thesis for banking sector

8/12/2019 Thesis for Banking Sector

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CHAPTER ONE

INTRODUCTION

1.0 Background of the study

Technology in the banks is presently catching up with a high level of development around the

world. The gaps between the Indian banks and their counterparts in the technologically advanced

countries are gradually narrowing down. The world has witnessed an information and

technological revolution of late. This revolution has touched every aspect of public life including

banking (Siam, 2006). Since two decades, due to an increasingly competitive, saturated and

dynamic business environment, retail banks in many countries have adopted customer-driven

philosophies to address the rapid and changing needs of their customers (Walker et al., 2008).

There is little work in exploring the brand dimension in the perspective of their customer eyes

(Alreck & Settle, 1999; Barrett et al., 1999). Supported by modern marketing philosophy; it is

important for marketers to understand the customer and offer the best products and services to

meet their wants and needs. Becoming customer-centric will give them competitive advantages

especially in a market-driven environment which regulated by customers demands (Mackay,

2001).

The importance in understanding customers perception toward the brand is a growing priority in

the marketing field. To date, a number of theoretical frameworks introduce by (L. a. D. O. R. de

Chernatony, F., 1997) have suggested in an attempt to assist marketers to understand how

customers

think, and respond to the brands, enable marketers to implement effective customer-centered

marketing activities and gain sustainable differentiation advantages in the competition (L. a. D.

O. R.


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de Chernatony, F., 1997; Martinez & De Chernatony, 2004; McDonald et al., 2001). In an effort

to

provide impetus to the service brand literature, this study investigated the potential branding

dimensions from the customers perspectives which are applicable to the banking services sector.

By

trying to identify dimensions of customers consciousness, we can gain a greater knowledge of

the

meaning of brands to customer (McEnally & Chernatony, 1999; OLoughlin & Szmigin, 2005).

1.1 Statement of the problem

1.2 Objectives of the study (at least 5)

1.3 Research hypotheses (at least 5)

1.4 Significance of the study

The study will serve as a guide to policy makers, especially, players of the bankingindustry.

It will also serve as a reference to the general public. This will inform and educate themon the theme of the study.

The study will contribute to existing literature of the subject of relationship marketing. It will as well provide a basis for further studies/research on the topic.

1.5 Scope and Limitation of the study


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The study was only limited to only four banks out of the many banks in Ghana. These banks

include ECOBANK, GCB, ACCESS BANK and HFC.

1.6 Organization of the study

The details of this work are divided into five chapters;

Chapter one looks at the introduction of this research, which includes the background of the

study, the statement of problem, the research objectives, the research questions, limitations and

delimitation, and organization of the study. Chapter two, which is titled review of related

literature, will examine and analyze researches and literature around the subject matter to present

a complimentary background of the subject matter. Chapter three deals with methodology, which

includes research design, population and sample of study, sampling techniques, procedure and

analysis. Chapter four involves data presentation, its analysis and discussions based on the stated

methods in chapter three. Chapter five covers the summary of the research, as well as conclusion

and recommendation based on the findings.

LITERATURE REVIEW

2.0Introduction2.1Theoretical frameworkBranding financial institutions. In the marketing of financial institutions, the corporate

branding is essential (Develin & Mckenchie, 2008; Moorthi, 2002; Balmer & Wilkinson, 1991).

However, compared with the tangible product branding, the research about services branding

remains under-developed (de Chernatony & Segal-Horn, 2003; Grace & OCass, 2005; Develin

& Mckechnie, 2008).


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The branding is considered as the procedure of creating a brand image which keeps consumers. It

is what separates identical products from each other (Duncan in Pitt et al., 2006), or the firm

from its competitors. Moorthi (2002) combined Aakers (1996) brand identity framework with

the 7Ps of services marketing. He proposes a branding process model which encompasses five

major elements:

Brand as a product (product, place, price, physical evidence); Brand as a process (process of interaction, Degree of customer involvement); Brand as an organization (people); Brand as a person; Brand as a symbol (logo, name, slogan...).

The current work deals with the two last components. We attempt to verify, in the same line of

some recent works (e.g., Gurbz, 2008; Grace

2.2Review of related studiesBrand development is particularly crucial within services where it is difficult to differentiate the services and there

is a lack of physical characteristics to evaluate competing service offerings (Zeithaml, 1996a), (Brady et al., 2005).

Branding a service can help customers by helping to assure them of a uniform level of service performance (L.L.

