Customer reactions to bank hypocrisy: the moderating role of customer–company identification and brand equity

Abstract

PurposeThe purpose of this study was to investigate the effect of perceived corporate hypocrisy on customer mistreatment behaviors within the banking industry and the moderating effects of customer–company identification (CCI) and brand equity on the hypocrisy-mistreatment behavior relationship.Design/methodology/approachUsing multistage sampling, 567 South Korean banking service users participated in an online survey. Structural equation modeling (confirmatory factor analysis) and hierarchical regression analysis were used to analyze the data.FindingsPerceived corporate hypocrisy was positively related to customer mistreatment behaviors. CCI and brand equity differentially moderated the positive relationship between perceived corporate hypocrisy and customer mistreatment behaviors. Specifically, CCI and brand equity strengthened and weakened the positive relationship between perceived corporate hypocrisy and customer mistreatment behaviors, respectively.Practical implicationsMarketers and banking service managers should pay careful attention to customer evaluations of their social activities and communication about the ethical values and actions of their firms. Since CCI and brand equity have contrasting moderating effects on the corporate hypocrisy-aggressive behavior relationship, marketers should devise different strategies to manage the adverse effects of such corporate crises on company-identified and brand-committed customers. For example, managers should focus on customers who actively express their deep sense of disappointment or profound anger in response to corporate hypocrisy (e.g. those with high levels of CCI) because they are likely to exhibit aggressive behaviors toward the company or its employees. Managers need to devise customized relationship-recovery strategies for such customers (e.g. forging a personal connection between the customer and service provider).Originality/valueThe present findings delineate the adverse effects of perceived corporate hypocrisy on customer behaviors and the moderating effect of customer relationship quality on the corporate hypocrisy-mistreatment behavior relationship within the banking industry.

Measuring stereotypes in the banking industry – an application to client relational benefits

“…They may also make it difficult for the sector to attract new employees (Willems, 2020). Furthermore, two stereotypes relate to results found in previous research: the shark stereotype can be considered an individual measure of corporate greed (Caruana et al , 2018), corporate hypocrite (Hur and Kim, 2020) or unethical sales practices (Tosun, 2020); the subordinate stereotype can relate to customer overconfidence, which is to say customers who do not seek advice when making investment decisions (Lewis, 2018). Overall, negative stereotypes may reflect a global loss of trust and commitment from the customers.…”

“…The studies that came closest to examining professional stereotypes were conducted by Willems (2020) on public servants, including bankers, by Lazarus (2012), who looked at four “banker figures,” and by Bienfait (2014), who studied the stereotype of the telephone advisor (banking by telephone). Although the literature shows that some customers fail to seek advice (Lewis, 2018) or fear corporate greed (Caruana et al , 2018), corporate hypocrisy (Hur and Kim, 2020), and unethical sales practices (Tosun, 2020), it still does not give an exhaustive scientific examination of the banker stereotype.…”

Past, present and future of bank marketing: a bibliometric analysis of International Journal of Bank Marketing (1983–2020)

“…, 2018; Salem et al. , 2019), as well as the danger of negative customer experiences going viral (Hur and Kim, 2020), which also explains why the cluster on customer satisfaction and loyalty (Cluster 3) has also overtaken the cluster on consumer behavior (Cluster 2) in banking and financial services research in IJBM . That is to say, the emergence and virality of service failure in the digital era have accentuated the challenge and importance of customer retention and satisfaction.…”

“…With the democratization of banking and financial services in the digital era, the cluster on service failure and recovery (Cluster 6) has also proliferated, which signals the emergence of new issues encountered by customers of banking and financial services, especially that over the Internet (e.g. cybersecurity, privacy) (Marafon et al, 2018;Salem et al, 2019), as well as the danger of negative customer experiences going viral (Hur and Kim, 2020), which also explains why the cluster on customer satisfaction and loyalty (Cluster 3) has also overtaken the cluster on consumer behavior (Cluster 2) in banking and financial services research in IJBM. That is to say, the emergence and virality of service failure in the digital era have accentuated the challenge and importance of customer retention and satisfaction.…”

Strategic CSR‐brand fit and customers’ brand passion: Theoretical extension and analysis

“…In addition to studying the mediational effect of three needs, we also examine the boundary condition of brand passion formation by studying the moderating effect of customer–company identification (CCI) into the relationship between strategic CSR‐brand fit and psychological needs satisfaction through the lens of social identity theory (SIT). Prior studies guided by SIT suggest that customers will more likely to be identified with those firms which help them build their social identities (Hur & Kim, 2020; Lafferty et al, 2016; Pérez & Rodríguez del Bosque, 2013) and the firm's CSR initiative is the one important way which contributes largely to building CCI (Yang et al, 2019). Swimberghe and Wooldridge (2014); noted that high CCI can satisfy customers' belongingness needs and strengthened active brand loyalty through the firm's CSR efforts.…”