RELATION OF MARKETING AND PROFITIBALITY OF KAZAKHSTAN BANKS
Currently, there are 38 commercial banks operating in Kazakhstan. Being competitive enough, they promote themselves by proper advertising campaigns. This paper is devoted to the issue of advertising campaign and explores whether or not it significantly affects profitability in the banking industry of Kazakhstan. Net incomes of the twenty largest banks in Kazakhstan are studied for the period of 2005 until 2012 consisting of 32 quarterly observations. Unit root test was employed to check marketing expenses, earnings before interest and taxes and net income. Regression analysis was conducted using marketing expenses from previous period and current profitability. Income was measured by Earnings Before Interest and Tax and Net Income of the largest twenty banks of Kazakhstan. Marketing expenses of previous periods were analyzed as well.
Key words: Marketing, profitability, banking sector, regression analysis
Jel Codes: G20, C30, M31
Andreasen A.R., (Feb., 1978) “The Ghetto Marketing Life Cycle: A Case of Underachievement”, Journal of Marketing Research, Vol. 15, No. 1, pp. 20-28
Barajas, A. R., Steiner, and Salazar N., (2000) “Foreign Investment in Colombia's Financial Sector,” in Claessens, S. and Marion Jansen, (eds.) The Internationalization of Financial Services: Issues and Lessons for Developing Countries, Boston, Mass.: Kluwer Academic Press.
Bennett, P. D., (1979) “Review of Strategic Planning and Policy by William R. King & David I. Cleland”. Journal of Marketing, 43(2), 131-132.
Biggadike E. R., (Oct., 1981) “The Contributions of Marketing to Strategic Management», The Academy of Management Review, Vol. 6, No. 4, pp. 621-632
Bhattacharyay B.N. and Ghose B.K., (Feb. 25, 1989) “Marketing of Banking Services in the 90s: Problems and Perspectives”, Economic and Political Weekly, Vol. 24, No. 8, pp. M27-M32
Chang C.E., Hasan I., and Hunter W.C., (1998) “Efficiency of Multinational Banks: An Empirical Investigation,” Applied Financial Economics, 8(6): 1-8.
Cohen K.J., Maier S.F., and Vander Weide J.H., (Oct., 1981) “Recent Developments in Management Science in Banking”, Management Science, Vol. 27, No. 10, pp. 1097-1119
Claessens S.A., Demirgüç-Kunt, and Huizinga H., (2000) “The Role of Foreign Banks in Domestic Banking Systems” in Claessens, S. and Marion Jansen, The Internationalization of Financial Services: Issues and Lessons for Developing Countries, Boston, Mass.: Kluwer Academic Press.
Clarke G., Cull R. M., Peria S.M., and Sanchez S.M., (Spring, 2003) “Foreign Bank Entry: Experience, Implications for Developing Economies, and Agenda for Further Research”, The World Bank Research Observer, Vol. 18, No. 1, pp. 25-59
Cheryl, N., and Sivakumar K., "Factors in Emerging Markets and their Impact on First Mover Advantages." Working Paper No.
Denizer, C., (2000) “Foreign Entry in Turkey’s Banking Sector, 1980-1997,” in Claessens, S. and Marion Jansen, (eds.) The Internationalization of Financial Services: Issues and Lessons for Developing Countries, Boston, Mass.: Kluwer Academic Press.
De Young R. and Nolle D.E., (1996) “Foreign-owned banks in the United States: Earning Market Share of Buying it?” Journal of Money, Credit, and Banking, 28(4), 622-36.
Dick, A.A., (Feb., 2007) “Market Size, Service Quality, and Competition in Banking”, Journal of Money, Credit and Banking, Vol. 39, No. 1, pp. 49-81
Gray J.M., & Gray H.P., (1981) “The multinational bank: A financial MNC?”, Journal of Banking and Finance, 5: 33-63.
Hasan, I. and Hunter W.C., (1996) “Efficiency of Japanese Multinational Banks in the United States,” in Andrew H. Chen, ed., Research in Finance, Volume 14, Greenwich, CT and London: JAI Press. 157-173.
Joshi A. and Hanssens D.M., (2010), “The direct and indirect effects of advertising spending on firm value”, Journal of Marketing, Vol.74, pp. 20-33
Kotler P. and Connor R.A., 1 (Jan., 1977) “Marketing Professional Services”, Journal of Marketing, Vol. 41, No., pp. 71-76
Kiraly, J.B., Majer L., Matyas, B., Ocsi, B., Sugar A. and Varhegyi E., (2000) “Experience with Internationalization of Financial Service Providers – Case Study: Hungary,” in Claessens, S. and Marion Jansen, (eds.) The Internationalization of Financial Services: Issues and Lessons for Developing Countries, Boston, Mass.: Kluwer Academic Press.4
Mahajan Rangan A.N., and Zardkoohi A., (1996) “Cost Structures in Multinational and Domestic Banking,” Journal of Banking and Finance, 20(2): 238-306.
Maysami, C.R., Koh S., (2000) “A Vector Error Correction Model of the Singapore Stock Market”, International Review of Economics and Finance, vol. 9 pp.79–96
Miller S.R., and Parkhe A., (2nd Qtr. 1998) “Patterns in the Expansion of U.S. Banks' Foreign Operations”, Journal of International Business Studies, Vol. 29, No. 2, pp. 359-389
Uppal R.K., (2010) “Marketing of bank products-Emerging Challenges and New Strategies”, Journal of Management Research, pp.35-42