The mediating role of corporate image on customers’retention decisions: an investigation in financialservices
Nha Nguyen and Gaston LeBlancDepartment of Business Administration, University of Moncton, Moncton,New-Brunswick, Canada
A conceptual framework isproposed that investigatesthe effects of customer satis-faction, service quality, andvalue on perceptions of cor-porate image and customerloyalty towards the servicefirm. To test the framework,structural equation modellingtechniques are applied todata collected from 1,224customers in the bankingservices industry. The resultsof the study indicate thatsatisfaction and servicequality are positively relatedto value and that qualityexerts a stronger influence onvalue than satisfaction. Thefindings also show that cus-tomers receiving higher levelsof service quality will form afavourable image of thebanking institution. In addi-tion, value is found to posi-tively impact on image, sug-gesting that the bankinginstitution should have astrong image when customersbelieve they are getting highvalue. Similarly, customersatisfaction and image per-ceptions are found to impacton service loyalty with satis-faction having a greaterinfluence on loyalty thanimage. The managerial andresearch implications of thereported study are discussed.
Understanding the role of corporate image inthe customer retention decision is a key issuethat has received little attention in the ser-vice marketing area. In the literature cus-tomer satisfaction, quality, and value haveoften been identified as predominant causesof buying behaviour (Bolton and Drew, 1991;Zeithaml, 1988). This study attempts to discover how these three distinct but stronglyrelated concepts influence beliefs with regard to corporate image evaluations, and customer loyalty towards the servicefirm.
Numerous studies in services marketinghave relied mainly on customer satisfactionand services quality to describe customerevaluations of services. Indeed, in recentyears, researchers have focused their atten-tion on measuring levels of customer satisfac-tion with products/services (Churchill andSurprenant, 1982; Day, 1977; LaBarbera andMazursky, 1983; Oliver, 1980; Oliver andDeSarbo, 1988; Peterson and Wilson, 1992; Tseand Wilton, 1988), and on the cues that signalservices quality to customers (Carman, 1990;Gronroos, 1984, 1990; LeBlanc and Nguyen,1988; Parasuraman et al., 1985, 1988). Morerecently, marketing scholars have attemptedto grasp and better understand the dynamicsof the relationship that exists between satis-faction and service quality and their impacton customer purchase intentions (Bolton andDrew, 1991; Cronin and Taylor, 1992; Taylorand Baker, 1994). Service value has alsoemerged as an important higher order con-struct linked to service quality and price(Zeithaml, 1988), and to the various phases ofthe service consumption experience (Hol-brook, 1994).
Although significant research has beenconducted on satisfaction, service quality,and value, the precise nature of the relation-ships that exist between these constructs andthe understanding of their effect on customerbehaviour still remains a key issue facing theacademy. A better understanding of howthese three major forms of service evalua-tions impact on corporate image and cus-tomer loyalty towards the service firmappears warranted, given the present compet-itive environment and the potential effect on
future profits of behavioural outcomes(Barich and Kotler, 1991).
The objective of this study is to propose andtest a conceptual framework that considerscustomer satisfaction, service quality, andvalue as antecedents to corporate image eval-uations and customer loyalty towards theservice firm. To that end, it is argued thatperceptions of image become instrumental inrepresenting the overall impression of ser-vice and validate the promises made to cus-tomers by the service firm. This global atti-tude has the potential of influencingcustomer loyalty (Barich and Kotler, 1991),which in itself represents the customer’srejection of competitive offerings aimed at changing buying habits (Sheth andPark, 1974; Woodside et al., 1980), and consti-tutes one of the most reliable overall indica-tors of the service firm’s success (Zeithaml et al., 1996). While customer satisfaction,service quality, and value have been the subject of much research, the position taken in this study is that a greater under-standing of their effect on the overall imageleft on the minds of customers in the form ofattitude and behavioural intentions is neededto assist management in ensuring the com-petitive performance of the service organiza-tion.
