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Question: Discuss About The Segmenting Consumer Decision Making Styles? Answer: Introduction Commonwealth is an Australian bank having business across US, UK, New Zealand, Fiji and Asia. The bank is one of the recognised brands in Australia. It was established in 1911. The headquarter is situated in Sydney. It is a leading provider of financial services. The bank provides financial services such as funds management, institutional and retail banking, superannuation, investment, insurance, and share broking products (Abeza, OReilly Seguin, 2017). Commonwealth bank listed on the Australian stock exchange in 1991 and is the largest Australian listed company as of 2015. Product/ Market orientation The Commonwealth Bank offers a huge variety of products and services to customers such as saving accounts, credit accounts, transaction and loans. The bank has a large network of ATMs. It also offers services to people who are planning to shift to Australia. The business banking products offered by bank are: Business accounts: The accounts available by the bank include Business transaction account, Premium business cheque account, Farm management deposit account and business online saver. Business credit cards: The Commonwealth Bank has a large variety of credit cards designed for businesses, Platinum credit card, Interest free rate card, Low rate card and the Business awards. The Platinum credit card allows a business to earn 3 flyer points for every dollar spends on the purchases such as supermarkets, petrol stations and departmental stores. The bank offers corporate credit card especially for large companies (Huang Sarigll, 2014). Business loans: The bank offers loans for reinvestment and expanding business, as per the suitability of business. The range of loans include Better business loan, Bill facility, Business overdraft, Market rate loan, CommSec margin loan and Business line of credit. The bank also offers loan for car equipment and finance, credit cards and bank guarantees (Jrvinen Karjaluoto, 2015). Merchant services: The merchant services are used by the business to accept payments through EFTPOS machines. The bank offers range of portable payment processing machines such as Leo, Albert and Emmy. The bank also offers 24X7 support service. Asset finance: The bank makes available car and equipment finance with payment plans. These are designed according to suitability of cash flow of business. A business can choose equipment finance, car finance, medical equipment finance and technology equipment finance (Bianchi Mathews, 2016). Investments: The bank offers short, medium and long term investments which helps a business to cover cash flow shortfalls and to expand business. These investments have great role in building wealth for future. International money management: A huge range of services is offered by the bank to deal with international business transactions, like products for importers and exporters and international payment solutions. Insurance: The business insurance products are available by the Commonwealth bank. It includes life insurance, wholesale life insurance, business overheads cover, vehicle insurance and income protection packages (Levy Cohen, 2016). Superannuation: The bank creates super solutions as per the need of business and has also options of employer superannuation and self-managed super fund. The products include self-managed super fund, essential super and first choice employer super fund. Value proposition and differentiation Value proposition is what a business does and how well is performed. Value proposition is a statement used by bank to explain how their product solves problem of customers and why a customer should buy product or service (Arnett Wittmann, 2014). Value proposition is a chance to engage with customers. Integrity: The commonwealth bank believes in integrity. It is the most important value proposition of bank. Integrity means saying and doing what is right for customers, people, community and shareholders. Collaboration: The bank believes in working as one team. The bank has a strong record in delivering value to customers and shareholders. It has more than 52,000 employees working as a team. Excellence: Commonwealth bank believes in excellence which means doing best. It is not about only having mind set. The bank is constantly trying to do best and deliver world class service. Accountability: The value proposition of bank is accountability means taking ownership. The bank follows and delivers to customers what was promised to them (Rezaei, 2015). Service to clients: Service is the most important value proposition of bank which means to help customers. It makes bank leading financial service provider. The bank helps customers to attain their goals and to meet their needs. Service to support community: The bank has been helping communities of Australia to develop and grow. The company is engaged in supporting communities to make a real difference. Digital experience differentiates the Commonwealth bank. The primary way of consumers interaction with banks is digital channels. Two third of customers transacts through internet banking. Digital experience has a great role in determining how consumers feel about banks. The consumers rated the bank as providing best digital experience. The bank makes continual investment in the features of online banking application and services. It is identified that customers who use online banking hold most value for the bank. It encourages customers to choose products in both present and future. The bank is the first to introduce lock, block and limit facility for credit card customers. It allows customers to track and control spending online. The credit card reward points also differentiate from other banks (McDonald Wilson, 2016). The customers need 2 of the banks award to get one flyer point. The bank also launched Australias first card less cash service which enables customers to use smart phone application to withdraw cash without card at banks ATM. Customers need, want and demand Meeting customer needs means increasing capacity of banks. The need and want of customers can be determined as: Digital channels: A large percentage of customers rely on digital channels than physical branch. The bank needs to focus more on building improved digital experience. The customers are more segmented and complicated. Personal banking needs to know customers and understand what kind of product or service they are looking for. Digital channels not only provide facility to customers but it boosts up the sales of bank also. The customers came to know about additional services given by bank. Digital channels are helpful in cross selling (Leite Azevedo, 2017). Responsive customer service: Service quality is necessary as it is the important reason customers switch to other banks. The bank needs to be transparent and quick to solve problem of customers. The poor customer service is the primary reason of leaving banks. The reason was their issue was not solved in first contact with bank. The responsive customer service not only helps to win customers but attains existing ones. The customers can interact more via digital channels, it helps banks to better understand need of customers. These channels increase retention by giving extra offer on products. Financial technology: Financial technology is the new technology expected by customers which aims to compete with traditional methods to deliver financial services. It enhances core banking value. Financial technology