How important is CRM toward customer’s loyalty to conventional and Islamic bank marketing strategy?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jono Mintarto Munandar ◽  
Dewi Oktaviani ◽  
Yenni Angraini
Keyword(s):  
Customer Loyalty ◽  
Structural Equation ◽  
Relevant Literature ◽  
Internet Banking ◽  
Service Industries ◽  
Equation Modeling ◽  
Islamic Banks ◽  
Content Type ◽  
Conventional Banks ◽  
The Impact

Purpose This paper aims to test the effect of customer relationship management (CRM) strategy on customer loyalty of bank customers. Design/methodology/approach The questionnaire derived from previous studies along with relevant literature was completed by 100 customers of conventional banks and 100 customers of Islamic banks. Structural equation modeling assessed the impact on customer loyalty on three key constructs of CRM programs (continuity marketing, one to one marketing and partnering). Findings Two out of three variables, which is continuity marketing and partnering, have significant effects on both banks. Continuity marketing is the dominant variable at conventional banks. Partnering is the dominant variable at Islamic banks. Research limitations/implications The effects of CRM programs on customer loyalty observed in this study required further research. The data used in this study were only gathered from the banking industry in Indonesia, and so more research studies are needed to support the conclusion. Practical implications It is reasonable to conclude that customer loyalty can be built, strengthened and retained by CRM programs, aimed at increasing security and building trust in each transaction, improving partnership, optimize another bank’s service product like internet banking and SMS banking and communicating with customers in a timely manner. Originality/value Advanced and specific knowledge relevant to CRM in banking service industries.

The consumers’ commitment and materialism on Islamic banking: the role of religiosity

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Junaidi Junaidi ◽  
Ready Wicaksono ◽  
Hamka Hamka
Keyword(s):  
Structural Equation ◽  
Survey Study ◽  
Equation Modeling ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Content Type ◽  
Positive Effects ◽  
Islamic Bank ◽  
Muslim People ◽  
The Impact

Purpose This paper aims to investigate whether and how religiosity (e.g. extrinsic and intrinsic) influences the mediator variables (consumers’ commitment and materialism) in the Islamic bank consumers context. It also examines how the mediators should be influence consumers’ preferences. Design/methodology/approach In total, 658 Muslim people and Islamic bank consumers were recruited for a survey study and structural equation modeling was used to test the research hypotheses. Findings The empirical results indicate that religiosity (e.g. extrinsic and intrinsic) has significant and positive effects on consumers’ commitment and materialism, whereas intrinsic religiosity has no significant effect on consumers’ commitment which subsequently influences consumers’ preference. Furthermore, mediator variables (e.g. consumers’ commitment and consumers’ materialism) have partial mediators between religiosity and consumers’ preferences. Research limitations/implications The current study was limited to Indonesian Muslim people; there is a future need to study consumers’ attitudes and engagement in religious products and services (e.g. Islamic brands). It is can help practitioners, regulators and researchers to observe the dynamic behavior to elaborate on the impact of religion and Islamic products on consumers’ preference. Practical implications The bank managers and regulators should enhance the information of products and services Islamic banks and the difference principle between conventional banks. Moreover, enlighten the consumers about the principle operation of Islamic banks from the perspective of marketing and religiosity. Originality/value This study contributes to consumers’ behavior literature and, specifically, for the decision-making process through developing and testing a model of religious determinants toward Islamic bank products, as well as offers new insights into the determinants of religion and consumers’ decision process toward Islamic banking.

Get connected with your Takaful representatives

2019 ◽  
Vol 11 (5) ◽  
pp. 1175-1200
Author(s):  
Mohsin Abdur Rehman ◽  
Ismah Osman ◽  
Khurram Aziz ◽  
Hannah Koh ◽  
Muhammad Awais
Keyword(s):  
Service Quality ◽  
Relationship Marketing ◽  
Customer Loyalty ◽  
Corporate Reputation ◽  
Cultural Context ◽  
Corporate Image ◽  
Service Industries ◽  
Equation Modeling ◽  
Content Type ◽  
The Impact

