European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.7, No.15, 2015 96 Marketing Challenges for Banks in the Recapitalisation Era in Nigeria Haruna Isa Mohammad 1 & Kamarudeen Babatunde Bello 2 1. Department of Management, Modibbo Adama University of Technology, Yola Adamawa State Nigeria. 2. Department of Management, Modibbo Adama University of Technology, Yola Adamawa State Nigeria. *Email of corresponding author: haruisa@yahoo.com Abstract The first phase of the consolidation exercise was concluded on the 31 st December 2005, and 25 banks emerged out of the previously existing 89. These banks however have to contend with the problems associated with bank marketing over the years. The objective of this paper is to identify these problems, which have become challenges that they must surmount in order to succeed and create a positive image of banking in Nigeria. The research is essentially a library research, which employed the methodology of descriptive analysis of relevant materials such as textbooks, journals, newspaper reports and comments from informed analysts. The findings of this study show that the challenges facing banks is not limited to satisfying customers alone, but they are also under pressure to meet the needs of other stakeholders, especially the shareholders who provided the funds for recapitalization. Specifically, the paper noted that banks have to contend with challenges in such areas as competition, customer service, bank/product branding and development, corporate positioning, customer relationship marketing, corporate image and reputation, efficient and marketing oriented staff. The paper concludes that banks should set up effective communication channels with the customers so as to bridge the gaps existing in the customers’ expectations, while also encouraging their staff to be more marketing and customer oriented. The paper recommends that banks should consider the adoption of the additional marketing mix tools, with the inclusion of the People, Process, Promise and Physical evidence, as additions to the already existing 4Ps. Keywords: Marketing, Banks, Recapitalisation Era 1. Introduction The banking industry in Nigeria woke up to a big surprise on the 6 th of July 2004, when the then newly appointed Governor of the Central Bank of Nigeria, Prof. Charles Soludo, announced a 13-point reform agenda for banks in Nigeria. The chief among the reforms is that of the minimum Capital base for banks in the country, which will henceforth be N25 billion. He went further to inform them of an eighteen (18) months deadline, expiring on the 31 st of December 2005, for banks in the country to meet up with the target, or get their operating license withdrawn (Soludo, 2004). This announcement caused uproar in the banking sector as bankers all over the country started running helter and skelter in order to avoid the CBN’s hammer. To the banks chief executives, the problem was how to raise the required amount, while to most bank staff, the problem was what is next to do, as their fate hung in the balance, precariously depending on what becomes of their banks at the end of the day. The truth was, as at the date of the pronouncement, there were 89 commercial banks in the country, out which ten (10) were considered sound (Ebong, 2006), and only four (4) of them considered big enough based on capital base. Things however changed, when a few among them stumbled on the solution: Private placement and Initial Public Offers for those who could make it alone; and mergers and acquisitions for those who could not. Thus, setting the phase for the banking sector consolidation and the many challenges that accompany such a move. Banking sector consolidation in most parts of the world usually resulted in the reduction in the number of operating banks to a few strong and viable ones (Soludo, 2004). In the Nigerian context, a reduction in the number of banks, and the creation of fewer, larger banks has demolished the pillars upon which banks placed their marketing programmes and strategies. This is because the emphasis on the dichotomy that existed between the high/low capitalized banks which served as a means of attracting customer accounts away from the perceived smaller banks to those who were perceived as bigger and stronger ones (Ebong, 2006) will no longer be a marketing weapon in the industry. This, along with the creation of a level playing field through the phased withdrawal of public sector funds implies that banks must find other avenues for sourcing deposits in order to remain in business. The consolidation option has therefore created new challenges for banks on the need to redefine and refocus their marketing policies and strategies (Ebong, 2006). The objective of this paper is to identify the new