Study On The Customer Network Structure Of Urban Commercial Bank Through The Lens Of Culture Embeddedness

Since the middle of 1990s, Chinese urban commercial banks came from urban credit cooperatives. It was a different development path from traditional commercial banks. In this process, a special relationship has been formed among the urban commercial banks and local governments, enterprises, customers and other stakeholders. That relationship gradually formed a kind of cultural elements, and embeds, influence and became a part of the customer network of urban commercial bank. For example, for urban commercial bank, the role of local government has changed from a funding builder to a major shareholder, then to controller and meddler. The integration of government’s benefits and customer network of urban commercial bank happened, through the carriers which include board, local financing platform, and depositors of government department. Another example is that, an agreement about sharing customer resources has been signed to carry out cross-selling among urban commercial banks and insurance, securities, asset management, real estate and other enterprises. So, it has been hard to tell whose customers. In a market economy, the enterprise’s subject is diverse and border is more transparent, which provide better carriers and channels for culture embeddedness. Thus, the culture embeddedness has been an ignored effect on the customer network of urban commercial bank.In this dissertation, literature survey, case analysis, social network analysis, regression analysis, and other methods have been used, and we research customer network of urban commercial bank from a perspective of culture embeddedness, which is meaningful to enrich and deepen the social embeddedness, culture embeddedness, customer relationship management, other aspects of theoretical researches, and to improve analytical methods and framework of customer network. Meanwhile, this dissertation use the data sample of DL bank which is useful and meaningful to understand its customer network and to handle the relationship with stakeholders better, for the local government to make financial reform policies and improve governance mechanisms of urban commercial bank.The analyses in this dissertation focus on the following aspects:First, the embeddedness theory, customer network theory and other aspects of the literatures were combined and reviewed, which provides the theoretical foundation for other study.Second, the mechanism of culture embedded in general customer network, the mechanism of culture embeddedness of customer network in the urban commercial bank are analyzed. Based on the analysis on the government-business culture and the win-win culture in China, the dissertation focus on the background of local-government-bank culture, cross-selling culture and the mechanism of culture embedded in urban commercial bank’s customer network.Third, on the basis of analyzing basic situation of customers related to the government and individual customers, the dissertation builds an urban commercial bank’s customer network analysis model with social network analysis method, then analyze the size and density of individual network, centrality, cohesive subgroups, relevance, brokers and other morphological characteristics of DL bank.Fourth, through the regression model and using DL bank customer network data, empirical tests have been done to examine the impacts of variables including local-government-bank culture, cross-selling culture and variables of DL bank’s customer network form. All theoretical assumptions have been well verified.Fifth, the dissertation builds a model which measures costumer value based on the trading activity, trading strength, centrality and the ability of faction communication in customer network, and then it calculates the customer value of DL bank’s customer network and analyzes the customer value sectionally. Finally, based on the viewpoint of culture embeddedness and from two aspects of improve customer value and increase the amount of funds of customer business, the dissertation puts forward a marketing strategy of DL bank’s customer network optimizing.First, the main carrier and channel which cultures embedded in the customer network of urban commercial bank is particular customers. The local-government-bank culture influence the form of customer network of urban commercial bank by means of controlling board of directors, local financing platform and depositors of government department; cross-selling culture embed in the customer network of urban commercial bank by means of sharing old customers and developing new customers commonly.Second, corporate customers in the customer network of urban commercial bank are importanter obviously than individual customers. The customer network of DL bank is typical and representative in the urban commercial banks. DL bank is founded on urban credit cooperative, and it is a local joint-stock commercial bank comprised by national stock, Chinese-funded legal person stock, individual shareholding. In the ownership structure, the DL municipal government holds the biggest stock rights, and it has the appointment power of board chairman, bank president and some other senior executives. In the development of DL bank, the DL municipal government provides amounts of supports, helps and coordination. In corporate deposit customers and enterprise loans customers of top 20 in DL bank, there are 8 local financing platforms,9 depositors of government department,9 insurance and financial companies and 12 real estate and construction companies. This shows that DL bank’s big company customers are mostly the carriers of local government and banking culture or cross-selling culture. Network analysis of DL bank show that corporate customers occupy an important position in customer network, and topology indexes such as the scale of its individual network, centrality, cliques and brokers are apparently higher than individual customers.Third, through empirical analysis, the dissertation verifies the influence of culture embedded in the customer network of urban commercial bank, including the amount of funds of customer business, positive influence of members of the shareholders customer on topology variables of urban commercial bank; the negative of local financing platform customers and depositors of government department on topology variables of urban commercial bank; cross-selling cooperative enterprises’s positive influence on topology variables of urban commercial bank, but in a few aspects, the influence between real estate companies, insurance and financial companies are different.Forth, the optimizing of the customer network of urban commercial bank should base on culture embeddedness and customer value. The dissertation believes that the proportion of customer value of the customer network of urban commercial bank should match with the proportion of the funds of customer business. The basic principle of the optimizing of the customer network structure of urban commercial bank is to promote customers’ position in the value partition draw close to diagonal in improving ways. Then, the optimizing of the customer network has two directions:one is to promote the customer value in low value district; the other is to promote the proportion of the funds of customer business in high value district.The Innovation of this dissertation is mainly in three aspects:First, define the local-government-bank culture, and analyze the mechanism of its embeddedness in urban commercial bank. This dissertation analyze the relationship of the background between the local government and urban commercial bank in detail from the historical perspective, based on it, the dissertation defined such long-established relationship, rules and orders between the two as the local-government-bank culture. And then analyze the mechanism of local-government-bank culture embedded in urban commercial bank’s customer network in the aspects of motive, cause, effect and other ways.Second, examine the impact of culture embedded in the urban commercial bank’s customer network. Culture embeddedness as an element to analyze its impact on the customer network of commercial bank is not so many in existing literatures. However, urban commercial bank has a certain degree of particularity, local government and banking culture and cross-selling culture has a strong impact on customer network. This dissertation uses the social network analysis method to establish a model of customer network of urban commercial bank, gets a detailed network data, and find a reasonable way to measure the indicators and data selected for cultural factors. Thanks to this, the dissertation successfully realizes the empirical test on culture embeddedness factors’ effects on customer network of urban commercial bank.Third, build a model of customer value measurement and accordingly form a customer network optimization direction and marketing strategies. This dissertation argues that the customer value of customer network is different from the customer value in general circumstances; it is subject to customer trading activity, trading strength,, centrality and the ability of faction communication. Based on this, the dissertation build a value measurement model of customers in customer network of urban commercial bank and accordingly get a network to optimize customer network and marketing strategies. Thereby, analytic framework of this dissertation is quite compact, including the customer network analysis of urban commercial bank, the empirical test on impacts of culture embeddedness and network optimization analysis. The viewpoint and the method are rare in existing literatures.However, the study also has limitations:First, the lack of empirical test on the optimization principles and direction of customer network of urban commercial bank; the second is lacking analysis of the individual customers of urban commercial bank. In future, the author will optimize the customer network model of urban commercial bank and customer value measurement model further, and corroborate with other evaluation models, while strengthening the survey data, sounding the scale and enriching the correlation analysis on the individual customers of urban commercial bank are needed.