The Indian financial market is in a state of metamorphosis. The last decade has been witness to some of the spectacular moments, such as Sensex crossing the 15,000 barrier and then again going as low as 10,000 points. Though the markets have been highly volatile resulting in huge losses they have also given reasonable returns. But one should consider that this volatility itself is a sign of growth and characteristic of a market moving towards maturity. Not only the markets but the investors themselves are also maturing. Thanks to the electronic media, investors today are more knowledgeable and better informed of the latest happenings in the financial arena. Investors today demand more customized services and want their preferred financial service-providers to give one-stop solution for all their financial needs. In this endeavor, financial institutions are trying to incorporate all kinds of financial products in their product line but, at the same time are increasing the risk of providing scrappy customer service.
Extending the product line is one serious issue but extending the distribution channels is yet another. To offer various products and to tap the potential investors, financial firms need more effective channels of distribution. In such a scenario, multi-channeling can provide some respite. With the financial markets getting fiercely competitive, more and more firms are deploying multiple distribution channels, because in the coming years, the differentiating factors amongst firms would be the kind of service they provide and the strength of their distribution network. There are certain factors that affect the choice of channels, namely. |