Purpose Marketing investigations on the concomitant variables of both service quality and relationship marketing are very scarce. Hence, the purpose of this study is to examine the customers’ perception of the Takaful (Islamic insurance) in relation to service quality and relationship marketing. More importantly, the examination of the impact of both service quality and relationship marketing on corporate image is further established. Accordingly, corporate reputation and customer loyalty were further evaluated, along with these respective interactions. Design/methodology/approach A self-administered survey was conducted from 350 Malaysian customers of Takaful products and services. The purposive sampling was used to collect data from the existing customers of Takaful service operators in the Klang Valley, an area in Malaysia. The questionnaire was constructed through measures of PAKSERV for service quality, as well as other measures related to relationship marketing and other constructs in this study. Structured equation modeling was used in the analysis of data. Findings The current study is the first one of its kind to examine perceptions of customers of relationship marketing and service quality as predictors of corporate image, which drives corporate reputation and ultimate customer loyalty from the perspective of the Takaful industry in Malaysia. Service quality dimensions (tangibility, reliability and personalization) and relationship marketing dimensions (Islamic ethical behavior and structural bond) positively influence corporate image of the Takaful organizations. Moreover, customer loyalty can be predicted, mainly through corporate reputation as well as corporate image. Research limitations/implications The present study is focused on the existing Malaysian Takaful customers as the population frame. Accordingly, future research studies may evaluate the same model, but perhaps in another different cultural context where the Takaful industry can grow and expand in other countries, including Saudi Arabia, Sudan and Pakistan. More importantly, the same variables may be verified to different service industries in future studies, especially those constructs related to relationship marketing because many products and services at present can be attained without face-to-face interactions through online transactions without having brick and mortar businesses. Practical implications It is important for Takaful service operators to focus on connecting the social and financial bonds to ensure the fulfilment of customers’ needs. They also need to improve the qualities related to tangibility, reliability and personalization to be able to increase their market share, especially in this present highly competitive market. Indeed, Takaful generally provides financial protection and risk management; nevertheless, the religious and ethical values need to be embraced in totality unlike conventional insurance, which has the element of gambling, uncertainty and the imposition of interest. Hence, this study aims to assist the Takaful operators toward achieving corporate reputation and apparently customer loyalty for them to remain relevant in this industry. Originality/value The model used in this study is based on the cultural context of Malaysia from the perspective of the Takaful industry. It attempts to explain customer loyalty through the incorporation of service quality and relationship marketing dimensions, where it is associated with the elements of the values of Islamic ethics especially in business transactions. More importantly, these dimensions were put together to identify its impact on corporate image, corporate reputation, and ultimately, customer loyalty, thus illustrating a distinct set of outcomes of the present study.

Corporate social responsibility toward stakeholders and customer loyalty: investigating the roles of trust and customer identification with the company

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Niki Glaveli
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Social Exchange ◽  
Customer Loyalty ◽  
Structural Equation ◽  
Equation Modeling ◽  
Content Type ◽  
Corporate Social ◽  
Customer Trust ◽  
The Impact

Purpose This study aims to uncover the underlying multiple intervening mechanisms between corporate social responsibility (CSR) and customer loyalty. Social identity and social exchange theories offer the ground for prediction that the primary outcomes of CSR initiatives are customer–company (C–C) identification and customer trust, which in turn affect customer loyalty. Also, the differential effect of CSR behaviors toward specific stakeholder groups on customer attitudes and behaviors are examined. Design/methodology/approach Data were collected from 333 customers of telecommunication companies in Greece. Structural equation modeling was used to test the postulated relationships. Findings The findings demonstrate that both C–C identification and customer trust intervene in the relationship between customer perceptions of CSR and customer loyalty; however, the identification mechanism is stronger than the trust mechanism in building customer loyalty while C–C identification seems to drive customer trust. Moreover, out of the three CSR components (customers, employees, and society/environment) that were considered as relevant to customers and were investigated, customer-centric activities were found to be the stronger predictor of both C–C identification and customer trust. Also, CSR toward society/environment was found to positively influence C–C identification. Practical implications The findings of this research can assist practitioners in effectively conceptualizing CSR image from a customers’ point of view and designing their company’s CSR and communication strategies to boost positive customer responses and strong long-term relationships. Originality/value The current study provides further insights into the complex relationship between CSR and customer responses and the impact that different CSR activities may have on customers.

