Banks have not fully recognized the role of customer strategy in business operations.
The customer factor has been paid attention to by banks in their activities, but has not been systematically demonstrated in all the contents of a customer attraction strategy. This issue has not been disseminated to all bank staff. Bank staff perform their duties almost solely with immediate professional responsibility, not with the purpose of directing customers to the bank in the long term through the bank's own unique impressions. In fact, when customers come into contact with banks, especially when communicating with some state-owned commercial banks, they feel difficult to approach, not because of the bank's services, but because of the unenthusiastic attitude of the bank staff.
Most bank staff have been trained but at a low level, performing general and specialized technical operations and consulting for businesses is still limited. There are still negative and personal phenomena in handling work and causing inconvenience to customers. Along with strengthening technical facilities, re-arranging the current staff in banks is extremely important.
Products and services are still poor and not competitive enough.
Maybe you are interested!
-
Directions and Solutions for Building Customer Strategy of Vietnamese Commercial Banks -
Current Status of Building Customer Strategy of Vietnamese Commercial Banks in Recent Times -
Customer relationship management in competitive strategy and lessons for Vietnamese enterprises - 13 -
Product Specific Strategy for Customer Segments -
Building and Implementing Good Customer Policy
After 15 years of innovation, what banks have achieved is a great effort, accelerating the process of integrating our country's banking system into the banking community of countries in the region and the world. However, the products and services of banks are still poor, with few varieties, not meeting the increasingly high demands of customers. Recently, some new products have been introduced to the market but are still in the testing phase, with a narrow target audience. The demand for products and services with some forms of payment
New payment, not yet widely used among the population such as card payment, ATM, personal account.
Input products are not really attractive to depositors. If anything, banks have to compete and push prices up to attract them. The lack of guarantees makes depositors feel uneasy.
The criteria of product and service quality based on speed, accuracy of delivery and customer satisfaction can be considered as the ineffective factor of commercial banks in Vietnam today compared to the foreign banking sector and other banks in the region as well as in the world. Determining transaction prices, transaction levels, and types of services provided are not really based on the close relationship between customers and banks.
Customer information is incomplete, inaccurate and not yet able to predict
newspaper.
The regulation that a customer borrows capital from many banks makes the
Banks find it difficult to track customers and debt collection sources, as well as financial status. Most customers in Vietnam currently transact with many banks such as opening deposit accounts, making payments, applying for loans, etc., so specialization is not high. While the trend is for a customer to only have a relationship with one bank, most corporate customers now transact with at least two or more banks.
Although there is a risk information center, the data is not updated, so it is not used effectively. The information of banks is sometimes inaccurate, and there are weaknesses in the collection, analysis and processing of information. Information about customers is very limited, for corporate customers, most banks only have information from financial reports, while much of this data is not audited and publicly disclosed. Compliance with accounting, statistics and auditing laws by enterprises is not systematic.
not in accordance with regulations, especially non-state enterprises. One of the reasons leading to the high rate of overdue debt is that when granting credit, banks lack information about the market, finance or capacity and ethics of customers, so they lend but cannot recover the debt.
The distribution channel system has not been improved.
Distribution points and distribution channels of commercial banks have not improved significantly. Although the branch system of commercial banks is a strength, due to limited capital conditions, especially the Agricultural Bank, the facilities of district branches are very backward, and business services are lacking such as computers, specialized vehicles, etc. The distribution network is still cumbersome, numerous but ineffectively used, and the role of cooperation in performing banking operations between banks and commercial bank branches is still low.
The bank branch network is still traditional, spread out in all places, without considering the needs of banking products and services of customers in each market area. The provision of banking products and services "at home" is still very limited, only a few banks do it. Transaction time with customers is mainly still carried out during office hours according to regulations, not expanding transaction time with customers according to demand or on holidays, after hours.
Promotion of bank reputation and image is still limited.
Advertising activities are still limited, if not too simple and rudimentary. People only know that banks are places where money is available, and they do not have a firm grasp of loan and repayment procedures. The problem is how to make people understand banks, know transaction procedures, easy to remember and understand, and popular, thereby contributing to bringing products to market as quickly as possible and consuming them as soon as possible. The relationship between commercial banks and mass organizations
The professional associations of news agencies and newspapers are still limited, so the lack of understanding of banking activities in society is not high, and the policy of banking activities serving the economy when deployed to the public is still slow.
2.3.2.2 Causes
Subjective causes
Most Vietnamese commercial banks lack appropriate and effective customer strategies. Customer strategy is the foundation and basis for building business strategies, but up to now, most Vietnamese banks have not yet built a systematic customer strategy, from segmenting and selecting target customers in each specific stage, to building policies on prices, products and services... and attractive approach plans for these customer segments.
