The Research Of Customer Segmentation Of Commercial Banks In China

Commercial Banks are all competing for the customers. In recent years, thequestion that how to better serve their customers has under gone a continuousargument. To improve customers’ degree of satisfaction, banks should make everyeffort to keep customers, find new target market, make analyses and designindividualized products.Before the banks design individualized products, they must first do the customersegmentation. The result of segmentation does affect the bank’s income, thus furtheraffect the development. The product which lacks variation does not attract thecustomers with different demand. Banks should conduct effective customersegmentation; put the limited resource into the key customers. Improve the resourceefficiency and create more customer values.This paper use customer relationship management theory analyze the customerrelationship management strategy and customer segmentation standard. An empiricalanalysis is used in the paper. The first hand statistics is from some banks in China.The cluster analysis is used in finding the new segmentation standard.Cluster analysis separate things into several groups by their attributes. Within thegroup, things have something in common. The research proved that cluster analysisworks better in customer segmentation, especially in the financial industry. This paperuses this analysis method to find segmentation standards and makes some suggestionsfor the Bank of Shanghai.This paper believes that using capital amount to separate customers is too simpleand does not show the detailed request of the customers. The risk preference elementshould be added to the standard. In this way, the bank can find more about thecustomers and provide different products for risk seek, risk balance or risk avoidcustomers.