Study of Marketing strategy for Public and Private sector Mutual Funds in India

Abstract

This study mainly focuses on the need for marketing strategies for Mutual Fund Industry in India. The competitive landscape of the Mutual fund industry has undergone a tremendous advancement in recent years. Mutual Fund houses compete with one another either by satisfying different economic functions or by introducing a low-cost or a differentiated product. Mutual funds in India have confined its reach to urban areas leaving vast saving potentials in rural areas untapped. The main reason for restriction of mutual fund investment in Top cities or Urban areas is the lack of awareness level in the rural and semi urban areas. Mutual funds have not been recognized and accepted in the rural and semi urban markets. The role of mutual fund agents or distributors is to educate the investor community. The abolition of entry load from August 2009, criticized by some brought benefits to investors. Recently mutual fund companies are initiating different steps through financial inclusion. Thus helping in promotion of investment behavior by spreading awareness among prospective customers in urban and rural areas. Indian Mutual funds have remained focused around a limited range of products. Efforts to develop and expand the market through innovative products have been negligible. This may be attributed to the funds inability to take risks and to predict the future developments in the market. Therefore the spread of Mutual Fund market has been limited. The absence of product diversification and confusion in the market has been enlarged by the lack of marketing initiatives for Mutual Funds.