Enhancing Customer Loyalty Performance and Improving Credit Card Business: A Case Study of OCBC Bank

The main aim of the current research report is to evaluate the ways through which OCBS can augment and enhance customer loyalty performance and improve their credit card business. The report proposes different solutions such as merchant tie-up, customer contact, improving rewards and benefits etc. The best fit solution that is tie-up with merchants is being suggested for the OCBC bank to adopt.

Business Case Study

EXECUTIVE SUMMARY
The main aim of the current research report is to evaluate the ways through which
OCBS can augment and enhance customer loyalty performance and improve their credit card
business. For attaining this aim, different relevant literatures have been reviewed effectively
and different theories and models were also being applied for evaluating the problems being
determined in the case study. From the evaluation it has been found out the degree of
competition is quite higher in credit card business and even satisfaction level of customers
and loyalty is relatively low and this needs to be resolved by employing different
methodologies. Different solutions have been proposed in the report such as merchant tie-up,
customer contact, improving rewards and benefits etc. However, one best fit solution that is
tie-up with merchants is being suggested for the OCBC bank to adopt. Furthermore,
recommendations on limitation of the study and further research work were also presented at
the end of the study.

CONTENTS
INTRODUCTION TO THE CASE STUDY.............................................................................1
Problem statement..................................................................................................................1
Research Aim and Objectives................................................................................................1
Structure of the rest of the report............................................................................................1
CASE BREIF: DESCRIPTION OF THE SITUATION............................................................1
Describing the situation in the case........................................................................................1
PROBLEM STATEMENT PLAN OF ANALYSIS..................................................................2
Statement of the problem in the case......................................................................................2
Proposed plan of analysis.......................................................................................................2
Relevant literature review.......................................................................................................3
ANALYSIS AND FINDINGS...................................................................................................7
Assessing the present position facing the OCBC bank from applying theories and models. 7
PROPOSED SOLUTION TO THE PROBLEM.......................................................................8
Alternate solution to the problem or issue..............................................................................8
Selecting the best fit solution.................................................................................................9
Recommendations..................................................................................................................9
REFERENCES.........................................................................................................................11

INTRODUCTION TO THE CASE STUDY
Problem statement
The credit care business of the OCBC bank was ranked last amongst the credit care
issues being studied on the basis of the study of Customer Satisfaction of Singapore (CSISG).
The bank is trailing behind the market leader Citi Bank. Furthermore, from the past few
years, the credit card business of the bank has been steadily ranked poorly on the index and
this is the problem being faced by the bank in recent years (Ang, Chen and Darendeli, 2022).
Research Aim and Objectives
The main aim of the current research report is “to evaluate the ways through which
OCBS can augment and enhance customer loyalty performance and improve their credit card
business. For the purpose of fulfilling the above aim, there will be need of some small
objectives and these are as follows:
 To evaluate the manners in which the behaviour of the clients in relation with the
credit card industry has been altered
 To analyse the influence of sustainability issues on credit card business of OCBC
bank
 To identify the approaches that can be used by the bank for improving customer
loyalty performance and customer satisfaction
 To recommend alternative solutions to OCBC bank for solving the problems
Structure of the rest of the report
The structure of the present research report is being elaborated in the below section:
 Case brief – The upcoming chapter will provide understanding in regards the present
situation of the OCBC bank and issues being faced by them.
 Problem statement Plan of analysis –The identified problems will be analysed and
suitable literatures will be explored.
 Analysis and findings – This is the stage where the identified issues will be analysed
by applying different models and theories.
 Proposed solution – This will include possible solution to the problems, suggestion
for further improvement, action plan for limitation of the study.
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CASE BREIF: DESCRIPTION OF THE SITUATION
Describing the situation in the case
The present case study is related with the OCBC bank and was being set in the year
2020. In the latest credit card sub-sector report from the Customer Satisfaction Index of
Singapore (CSISG) survey being conducted by the Institute of Service Excellence (ISE) at
the Singapore Management University, it has been found out that the credit card business of
the OCBC bank has again acquired the last position in relation with the customer satisfaction.
It has also been found out from the survey that there is a high level of competition in the
credit card industry and Citi bank is achieving top position and becoming the market leader in
the credit card business. Further, the evaluation of the two most important customer loyalty
metrics specifically likelihood to use the credit card again' and 'likelihood to recommend their
card' have seen the bank proceeding only to some extent better for the former, however has
again ranked last for the latter (Ang, Chen and Darendeli, 2022). In addition to this, talking in
relation with the market share of the credit cards of the banks over the past five years, it has
been appeared that it has increased to 2 to 3 percent from the year 2015 to 2019. However, on
the other side, DSB bank and UOB bank have saw their market share by business value
upsurge from 26.5 percent to 26.9 percent and 18.4 percent to 20.3 percent correspondingly.
