The business-level strategies for the corporation Citi Group
Businesses around the world have a similar goal, which is to earn profits through income and generate returns to the shareholder. To successfully achieve their aims, the corporations use different strategies, including business-level strategy and corporate-level strategy. Business level strategy concentrate on attaining customers, satisfying them, and increasing the company’s profits. On the other hand, the corporate level strategy focuses on all business units to ensure that the entire company succeeds. A company can choose to use any of the two approaches or even both in dealing with business competition.
The business-level strategies for the corporation Citi Group
Citibank is one of the biggest banks in America. It has a different business-level approach than other companies. The core products that the corporate banking offer includes transactions services, corporate finance services, and Treasury marketing services. Citigroup uses different business-level strategies to achieve its goal. The first one is the citizenship strategy. In the approach, stakeholders are involved in the assessment of materials. They also get involved in discussions to see how the stakeholders can contribute to overcoming an issue. External standards and principles are also used in the Citi group. The group manages their activities in an organized, strategic way to ensure that the stakeholders are away from business operations and also to keep on measuring their progress. Don't use plagiarised sources.Get your custom essay just from $11/page
The second strategy is the e-business strategy. The plan aims to connect costumers to the web available services and to improve the capabilities of the group to internet offerings. This strategy all aimed at withstanding the market pressure. The e-business strategy has the following elements. The elements include; helping customers help themselves, provide web-enabled services, building a network of strategic partners, and making the bank a trusted brand in the society. This strategy had been tried, but it failed in 2000, but lately, it has been working well. Through the use of this strategy, customers recognize Citibank as a strong brand with innovation. The strategy has been providing successful acquisition and generating revenue since its initiation.
The other strategy used by Citi group is the content marketing strategy. The bank is enlarging is content about marketing through new publications. For the first time in history, the company is running and digitally displaying ads. The ads are found in selected articles and aim to track customers taking those offers. In the past months, the group developed a content site. The CEO offers financial advice to the population. This strategy has expanded awareness of the brand hence boosting revenue. According to the recent study, many marketers, about 58%, have confirmed that the strategy is more successful. The company has also performed holiday campaigns alongside this marketing tactic.
In my opinion, e-business is the best business-level strategy for Citi group to achieve long-term success. There are many facts and advantages of e-commerce that makes is the most appropriate than the other strategies. The first reason is because of improving technology. With the daily improvements in technology, people will no longer need to queue in the banks to access the services. Most of the services will be obtained through internet access in phones, laptops, and tablets. The young and future generations also tend to be addicted to using the internet. The use of this strategy will attract them, making them potential customers. Through this company’s income will increase drastically. The strategy also va competitive advantage over others. By the time other businesses will be embracing this method, Citi bank would have made more revenue from it and even perfected it. Besides, Citibank’s approach to customer satisfaction helps in competing with other companies using e-business. The corporate enables its customers to do transactions anywhere as long as you have access to the internet. Services also efficient in Citibank. Their web platforms are easily accessible, and there is also ample security in terms of transactions. The above e-business advantages make e-business strategy the best for success.
The corporate-level strategies for Citi Group
As defined before, the corporate level strategy involves making decisions that influence the activities of the entire company. The strategy affects all services offered in a company. The plan ensures that the business financially succeeds in the future and also maximizes the profitability of a business. When utilized well, the competitive advantage of accompanying increases hence overpowering its competitors. One of the companies that use corporate business strategy is the Citi group. Different corporate-level strategies are used in this company.
The first corporate-level strategy used by this company is the expansion growth strategy. This strategy mainly aims to increase the growth of the company and exploit opportunities in the market. The strategy helps the company in dominating and controlling the market hence winning over the competition. The most used form of expansion strategy is diversification. The method involves the launching of new business lines and products. Another type of diversification is entering new markets. The introduction of e-business in this company is a form of this strategy. The method has enabled the company to enter the new market through the use of the internet. This method is only fruitful if it is profitable hence overcoming the costs.
