Commerce Bank Case

Nova Southeastern University ~ H. Wayne Huizenga School of Business & Entrepreneurship Assignment for Course:
OPS-5095
Submitted to:
Dr. Kimberly Deranek
Submitted by:

Amy Monasterios

Date of Submission: May 21, 2015
Title of Assignment: Commerce Bank Case Study
CERTIFICATION OF AUTHORSHIP: I certify that I am the author of this paper and that any assistance I received in its preparation is fully acknowledged and disclosed in the paper. I have also cited any sources from which I used data, ideas or words, either quoted directly or paraphrased. I also certify that this paper was prepared by me specifically for this course.
Student 's Signature: Amy Monasterios __
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Instructor 's Comments:
They emphasize the importance of keeping their customers happy on a day-to-day basis. They have established practices that are out of the norm for the banking industry. These practices include: extended hours, coffee and newspapers in the waiting lobby, inviting locations, phones in their ATM machines and even a bright-red Penny Arcade in their lobby! Through these practices Commerce’s goal has been to bring the retail experience into all of their branches. Looking at the banking industry using Porter’s Five Forces Model, it is clear that the industry is very competitive. There is a very high degree of rivalry caused by local and international banks along with credit unions which are favored by a substantial number of customers. Commerce is also facing an increasing potential of new entrants into their competition because other banks have started to assimilate their customer-centric practices. Additionally, Commerce has to face the reality of technology slowly becoming a threat in what’s evolving into a “self-service” world. As a supplier, the bank has less bargaining power than the customer due to the minimal costs involved in switching banks and the large number of banking options available to the
In addition to this, Commerce Bank also faces the threat of technology. The idea of moving to a world where the customer is self-sufficient has affected the industry tremendously. There is an increasingly high network of ATM stations that are strategically located throughout the country. Additionally, internet banking has also started to substitute actual banking branches. Customers have shifted their focus to electronic channels and have embraced self-servicing.
Bargaining Power of Suppliers Typically commercial banks have low bargaining power in the industry because they all offer very similar commodity products such as deposits and loans. Commerce Bank strives to increase its bargaining power through its differentiation strategies.
Since customer satisfaction within the banking industry has been historically low, suppliers should focus on gaining competitive advantage through creative service offerings.
Bargaining Power of