Lion King Bank, a South African consumer bank, seeks to improve profitability after cost-cutting measures. The case explores strategies to increase revenue, focusing on customer acquisition and segmentation. Key areas examined include:
- Evaluating market potential for student and affluent middle-class customers
- Analyzing growth opportunities in customer accounts and revenue per account
- Comparing strategies for targeting students vs. affluent mid-income customers
- Assessing long-term value of student accounts despite initial low profitability
The case concludes by recommending a focus on mid-income customers for short-term revenue growth while maintaining a long-term view on student acquisition. It highlights the importance of product mix optimization, customer lifetime value, and potential risks of aggressive customer acquisition strategies.