Proceedings of International Conference on Contemporary Management - 2014 (ICCM - 2014), pp 753-770 MICRO CREDIT MARKETING STRATEGIES IN THE POST WAR MARKETING CONTEXT. S.Shivany1 , T.Velnampy2, K.Kajendra3, Abstract Absence of research on micro credit marketing strategies which significantly contributing factor to strategic marketing, and micro credit marketing in the financial and nonprofit organizations domain, and the extant research on marketing strategies lacks in theory based frameworks that explicate what marketing strategies are appropriate for micro credit marketing in the post war marketing context. Present study explored marketing strategies for micro credit in the unique context. Using grounded theory approach, data were collected from 08 focus group discussions, and in depth interviews with different micro credit marketing organizations. This study compared the profit oriented micro credit organizations and nonprofit organizations. NVivo (version 09) software was used to manage the focus group data. Transcripts were reviewed as the data collection to identify emerging ideas and specific themes, which guided subsequent data collection efforts. To code the data, open coding and axial coding schemes were used. market orientation, ethical marketing, post war development as differentiation, Customer service in good relation, Participation in group-lending have been identified as the marketing strategies which have been adopted by the profit and nonprofit orientated organizations in the post conflict marketing context. Keywords: Micro credit marketing, Marketing strategies, Postwar context, Grounded theory 1. INTRODUCTION additional income. Sri Lankan microcredit Microfinance is the solution that organizations become gradually aware of ensures the provision of loans and other the importance of marketing in their current basic financial services to those activities, those who have penetrate into post entrepreneurs who have limited access to the war marketing environment. banking sector. These financial services provided by microfinance institutions allow Understanding the market for small business owners to take advantage of microcredit services, and using effective their entrepreneurship skills by developing marketing tools and strategies to attract new small businesses capable of generating clients is critical if programs are serious 1University of Jaffna, [email protected] 2University of Jaffna, [email protected] 3University of Colombo, [email protected] 753 about increasing their scale and being seen It has created positive impacts on two vital as critical players on the microenterprise/ areas of national development, viz., small business development scene. alleviation of poverty and women's empowerment. Microcredit programmes in Microcredit as a business starting as post war context are targeted to the poor who a social inspiration and ending as a has returned to their normal life after 30 sustainable model for microcredit (Ray M. years of civil war. Valadez, Bruce Buskirk, 2012). Microcredit has attained rapid growth in Sri Lanka. It has Being a rural based micro finance emerged as a potent instrument of poverty providers with extension into the small alleviation. Both private and public sector business sector, micro credit organizations organisations are involved in microfinance. have been instrumental in empowering rising entrepreneurs from the grass root The development of the competitive level. Through group and individual lending environment often takes place in parallel schemes, they have targeted women, small with the market development. On emerging entrepreneurs and farmers, and become a markets, competition is very low, often pillar of financial strength in their journey nonexistent. It increases on developing towards becoming a viable business markets and is very strong on mature enterprise in the Sri Lankan Post war context markets. Once competition becomes more (LOLC, 2014). intense, microcredit organizations feel the threatened that they might lose the market Developing markets can be found share they have, and they start to invest in rural areas and small towns that have resources in marketing activities to help economic potential for development. These them maintain their market position. In markets are characterized by an increasing urban areas, the main competitors are other demand for microcredit, which is and will be microfinance institutions, banks, with the met by existing or future Microcredit consumer loans. The rural market is programs. This demand comes from existing relatively divided geographically between customers and potential customers who have microcredit organizations. Banks have just heard of the available microcredit products started to open small local offices, to shine in and see their effect on customers who have micro credit activities (Ray M. Valadez, accessed them (Ray Valadez, Bruce Buskirk, Bruce Buskirk, 2012.) 2012). Microcredit has generated The creation of Microcredit markets considerable hope and expectations among in poor countries is a crucial factor for their the academics, policy makers of the development. If well put into practice, government, NGO leaders and other people would be able to improve their development practitioners in post war quality of life. With the suitable support they marketing environment of Sri Lanka. will become educated and that will allow 754 them to enlarge their business, to think by post war marketing context. It is an essential themselves and to appreciate that they have to explore the marketing strategies, which rights. The creation of credit markets in poor have been used to compete in the micro countries is a crucial factor for their credit marketing. development. If well implemented, people would be able to sell their products, pay a Micro credit marketing is the fair interest rate, and use the extra money to emerging phenomena, and especially in the improve their quality of life (Sofia Santos, post war context marketing strategy making 2009). is needed for post war development. So the present study is to find out the strategies of In many cases, there is only one micro credit marketing in the post war microcredit supplier operating in the area. context. This research paper is highlighting a The challenge in this situation is to develop picture of marketing strategies for micro appropriate internal systems to manage credit customers as a profitable segment for growth. Attracting customers is relatively microfinance institutions. easy and the lack of competitive environment offers these customers few Research Lacuna options, so the microcredit organization has Micro credit is a source for small a high retention rate (Florenta, Lucian business as a means for alleviating poverty Blaga, Hermann Oberth, 2012). has garnered significant attention among businesses, policy makers, and scholars in Need of the study recent years. Yet, little attention has been The need of microcredit arises given to the approach by which the poor because, the post war context requires actually seek out small scale loan to satisfy sources of finance for poverty alleviation, their basic business financial needs (Sofia procurement of agricultural and farms input Santos, 2009). and post war business development. However, there is a dearth of Micro credit is a programme to empirical knowledge to understand the support the poor rural people to pay its debt effectiveness of marketing capabilities or and maintain social and economic status in guide their development and use in micro the villages. ventures. Bruton, Ahlstrom, and Obloj (2008) suggested that much more insight is As we know that Sri Lanka is needed into the types of influence and agriculture based economy so microcredit personal selling strategies that are effective may be a tools to empower the farmers and in emerging economies. rural peoples to make business and agriculture profitable in the post war In the earlier epoch, micro credit has marketing context. been offered only by service oriented organization, and the non-government Due to the competition exists organization, but in the contemporary among the micro credit organisations in the competitive environment profit oriented 755 organization also have started to offer micro livelihood income generation activities were credit for profit as a cross selling strategy for studied (Velnampy, Kajendra, Shivany, profit earning. Non -Profit oriented 2013). There are many links between organsiations gain income from the profit of livelihood and micro credit marketing. This micro credit marketing by starting sub study contributes for building from theory in branches to market micro credit (Florenta, strategic marketing, and theories the Lucian Blaga, Hermann Oberth, 2012). marketing strategies for micro credit activities in the post war context. To that end, Need for micro credit is immense this study offers several contributions. This because many nonprofit/non-government study explores the role of marketing organizations provide training for starting capabilities in driving performance in Micro self-employment, and livelihood income credit marketing. Specifically, explore the generating activities. The people who have marketing strategies in the post war context, been trained need micro credit for starting which have been underexplored. This study new business, it created a big segment of also brings together theory from strategic micro credit (Sofia Santos, 2009). marketing and micro credit marketing that has seen minimal integration to date