Financing woes: estimating the impact of MSME financing gap on financial structure practices of firm owners

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Vibhuti Mittal ◽  
T.V. Raman
Keyword(s):  
Structural Equation ◽  
Small And Medium Enterprises ◽  
Financial Structure ◽  
Service Industries ◽  
Equation Modeling ◽  
Content Type ◽  
Financing Gap ◽  
Medium Enterprises ◽  
The Impact ◽  
Firm Owners

PurposeAccessing formal mainstream finance is a cumbersome process for Micro, Small and Medium Enterprises (MSMEs) of emerging economies. Empirical investigations have connected finance accessibility to financing gap that restricts MSMEs from borrowing through formal channels. The purpose of this study is to explore the influence of financing gap on firms' financial structure (FS) practices. In this regard, the research framework divides financing gap into four dimensions, namely: demand gap (DG), supply gap (SG), knowledge gap (KG) and empathy gap (EG).Design/methodology/approachThe paper adopts a quantitative approach to establish the underlying relationship between the variables. The participants of the self-structured questionnaire survey were 219 MSME owners from manufacturing, trading and service industries. The results are inferred through the partial least squares structural equation modeling (SEM) technique.FindingsThe findings recognise a significant impact of financing gap on the FS practices of firm owners. The financing constraints contributing to KG, SG and EG are found to be extending the unwillingness of firm owners to borrow through formal channels. Further, the results also confirm the influence of financing gap on the pecking order framework (POF) of MSMEs' FS.Practical implicationsThe study offers the perspective and hesitance of MSME owners towards mainstream financing. The key findings are useful for the financial intermediaries and policymakers, who need to be sensitive and proactive in their small business lending process.Originality/valueThe study adds to the limited evidence of various dimensions of financing gap. It also addresses the role of financing gap on the conscious preferences of MSME owners towards the informal source of financing along with the POF.

The impact of strategic quality orientation on innovation capabilities and sustainable business growth

2018 ◽  
Vol 35 (8) ◽  
pp. 1568-1598 ◽  
Author(s):  
Bilal Ahmad Khan ◽  
Hummayoun Naeem
Keyword(s):  
Conceptual Framework ◽  
Structural Equation ◽  
Service Industries ◽  
Service Organizations ◽  
Equation Modeling ◽  
Business Growth ◽  
Sustainable Business ◽  
Empirical Examination ◽  
Content Type ◽  
The Impact

PurposeThe purpose of this paper is to present a new conceptual framework for service organizations to achieve sustainable business performance through strategic quality orientation and innovation capabilities on the basis of relevant literature review and integration of various innovation and business sustainability theories and models. The study tests if the strategic quality orientation enhances innovation capabilities in terms of exploitation and explorative innovation, which, in turn, can lead to sustainable business growth. Mediating impact of innovation capabilities between strategic quality orientation and sustainable business growth relationship is also examined.Design/methodology/approachA conceptual framework was developed to test and establish these relationships. Results were analyzed based on 442 questionnaires collected from five different service industries of Pakistan, and the structural equation modeling technique was used to empirically test the conceptual framework.FindingsThe results indicate that strategic quality orientation directly affects innovation capabilities and sustainable business growth and also indirectly impacts sustainable business growth through its effect on innovation capabilities.Practical implicationsThe study suggests service organizations can jointly implement quality and innovation using a structured approach, with strategic quality orientation as the foundation. In this way, they can leverage from their strategic quality management, supplier relationship, corporate quality culture, continual improvement and people management in order to ensure innovation and sustainability in their business growth.Originality/valueThe study integrates strategic quality orientation and innovation capabilities, and validates a new organizational framework through empirical examination which can be used by service organizations to ensure their sustainable business growth.

Metrics for the elements of intellectual capital in an economy driven by knowledge

2014 ◽  
Vol 15 (2) ◽  
pp. 206-226 ◽  
Author(s):  
Mariya Anatolievna Molodchik ◽  
Elena Anatolievna Shakina ◽  
Angel Barajas
Keyword(s):  
Customer Loyalty ◽  
Intellectual Capital ◽  
Structural Equation ◽  
Design Methodology ◽  
Relevant Literature ◽  
Empirical Support ◽  
Equation Modeling ◽  
Content Type ◽  
Structural Capital ◽  
Practical Implications

Purpose – The purpose of this paper is to explore the plausibility of six elements of IC and justify the measurement ability of a set of indicators based on publicly available data for each of the proposed element in order to provide tools to managers for their decision-making process in knowledge management (KM). Design/methodology/approach – Core company's intangibles are combined into six intellectual capital (IC) elements that appear after the division of each of the traditional components (human, structural and relational capital (RC)). The human capital includes management and human resources capabilities (HRC). Structural capital is divided into innovation and internal process capabilities (IPC). RC contains networking capabilities and customer loyalty. In drawing on the relevant literature each element is described through a set of indicators collected from publicly available data. The validity of proposed IC model is justified through structural equation modeling. Each element is tested on a sample of more than 1,650 listed European companies over the period of 2004-2011. Findings – The study gives empirical support of three component IC structure and its decomposition into second level. The findings reveal that implementation of KM plays a significant role for HRC as well as for IPC. Research limitations/implications – The analysis was conducted for a particular sample that may restrict the conclusions. Practical implications – The proposed measurements for intangibles can be applied by any company for benchmarking and comparative analysis in KM. Originality/value – The study provides empirical justification of metrics for intangibles allowing a better route in an economy driven by knowledge.