Considering these findings of the case of OCBC bank, an analyst at Institute of Service
Excellence “Tammy Ang” had been given a task of preparing a business consultancy pitch
for the credit card business of the OCBC bank. Making use of her skills in business analytics,
Ang is planning to make use of information for providing beneficial insight for the bank for
enhancing its customer loyalty performance.
PROBLEM STATEMENT PLAN OF ANALYSIS
Statement of the problem in the case
The credit care business of the OCBC bank was ranked last amongst the credit care
issues being studied on the basis of the study of Customer Satisfaction of Singapore (CSISG).
The bank is trailing behind the market leader Citi Bank. Furthermore, from the past few
years, the credit card business of the bank has been steadily ranked poorly on the index and
this is the problem being faced by the bank in recent years.
Proposed plan of analysis
The problem Theories and models to be used
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Remaining sustainable on credit card business Six modes of co-production for
sustainability
Customer satisfaction European customer satisfaction
framework model (ECSF)
High level of competition in the market Porters five force model
Changing customer behaviour The consumer buying process
Relevant literature review
Porter’s five force analysis
Figure 1: Porter’s five force analysis
(Zhukova, 2021).
As per Kitchen and Proctor (2015), porter’s five force evaluation is being referred as
one of the most crucial tools for analysing the competitive environment of the industry in
which the firms operate. It is a model that supports in identifying and analysing the strengths
along with the weaknesses of a particular industry or sector. With the help of analysis of the
structure of the industry, it relatively become very simple for the firms to determine the
corporate strategy. There are five crucial forces which are being analysed for directing the
business strategy for augmenting the competitive advantage like threats of new entry,
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bargaining power of the suppliers, bargaining of the customers, threats from the substitute
goods and competitive rivalries within the industry. This is the model which allows the firm
to perform modifications in their approaches for making use of their resources effectivity for
creating a greater number of profits (Nwokah and Ahiauzu, 2018).
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Six modes of production for sustainability
The themes being emerged as specifically crucial for shaping the practices and results
of co-production. It is being known as the four Ps that is the purpose of co-production,
comprehension of power, approaches to politics and pathways to influence. A cluster
evaluation is being grounded on varied strategies to these four aspects has exposed that some
of the case has undertaken same kind of design choices and is being called as six modes of
co-production for sustainability. An explanation of these six modes is being done in the
subsequent paragraph:
 Researching solutions – It is important that more realist investigating methods should
be employed producing practical scientific knowledge and understanding with an
objective to impact the policies as well as interventions.
 Empowering voices – It is involves focusing on the process and more actively
engaging within the policies and management context for generating direct influence.
 Brokering power – This is third mode which involves engagement of relatively
powerful actors for the purpose of developing long term innovative institutions for
reframing and addressing sustainability challenges (Chambers and et.al., 2021).
 Reframing power – This is the fourth mode which involves engagement of relatively
marginal as well as powerful actors of reframing the technocratic narratives along
with policies that marginalizes social concerns.
 Navigating differences – It involves building of processes that gives priority to
connection, learning, institutions and empowerment over transferring scientific
knowledge.
 Reframing agency – Creation of safe spaces for exploring the perception of agency for
learning and building collective agency for addressing systematic governance issues.
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Consumer buying process
Figure 1: The consumer buying process
(Marketing Theories, 2022).
While making decision regarding purchasing or buying anything, the consumer passes
on different stages. The consumer decision making model involves five important stages that
is recognizing the need, searching of data, analysis of alternatives, decision regarding
purchase and post purchase analysis. This is being referred as the process through which the
clients analyse their buying decision on the basis of different factors. Talking in relation with
the first stage of this model, it involves identification of the issue and requirement of
purchasing the products. After recognizing the need, it is important for the customers to
collect information for understanding the ways of fulfilling these needs and wants. For this,
the customers rely on their past experiences, physical locations and online research (Foxall,
2016). The third stage is being known as evaluation of alternatives stage wherein the
customers create some criteria about the things being needed by them in their products and
services. On the basis of this criteria, they select the products and services. The next stage is
related with decision regarding the purchase and finally, involving post purchase analysis.
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European customer satisfaction framework model (ECSF)
Figure 2: European customer satisfaction framework model (ECSF)
(Chambers and et.al, 2021).
