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Competitiveness vis-Ã -vis service quality as drivers of customer loyalty mediated by perceptions of regulation and stability in steady and volatile markets

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  • Baumann, Chris
  • Hoadley, Susan
  • Hamin, Hamin
  • Nugraha, Albert

Abstract

The purpose of this research is to investigate predictors of customer loyalty in order to identify alternatives to customer satisfaction with service quality, which has been traditionally accepted as the primary predictor of customer loyalty, particularly for services. A stratified sample of bank customers was surveyed to collect information on customer perceptions and behaviors in relation to satisfaction with service quality, competitiveness, risk, regulation, stability and loyalty. Partial least squares path modelling (PLSPM) was applied to develop loyalty models for a steady market (Australia) and a volatile market (Greece). This study's empirical findings support theoretical arguments for the inclusion of customer perceptions of competitiveness in loyalty modelling. Perceptions of regulation and stability intervene in the relationship between drivers of loyalty and loyalty itself. For bankers, the study emphasizes the need to move away from customer satisfaction with service quality to explain customer loyalty, towards focusing efforts on achieving relative superiority in competitiveness, namely competitive productivity and products. Profiling customers based on their perceptions of a bank's competitiveness can provide additional explanatory power beyond traditional satisfaction based loyalty models. Services marketing has focused on the service components, and there is no doubt about its crucial role. But given this focus, other factors, such as the actual product component, have been somewhat overlooked in services research. The study makes a unique contribution to understanding and modelling customer loyalty by demonstrating the importance of the inclusion of customer perceptions of other factors as appropriate to market conditions.

Suggested Citation

  • Baumann, Chris & Hoadley, Susan & Hamin, Hamin & Nugraha, Albert, 2017. "Competitiveness vis-Ã -vis service quality as drivers of customer loyalty mediated by perceptions of regulation and stability in steady and volatile markets," Journal of Retailing and Consumer Services, Elsevier, vol. 36(C), pages 62-74.
    • Handle: RePEc:eee:joreco:v:36:y:2017:i:c:p:62-74
    DOI: 10.1016/j.jretconser.2016.12.005
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    1. Miklós Pakurár & Hossam Haddad & János Nagy & József Popp & Judit Oláh, 2019. "The Service Quality Dimensions that Affect Customer Satisfaction in the Jordanian Banking Sector," Sustainability, MDPI, vol. 11(4), pages 1-24, February.
    2. Mirza Mohammad Didarul Alam & Nor Azila Mohd Noor, 2020. "The Relationship Between Service Quality, Corporate Image, and Customer Loyalty of Generation Y: An Application of S-O-R Paradigm in the Context of Superstores in Bangladesh," SAGE Open, , vol. 10(2), pages 21582440209, May.
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    5. Agarwal, Reeti & Mehrotra, Ankit & Misra, Dheeraj, 2022. "Customer happiness as a function of perceived loyalty program benefits - A quantile regression approach," Journal of Retailing and Consumer Services, Elsevier, vol. 64(C).
    6. Kattreeya Chanpariyavatevong & Warit Wipulanusat & Thanapong Champahom & Sajjakaj Jomnonkwao & Dissakoon Chonsalasin & Vatanavongs Ratanavaraha, 2021. "Predicting Airline Customer Loyalty by Integrating Structural Equation Modeling and Bayesian Networks," Sustainability, MDPI, vol. 13(13), pages 1-21, June.
    7. Methawadee Chaisomboon & Sajjakaj Jomnonkwao & Vatanavongs Ratanavaraha, 2020. "Elderly Users’ Satisfaction with Public Transport in Thailand Using Different Importance Performance Analysis Approaches," Sustainability, MDPI, vol. 12(21), pages 1-20, October.
    8. Leckie, Civilai & Dwivedi, Abhishek & Johnson, Lester W., 2023. "Credibility and price premium-based competitiveness for industrial brands," Journal of Retailing and Consumer Services, Elsevier, vol. 74(C).
    9. Chang, Woojung & Song, Ji Hee & Lee, Sungho, 2020. "Observation of other's preferential treatment as a constructive catalyst for improved repatronize intentions," Journal of Retailing and Consumer Services, Elsevier, vol. 57(C).
    10. Della Lena, Sebastiano & Timming, Andrew R., 2023. "Why do consumers prefer one brand over another? The economics and sociology of brand competitiveness," Journal of Retailing and Consumer Services, Elsevier, vol. 74(C).
    11. Lucrezia Maria Cosmo & Luigi Piper & Antonio Mileti & Gianluigi Guido, 2023. "The influence of negative travel-related experience on tourist’s brand loyalty," Italian Journal of Marketing, Springer, vol. 2023(3), pages 351-368, September.
    12. Romina Cheraghalizadeh & Hossein Olya & Mustafa Tumer, 2021. "The Effects of External and Internal Factors on Competitive Advantage—Moderation of Market Dynamism and Mediation of Customer Relationship Building," Sustainability, MDPI, vol. 13(7), pages 1-15, April.
    13. Bezerra, George C.L. & Gomes, Carlos F., 2020. "Antecedents and consequences of passenger satisfaction with the airport," Journal of Air Transport Management, Elsevier, vol. 83(C).
    14. Ho, Hillbun & Tien, Keng-Ming (Terence) & Wu, Anne & Singh, Sonika, 2021. "A sequence analysis approach to segmenting credit card customers," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).
    15. Jaroslav Nenadál & David Vykydal & Eva Tylečková, 2021. "Complex Customer Loyalty Measurement at Closed-Loop Quality Management in B2B Area—Czech Example," Sustainability, MDPI, vol. 13(5), pages 1-20, March.
    16. Koshksaray, Amir Abedini & Quach, Sara & Trinh, Giang & Keivani, Somayeh Bahoush & Thaichon, Park, 2023. "Brand competitiveness antecedents: The interaction effects of marketing and R&D expenditure," Journal of Retailing and Consumer Services, Elsevier, vol. 75(C).
    17. Boakye, Kwabena G. & Natesan, Prathiba & Prybutok, Victor R., 2020. "A correlated uniqueness model of service quality measurement among users of cloud-based service platforms," Journal of Retailing and Consumer Services, Elsevier, vol. 55(C).
    18. Boisvert, Jean & Christodoulides, George & Sajid Khan, M., 2023. "Toward a better understanding of key determinants and consequences of masstige consumption," Journal of Business Research, Elsevier, vol. 161(C).
    19. Ooi, Keng-Boon & Lee, Voon-Hsien & Hew, Jun-Jie & Leong, Lai-Ying & Tan, Garry Wei-Han & Lim, Ai-Fen, 2023. "Social media influencers: An effective marketing approach?," Journal of Business Research, Elsevier, vol. 160(C).
    20. Katsumata, Sotaro & Nishimoto, Akihiro & Kannan, P.K., 2023. "Brand competitiveness and resilience to exogenous shock: Usage of smartphone apps during the COVID-19 pandemic," Journal of Retailing and Consumer Services, Elsevier, vol. 75(C).
    21. Lee, Wei-Long & Liu, Chih-Hsing & Tseng, Tzu-Wen, 2022. "The multiple effects of service innovation and quality on transitional and electronic word-of-mouth in predicting customer behaviour," Journal of Retailing and Consumer Services, Elsevier, vol. 64(C).

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