E-COMPLAINT HANDLING AND CUSTOMER LOYALTY OF BANKS IN PORT HARCOURT

E-COMPLAINT HANDLING AND CUSTOMER LOYALTY OF BANKS IN PORT HARCOURT

This study aimed to empirically evaluate the relationship that exists between e-complaint handling and customer loyalty of banks in Port Harcourt

GET RELATED RESEARCH MATERIALS HERE

CHAPTER ONE

INTRODUCTION

• Background to the study

The issues of e-complaint handling in deposit money banks have been discussed in several works of literature, and its importance to the success of the financial sector remains imperative. Banks are to always fashion those factors that lead to the offering of superior service delivery to its teeming customers. There is a need for customers’ expectations to be met and even be exceeded by the exceeding of customers’ expectations, surpassing and delighting the customers beyond its required standard. It is also defined as a service that treats customers with a friendly attitude and tries to resolve their problem or question as efficiently as possible (www.livecareer.com/complaint-handling-).

It is a point of duty that deposit money banks in Port Harcourt Rivers State, Nigeria handle complaints, and try as much as possible to keep, exceed those promises that keep their customers for a longer time, by keeping those promises, an attribute of trustworthiness and reliability is establish which is cable to elicit a repeat purchase or visit behavior.

E-complaint handling is embedded in the fact that banks will always provide beyond what customers expect of them. According to Edwards (2012), e-complaint handling deals with the ability of the banks to constantly meet and exceed customer expectations and effectively manage the experience of the customers. The financial sector especially DMBs must place importance on e-complaint handling to better their operations and remain competitive (Kenargn, Donald & Miles 2009). Accordingly, e-complaint handling encompasses four different factors which include: delivery of the promise of quality services such as the financial services, the provision of personalized services to customers, and the ability to do more jobs that are required of the employee to the customer, and the ability to resolve or solve customers’ problem emanating from the previously rendered service (Johnstone, 2014).

Customer e-complaint handling comprises a constant provision of service quality to the consumer, and consistency of the service quality targeted toward the customer. For example, the writer identified that among the (21) twenty one functional deposit money banks in Rivers State, Access bank plc is observed to be providing quality services to her numerous customers. This clear observation shows that some of the banks in Port Harcourt while some are not. It is on this note that it becomes imperative for all the banks who receive deposits from their customers, to develop a positive attitude towards e-complaint handling.

Customer loyalty, on the other hand, refers to the level of faithfulness shown by a customer in continuing to purchase a particular product or service (Ozuru & Kalu, 2009). Also, customer loyalty is an indicator of the degree of satisfaction the customer has with the product. Customer loyalty could also be defined as the feeling of attachment or affection for a company’s product or service that will directly influence customer’s behavior, to keep and satisfy them and make them buy more of the firm’s products. (Dowling & Hammond, 2013) claims that loyalty in service occurs when ‘the customer feels so strongly that you can best meet his or her relevant needs, that your competition is virtually excluded from the usual belief that making a service more tangible makes the customer build expectations easier in certain contexts becomes difficult besides some services to have a greater degree of tangibility than others and make the management of it more complex (Grönroos, 2000). In this scenario, we view what was traditionally considered as service tangibility and its relationship with customer loyalty as most difficult to ascertain. It can then be seen that even though different models about service tangibility have frequently been proposed in the literature, hence a common feature has yet emerged which is a consequence of the link between service tangibility and customer loyalty. Consequently, this has created a yearning gap in service literature, given the perceived service deficiency emanating from previous works and the inability of service scholars to develop a relevant thesis in this area. It is based on this premise that the current study seeks to identify those factors that lead to service tangibility and its impact on customer loyalty. This serves as the main gap identified by the research, which the study tries to cover, and it serves as our point of departure.

• Statement of the Problem

Currently, in Port Harcourt, there is a clear deficiency in the level of e-complaint handling which consistently results in service excellence and customer loyalty. This is simply because our financial institutions have lost focus or shifted attention from service that is distinguishable to just profit-making. As a result, the customer base is beginning to dwindle on a regular bases.

Hence, it was recorded that e-complaint handling is very essential to an organization. E-complaint handling stands as a competitive strategic tool, most if not all the service organizations such as the deposit money banks in Port Harcourt (Hina & Harry, 2009).

However, the problem of this study is empirically evaluating the nexus between e-complaint handling and customer loyalty of banks in Rivers State.