The fundamental structure of this model has been developed over a number of years
and is being grounded upon well-established theories along with approaches related to the
consumer behaviour, product and services quality and customer satisfaction. The structure of
this customer satisfaction model is been under review and subject to notifications. In addition
to this, it is being defined as a set of casual equations which helps in liking perceived quality,
perceived value as well as expectations of the clients to satisfaction of the clients. Further, the
customer satisfaction model is linked in turn to its impacts in relation with the customer
loyalty. In this conceptual model, the dependent variable is customer satisfaction on the other
hand, the independent variables are perceived value, customer expectations and perceived
quality of products and services. Customer loyalty is the outcome or consequences of this
conceptual framework. It is also important to understand the satisfaction of the customers and
as per this transaction specific model, satisfaction of the clients is being considered as a post
choice appraising decision of a particular purchase event (Walsh and Lipinski, 2019). This
approach clearly defines satisfaction among the clients as an emotional reaction by the clients
to the most current transactional experience with the company.
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ANALYSIS AND FINDINGS
Assessing the present position facing the OCBC bank from applying theories and models
According to the discussion being done in the above section, OCBC bank is facing
with different issues. Initially, the bank was continuously getting the lowest ranks in the
contexts of their credit card business. While the other banks such as Citi bank, DSB bank and
UOB bank have achieved a market leader position in the credit card industry. The bank is
facing intense and high level of competition from the other banks. In addition to this, it has
also been analysed from the case that from the evaluation of the two most important customer
loyalty metrics specifically likelihood to use the credit card again' and 'likelihood to
recommend their card', it has been originated that customer ranked OCBC bank last for
recommending their credit cards and some better points for using the credit card again. This
clearly reflects that the customers are not satisfied with the credit cards and other benefits
being offered by the bank and thus, their loyalty towards the credit cards of the back is also
very low. Therefore, for the purpose of making the customers more satisfied with the bank
for improving the customer loyalty performance of the OCBC bank, it is important on the
part of the bank to adopt certain strategies (Graffy, 2018).
It has been evaluated from the case that it is important that the firm should focus more
towards extensive selection of the card designs for meeting the latent needs of the customers.
For maintaining the sustainability goals and enticing the customers towards their credit cards,
six modes of co-production for sustainability should be used by the bank. It is crucial that the
firm should investigate more realistic methods for producing sustainable credit cards with the
main goal to influence the policies and interventions. It is important that through actively
engagement within the policies, the bank should focus on development of Polylactic acid
(PLA) credit cards which is a sustainable plastic substitute made with renewable bio-sourced
resources such as corn. Eco-friendly cards and services will help the bank in better satisfying
the customers and will also helps in gaining higher ranks in terms of likelihood of the
customers for recommending their credit cards to others. Further, they must involve in
building of processes that places priorities on learning, connection and empowerment and
helps in development of safe and sustainable credit cards.
After carrying out competitive analysis from porter’s five force model, it has been
found out that there is a high level of competition in the credit card industry and the
bargaining power of the customers is also very high due to many banks offering different
credit cards and benefits in the market. The switching cost of the buyers is also low. Further,
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the suppliers also enjoy moderate high power as materials being used to develop cards are the
key factors of attractions (Kotler, Armstrong and Opresnik, 2018). The threat of the substitute
is also very as there are many other options available to the clients, such as personal loan,
secure loan, current account and secured loan. the competition among the rivalries is also
very high and thus, bank should focus on extending their share in the market. They need to
have strong relationship with the clients for achieving an edge over their competitors.
In addition to this, there was one more issue being faced by OCBC bank and this was
in relation with the lower level of satisfaction and loyalty of the customers for their credit
cards. As per the consumer buying process being analysed, it has been found out that each
and every consumer passes five stages prior making decision to purchase things. It is
important on the part of the bank to take into account these stages effectively for retaining
clients and gaining loyalty from them. It is important that the bank should understand the
issue and demands of purchasing credit cards. For example, customers think about payment
system while purchasing credit cards and thus, OCBC bank should offer cards accordingly.
They must also make efforts towards marketing their cards so that clients can get
information. Bank must work on payment system materials of credit cards and other factors
so that customers can analyse on these criteria and makes decision of purchase (Kitchen and
Proctor, 2015).
Finally, after application of the European customer satisfaction model, it has been
found out that image, customer expectation and perceived quality of products and services
helps in creation of perceived value price of the customers which is the benefits that the
clients believe they will get when they purchase the products. It has been found out that
customers focus on price, quality, payment system, rewards and benefits while making
decision of selecting bank for their credit cards. Thus, OCBC bank must focus on these
aspects for gaining customer satisfaction and loyalty.
PROPOSED SOLUTION TO THE PROBLEM
Alternate solution to the problem or issue
According to the analysis being done above, there are varied issues which are being
faced by OCBC bank. For solving these problems, some alternative solutions are
recommended to the bank which can be utilized for maximizing the customer loyalty and
satisfaction. Some of the solutions are being defined below:
 Merchant tie-ups – This is being regarded as one of the most important solutions for
maximizing the customer loyalty and satisfaction. The OCBC bank can tie-up with
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merchants for the purpose of offering higher amount of rewards and benefits,
discounts and cash backs to their valuable clients. Furthermore, such kind of tie-ups
will allow the bank to attract more and more card users to spend quite more on their
credit cards. Other than this, these tie ups will also support the bank in having
effective promotion of their brand and credit cards being offered by them among the
users.
