| Summary: | This dissertation reports on the research in how Chinese domestic banks use Segmentation, Targeting and Positioning (STP) strategy for retail banking in the context of anticipated competition after 2006 when the banking business will be fully open to foreign banks. With the full liberalization of China's banking sector due under China's WTO commitments, Chinese domestic banks are faced with the need to increase their competitiveness.
This research will start with a literature review concerning STP strategies in general and its relation to the financial sectors. Following the literature review, the historical development of the banking industry in China will be briefly introduced in chapter Three to disclose its history resources and present day capabilities. Also, the competitive environment of the retail banking in China will be analysed to understand the market conditions and competitive situations of the banks. Chapter Four introduces the methodology employed for the research. In Chapter Five, case studies concerning assessment of the STP strategies of three banks (two state-owned banks and one joint commercial bank) will be discussed involving important variables and barriers in their segmentation, targeting and positioning process. This will reveal strategies and the perceived competitive advantages from the perspectives of the bank managers. Finally, interviews from the customer perceptions towards the retail banking business for these banks are analysed to examine the gap between the two counterparties.
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