• Aim and Objectives of the Study

The main aim of this study is to empirically evaluate the relationship that exists between e-complaint handling and customer loyalty of banks in Port Harcourt. However, its specific objectives include:

1. To determine the extent to which service innovation affects customer loyalty of banks in Port Harcourt.
2. To determine the extent to which prompt delivery affects customer loyalty of banks in Port Harcourt.

• Research Questions

From the objectives, the following questions were asked to guide the study. They include:

1. What is the relationship between does Service Innovation and customer loyalty of banks in Port Harcourt?
2. What is the relationship between Prompt Delivery and customer loyalty of banks in Port Harcourt?

• Study variables and conceptual framework

There are two main variables involved in this study (predictor and criterion variable). Service tangibility and customer loyalty, the predictor has its dimension as service innovation and prompt delivery. While the criterion variable customer loyalty with its measures as repurchase, commitment, and referrals. These main variables and sub-variables are functionally represented as follows:

CL     =       f(ECH)-       –        –        –        –        –        –        (1)

ECH  =       f(SI, PD)     –        –        –        –        –        –        (2)

CL     =       f(RP, C, R)  –        –        –        –        –        –        (3)

Where:

ECH  =       Electronic Complaint Handling

SI      =       Service Innovation

PD     =       Prompt Delivery

CL     =       Customer Loyalty

RP     =       Repeat Purchase

C       =       Commitment

R       =       Referrals

FIG. 1: Conceptual framework of the relationship between e-Complaint Handling and Customer Loyalty of Banks in Port Harcourt.

Source:  Desk Research, (2019)

• Research Hypotheses:

Hypothesis is a comprehensive statement of the relationship between two variables. In the course of this study, the following hypotheses were postulated;

H_O1:  There is no significant relationship between service innovation and the repurchase of banks in Port-Harcourt.

H_O2: There is no significant relationship between service innovation and Commitment of banks in Port-Harcourt.

H_O3: There is no significant relationship between service innovation and Referra1s of banks in Port-Harcourt.

H_O4: There is no significant relationship between prompt delivery and repurchase of banks in Port-Harcourt.

H_O5: There is no significant relationship between prompt delivery and Commitment of banks in Port-Harcourt.

H_O6: There is no significant relationship between prompt delivery and Referrals of banks in Port-Harcourt.

• Significance of the Study

The study, if carried out shall have a specific implication on e-complaint handling of service organizations. The study is likely to help the management of deposit money banks in Nigeria and other services organizations solve the identified problem of the dependent variable, using a model that shall be developed for service quality in the banking industry to ensure that customers receive the service that matches their need and is performed flawlessly. The findings of this study, if followed, shall reduce the incidences of service risk and customer apprehensions during service encounters, as the emerging framework shows the effectiveness of e-complaint handling on customer loyalty.

• Scope of the Study

The scope of this study includes:

Context Scope: This research purely deals with the evaluation of the impact of e-complaint handling on customer loyalty of banks in Port Harcourt.

Geographical Scope: The study is specifically spelled out to be carried out within the shores of Port Harcourt.

Levels/Unit of analysis: The research is bid to investigate factors that help banks in Port Harcourt to provide tangible services. Therefore, the study will adopt micro-level analysis which means that the customers of the above firms will serve as our study elements or respondents, this is because the customers are in a pole position to ascertain if the services delivered to them are tangible.

• Limitations of the study

Our limitations, therefore, lie in the generalization of data to the banking industry. Therefore, our findings are not generalized to other industries, until further studies are conducted and verified.

Some of the respondents see the information sought after as “official secret” and were reluctant to part with information, however, they gave their opinion on hypothetical scenarios.

The Geographical scope shall cover all deposit money banks operating in Port-Harcourt. Therefore our study results may be very specific to this area under study.

• Definition of Terms

Commitment: Is frequently defined as a desire to maintain a relationship.

Customer: This refers to a recipient of a good or service, product or idea, obtained from a vendor or supplier for a monetary or valuable consideration.

Customer loyalty: It is a long-term commitment of a consumer that emanates as a result of satisfaction derived, which leads to repeat purchase behavior.

Deposit Money Banks (DMBs): These are commercial banks that receive deposits and cheques from a customer on a long or short termbase.

Prompt delivery: Prompt delivery is a measure of process and supply chain efficiency which measures the number of finish goods or services delivered to customers on time and in full.

Quality: Refers to the standard of something, when compared to other things like it.

Referral: An act of sending someone to a person or place where what is wanted or needed can be obtained.

Service: service can be defined as any activity or benefit that one can offer to another which is essentially intangible and does not result in the ownership of anything.

Service innovation: Service innovation means changing the way you serve your customers to create greater value for them and deliver more revenue for your organization.