Berry, 2000a). Therefore, the execution of services brand strategy needs more consideration (L. a. D. O. R. de

Chernatony, F., 1999b; L. d. C. a.S. Segal-Horn, 2003b).

The bank services sector provides excellent examples of highly intangible, impalpable and complex

service-based offerings, which vary enormously in context, use, consumption, delivery, duration and

significance to the customer (L. de Chernatony, 1999a), (Turley & Moore, 1995). Options for addingvalue in the bank services may be limited due to customer reliance on experience and credence

qualities (Oppewal & Vriens, 2000) during the purchase decision (Ashill et al., 2003; Brady et al.,

2005), and extrinsic cues such as brand image and reputation (Turley & Moore, 1995; Zeithaml,

1996a); (McDonald et al., 2001) of the bank institutions.

Combined with the identified uniqueness of services and the growing prominence of service

marketing, brand equity is applicable as a marketing imperative and the need to manage the brand

associations (Alreck & Settle, 1999). (Krishnan & Hartline, 2001) proposed that brand equity is more

important for services that are dominated by experience and credence attributes. Credence attributes

include any product characteristics that customers cannot determine or evaluate even after purchase or


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consumption (Kathryn et al., 2000)

(L.L. Berry, 2000a) highlighted that there are two components of brand equity brand awareness and

brand image. Brand awareness is defined as the knowledge of brand in memory and the ability of the

person to recall it. The primary source of brand awareness is the companys presented brand via

advertising (Meenaghan, 1995), service facilities, and the appearance of service providers, company

name, and logo (Turley & Moore, 1995). Having secondary impact on brand awareness is companys

external brand communications, which refers to information customers receive about the service

which is essentially uncontrolled by the company via word of-mouth communications, and public

relations (L.L. Berry, 1980a). Brand meaning is said to be mainly influenced by the customers

experience with the company. The proper definition of brand meaning is the customer perceptions

about a brand held in customers minds such as ideally, strong and unique brand associations (OCass

& Grace, 2004

Perception

Perception is the process where an individual selects, organizes, and interprets stimuli into a

meaningful and coherent picture of the world (Barrett et al., 1999). Perception has strategic

implications for marketers because customers make decisions based on what they perceive

rather than on the basis of objective reality (Craig-Lees, 1998). Customers selection of

stimuli from the environment is based on the interaction of their expectations and motives

with the stimulus itself. People usually perceive things they need or want and block

unnecessary and unfavorable perception (Deirdre (Debling, 1995)

The interpretation of stimuli is highly subjective and is based on what the customer expects

to see in light of previous experience, on the number of plausible explanations they can

envision, on motives and interest at the time of perception (Grace & OCass, 2002). The

perceived image and interpretation of services positioned are important for its ultimate

success. Services that are perceived distinctly and favorably have a much better chance of

being purchased then services with unclear or unfavourable image (L. L. Berry, 2000b)

Service brand and customer satisfaction


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There is no doubt about the importance of achieving high customer satisfaction as the

ultimate goal of service companies. Customer satisfaction is considered as a necessary

condition for customer retention and loyalty and therefore helps in realizing economic goals

like sales turnover and profit revenue (Shaun McQuitty, 2000). In most client evaluations of

retail banking services, the focus has been on the experience of comparative judgments in the

service expectations versus perceived service performance (Kathryn, 2000). It is argued that

service experience effects the customers overall satisfaction with the service brand. Defined

as an emotive response to service attributes and service information, satisfaction is the

customers immediate reaction to both tangible and intangible brand stimuli. The intangible

brand stimuli such as core service, employees, environment and feelings aroused during

service consumption to have a direct effect on satisfaction (Babin, 1999).It is argued that

service experience effects the customers overall satisfaction with the service brand (Chen,

2001). Defined as an emotive response to service attributes and service information,

satisfaction is the immediate reaction to the service experience. Satisfaction is claimed as

being generally associated with a particular transaction at a particular time as opposed to

brand attitudes that take a more global perspective (Cote, 2000). In terms of service brand

stimuli such as brand equity, literature reveals that a number of brand dimensions are

strongly associated with satisfaction (D. a. O.C. Grace, A., 2001). Several brand equity

dimensions such as services cape (Berry, 2000); core service, employee service and feelings

aroused during service consumption, are also argued to have a direct effect on satisfaction

and service quality in various service setting (Babin, 1999).

Definition of terms

thesis for banking sector

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