dc.description.abstract | Due to rapid development of internet, banks have committed to promote electronic commerce application and products of financial service, which have caused the channels of financial service even more diverse. Nowadays, such diversity of bank’s electronic channel services not only provide channels for financial services, various functions of financial transactions, but also combine with other financial products for customers to provide them one-stop shopping, customize selective services, and innovate various services to expand the e-finance customer groups.
As internet has greatly changed life style of people and sales mode of industries, the term “Internet Economy” emerged. In the development of electronic financing transaction system, it is found that operational development mode is related to relative theories of internet economy. Based on this perspective, this study employed (1) internet externalities & critical mass (2) economy of scale, (3) switching cost and lock-in effect, and (4) positive feedback to explore the effect of innovation of electronic ecommerce on bank industry.
In this study, case analysis was used to analyze the electronic commerce platform of Cathay United Bank, including internet banking and web ATM. Here the theory of internet economy was adopted to review characteristics, advantages, innovated functions, marketing and efficiency. Research results show that electronic transaction has effectively reduced operational cost of the bank and presented the effect of economic scale. Moreover, it has also enhanced customers’ brand recognition, personal design function, promotion of marketing strategy, and cross-sell to strengthen the stickiness between products and customers, integrate the function development of customization, and satisfaction of customers’ various requirements and using habits, thus switching cost for and lock-in effect on customers. On the other side, the advantage of using Web 2.0 would also achieve internet externalities though various marketing activities and promotions, thus critical mass could be approached.
The development of bank’s electronic commerce has entered the mature stage. Through the experience of customers’ usage, R&D and innovation, banks will be able to reduce operational cost and risks and increase efficiency, develop new customer groups, and create the profit of handling fees.
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