies work with the different types of skills involved. Maybe the insurance branch may not require the same staff as required for Global wealth management or the staff with investment banking may not possess the same skills as the credit cards department. RBS serves different types of products in the market such as finance, investment banking, global wealth management, mortgages, credit cards, personal banking, and corporate banking which carries a huge amount of risk in the dynamic market. The more it can generate income from them the more diversified it becomes. Managing risk through Products: Risks in the product market can be managed by pure marketing skills people who can understand the need for the business which is their customers & employers, & the market itself with major & minor components. These marketers should market all sectors of the RBS products to different customers but the right customers & at the right place. These marketing skills lead to marketing Assets which represents the large amount of captured value by RBS. This can be stated when in November 2009, RBS switched from backing long-standing UK client Cadbury plc to back a hostile takeover from a US company Kraft Foods whilst being 84% owned by the UK Government (state owned). The RBS since then is marketing its different products in different market segments all around the world. In December 2008, the British anti-poverty charity War on Want released a report documenting the extent to which RBS and other UK commercial banks invest in, provide banking services for and make loans to arms companies. The charity writes in its report that RBS holds shares in the UK arms sector totally 36.4 million, and serves as principal banker to four major arms companies, including BAE Systems the UK's largest arms company. The report also details RBS's dealings with known producers of cluster munitions and depleted uranium. These critics endanger the product value in the customer market in relation to business ethics.

After the completion of the product life cycle, successful product development should be done to extend the life of the product. The banking products which the RBS offers are everlasting products related to finance hence they keep on developing their product through better marketing through their websites, email alerts to existing customers, user interface to new customers. RBS has also got their own personal relationship manager who helps & guides newly opened accounts in personal, business & corporate banking with the day-to-day investments & the know how in the international level of the business. RBS now offers a high level of marketing competitive advantage through its marketing distribution channels. RBS has made their product simple to use just by adding customer interface to their website so that each &every person can access their accounts from home. This enables the product awareness among the market. Another product of the RBS is the Share Price. This is a high amount of risk due to the recession period & the financial fluctuations in the economy. When ABN Amro Dutch bank was acquired by RBS its financial lose in shares went from 10billion to 24.1 billion. Within 4years from 2001-04 the share prices increased with an average of 400.

Managing risk through market: RBS was shattered in the year 2008-09 with the acquisition of ABN Amro & a total loss of around 28.1 billion under CEO Fred Goodwin. Hence they needed proper marketing to reduce their downfall through managing their core competencies in the competitive market in 2009 & the period of economic downturn. The companies financial analysts then realised the need for capturable value of customers through offering various benefits to its shareholders & customers. RBS marketed themselves through brands in the international market by sponsorship in Sports namely Rugby 6 Nations Cup, merger with AT & T Williams in F1 Races, sponsoring Andy Murray in Tennis & Jack Nicklaus in Golf. They turned out to be great value drivers in the marketing approach of RBS. These marketing strategies added value to the bank, its shareholders & customers globally & made a perception that they are investing in a globally renowned company & are moving in the positive & profitable way. RBS also increased the dividends per share to its shareholders as soon as it made a Government or state owned enterprise which started to gain value in the London Stock Exchange from 65.70p. RBS shareholders saw the potential of the value for money in the invested bank & hence again has started a boost in the shareholder economy of RBS.

RBS also supplemented in the successful Returns on Investment (ROI) & Returns on Capital Employed (ROCE) with an amount of 2323 million.

Steps Taken to Avoid risk through Products & Services: RBS has avoided & is in constant process of avoiding risk in the global dynamic & competitive market through successful & careful investments. It has also helped its shareholders & customers to earn expected profits in the recession period of the decade. Its investment in the Bank of China with a total of 10% stake & specialisation in the Global Wealth Management made them recognise as a good investment company in the economic zone of Asia-Pacific. Unfortunately when they sold out their share from the Bank of China as they saw the opportunity they made null profits due to the exchange rate fluctuations. RBS has also entered into other economically unstable markets or niches in the zones of Americas, Europe & Middle-East & Africa with a minimal investments but a greater returns to investors because they later saw the boom in the economy of these markets. Hence it is strengthening its position in the international market by securing its investors & customers. As RBS is a big entity with 5th largest company in the world in Banking & Investments, they have started not only to acquire new customers holding a large number of personal banking, business banking, corporate banking accounts but also retaining their previous shareholders & investors through loyalty programs & especially through their higher pay of dividends. They provide a unique yield to their shareholders per share which has made them one of the leaders in Investment banking & Insurance in the World. They also provide easy & friendly banking procedures & seek an opportunity for its shareholders to run business internationally to strengthen their position in the competitive market. They help as well with the free advices for customers holding business accounts & corporate accounts &readily help them with reasonably good loans by identifying the risk factors to which each of your portfolios are subjected & at varied interest rates. Hence RBS seeks an opportunistic approach in its day-to-day business operations in the market repositioning themselves & manage risk of fluctuations in the rate of inflation. Last year, RBS also closed down its tax avoidance department which help them avoid 500 million of tax by channelling billions of pounds through securitized assets in tax Havens like the Cayman Islands.

Conclusion

As RBS is an old company with a good financial record holding a fair market value in respect with its market share over the past decades, it is a good company to invest in. The share prices are growing considerably & slowly which is a good sign for the progress of the company therefore boosting the economy. They hold a huge market in all segments of the economic zones in the world. They are providing with a good customer service & a good customer insight with a genuine returns on capital employed, returns on investment, have good profitability ratio, good solvency ratio, good yield, good dividends, considerable increase in share price of the company. Since RBS satisfies the drive & demand of its investors & shareholders in an ethically accepted market hence it is wise to invest in such a company whose goals & objectives are clear & are committed to achieve & give the results.

Bibliography
www.RBS.co.uk Fred The Shred RBS Success & Downfall