History of Commonwealth Bank of Australia

The Commonwealth bank of Australia (CBA) is a multinational business, that is, it owns and controls enterprises in other countries other than its home country (Australia). The bank was established by the Commonwealth Bank Act of 1911 to receive and carry out general bank-related business. As early as 1912, the bank started its expansion by opening up its first branch in Melbourne. In the 1960s and 1970s the bank diversified its operations into other areas such as travel and insurance. In addition, it become more profoundly involved in international banking, especially foreign currency exchanges (Attard and Dilley, 2013). During the 1960s the bank enthusiastically supported the introduction of decimalization process which allowed it to convert the previous non-decimal currency denominations into the decimal system. Gradually, CBA transformed its paper records into a new computer-based system. The Commonwealth Bank formed the first credit card in Australia in 1974 through the introduction of bankcard which was later used in New Zealand as well. It also established the use of MasterCard and visa when it started issuing them to its customers.Today, this corporate organization has been expanded into businesses in New Zealand, the United States, United Kingdom as well as Asia. The bank’s operations are diversified to cover insurance, institutional banking, Superannuation (pension services) investment and broking services, funds management and also retail businesses. It is not only one of the largest Australian corporations listed on the Australian Securities Exchange but it is also one of the largest banks in the Southern Hemisphere.

Commonwealth Bank of Australia is one of the leading banks in the world that has incorporated the social media platform in its operations (Miranda et al., 2013). It uses various channels to improve the efficiency and effectiveness of the services offered to its customers as well as to increase its consumer base (Paquette, 2013).

This is one of commonwealth bank’s principal social media channels. Just about a year after launching its social network operations the commonwealth bank had attracted about 100 thousand viewers on its Facebook page (Wire, 2010). The main aim of creating this Facebook page was to upsurge customer support.The corporation was seeking new ways to serve and extend support to its clients (Gavrilova, 2008).The bank uses this platform to increase its consumer base and enhance its interaction with them thus creating a community among its customers (Prema and Sudhakar, 2009). CBA’s customer service team replies to any banking inquiries in real time through its Facebook wall thereby outspreading its consumer servicesbeyond the old-style branch and phone dealings (Rajesh, 2009). CBA therefore evidently uses Facebook for marketing and sales enhancement.

Operations of Commonwealth Bank of Australia

Internet banking, also referred to as online banking is an electronic payment system (digital currency, for example the virtual currency) that permits the clientele of financial institutions to carry out banking transactions online via the institution’s website interface. It was first introduced in 1994 by the Stanford Federal Credit Unit but now operates at a very wide spectrum in the industry from the traditional financial institutions to banks that exist only online (Adapa and Cooksey, 2013).

The Commonwealth Bank of Australia uses NetBank for its online banking. NetBank increases the efficiency of customer service thus it is assimilated by CBA to increase its sales (Hassan et al., 2012). NetBank is free to register and provides a simple, fast and convenient way for a consumer to embark on their online banking. It allows one to access all their bank accounts under the Commonwealth Bank Group in a single place at any time of the day. Many more transactions are carried out at a shorter period of time hence vastly increasing the bank’s sales (Yeow et al., 2008).

The CommBank Kaching application is a Commonwealth Bank’s application for iPhone and android phones that allows users to transfer funds to each other through their Facebook accounts or mobile phones. This app was originally developed for use by iPhone users only but its android phone version was later released due to the progressively popular android operating system. This was done to capture the users of android phones thus further increasing the clienteles of CBA.

The CommBank Kaching application also offers bump payments whereby after bumping the iPhones together the payment is made promptly. The application can therefore be useful for partial payments at dinner (splitting the bill) or for recompense to a creditor in case one has no cash at hand. The Commonwealth Bank of Australia has guaranteed a 100 percent security of an individual’s banking services while using the application. This means that CommBank will be responsible for any losses made during the course of the dealings or in the event that a person makes an unauthorized transaction.

The Commonwealth Bank of Australia also introduced a property guide application for homebuyers with an aim of increasing its reach on its mortgage leads. The application combines mobile amplified reality with licensed info on the actual selling prices of properties, the estimated current property value as well as the closing dates. It is of great help to prospective home buyers as they can determine their affordability of the property, search for properties that suit their lifestyles and access the property’s market price easily and conveniently. The prospective buyer can then confidently apply for a mortgage to purchase their chosen.

