The Evaluation of opportunities of electronic commerce to retailing companies in the UK and Hong Kong

Diplomarbeit von Thorsten Rohn

Abstract:

The thesis „Evaluation of opportunities of Electronic Commerce to retailing companies in the UK and Hong Kong“ is written with particular emphasis on Internet banking. The primary objective of the research was to evaluate opportunities e-commerce provides to the retail banking industry in the UK and Hong Kong. The thesis looks at already established Banks who extend their distribution channels by offering Internet banking as well as pure Internet banks.

Chapter one provides a brief overlook of the approach and methodology to the thesis. Chapter two contains a general overview about the Internet and e-commerce. Chapter three deals with Internet banking and how the Internet affect the distribution of financial services. Chapter four analyses the macro environment for retail banking in the UK and Hong Kong. Chapter five then tries to identify opportunities for Internet banking but also possible threats and weaknesses. Chapter six makes the attempt to find determinants of successful Internet banking. The final chapter provides a brief summary of the thesis and an outlook of the future of Internet banking.

At the end of the research, the authors expected four gains. First, improve the skills, from research to data collecting, language, analytical and problems solving, etc. Secondly, the study in dept about e-commerce and the banking industry of Hong Kong and the UK will drive the authors to the international approaches and experiences. Thirdly, the methodology and writing expression will enhance author communication skills. Finally, the author hopes that companies can benefit from the findings of this thesis.

Table of Contents:

1.	APPROACH AND METHODOLOGY TO THE THESIS	1
2.	THE INTERNET AND E-COMMERCE	2
2.1	THE INTERNET AND ITS EMERGENCE	2
2.2	INTERNET PENETRATION	2
2.3	FACTORS THAT AFFECT INTERNET PENETRATION	5
2.3.1	New technologies	5
2.3.2	Cost of Internet access	7
2.4	THE DEFINITION OF E-COMMERCE	9
2.5	THE INTERNET AS A PLATFORM FOR E-COMMERCE	11
2.6	TRENDS IN E-COMMERCE	12
2.6.1	The second generation of e-commerce	12
2.6.2	E-commerce in a global market place	14
2.6.3	Increased familiarity with Information Technology	15
3.	INTERNET BANKING	17
3.1	THE INTERNET AS A DISTRIBUTION CHANNEL FOR BANKING SERVICES	17
3.2	THE DEVELOPMENT AND GROWTH OF INTERNET BANKING	18
3.3	THE IMPACT OF TECHNOLOGY	20
3.3.1	on categorisation of services	20
3.3.2	on customers	21
4.	RETAIL BANKING AND THE DEVELOPMENT OF THE MACRO ENVIRONMENT	23
4.1	ASSESSMENT OF THE BRITISH BANKING ENVIRONMENT	24
4.1.1	Political Environment	24
4.1.2	Economical Environment	26
4.1.3	Social Environment	29
4.1.4	Technological Environment	30
4.1.5	Outlook for the Internet banking environment of the UK	30
4.2	ASSESSMENT OF THE BANKING ENVIRONMENT OF HONG KONG	31
4.2.1	Political Environment	31
4.2.2	Economical Environment	33
4.2.3	Social Environment	37
4.2.4	Technological Environment	38
4.2.5	Outlook for the Internet banking environment of Hong Kong	38
5.	INTERNET BANKING OPPORTUNITIES IN THE UK AND HONG KONG	40
5.1	SWOT ANALYSIS	40
5.1.1	Strengths	40
5.1.2	Weakness	41
5.1.3	Opportunities	44
5.1.3.1	Internal opportunities	44
5.1.3.1.1	Cost reduction	44
5.1.3.1.2	Marketing and communication	48
5.1.3.1.3	Cross selling opportunities	51
5.1.3.1.4	Opportunities for traditional banks	53
5.1.3.2	External opportunities	56
5.1.3.2.1	Increasing experience and Internet penetration	56
5.1.3.2.2	Internet banking as facilitator of e-commerce	58
5.1.3.2.3	Increasing competition	59
5.1.3.2.4	New technologies	60
5.1.3.2.5	Internet banking as a means of customer segmentation	63
5.1.4	Threats	64
5.1.4.1	Threats for all Internet banking providers	64
5.1.4.2	Threats for Internet only banks	66
5.1.4.3	Threats for traditional banks	67
5.2	MICHAEL PORTER FIVE FORCES	68
5.2.1	New entrants	68
5.2.2	Power of buyers and suppliers	70
5.2.3	Rivalry	71
5.2.3.1	The UK Market	71
5.2.3.2	The Hong Kong Market	77
5.2.4	Substitute	80
5.3	VALUE CHAIN ANALYSIS	81
6.	DETERMINANT OF SUCCESSFUL INTERNET BANKING IN THE UK AND HONG KONG	86
6.1	SITE RESPONSIVENESS, EFFECTIVENESS AND FULFILMENT	88
6.2	TRUST, CONFIGURATION & CUSTOMISATION, INFORMATION & STATUS	89
6.3	PROACTIVE SERVICES AND VALUE ADDED SERVICES	90
6.4	INTERNET BANKING SURVEYS	92
7.	CONCLUDING REMARK AND OUTLOOK FOR INTERNET BANKING	94
	REFERENCES	100
	BOOKS	100
	ARTICLES	103
	NEWSPAPERS	106
	INTERNET	110
	APPENDIX	123