Market orientation and the response of UK financial services companies to changes in market conditions as a result of e‐commerce

Abstract

The UK financial services industry is changing rapidly, particularly as a result of developments in distribution, notably with e‐commerce. The aim of this study is to apply the conceptual framework of market orientation to explain how a number of financial services companies are responding to this fundamental distribution change. The fieldwork consisted of multi respondent semi‐structured interviews conducted in four major UK financial services companies from December 1999 to August 2000. This paper puts forward some initial findings and observations from these interviews. E‐commerce is recognised by the great majority of respondents as being fundamentally important as a new way of providing information, purchasing certain products, automating transactions, providing self service and lowering costs. In the new standalone operation studied, the instant and centralised communication made possible by e‐commerce promotes the ability to respond to customer requirements in a way that corresponds to many aspects of the major market orientation models. However in trying to integrate e‐commerce with more traditional channels, in existing organisations, there are some major challenges to overcome.