Development of Distribution Channels in Finance Industry: Evidence From Banking and Insurance Sector in Turkey

Abstract

The purpose of this study is to review the development of distribution channels in finance industry with reference to banking and insurance. Distribution as a marketing function is of great importance for all businesses regardless of the main separation of production economy and financial economy in view of the fact that businesses can continue their activities in condition that their goods and services are marketed. This is dependent on the marketing performance of companies. This very fact accounts for the significance of this line of business. The paper covers Turkey as an emerging country where banking industry and –in particular- insurance industry have been growing remarkably despite global and local financial turbulences. In this study, change in distribution channels is analyzed for the years after 2002 when Turkish Financial Markets –especially banking and insurance sector- went through a considerable transformation in the aftermath of 2001 economic crisis. Analyzing comprehensively the figures about marketing line of business, this paper suggests that -as far as Turkish market is concerned- there exists much room for the development of distribution channels in finance industry. The paper also argues that banc-assurance, private-banking and digital distribution channels have great potential to grow in banking and insurance market.