The other corporate strategy method used by this company is the internationalization. Citibank is found in all continents, including Asia, Europe, Africa, South America, and North America. This strategy involves marketing your business products and services all over the world. The company has used this strategy to expand its market internationally. In using this method, the company considered some of the political and social risks. This method is so technical; hence, any company using it should be careful. The company uses this strategy by taking advantage of the market potential, the favorable business environment in those countries.
Mergers and Acquisition is also another corporate-level strategy that was used by Citigroup. This strategy involves combining two or more organizations to form one. Citi group was established in 1998 by merging two companies, that is, the Citicorp and financial conglomerate, Travelers Group. For this to happen, both the companies had an agreement. There has been an expansion in the lines of product and enhancement of the distribution network. The company has been able to acquire competing companies hence reducing competition. The merger also led to an increase in the company’s market share.
Of all the three strategies, diversification is the best method to use in ensuring that the company succeeds for a longer time. Although all the remaining strategies also have its advantages and benefits, diversification has proved that it can make the company be the best in the market. Gaining power in the market is one of the advantages. By introducing new services and products in the market, you attract and gain more customers than your competitors. Winning over competitions makes the business to last longer. The adoption of new business lines, such as the initiation of e-business by the Citi group, is making it more successful than the other companies. The strategy has expanded access to their services hence the increase in the number of customers. With an increase in the number of customers, revenue generation in a company increases, thus sustainability. Internationalization is not the best option because of the risk it has, especially when political instability emerges in a country. This can hinder the company’s activities in the area. The merging strategy is only helpful to a company at the initial stages. Though the company expands drastically after the merging, the funds won’t be available for the future. In my judgment, I can say that this option is the right choice.
Competition Environment
The banking industry is very competitive due to the presence of other companies doing the same business. The competition is experienced in corners of the business environment. In the financial banking sector, Citi Group experiences competition from Morgan Stanley, Wells Fargo, HSBC, Bank of America, and also from international banks such as States Bank of India and Barclays. With the expansion in the global market, competition in this industry is increasing day by day. The most significant competitor is HSBC. Citigroup is a global company doing business in over 160 countries. In contrast, HSBC is present in 71 countries and is one of the most significant banking institutions in the world.
Recently, there has been a higher growth in revenue in HSBC than in Citigroup over the last three years in Asia. It was as a result of the focus HSBC made on retail banking. It also considered the expanding market. Citigroup performs better in North America with a revenue of 46%, followed by that from Asia of 20%. Although both of these financial institutions have an increase in operating margins, HSBC has undergone a faster growth than the Citigroup. From the analysis, it is clear that HSBC has been performing better and is a serious competitor to the group.
Despite the competition, the business strategies used by the Citigroup has enabled it to continue being the best in the industry. The company has been developing new business ideas hence coping with the competition. The adoption of e-business gives the company an upper hand over other competitors, such as HSBC, that use retail banking.
Competition in Fast-Cycle and Slow-Cycle Markets
In the fast cycle market, the game is too high. The company should always come up with new products. It is a high-speed market. In the slow cycle market, the completion is so low that one company tends to be controlling the entire market. In the slow cycle, the investors use a lot of capital in their ventures. The banking industry in the fast cycle market. Like any other industry, some products and services move fast while others move slow. The use of e-business has grown faster than expected, and services are being offered fin a fast cycle through the internet.
The HSBC and Citigroup are competing day by day. If one company expands to another region, the other one follows. Soon both the companies will be using e-business strategy in doing transactions online. With the continuation of the trend, the battle between n these companies will continue. No company will agree to be younger or smaller than the other. In the fast cycle market, it is clear that Citigroup will be more successful than other competitors in the industry. It may be as a result of fast transactions that can be done online.
Conclusion
The banking and financial industry is growing and becoming exceedingly competitive day by day. The companies in these businesses are developing new strategies so that they can have the market advantage and gain more profit. Companies can decide to adopt either business-level strategies or corporate level strategies to attract more consumers and customers. Citigroup uses both strategies. The company concentrates on e-business, citizenship, internationalization, and diversification, which has turned out to be very helpful. Despite the success, the company will till continue experiencing completion from other big companies.