Salesperson ethics behavior as antecedent of Islamic banking customer loyalty

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tony Wijaya ◽  
Moh Nasuka ◽  
Anas Hidayat
Keyword(s):  
Customer Loyalty ◽  
Structural Equation ◽  
Equation Modeling ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Consumer Loyalty ◽  
Islamic Ethics ◽  
Content Type ◽  
New Findings ◽  
Customer Trust

Purpose The development of the banking industry is encouraging increasingly fierce competition. In the face of banking competition, Islamic banks need to build customer loyalty by paying attention to ethical aspects. Ethics has an essential role in forming and preserve relationships between companies and customers in the long term. The measurement model of salesperson ethical behavior in this study was built using the Islamic-based marketing concept. This study aims to test empirical models of Islamic ethics-based salesperson behavior in increasing customer loyalty of Islamic banks through the aspect of customer trust. Design/methodology/approach Research data were obtained from 165 Islamic bank customers in the Central Java, Indonesia, using the purposive sampling method. Data analysis in this study uses structural equation modeling. Findings The study shows that the Islamic ethics-based salesperson behavior has a positive effect on customer trust in a salesperson, customers’ trust in Islamic banks and customer loyalty. Customer trust in a salesperson has positively and significantly influenced customer trust in Islamic banks and customer loyalty. Customer trust in Islamic banks has a positive and significant effect on customer loyalty. Practical implications This study’s results are expected to be used to reference maintenance salesperson in Islamic banking to behave based on Islamic principles. Islamic marketing principles need to be applied through salespersons behaving realistically (al-Waqi’iyyah) and humanistic concepts (insaniyyah). The application of Islamic ethics can limit and avoid deviant behavior from salespeople that is detrimental to consumers and organizations. The behavior of salespeople based on Islamic ethics will build consumer trust in both organizations and salesperson so that it has implications for consumer loyalty. Originality/value This paper provides new findings to understand Islamic banking consumer loyalty that focuses on Islamic ethical salesperson behavior point of view. This paper also presents a new measurement of research variables from an Islamic perspective in examining the role of Islamic ethics-based salesperson behavior toward banking customer loyalty. This study takes the object of research in Islamic banking that has different characteristics from conventional financial institutions.

The effect of Muslims’ tendency to regret being customers of conventional banks on their intention to save money in Islamic banks

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Burhanudin Burhanudin
Keyword(s):  
Structural Equation ◽  
Islamic Law ◽  
Emotional Experience ◽  
Partial Least Square ◽  
Least Square ◽  
Equation Modeling ◽  
Islamic Banks ◽  
Banking Services ◽  
Content Type ◽  
Conventional Banks

Purpose There are some Muslims who only hold conventional bank accounts, regardless that some believe that such banks implement an interest charging system that contradicts Islamic law concerning the prohibition of charging interest. This study aims to investigate the consumers’ tendency to regret (CTR) related to purchasing conventional banking services (CTR-P) and the failure to purchase Islamic banking services (CTR-NP). Then, this study investigates whether CTR-P and CTR-NP translate into regret, which, in turn, leads to the intention to save money in Islamic banks. Design/methodology/approach A survey of Indonesian Muslims who only hold conventional banking accounts was conducted. There were 323 participants. This study then applied a partial least square structural equation modeling (PLS-SEM) to test the hypotheses. Findings This study found that a combination of CTR-P and CTR-NP translates into regret, which then drives the intention to save money in Islamic banks as a means of releasing such feelings of regret. The findings suggest that Muslims evaluate their banking decision on an Islamic basis and that making a decision that contradicts the prohibition of charging interest tends to cause regret. Islamic banks have opportunities to penetrate the market by focusing on Muslims who only hold accounts with conventional banks. Originality/value The findings of this study help advance understanding of Muslims’ negative emotional experience due to making a decision that they perceive contradicts Islamic law. Also, the findings help predict the strategy that Muslims use to neutralize such a negative emotional experience.

