BMA5100
The Marketing Business
Individual Pitch Proposal
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Brand Overview
UK-based fintech GoCardless has been one of the leading payment providers since its founding in 2011. The company uses bank-to-bank payment technology to facilitate the recovery of recurring and ad hoc charges for companies. GoCardless is a major competitor in the direct debit payment space, operating in 31 countries while serving clients of 70 thousand and above (GoCardless, 2017).
Figure 1 GoCardless Logo
(GoCardless, 2017)
Current Situation Analysis
The current business environment can be described over a few key factors, which are as follows: The company is well positioned in its primary space of recurring payments, has integration with most of the significant accounting software providers, it is based on the technologically, and is, moreover, an international account that supports multiple currencies. That said, the firm as is GoCardless also has its weaknesses such as rivalry with numerous fintech firms, legal constraints in the various markets, dependency on bank associates, and relatively low visibility in markets beyond the United Kingdom and Europe (Joudeh et al., 2023).
Key Issues and Challenges
In the broader context, several key issues and challenges are shaping the financial technology landscape:
COVID-19 has intensified the pace of digitization opening new opportunities and posing threats to the firms in the Fintech market.
New open banking concepts, especially across Europe with PSD2, are now starting to redefine the financial services industry.
Security is one of the issues arising from the growth in the use of electronic money transactions.
It is still a trend today to require companies to be environmentally friendly and socially responsible.
SMEs are searching for convenient financing methods to help their recovery and economic growth after the pandemic (Suryono et al, 2020).
Growth Opportunity: Sustainable Finance for SMEs
Collecting market insights have come up with attractive prospects for GoCardless in sustainable finance/SME services’ cross-section. Research indicates a strong trend towards sustainability in the business world, particularly among SMEs:
According to a 2023 cross-sector European Investment Bank survey, 75% of SMEs currently believe sustainability is a factor that will influence their competitiveness in the future (Kireyeva et al., 2020).
Global Sustainable Investment Alliance points out that sustainable investment assets hit $35.3tn in 2020, a 15% increase from 2018.
A McKinsey analysis reported that only 30 percent of SMEs can find funding for sustainable projects.
The World Bank predicts that business solutions to improve climate outcomes for emerging markets could be worth $23tn by the end of the next decade (GoCardless, 2017).
Based on these developments, we suggest that GoCardless capitalize on the current technologies and market presence to develop the concept of a ‘Green Payments,’ platform that targets SME businesses. It would allow purchasers to pay for sustainable goods and services, provide better rates for payments concerning green measures, offer sustainability reporting and carbon tracking, and find green funds for SMEs. This opportunity resonates well with GoCardless’s areas of specialization in payment technology but at the same time fills a gap that is currently seen with growing issues on sustainability especially among SMEs.
Marketing Mix Strategies
Product
GoCardless should hence avail what they refer to as the GoCardless Green; a product range, that would incorporate green payment processing, with relatively cheaper rates to sustainable payments, tracking, reporting, and carbon offset partners among others. The company also needs to develop a separate API for sustainability data as well as a blockchain-based verification system for green and clean transactions.
Price
The pricing strategy should make a layered model based on the amount of transactions and give discounts for businesses. Another approach could be to focus on the usage of green transactions and providing charges on the non-green ones; ‘sustainability credit’ could be awarded where businesses use green services ‘purchases’ to offset their fees for the non-green ones, or gain extra services. Dynamicity in fees where the fees are flexible depending on data and information gathered on a real-time basis about sustainability could also be suggested.
Place
Due to the high growth potential, GoCardless should seek to distribute via more organizations and certificated bodies interested in sustainability. Creating a specific sub-platform of the GoCardless as the “Green Marketplace” would help to unite sustainable SMEs with potential customers or investors. A mobile app optimized for green payments and sustainability tracking would also be convenient for the users.
Promotion
The idea must be to create a large-scale marketing blitz tagged as ‘GoGreen with GoCardless’ under which go-to marketing is the content marketing related to sustainable finance, creating strategic collaborations with environment influencing coupled with sponsoring sustainable events including webinars. Forums, where existing clients could bring other SMEs who might be interested in sustainable finance, could help increase the user base. Creating case studies and proving that GoCardless Green is an environmentally friendly method that saves money would have presented social proof. Forming partnerships with other companies /charities whereby the company would donate a percentage of the green transaction fees to supporting particular causes would add to the credibility of the green initiative.
Figure 2 Marketing Mix
(Author, 2024)
People
GoCardless should hire sustainability experts to support product development. Comprehensive training should be provided to customer support teams in sustainable finance and the new green product suite implementing a sustainability program would align company practices with the new product offering.
Process
Process improvement should include streamlining the onboarding process for SMEs looking to adopt sustainable finance practices, and developing an automated sustainability assessment tool to help businesses identify areas for implementing real-time sustainability impact reporting for businesses using the platform.
Conclusion
These areas of the marketing mix will help GoCardless to come out as a marketing leader in sustainable finance for SMEs that need financing through fintech and at the same time would help in contributing to the environmental changes positively. Notably, this approach does not only counter the existing marketing needs and social issues but is also tailored to GoCardless Capabilities in terms of payment innovation, as well as geographical presence. For this to work successfully, It must be done well, continuously improved upon, and done with passion.
References
GoCardless (2017). GoCardless. Gocardless.com. Available at: https://gocardless.com/faq/merchants/ [Accessed 5 Oct. 2024].
Joudeh, J.M., Al-Gasawneh, J.A., Joudeh, A.M., Aljabbri, M.A. and Khader, J.A. (2023) ‘The impact of marketing mix of financial services on customer satisfaction and competitive advantage of money exchange companies from the customers’ perspective,’ Seybold, 18(2), pp.1-16. https://www.researchgate.net/profile/Mohammed-Aljabari/publication/369146475_the_impact_of_marketing_mix_of_financial_services_on_customer_satisfaction_and_competitive_advantage_of_money_exchange_companies_from_the_customers'_perspective/links/640d8bda66f8522c38998a63/the-impact-of-marketing-mix-of-financial-services-on-customer-satisfaction-and-competitive-advantage-of-money-exchange-companies-from-the-customers-perspective.pdf
Kireyeva AA., Kredina, A., Vasa, L. and Satpayeva, Z.T. (2021) ‘Impact of financial technologies on economic development: Theories, methods and analysis,’ Journal of International Studies, 14(4), pp. 286-303 https://jois.eu/files/19_1192_Kireyeva%20et%20al.pdf
Suryono, R., Budi, I., and Purwandari, B. (2020) ‘Challenges and trends of financial technology (Fintech): a systematic literature review,’ Information, 11(12), p.590-610. https://www.mdpi.com/2078-2489/11/12/590/pdf
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