The customer strategy is still general and does not have differentiated product policies for each bank . Vietnamese commercial banks, especially the state-owned commercial banks, have not proactively approached the market in a scientific and systematic manner, and are poor at collecting information and analyzing the market to determine needs and thereby best meet the market. All state-owned commercial banks pursue the goal of serving all sectors of the economy, so they will have to spread their resources. All four banks operate with almost the same business model: a universal bank serving all sectors of the economy without any significant focus on any market. The level of competition between state-owned commercial banks will increase and reduce profits in the sectors where banks invest together, while other sectors are not served. Thus, there is a risk that banks can weaken each other through similar strategic choices.
The work of building customer strategies of state-owned commercial banks has not received due attention and investment. The Industrial and Commercial Bank has only stopped at identifying strategic customers and has no specific plans for implementation. Moreover, the strategic customers are defined broadly and widely, without indicating priorities. The customer strategies of other banks such as the Bank for Investment and Development and the Bank for Agriculture and Rural Development have not received much attention and investment.
Currently, state-owned enterprises are the main customer segment of state-owned commercial banks. These enterprises are large in scale but have lower operating efficiency than the private economic sector and the foreign-invested sector, so they have many potential risks on a large scale and are highly systematic. The non-state economic sector is a dynamically developing sector in the economy and is experiencing significant development. Furthermore, although the risk level of each individual subject may be higher, due to the small scale of each subject and low systematicity, in general, the risk is dispersed and the possibility of large-scale risks is low, and state-owned commercial banks have not paid due attention to it.
The weak technological level and financial capacity of the banking system are inevitable results of the legacy from the subsidy period and an economy with a low starting point. In a centrally planned economy, banks mainly operate on policy, there is no competition and little concern for efficiency. This is also an important factor hindering the development of banking technology to create utilities to attract customers, although banks have made efforts to solve this problem.
The lack of management experience of bank staff in both credit management and organizational management is still common. From the imprint left by a time of bureaucracy, subsidies, desk style, and mainly customers
go to the bank to receive products and services, the bank has not proactively responded to customers "at home". Many staff have not kept up with the new technology level, and their passivity is still high. Along with the change in the direction of operations towards commercial establishments, bank managers and operators will be the ones who have to make their own decisions based on their analytical skills and management experience, and must take responsibility for these decisions.
Objective reasons
Demand for products and services is not high.
The habit of using cash among the people leads to the use of credit cards or payment accounts, consumption becomes difficult to develop; the average salary of the majority of people is still too low to be able to open an account or use a credit card; the general development level of Vietnamese enterprises is still too low compared to the world, leading to the demand for new and modern banking services like in developed countries is not really urgent, besides the demand for capital for investment and expansion of production scale.
Impact of the old centralized subsidy management mechanism.
Innovating banking operations in the context of Vietnam facing many difficulties due to the consequences of the old management mechanism, the new mechanism was formed but initially implemented with confusion and lack of experience, so it had to be constantly changed and adjusted for perfection. Although the two-level banking organizational structure has been established, initially there are still many overlaps and lack of unity, which somewhat affects state management and business in the fields of currency, credit and banking.
The macro environment is not clear .
The economic and investment environment is not stable. The organizational market is not synchronized, macro policies, especially tax policies, are often changed, with many fluctuations that adversely affect banking activities. Support
The state-owned and non-state-owned economy is still small, the “playing field” of enterprises is not really equal, the restructuring of state-owned enterprises is slow, many enterprises are small-scale, capital and technology are backward. The competitive environment has unhealthy factors such as collusion, corruption, etc., causing difficulties for serious business people. Strengthening and perfecting state policies and measures for economic sectors, ensuring a healthy and stable economic environment for enterprises to develop is very necessary. Creating conditions for “healthy” customers will ensure that banks expand their markets and operate effectively.
The legal environment is not consistent, making it difficult to carry out high-risk banking activities. Although the legal system in our country has had positive changes, it has not yet met the requirements of the market economy, being both redundant and lacking, inconsistent and overlapping.
Legal documents related to banking credit activities and current credit mechanisms do not clearly define the legal responsibilities of lenders and borrowers. Law enforcement agencies have sometimes criminalized banking activities, affecting business reputation and customer trust in banks.
In summary, Chapter 2 analyzed the challenges and opportunities from the business environment, the strengths and weaknesses of Vietnamese commercial banks themselves; assessed and clarified the existence and causes of the current state of customer strategy based on the current state of the customer system and the operational capacity of banks to meet the needs and attract customers. Thereby, it is seen that the customer strategy of Vietnamese commercial banks is still confusing, inadequate, mainly improvised and has not been
orientation, construction, and implementation in a planned and systematic manner. Therefore, chapter 3 will present successful experiences in customer attraction strategies of foreign commercial banks and solutions for building appropriate customer strategies for Vietnamese commercial banks.