This article is organized in four sections.First, a review of the literature related tocustomer satisfaction, service quality, value,image, and customer loyalty is presented. Theconflicting nature of the reported relation-ships that exist between satisfaction andquality and their effect on behavioural inten-tions are ascertained. Links between theconstructs under investigation are proposedand presented in a conceptual model. Second,the methods employed are explained. Third,the results of the study are presented anddiscussed. Finally, the managerial andresearch implications of the reportedresearch are explained. In summary, theresults show that satisfaction and quality arepositively related to value and that valueleads to corporate image. In turn, satisfactionand image are found to impact on customerloyalty.
The authors would like toacknowledge the financialsupport of the SocialSciences and ResearchCouncil of Canada.
[ 53 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
Conceptual framework
The conceptual framework presented inFigure 1 is unique in that it presents an over-all approach to service evaluations whichconsiders a set of previously untested rela-tionships. The following discussion presentsan overview of the literature related to theconstructs included in the proposed model.
Customer satisfactionConsiderable attention has been given to theconcept of customer satisfaction over the lasttwo decades. A review of the marketing litera-ture reveals the undisputed dominance of thedisconfirmation of expectations paradigm incustomer satisfaction/dissatisfactionresearch (Churchill and Suprenant, 1982;Oliver and DeSarbo, 1988; Spreng andOlshavsky, 1993).
In the services marketing literature, cus-tomer satisfaction is described as a judge-ment made on the basis of a specific serviceencounter (Bolton and Drew, 1991; Croninand Taylor, 1992). This concurs with Oliver’s(1981) view that satisfaction is an emotionalreaction which influences attitude and isconsumption specific. From this perspective,Cronin and Taylor (1994) propose that thedomain of customer satisfaction should belimited to transaction-specific judgementsand service quality to long-term attitudes.Consequently, the cumulative effect of ser-vice encounter satisfactions should lead to aglobal evaluation of service quality over time(Parasuraman et al., 1994). In this regard,certain researchers have suggested that sat-isfaction is an antecedent to service quality(Bolton and Drew, 1991). Other researchersdo not share this view and propose that cus-tomer satisfaction and service quality can beexamined at both the transaction-specificand global perspectives (Teas, 1993). Satisfac-tion evaluations have also been linked toperceived value (Zeithaml, 1988), repeat-
purchasing (Oliver and Swan, 1989), as wellas customer loyalty towards a brand or com-pany (Kasper, 1988). Indeed, Fornell (1992), inhis study of Swedish consumers, states thatalthough customer satisfaction and qualityappear to be equally important for all firms,satisfaction is more important for loyalty inindustries such as banks, insurance, mailorder, and automobiles.
Perceived qualityMost recent work suggests that service qual-ity is the customer’s overall impression withregard to the superiority (Bitner and Hub-bert, 1994) or excellence of the serviceencounter (Rust and Oliver, 1994). Perceivedquality is the result of an evaluation that isbased upon the customer’s experience withthe service, whereas objective quality refersto a combination of quantifiable factors asso-ciated with the superiority of materials, themanufacturing process, workmanship, andwith design and aesthetics (Garvin, 1984;Jacoby and Olson, 1985).
The conceptualization of service quality asproposed by Parasuraman et al. (1985, 1988) isrelatively similar to the disconfirmation ofexpectations paradigm developed in satisfac-tion research. In their work, Parasuraman etal. measured both customers’ expectations ofservice, i.e. what customers believe excellentservice companies should offer, and theirperceptions of the service received. Throughthe use of gap scores, a set of five factors thatsignal service quality across a broad spec-trum of service industries were identified.Based on their results, the authors argue thatservice quality is a five-dimensional con-struct consisting of tangibles, reliability,responsiveness, assurance and empathy.