Developing a customer loyalty model for guest houses in China: a congruity-based perspective

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sha Wang ◽  
Kam Hung ◽  
Minglong Li ◽  
Hailian Qiu
Keyword(s):  
Customer Loyalty ◽  
Structural Equation ◽  
Relevant Literature ◽  
The Body ◽  
Purchase Behavior ◽  
Equation Modeling ◽  
Content Type ◽  
Guest House ◽  
Functional Congruity ◽  
Post Purchase

Purpose Although the number of guest houses in China is increasing rapidly, many of them are not performing well in developing customer loyalty. Self-congruity and functional congruity represent two cost-effective but inadequately researched ways for guest houses to maintain customers. In view of the lack of empirical research explaining the post-purchase behavior of guest house customers, the purpose of this study is to develop a congruity-based customer loyalty model for this specialized type of accommodation. Design/methodology/approach Based on a review of relevant literature, a robust conceptual framework of customer loyalty comprising satisfaction, self-congruity, functional congruity, perceived value and attractiveness of alternates was constructed. By means of an online panel survey, 828 valid questionnaires were obtained from customers who had stayed in a Chinese guest house within the previous year. Structural equation modeling was conducted to test the conceptual model and the hypothesized relationships among the constructs. Findings Significant relationships were found between the two congruity constructs in guest houses, which both led to positive customer post-purchase behaviors. The authors found that self-congruity, functional congruity and the attractiveness of alternates did not affect customer loyalty directly; rather, they influenced loyalty indirectly through customer satisfaction. Originality/value This study developed a unique, congruity-based model of customer loyalty in the context of guest houses. It enhances the body of knowledge regarding congruity in the field of tourism and hospitality, and it discusses relevant implications of the findings for tourism marketing researchers and for owner-managers of guest houses.

The impact of knowledge management practices on organizational performance

2015 ◽  
Vol 28 (1) ◽  
pp. 131-159 ◽  
Author(s):  
Changiz Valmohammadi ◽  
Mohsen Ahmadi
Keyword(s):  
Knowledge Management ◽  
Organizational Performance ◽  
Structural Equation ◽  
Management Practices ◽  
Service Industries ◽  
Leadership Role ◽  
Equation Modeling ◽  
Cross Sectional ◽  
Content Type ◽  
The Impact

Purpose – The purpose of this paper is to present a holistic approach regarding evaluation of knowledge management (KM) practices on organizational performance. The effects of seven critical success factors (CSFs), namely leadership role, organizational culture, KM strategy, processes and activities, training and education, information technology, and motivation and rewarding system, on organizational performance in the framework of four perspectives of balance scored card (BSC) approach were surveyed. Design/methodology/approach – The research hypotheses were raised based on the four perspectives of this approach, namely, growth and learning, internal processes, customer and financial. By literature review, CSFs of KM and organizational performance along with their items were identified in the framework of BSC’s perspectives. Based on these constructs and their items an instrument was designed and distributed among managers and employees of the subsidiary firms of Iran National Petrochemical Company (INPC). Reliability of the instrument was calculated by Chronbach’s α for the two sections of the instrument i.e. KM practices and organizational performance. Also, using factor analysis the construct validity of the questionnaire was approved. Finally, based on the hypotheses of the study and using structural equation modeling the impacts of KM practices on organizational performance were investigated. Findings – The results revealed that KM practices positively and meaningfully (though weak) impact overall organizational performance. This impact is significant only regarding growth and learning dimension and on the other dimensions is insignificant. Also, as customer and financial constructs were loaded on one factor based on the entity of their indicators we considered these two constructs as stakeholders construct. In addition, among the above mentioned seven CSFs, motivation and rewarding system obtained the lowest rank among the survey organizations. Research limitations/implications – The sample is restricted to only three companies, so gathering data from various parts of Iran including both manufacturing and service industries could increase the generalizability of the results obtained. Also, as in this study the data gathered were cross-sectional, a longitudinal study could help gain deeper understanding of the cause-and-effect relationship among the variables. Originality/value – The most significant gap in the literature is the lack of enough application of statistical and comprehensive methods like BSC that KM makes a difference to organizational performance. This study contributes to the field of KM by empirically investigating the impact of KM practices on various measures of organizational performance in order to prove the suitability of a comprehensive approach like BSC.

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