includes the use of phones for mobile banking and investing services (Patti, et. al.2017). This technology is used to replace existing financial banks. It is useful for customers, as they do not need to carry cash as it is electronic mode of payment. Loans at low interest: After deciding the type of loan, the customers focus on the rate of interest charged by bank. The majority of customers like to take loans at low rate of interest. So, the customers take loan only after comparing interest rate of banks. The customers automatically shift to the banks who charge low rate of interest. The Commonwealth bank provides home loans, commonwealth portfolio loan, personal loans, business loans and more. The bank also provides loans at variable and fixed rate. Fair rates and fees: the customers expect fair rates and fees from banks. The banks do not pay dividend to external shareholders, so banks are supposed to deliver better value to customers. The banks balance the rates paid to depositors and the rate charged from borrowers so that fair rate and fees can be charged from customers (Katsikeas, et. al.2016). Expectation of customers More personalisation: Customers want bank to put information and products, they are in need. Nearly 50% of customers will change the bank, if they do not find the products wanted by them. The toll free number should be displayed on website, to provide them 24X7 help. So, at the end of the day, the staff should take a look at customer requests and questions. More options: The customers like to interact with bank via many options other than physical branch like digital and social media. The phone is the most preferred tool and apps are the most suitable tool. In the recent years, the use of web, online communities and chats has increased subsequently. Constant contact: The majority of customers expect follow up efforts to fill their experience. It benefits an organisation on large extend. Keeping in touch with customers helps to reduce costs and increase revenues as well. It provides sufficient information to customers at right time (Chng, et. al.2015). Listen closely, respond quickly: The banks need to respond to feedback of customers. To act on it to makes customers experience better. Real-time online surveys provide the quick response to customers. Factors influencing buying behaviour Purchasing power: The purchasing power of consumer plays important role in influencing buying behaviour. The consumers analyses the purchasing power before making a decision to buy banking products and services. Segmentation is done in banking on the basis of need and income of consumers (Lusch Vargo, 2014). Like a person earning higher income, like to invest in fixed deposits. Personal preferences: At personal level consumer behaviour is influenced by the need of customers. Their need decides the demand for a product. The type of loan also depends on the requirement of a person such as personal loan, home loan, business loans, portfolio loans etc. The customers preferences keep on changing depending on their requirements. Economic conditions: Buying banking products are also influenced by the economic conditions prevailing in the market like buying life and health insurances to see ailing condition of population in economy (Tarka, 2017). The growth of share market also influences buying behaviour and leads a person to invest in shares and mutual funds. Marketing campaigns: Advertisement has a great role in persuading purchasing decisions made by customers. It even brings a great shift in market shares of banks (Rcker, Homburg Vomberg, 2016). The marketing campaign done by banks influences purchasing decision of consumers to a large extend that they may prefer other bank. Group influence: It also affects the buying behaviour of customers. The primary group which influences customers are classmates, family members and relatives. The secondary group includes neighbours and colleagues, like taking insurance policy. They tell the benefits of taking insurance to influential person. It may convert the lead to perspective. Nature and level of competition New market entrants results in high degree of competition. The customers have many options in Australia to meet their financial needs such as major banks of the country, regional banks, credit unions, non-bank lenders and non-financial consumer brands. The comparison available on online sites makes easy for customers to compare products of different banks (Cross, Belich Rudelius, 2015). The National Consumer Credit Protection Act, 2009 has made it compulsory to provide necessary key facts sheet and information to customers applying for credit card or home loan. Deposits: The numbers of deposit taking institutions are increasing in Australia as APRA lowers licensing difficulties. The country has 152 authorised institutions out of which 108 are approved to take household deposits. The banks which held household deposits are increased by 43% from 2012 to 2017. Since the introduction of Basel III, the banks have started focussing on competing for domestic deposits and term deposits. The banks have concentrated more on source of funding (Bianchi Andrews, 2015). Payment credit cards and personal credit: The competition has increased for payments as franchises compete in the financial system such as AliPay, Apple, PayPal and FinTech companies. For instance Apple launched a virtual Apple Pay prepaid credit card which accepts Apple payment and it can also send peer to peer payments via Apples iMessage service (Babin Zikmund, 2015). There is increase in number of service particularly in credit cards. In Australia, there are 100 credit card brands offers 250 credit card products. Mortgages: Australia has intense competition in the mortgage market, refinance made up 36% of the volume of housing finance commitments. The mortgage brokers facilitate competition. The Australian Finance group has 2,875 brokers who have right to use more than 3400 products. More than 16000 residential brokers are active in the industry; The value of mortgages has also increased from 47.7% in 2012 to 54.3% in 2015. The consumers are taking turn towards non-bank lenders because of the increasing growth in the less regulated banking sector for mortgages. Corporate and institutional banking: The entry of international banks and Asian banks has made competition intense in the corporate and institutional lending market of the country. It has led to significant liquidity in the market. Institutional investors are also an option for borrowers where they are seeking longer tenancy. It combined with growing capital costs of Australias major banks and resulting in great price competition for Australian banks (Lantos, 2015). It has subsequently reduced the market share of corporate and institutional banking segment. New entrants to the Australian market in recent years: The FinTech industry of Australia has record investment of $656 million in 2016. It is seen because of the less competition in the financial system has encouraged new entrants. The Sydney based FinTechs has also increased five times more in 2017 than 2014. In the recent years, Australian banks have also united with the new market applicants (Bellin, 2017). It provides talent and innovative ideas. The banks that are established offer mature process and access to distribution channels. Conclusion From this report it has been concluded that Commonwealth bank is one of the leading bank of Australia. The product of the bank has quite different features than other banks. 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