There has been some debate in the litera-ture concerning the appropriate manner inwhich to operationalize the service qualityconstruct, the causal order between satisfac-tion and quality, and the process by whichcustomers update their evaluations of quality.Cronin and Taylor (1992, p. 62) contend that“the current conceptualization and measure-ment of service quality is based on a flawedparadigm”. Indeed, in their work, they main-tain that the gap scores method is inappropri-ate for measuring service quality and theyargue in favour of performance-based mea-sures. The services marketing literature hasreported conflicting results with regard tocausal order between customer satisfactionand perceived service quality and their influ-ence on purchase intentions. Although Boltonand Drew (1991) and Carman (1990) proposethat satisfaction impacts on service quality,Anderson and Sullivan (1993), Cronin andTaylor (1992), and Woodside et al. (1989)
Perceivedvalue of service
Customersatisfaction
Servicequality
Corporateimage
Customerloyalty
Figure 1Proposed conceptual framework
[ 54 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
provide empirical evidence in support ofperceived service quality as an antecedent tocustomer satisfaction, which exerts astronger influence on purchase intentionsthan satisfaction. This agrees with the workof Gotlieb et al. (1994) who found that the focaland contextual dimensions of disconfirma-tion affect perceived quality and that qualityaffects satisfaction and in turn intentions areinfluenced by satisfaction. Taylor and Baker(1994), for their part, conceptualize satisfac-tion and service quality as acting jointly onintentions, and report higher purchase inten-tions when both perceived service qualityand customer satisfaction levels are high.
In their analysis of the causal orderbetween satisfaction and quality, Parasura-man et al. (1994) propose a transaction-spe-cific conceptual model that views acustomer’s overall satisfaction with a trans-action to be a function of service quality,product quality, and price. In addition, theauthors propose a framework that depictscustomers’ overall assessment of service as afunction of transaction experiences. Bouldinget al. (1993), in their process model, view ser-vice quality as a cumulative construct that isupdated each time the customer experiencesthe service. Customers’ expectations on keyservice attributes and each new service expe-rience combine to form an evaluation of ser-vice and this affects what customers believewill and should occur in future serviceencounters.
Noting the lack of consensus in the litera-ture about the causal link between customersatisfaction and service quality and theprocess by which customers update theirevaluations, Dabholkar (1993, p. 16) states that“in terms of transactional or global perspec-tives both service quality and customer satis-faction can be conceptualized and measuredin relation to an overall evaluation of theservice, a given service experience, or spe-cific aspects of the service. Research objec-tives should determine the perspectiveapplied to the constructs.”
Perceived valueDespite the importance of perceived servicevalue as a major form of customers’ assess-ment of services, the services marketingliterature reveals that there has been limitedwork undertaken on the understanding of theprecise nature of the construct and its impacton customer behaviour. Zeithaml (1988), in anextensive review of the literature, proposesthat value is a higher order construct thanquality and reports four customer definitionsof perceived value: i.e. value is low price,value is want satisfaction, value is the qualityI get for the price I pay, and value is what I get
for what I give. Perceived value is differentthan quality and a more comprehensive formof customer evaluation of service. Value canbe conceptualized as the overall evaluation ofthe service consumption experience and, likequality and satisfaction, value can beencounter specific or a more enduring globalevaluation (Rust and Oliver, 1994). Value rep-resents the trade-offs between costs and bene-fits and arises from both quality and price.Rust and Oliver (1994), in their work on ser-vice value, indicate that value shouldincrease as quality increases and pricedecreases. They note that it is yet not clearhow quality and price combine to form value.
Customers’ evaluation of value alsodepends on monetary and nonmonetarycosts, i.e. the sacrifices associated with utiliz-ing the service and the benefits or utilityreceived in exchange (Hauser and Urban,1986; Sawyer and Dickson, 1984). As such,value is more situational and personal thanquality and can take on different meaning atvarious phases of the service consumptionprocess (Holbrook and Corfman, 1985; Zei-thaml, 1988). Customer choice is hypothesizedto be influenced by functional, social, emo-tional, epistemic, and conditional values.Functional value refers to economic utilityderived from choice, while social value isassociated with the value gained from thenotice of others. Emotional value is derivedfrom acquiring goods that are liked, and epis-temic value is the capacity of the choiceobject to provide novelty. Finally, conditionalvalue refers to situational conditions thatinfluence choice behaviour such as the pur-chase of Christmas cards (Sheth et al., 1991).