Social Media Presence of Commonwealth Bank of Australia

The Commonwealth Bank of Australia has accounts on other social media platforms such as Instagram and Twitter. These are mostly used for marketing of the bank by posting promotional content for. On its instagram account it provides emotive snapshots of ordinary Australians (Australian of the Day). Even though this is not necessarily a financial service, it enhances the interaction the bank has with its clientele which may consequently translate into more sales. On twitter, CBA shares links to blog posts on various contents such as investments, property and budgeting as well as promotional materials. Additionally, it uses twitter to notify its customers on any changes in its service provision (Casey, 2009). It may also, deliver snapshots from its Australian of the Day site.

The Commonwealth Bank of Australia uses linked in to inform job seekers of any job opportunity in the organization. Its profile is viewable by any individual who has a LinkedIn account. In this platform all the employees of the CBA have a chance to connect with each other, commune and share ideas (Santosh et al., 2016). The CBA LinkedIn profile indicates a list of its thousands of employees making it easy to find each other and interact. Through LinkedIn any individual has the capacity to find out about job availability in their field of choice at Commonwealth Bank and apply for that job. Basically, CBA uses LinkedIn for recruitment purposes.

CommBank runs a You Tube channel with more than 11 thousand subscribers in which it posts its various services in form of videos. CBA uses these videos to educate customers and carry out promotional activities. Step by step education may increase their clientele as it makes it easier to follow the steps required to efficiently receive the services needed. The presence of a video about the success story of the Commonwealth Bank of Australia is a great way to motivate people who may be pleased by the bank’s way of service provision and become new clients, that is, convert viewers into buyers. Furthermore, the videos are used to drive retail financial services of the CBA thus increasing the organization’s sales (Angelini et al., 2017).

Net Banking

Advantages

Convenience: It allows customers to have access to their accounts at any time any during the day or night. This accelerates real-time account maintenance as it can be achieved while the individual is carrying out their daily functions such as travelling (Eze et al., 2011).

Online Banking Platforms of Commonwealth Bank of Australia

Time-saving: the account holder can undertake their banking transactions without having to go to specific physical location and wait in a queue while the earlier arrivers are being served.

Speed and efficiency: online banking is fast and proficient as it gives accurate answers to an individual’s questions in seconds or minutes depending on the number of instructions required to complete the transaction.

Less costly: Online banking incurs lower overheads to execute the operations of the institution. It does not sustain costs for electricity or water bills, janitorial services or rent. It therefore decreases the cost of providing the service which enables the association to charge a lower fee for the services it provides and still make profits.

Though the NetBank service, customers can:

• Evaluate and pay their bills
• View their financial statements online or download them
• Review transactions and view balances
• Transfer cash to their designated accounts. This includes to other financial institutions in Australia
• Surge their existing home loan
• Print and export their financial dealings
• Commence transmission of a credit card balance
• Change their card’s limit every day
• Assess their Commonwealth Awards point balance or redeem them
• Activate their card
• Carry out application for a range of products such as personal loan and credit card

Disadvantages

Account Security: as a result of financial institutions carrying out their business transactions, they have become a major target by professional hackers (Gold, 2013). The financial industry’s susceptibility to cybercrimes is a main worry for both the institutions and the account holders while solving this issue is a key challenge (Lim et al., 2012). A loss of an account holder’s mobile phone or personal computer can result to access of his or her online bank account by the individual who finds the devices (Zanoon and Gharaibeh, 2013).

Absence of physical interactions: some transactions require a face-to-face conversation and physical interaction between the service provider and the recipient such as applying for a loan and customer service issues. This is a not possible while conducting online banking as the consumer required to print out the required documentation and either scan or fax and email them. This may lead a lengthy exchange between the service provider and the client as the documents maybe inappropriate or some details maybe missing (Liu et al., 2008). Holding face-to-face conversations enhances understanding between the parties and minimizes the possibility of inaccurate transactions being carried out. Lack of physical interaction is especially a challenge for financial institutions which have only virtual presence and no physical location.

Technology Issues: online banking services may not be available to people living in areas where there is no power or its upsurge is a problem. It is also affected by other issues such as servers going down and power outage whereby one may not be able to access their account at all. Use of a phone in this case may be required but this may not always be successful as the institution’s phone may be overwhelmed.

