Increasing customer loyalty through customer engagement in the retail banking industry

Abstract

Purpose This study aims to determine the main antecedents of customer engagement (market orientation, satisfaction, emotions and self-brand connection) and the relationship between customer engagement and customer loyalty in the retail-banking context. Design/methodology/approach A theoretical model of effects is tested using dyadic methodology, based on 225 dyads (bank branch manager–average of five branch customers). The authors use structural equation modelling (EQS 6.1) to test the relationships. Findings The results reveal a strong relationship between customer engagement and customer loyalty. Satisfaction is the main antecedent of customer engagement. Self-brand connection and emotions during the service also have a significant influence. Finally, branch market orientation has a positive influence on satisfaction and emotions. Research limitations/implications The first concerns the transversal data used. Geographical context is the second limitation. Third, the study sample only included customers with experience of the financial services of a specific bank (online customers are not included). Finally, the dyads are based on the opinion of the branch manager, on one hand, and an average of five customers per branch, on the other. Practical implications The combination of the branding strategy at the corporate level and the relationship marketing strategy at branch office level creates a situation in which customer engagement and customer loyalty can thrive. The communication campaigns designed to promote the brand image and associate brand values with the personality of the banks’ current and potential customers help to create an emotional bond that represents a switching cost for the customer. The moments of truth in branch offices are crucial aspects in the retail bank strategy. Originality/value First, from the conceptual perspective, it establishes a direct relationship between customer engagement and customer loyalty. Second, it empirically tested Pansari and Kumar’s (2017) customer engagement framework, which establishes customer satisfaction and customer emotions as the antecedents of customer engagement. Third, the study took an innovative step in establishing two levels of customer emotions in the retail bank context: emotions generated by corporate branding and emotions that arise during the experience of purchase and consuming. Fourth, the study shows that the market orientation adopted not at the macro corporate level but at the individual branch level is crucial to the generation of positive relational outcomes in the service the customer receives. The fifth contribution is related to the fact that the research streams associated with market orientation and relationship quality have traditionally been studied in isolation.

Customer loyalty to Islamic banks: Evidence from Indonesia

“…This extends to Thakur (2019) who observes that CE affects the relationships between CS and loyalty to mobile shopping, and CS and travel planning apps. Moreover, Monferrer et al (2019) also observe that satisfaction is the most important variable for improving CE and loyalty to Islamic retail banking. Thus, the results suggest that Islamic banks should improve CS to increase customer loyalty through stronger CE.…”

“…Peng et al (2019) find service quality, bank image, and trust as antecedents of customer loyalty. According to Monferrer et al (2019) customer relations represent a factor in attaining customer loyalty through customer satisfaction because it has the strongest total effect on customers. However, studies, for instance, Kashif and Rehman (2015), Altaf (2017), Yilmaz et al (2018), and Ali and Naeem (2019) conclude that their results cannot be generalized because cultural differences may affect customer loyalty to Islamic banks in various countries.…”

Understanding the intention to revisit a destination by expanding the theory of planned behaviour (TPB)

“…Satisfaction refers as an emotional response that follows from cognitive responses to an experience (Smith, 2020;Monferrer et al, 2019;Chong, 2016). Research in the tourism context has already established the association between satisfaction and revisit intention and empirically recognized that satisfaction lays a significant impact on creating a positive revisit intention by tourist (Hasan et al, 2019;Breiby and Slåtten, 2018).…”

Modelo de Ecuaciones Estructurales (Con estimación PLS) basado en calidad de servicio y lealtad del Cliente de las Cajas Rurales Peruanas

“…De manera que existen esfuerzos para analizar y mejorar la calidad de servicio financiero de diferentes escenarios; por ejemplo, Marta Estrada et al (2014) proponen un modelo para estudiar la relación entre la calidad de los servicios bancarios y la lealtad en usuarios adultos mayores; otro escenario son los servicios bancarios por internet o servicio en línea (Kampakaki y Papathanasiou, 2016;Tardivo et al, 2014). Sin embargo, son muy pocos quienes han utilizado el modelo de ecuaciones estructurales para esta rama de la administración (Monferrer et al, 2019;Ramírez-Asís et al, 2020); de allí radica la importancia del presente estudio.…”