Few studies have investigated the relation-ship that exists between service quality, cus-tomer satisfaction and perceived servicevalue (Zeithaml, 1988). In their work on cus-tomers’ assessments of local telephone ser-vice, Bolton and Drew (1991, 1992) report thatservice quality is the most important deter-minant of value, followed by disconfirmationexperiences, and that service value was posi-tively related to behavioural intentions. In asimilar vein, Anderson and Sullivan (1993),note that other factors such as switchingcosts and switching benefits affect repur-chase intentions. To date, little work hasinvestigated the effect of customer satisfac-tion on perceived service value. In her con-ceptual framework, Zeithaml (1988) notes thatvalue is: want satisfaction, low price, thequality the customer gets for price paid, andthat value is what is received for what isgiven in exchange. The view taken in thispaper is that perceived service quality andcustomer satisfaction are two distinct butclosely related constructs that act jointly on
[ 55 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
service value, image, and behavioural inten-tions.
Based on the review of the literature withregard to the concepts of customer satisfac-tion, perceived service quality and perceivedservice value the following hypotheses areproposed:
H1: Higher levels of customer satisfactionlead to higher levels of perceived ser-vice value.
H2: Higher levels of perceived service qual-ity lead to higher levels of perceivedservice value.
Corporate image The marketing literature reveals thatresearch on the concept of corporate imagehas been undertaken mostly on goods produc-ing firms and on retail stores, and that littlework has been reported to date on customers’image assessments in services (Donovan andRossiter, 1982; Dowling, 1988; Golden et al.,1987; Mazursky and Jacoby, 1986). Gronroos(1984) argues that image is of utmost impor-tance to service firms and is to a great extentdetermined by customers’ assessment of theservices they receive. Indeed, since servicesare intangible and based on performances, abetter understanding of the components ofimage promises to help management improvethe competitive performance of the firm. Aprerequisite to image management is, there-fore, the understanding of the process bywhich image is formed and the customers’beliefs and attitude with regard to the firm’sproduct/service offering.
Numerous definitions of image are found inthe psychological and marketing literature.Image has been described as subjectiveknowledge (Boulding, 1956), as an attitude(Hirschman et al., 1978), and as a combinationof product characteristics that are differentfrom the physical product but are neverthe-less identified with the product (Erickson etal., 1984). Examples include tradition, ideol-ogy, company name, reputation, price levels,variety of services, and the quality communi-cated by each person interacting with theservice firm. Other aspects, such as corporateidentity, level and quality of advertising, anddelivery systems also contribute to imagebuilding. Image has also been described asthe “overall impression” left on the minds ofcustomers, as a “gestalt” (Zimmer andGolden, 1988), and as an “idiosyncratic cogni-tive configuration” (Mazursky and Jacoby,1986).
MacInnis and Price (1987), along with Yuilleand Catchpole (1977), describe image forma-tion as a procedure by which ideas, feelingsand previous experiences with an organiza-tion are stored in memory and transformed
into meaning based on stored categories.Salient facts, compatible with the customer’sattitudinal structure, are later retrieved toreconstruct image when the service firm isbrought to mind. Two principal componentsof image, functional and emotional, are iden-tified (Kennedy, 1977). The functional compo-nent is related to tangible cues that can bemeasured more easily, while the emotionalcomponent is associated with psychologicalstates that are manifested by feelings andattitudes. The customer, exposed to realitiescreated by the firm, selects the symbolsthrough which image is formed. Image isdescribed as a hierarchical network of mean-ings stored in memory that range from holis-tic general impressions to very elaborateevaluations of objects, and these meaningsare proposed to be linked to the individual’spersonal values. In the customer’s mind, themeaning of image must be investigated at ahigher level of abstraction (Reynolds andGutman, 1988).
Gronroos (1984) argues that corporateimage is built mainly by technical quality i.e.what the customer receives from the serviceexperience, and functional quality, the man-ner in which the service is delivered. Bitner(1990, 1992) proposes that cues from the physi-cal environment are instrumental in commu-nicating the firm’s purpose and image. Baker(1987), for her part, contends that atmospher-ics have considerable influence on employeemotivation and the quality of the serviceencounter. Similarly, Crosby et al. (1990) notethat the performance of contact personnel isindicative of the level of quality offered by theservice firm. Interestingly, physical environ-ment and contact personnel are integralparts of the service quality factors identifiedby Parasuraman et al. (1988). The assumptionis that customers who perceive service qual-ity over repeated service encounters have anoverall favourable image of the firm. Simi-larly, since customer satisfaction is describedas a judgement made on the basis of a specificservice encounter (Bolton and Drew, 1991;Cronin and Taylor, 1992), satisfaction levelsderived from each service encounter areviewed as having an effect on image assess-ments. Image is, therefore, viewed as cumula-tive construct that is updated each time thecustomer experiences the service. As for theinfluence of perceived service value on corpo-rate image, Barich and Kotler (1991) proposethat a company will have a strong image ifcustomers believe that they are getting highvalue when they buy from it. Accordingly, anumber of factors such as good products andservices and reasonable prices are said toinfluence value judgements.