Advantages of Online Banking Services

Advantages of Using Other Social Media Platforms

Finding out potential customers: In the contemporary world almost everyone is involved in social media in one way or another. There is a sea of dialogs taking place online about every aspect of our present lives. Social media usage is therefore the best way to reach out to as many people as possible who may be interested in the services offered by the bank. The use of Facebook, for instance, is a great way for CBA to get involved in a conversation instead of sending out seemingly cold emails to unknown individuals. The value of the interaction between the institution and the users or the potential users of its services can be a major determinant of the level of its competitive advantage. The institution has the capability to turn around the customers of its competitors into its services’ buyers based only on how it relates to people online.

Understanding the Market: social media is a great way to fully comprehend what the consumers really want. Most people are not fearful of opening up in social media since there is no direct contact physically thus they feel safe. Social media helps the organization come to terms with the changes in tastes and preferences of their clients and even discover ways in which these new requirements can be fulfilled all from the horse’s mouth (Dootson et al., 2016). It is absolutely vital to be abreast with the latest trends and changes in the financial industry so as to offer quality services that are satisfactory to the clients and avoid losing them to the competitors.

Customer feedback: the traditional market surveys carried out to find out the thoughts and opinions of consumers are made easier and less costly by social media. Nowadays, many folks post their reviews, opinions and thoughts about the services provided on the social media platforms (Thomas et al., 2012). It is critical for the corporation to ascertain what people think of their services in which case it can improve to serve the customers better.

Analyzing the Competition: the financial industry is a very competitive sector in the current world. Although the Commonwealth Bank is the largest bank in Australia, other banks are also growing at an alarming rate and expanding their consumer base. CBA can analyze what individuals and groups in the social media say about their competitors both the compliments and complaints. From this information, the corporation can come up with ways to best serve the customers and even attract some from the competition. This way it can always stay on top.

Disadvantages of Online Banking Services

Disadvantages of Social Media Usage

Negative feedback: people are not scared of posting anything on the social networks. Their personal negative opinions may damage the reputation of the corporation (Arli and Dietrich, 2017).

Resources: in order to keep up with the changing trends in the financial industry, the organization needs to put a lot of resources into the Information Technology (IT) sector which definitely reduces their profits (Kostogryz and Ovcharuk, 2011).

Ineffectiveness: use of social media to increase the sales or clientele may not be always operational as some persons may be able to view the posts and still ignore them (Garrett, 2011).

Commonwealth Bank of Australia has incorporated the use of various social media channels for its marketing, sales, outreach and increasing the clientele. It has assimilated particularly the use of the most popular social media podiums which has vastly increased the number of its customers, its sales and even attracted new consumers for its services. However, there is always room for improvement.

CBA should get more involved with their clients at a personal level (Mudra, 2011). For instance, the corporation can be sending electronic mails and text messages more frequently to its customers. These messages can be about changes in their manner of service provision, informing them about upcoming promotional tasks or even alerting them of any inconveniences possibly to be experienced as a result of an update or any other activity. Sending personal messages to the client makes them feel valued and obligated to honor the information contained in the message. This is a pronouncedway of increasing loyalty of the customers to the organization. It aids in keeping the current clientele of the corporation satisfied and happy with the services they receive as well as increasing the client base through word of mouth. In sending these messages, however, CBA should put up measures to ensure 100 percent security in order to avoid scam messages being sent to its clients (Murray, 2010).

Conclusion

In conclusion, it is evident that the Commonwealth Bank of Australia is a major user of social media in its interaction with its clienteles. It holds an account in all the principal social media sites which include You Tube, instagram, twitter, Facebook and also LinkedIn. This is a great way to communicate with its many clients around Australia in simple and easy way. Support for its clients and their satisfaction is very important to the bank. It has a Facebook page in which it interrelates with the consumers of its services to ensure their satisfaction. It is also obvious that the bank values the convenience of its customers in seeking out its services. CBA has developed and launched which significantly enhance the efficiency and effectiveness of the services provided. The Kaching application is useful in enabling the user to move from one place to another without necessarily carrying cash. The property app by the CommBank enables one to pick up vital information about a property they are interested in and therefore make a more informed decision about it. It offers information about matters like the current value of the property in the market which is imperative in deciding whether to purchase that property. This way the prospective buyer can get on to borrow the mortgage and acquire the property without any major regrets. CBA uses NetBank which is an online banking service that heightens the convenience and speed of undertaking transactions. Social media use in the banking sector is of great importance and should be encouraged due to its advantages such as understanding the market, the customers and observing their feedbacks about the organization’s services.

References

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