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Increasing competition and changing customer behavior in the German financial services sector

An analysis of market trends and their consequences for the business model of cooperative banks

©2006 Masterarbeit 125 Seiten


Within the last few years, dramatic changes took and still take place in the retail banking business. On the supply-side competition for cooperative banks is increasing due to various reasons. New competitors with different business models have entered the market. There is no doubt that they pose a serious threat to cooperative universal banks (which were the focus of this dissertation) and whose market share is declining constantly. Furthermore, „non-banks“ and „near-banks“ have to be considered in this respect, too, as these entities' business models are increasingly targeting customers of universal banks.
On the demand side, changing customer behavior has accelerated transformation processes in recent years. An increased willingness to change suppliers can be noticed as consumers are placing more and more importance on price. A strong price awareness is changing market conditions in many business sectors in Germany. Decreasing customer loyalty forces universal banks to push sales activities and to intensify their personal relationship with the customer.
The main objectives of this dissertation are the following:
Work out a strategy within today’s typical structure as a universal bank. Identify key success factors and evaluate this strategy for its chances for success.
Derive the consequences for the future business model of a cooperative bank. Determine the change steps necessary to strengthen the competitiveness.
Furthermore, the prerequisites of such a change process will have to be worked out.
An inductive approach was chosen to achieve the aims of this thesis (Gill & Johnson). Firstly, an in-depth analysis of existing literature was carried out in order to gain an overview on current developments such as a) customer behaviour, and b) the competitive situation of the financial services sector. The results were to produce not only an explanation for current trends but also allow the prediction of future trends over the course of the next years. The environment in which cooperative banks are operating was described in detail. This approach provides a good basis to identify the relevant factors and to work out the necessary consequences for cooperative banks.
In order to examine possible conclusions, interviews with 12 experts in the field were conducted. The target groups were CEOs of cooperative banks and representatives of cooperative bank associations. It is those people who are confronted with new challenges […]


ISBN (eBook)
ISBN (Paperback)
897 KB
Institution / Hochschule
Hochschule Ludwigshafen am Rhein – MBA-Studiengang International Management Consulting, International Management Consulting (IMC)
2006 (Oktober)
finanzdienstleistungen banken swot business model volksbank



Titel: Increasing competition and changing customer behavior in the German financial services sector