 Augmenting rewards and benefits – For alluring the interest of the customers towards
the credit cards of OCBC bank, it is important that the bank should work on
augmenting their rewards and benefits which are not yet offered by their competitors
such as pay yourself back features for redeeming points for expenses outside of travel
at a favourable rate (Hirschman, 2019).
 Customer contact – It is important that the bank should make use of single campaigns
for contacting and giving messages about their products to customers. If huge contact
is being created than people will be apathetic and will disengage at worst.
 Data driven model – It is crucial that OCBC bank should have customer centric and
end to end campaign strategy with clear annual planning, comprehensive message
breakdown and setting of change council for offering flexibility needed in campaign.
A survey should be included for allowing the customers to give direct feedbacks
specific to message (Improving credit card customer experience, 2022).
Selecting the best fit solution
Based on the evaluation of the above determined alternative solutions, the best fit
solution that the OCBC bank should adopt for making improvement in the customer loyalty
performance and offering them maximum level of satisfaction is tying up with merchants.
This is because of the fact that partnering with the merchant will allow the bank to offer
range of awards to the customers. In addition to this, such kind of tie-ups will allow the bank
to attract more and more card users to spend quite more on their credit cards. Other than this,
if they will receive more rewards, offers and discounts than they will be more satisfied with
the bank and will recommend other to make use of credit cards of OCBC bank (Ramanathan,
Subramanian and Parrott, 2017). Based on this, it can be said that the best fit solution for the
bank is nothing but tying up with more and more merchants effectively.
Recommendations
There are some limitations of the current study and the very first among them is time
constraint. Because of the lack of time, extensive study has not been carried out. Further,
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scope along with the depth of the discussion was also been compromised due to lack of
experiences in carrying out these types of research work. Further, the main aim and objective
being deigned to broadly which has also reduced the degree of attention of the study.
Therefore, for the future research there is a requirement of development of an action plan. For
augmenting the degree of attention, research aim and objectives needs to be narrowed down.
Further, for effective management of time constraints, alternative research methods must be
presented like quantitative study will save time. Finally, for depth as well as scope of
discussion, more studies should be carried out for gaining experience for further future
studies.
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REFERENCES
Books and journals
Ang, A., Chen, Y. and Darendeli, S.P., 2022. Getting the next swipe: Improving customer
loyalty for OCBC bank credit cards. Singapore Management University.
Chambers, J.M., Wyborn, C., Ryan, M.E. and et.al, 2021. Six modes of co-production for
sustainability. Nat Sustain. 4. pp.983–996.
Foxall, G., 2016. Consumers in Context: The BPM Research Program. Routledge.
Graffy, E., 2018. Agrarian Ideals, Sustainability Ethics, and US Policy: A Critique for
Practitioners. J Agric Environ Ethics. 25. pp.503–528.
Hirschman, E.C., 2019. Differences in Consumer Purchase Behaviour by Credit Card
Payment System. Journal of Consumer Research. 6(1). pp.58–66.
Kitchen, P.J. and Proctor, T., 2015. Marketing communications in a post-modern world.
Journal of Business Strategy. 36(5). pp.34-42.
Kotler, P., Armstrong, G. and Opresnik, M., 2018. Principle of Marketing. 17thed. Pearson
Education Inc.
Nwokah, N.G. and Ahiauzu, A.I., 2018. Managerial competencies and marketing
effectiveness in corporate organizations in Nigeria. Journal of Management
Development. 27(8). pp.858-878.
Ramanathan, U., Subramanian, N. and Parrott, G., 2017. Role of social media in retail
network operations and marketing to enhance customer satisfaction. International
Journal of Operations & Production Management.
Walsh, M.F. and Lipinski, J., 2019. The role of the marketing function in small and medium
sized enterprises. Journal of Small Business and Enterprise Development. 16(4).
pp.569-585.
Online references
Improving credit card customer experience. 2022. [Online]. Available through:
<https://www.gobeyondpartners.com/our-thinking/improving-credit-card-customer-
experience/>. [Accessed on 7thSeptember 2022].
Marketing Theories. 2022. [Online]. Available through:
<https://www.professionalacademy.com/blogs/marketing-theories-explaining-the-
consumer-decision-making-process/>. [Accessed on 7thSeptember 2022].
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Zhukova, N., 2021. Understanding Porter's Five Forces Model. [Online]. Available through:
<https://www.semrush.com/blog/understanding-porters-five-forces-model/>. [Accessed
on 7thSeptember 2022].
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