The effect of nWOM firestorms on South African retail banking

Lappeman, James; Clark, Robyn; Evans, James B.; Sierra-Rubia, Lara

doi:10.1108/ijbm-07-2020-0403

Cited by 9 publications

(7 citation statements)

References 42 publications

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“…In a practical sense, banks could use this. As the methodology continues to improve, it can also allow banks to identify and intervene in online firestorms at an early stage to mitigate damage (Lappeman et al , 2021). Banks can also identify and observe general service-delivery trends that threaten to cause customer churn to both forecast attrition and also provide preventative structural measures in areas of weakness.…”

Section: Discussionmentioning

confidence: 99%

What social media sentiment tells us about why customers churn

Lappeman

Franco

Warner

et al. 2022

JCM

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Purpose This study aims to investigate the factors that influence South African customers to potentially switch from one bank to another. Instead of using established models and survey techniques, the research measured social media sentiment to measure threats to switch. Design/methodology/approach The research involved a 12-month analysis of social media sentiment, specifically customer threats to switch banks (churn). These threats were then analysed for co-occurring themes to provide data on the reasons customers were making these threats. The study used over 1.7 million social media posts and focused on all five major South African retail banks (essentially the entire sector). Findings This study concluded that seven factors are most significant in understanding the underlying causes of churn. These are turnaround time, accusations of unethical behaviour, billing or payments, telephonic interactions, branches or stores, fraud or scams and unresponsiveness. Originality/value This study is unique in its measurement of unsolicited social media sentiment as opposed to most churn-related research that uses survey- or customer-data-based methods. In addition, this study observed the sentiment of customers from all major retail banks across 12 months. To date, no studies on retail bank churn theory have provided such an extensive perspective. The findings contribute to Susan Keaveney’s churn theory and provide a new measurement of switching threat through social media sentiment analysis.

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Section: Discussionmentioning

confidence: 99%

What social media sentiment tells us about why customers churn

Lappeman

Franco

Warner

et al. 2022

JCM

Self Cite

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“…The first key marketing outcome, WOM is defined as communication between a receiver and a communicator regarding a brand, product or service (Arndt, 1967). WOM is important for businesses, such as financial services (Lappeman et al ., 2021; Lien et al ., 2018; File and Prince, 1992), where the offerings are intangible and credence based (Ng et al ., 2011). This is due to consumers being unable to judge the quality of the service prior to investing, and as such, relying on the WOM of others for suggestions and advice (Kinard and Capella, 2006).…”

Section: Literature Reviewmentioning

confidence: 99%

Feeling the love? How consumer's political ideology shapes responses to AI financial service delivery

Riedel

Mulcahy

Northey

2022

IJBM

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PurposeThis paper aims, first, to examine artificial intelligence (AI) vs human delivery of financial advice; second, to examine the serial mediating roles of emotion and trust between AI use in the financial service industry and their impact upon marketing outcomes including word of mouth (WOM) and brand attitude; and third, to examine how political ideology moderates' consumers' reactions to AI financial service delivery.Design/methodology/approachA review of the extant literature is conducted, yielding seven hypotheses underpinned by affect-as-information theory. The hypotheses are tested via three online scenario-based experiments (n = 801) using Process Macro.FindingsThe results of the three experiments reveal consumers experience lower levels of positive emotions, specifically, affection, when financial advice is provided by AI in comparison to human employees. Secondly, across the three experiments, conservative consumers are shown to perceive somewhat similar levels of affection in financial advice provided by AI and human employees. Whereas liberal consumers perceive significantly lower levels of affection when serviced by AI in comparison to conservatives and human employee financial advice. Thirdly, results reveal affection and trust to be serial mediators which explain consumers' WOM and brand attitudes when financial services are provided by AI. Fourthly, the investment type plays an important role in consumers’ reactions to the use of AI.Originality/valueTo the best of the authors’ knowledge, this research is one of the first to study political ideology as a potential moderator of consumers’ responses to AI in financial services, providing novel contributions to the literature. It further contributes unique insights by examining emotional responses to AI and human financial advice for different amounts and types of investments using a comprehensive approach of examining both valence and discrete emotions to identify affection as a key explanatory emotion. The study further sheds insights relating to how emotions (affection) and trust mediate the relationship between AI and WOM, and brand attitudes, demonstrating an affect-attitude psychological sequence that explains consumers’ reactions to AI in financial services.

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“…These factors are related to how a retail bank functions during the ordinary course of its business as a financial services provider. Nevertheless, the factors do not remain constant over a long period of time as technological and regulatory changes in the industry might introduce a new factor in consumer decision making such as social media comments (Lappeman et al, 2021).…”

Section: Prior Neutral Ethical Reputation Of a Bankmentioning

confidence: 99%

“…Some scholars have even argued that emerging markets are an "important testing ground for our existing theories, models and concepts of business and management" (Akbar, 2006: 1). This is especially relevant for the banking industry as the existing literature points out that national/local culture (Lappeman et al, 2021;Tan & Chua, 1986) as well as governance of the banking sector (San-Jose et al, 2011;Aramburu & Pescador, 2019) affect consumer choice.…”

Section: Emerging Economy Context and The Importance Of Replicationsmentioning

confidence: 99%

Ethical reputation and retail bank selection: a sequential exploratory mixed-methods study in an emerging economy

Butt

Ul-Haq²,

Shareef³

et al. 2022

IJBM

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PurposeIn this study, the authors examine how a retail bank's positive, neutral, and negative prior ethical reputations influence customers' perceptions and attitudes, leading to their bank selection decisions and also analyze whether there is a trade-off between a bank's negative prior ethical reputation and its functional benefits to customers.Design/methodology/approachThe authors followed a sequential exploratory mixed-methods research design with two studies. The authors’ first study was qualitative, in which the authors conducted interviews and focus groups with banking customers in Pakistan. The results of this study were used to generate hypotheses that were tested in the second study using random choice experiments.FindingsThe results indicate that positive and neutral prior ethical reputations do not significantly impact customers' choices; however, a negative reputation does affect selection. The results also show that customers punished negative reputations, even when the associated functional benefits were higher than the alternatives.Originality/valueThis is one of the first mixed-methods studies in an emerging economy context to consider the impact of ethical reputation on consumer orientation and bank selection decisions.

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The effect of nWOM firestorms on South African retail banking

Cited by 9 publications

References 42 publications

What social media sentiment tells us about why customers churn

What social media sentiment tells us about why customers churn

Feeling the love? How consumer's political ideology shapes responses to AI financial service delivery

Ethical reputation and retail bank selection: a sequential exploratory mixed-methods study in an emerging economy

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