Citibank Review Section: Marketing Essays
India I am extremely skeptical about this market. This country probably possesses the greatest challenge in the entire region. Enticing is the vast population (797 million) and enormous GNP ($222.5 million, both surpassing every country in the case analysis. Perplexing is the high annual inflation (9.8%), and the 5 year average inflation (8.2%). The political risk is assed as fairly high, with specific comments about government instability and corruption. In addition, 90% of the population earns less than 2,000 annually. Conversely there is still room for market entry. Thirty percent of the existing Diners Club card carriers are situated in the upper 3 levels of annual income. American Express does not exist in this country. Break-Even Analysis: $2 mil + $35 mil = 925,000 new credit card customers ''$65 - $25 ** (An additional $10 million to $15 million for each additional 250,000 credit card customers) ''=Joining fee and annual fee estimated from Diners Club (Exhibit 9) Indonesia I also assess Indonesia as a country I am least interested in entering. The country has an extremely low GNP as compared to the other countries in the region ($63.4 billion), with a relatively high population. Inflation is relatively high and the political risks is also a ''C'', with political turmoil looming on the horizon. Attractively, there is an above average savings rate (27.9%), a fairly strong estimate of growth (4.2%). But like India, 90% of the population earns less than $2,000 per year. From the outside, the market appears to be saturated with credit cards, with American Express and Diners Club already existing in this country. It would take considerable discussion to invest in entering this market.
Break-Even Analysis: $2 mil + $35 mil = 435,294 new credit card customers ''$110 - $25 ** (An additional $10 million to $15 million for each additional 250,000 credit card customers) ''=Joining fee and annual fee estimated from American Express Green (Exhibit 9) Malaysia This is not a country that you correspond with financial prosperity, but several indications point to a lucrative market with substantial growth possibilities. With a GNP ($34.1 billion) commensurate with it''s population (16.9 million), this country possess great inflation rates (2.0 %, with a 5-yrear average of only 1.6%). The middle three earning categories comprise the largest group of the population (75%). Only 17% of the population currently owns a credit card, with room for considerable growth. Break-Even Analysis: $2 mil + $35 mil = 616,667 new credit card customers ''$85 - $25 ** (An additional $10 million to $15 million for each additional 250,000 credit card customers) ''=Joining fee and annual fee estimated from American Express Green (Exhibit 9) Philippines I believe this country has room for expansion in the credit card market. There are some negative detractors to entry. A large portion of the population is in the last three categories of earnings (82% of the population earns less than $12,500 annually). The estimated growth rate is a dismal 0.5% annually. In addition, it possesses the lowest political and economic ranking ''D'', with comments about turmoil and communist insurgency. Impressively, the upper category of annual income possesses 50% of the credit cards currently in circulation on the Philippines. Socially, the Philippines places a great esteem on the financial affluence, and the entry of a affluence credit cards such as Citibank, will have great market attraction to the effluent portion of the population.
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