Sales Efficiency of the Indonesian Retail Bond (ORI) and Its Implications on Marketing Strategy

Abstract

This study aims to assess the efficiency of the Indonesian Government Retail Bond known as ORI (Indonesian Retail Bonds) at every branch of BRI (Bank Rakyat Indonesia, an Indonesian commercial bank) in order to obtain a comprehensive study on marketing strategy of ORI that is applicable for the Bank. The method used to analyze the efficiency is SFA (Stochastic Frontier Analysis) method, using number of marketers and marketing costs (marketing promotion cost plus overhead costs) as inputs, while the output is selling fee income of each branch. The five branches of BRI, namely: Jakarta Pasar Minggu, Jakarta Hayam Wuruk, Kramat Jakarta, Medan Iskandar Muda and Jayapura become the five most efficient branches in conducting sales of ORIOOl-005. Those branches have average cost per marketers ranges from Rp.533.750 to Rp.1.036.173 while their ORI sales target ranging from Rp.220.000.000 to Rp.7.921.666.667. Based on the research results, the effective marketing strategy that can be applied to all branches of BRI is to set the sales target of Rp.l.494.000.000 and marketing cost of Rp.1.036.173 (which consists of marketing/promotion cost and marketers' overhead cost) in order to obtain a profit of Rp.5.754.736 per-marketer.