Research On The Competitive Strategy Of HF Bank Credit Card Business

The past three decades have witnessed remarkable economic development of China and the steady growth in the national income and the household consumption level.Credit cards,based on their inherent features,play an important role in daily consumption.Considering the presently prevalent shift towards retailing banks,the credit card service continuously makes a greater contribution to the income growth of banks.Under these circumstances,major banks successively enter competitions in the credit card industry.In this study,the strategic management theory and research methods,in combination with day-to-day practice and relevant research data,were applied to probe into the competition environment facing the new entrant HF bank to the credit card industry and analyze its conditions and external environment from the perspective of credit card business.Based on the strengths of HF bank,a competitive strategy that satisfied its demands for development and made the best of its second-mover advantage was formulated to achieve rapid development.It was found by comparison that HF bank had the following advantages:(1)a large number of potential customers in the credit card industry,(2)bright development prospects,(3)advanced information systems,and(4)experienced practitioners;however,it was in a less favorable position because of its limited credit card service coverage,a high level of product homogeneity and low popularity as a late mover.Besides,HF bank was confronted with fierce competitions in the domestic credit card industry where card holders were still holding immature perceptions of credit cards.At the same time,it was provided with ample opportunities thanks to the rapid growth of the domestic economy and the vigorous credit card market.Lastly,an SWOT analysis was performed to specify HF bank's conditions,strengths,weaknesses,opportunities and threats while a differentiation strategy and protective measures for credit card service were developed with HF bank as a new entrant to the credit card industry;meanwhile,a market'-oriented marketing model centering on product and service differentiation was established to bring superior customer satisfaction and strengthen its market competitiveness;HF bank was expected to increase its market share and raise its brand awareness by making full use of the second-mover advantage and ensure smooth implementation of the strategy based on a dynamic risk management system,flexible personnel and organization management,specialization and Internet technology.The present study explored appropriate competitive strategies of commercial banks that stepped into the credit card business and carried out supplementary research on relevant fields in China.Besides,an innovative experience model was introduced,which imposed dynamic customer and product management in credit card fee rate transactions and provided equity overdraft service.To a certain extent,this study provides guidance for HF bank in respect of its credit card service.For credit card centers of other banks,especially those having recently entered the industry,it serves as enlightenment and reference for future development of their credit card business.