[ 56 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
Although there appears to be a lack of con-sensus in the literature on how to define andoperationalize the image construct, the viewtaken in this paper is that the overall image ofthe service firm is influenced by perceivedservice quality, customer satisfaction, and byperceived service value. These links have notbeen the object of much attention in the liter-ature and in our view merit investigation.Indeed, understanding the role of corporateimage in the customer retention decisionboth as an antecedent and consequence is akey issue that has received little attention inthe service marketing arena. Hence, the fol-lowing previously untested hypotheses areproposed:
H3: Higher levels of perceived service qual-ity lead to favourable customer assess-ments of corporate image.
H4: Higher levels of customer satisfactionlead to favourable customer assess-ments of corporate image.
H5: Higher levels of perceived service valuelead to favourable customer assess-ments of corporate image.
Customer loyaltyWhile products have been the focus of atten-tion in research aimed at defining and mea-suring customer loyalty, the construct is alsoof importance for services (Dick and Basu,1994). In the literature, brand loyalty hasmany definitions and related measurements.Indeed, Jacoby and Chestnut (1978), in theirreview of the literature, report 53 differentdefinitions of the construct. Even though thetypically loyal customer can be described asthe one who repeats purchases, brand loyaltycannot always be measured by purchasebehaviour since the decision to buy a brandcan be influenced by other moderating vari-ables such as social norms (Ajzen and Fish-bein, 1980) and situational factors (Smith andSwinyard, 1983). Similarly, a psychologicaldimension expressed in the form of an atti-tude or preference must also be includedwithin the concept. In so doing, this yields amore comprehensive view of loyalty. Indeed,Dick and Basu (1994), in their conceptualframework of customer loyalty, propose thatloyalty is greatly affected by the relativestrength of the relationship between attitudeand behaviour. According to Sheth and Park(1974) it is preferable to analyse purchasebehaviour that is repeated in contexts wherethe customer experiences competitive pres-sures aimed at changing buying habits. Fromthis perspective loyalty truly exists when thecustomer resists pressures to switch toanother brand (Newman and Werbel, 1973;Woodside et al., 1980).
The link between customer satisfaction andloyalty has been acknowledged in the litera-ture. Indeed, Fornell (1976) reports that satis-faction positively affects customer loyalty.Similarly, in their study on household goods,Newman and Werbel (1973) report that satis-fied customers are more loyalty prone. Ander-son and Sullivan (1993), for their part, foundthat repurchase intentions were positivelyinfluenced by satisfaction across productcategories, and that customers were morelikely to be retained as satisfaction increased.In a similar vein, Woodside et al. (1989) founda significant association between overallpatient satisfaction and their intent to choosethe hospital again. The positive effect of cus-tomer satisfaction on brand loyalty is alsonoted by LaBarbera and Mazursky (1983) andKasper (1988). Oliva et al. (1992) found thatwhen satisfaction with services went above acritical point customer loyalty also increased.To achieve customer service loyalty, theauthors maintain that all service encountersoffer an opportunity to provide superiorservice and to distinguish the firm from itscompetitors. Consequently, customer satisfac-tion is considered to be an antecedent to ser-vice loyalty.
Service quality has also been described ashaving the potential to impact on serviceloyalty. Fornell (1992) notes that high qualityleads to high levels of customer retentionwhich in turn are strongly related to prof-itability. Moreover, Bitner (1990) suggests thata high level of service quality will lead toservice loyalty. This view is shared by Dickand Basu (1994) who propose that marketingcommunications that accentuate customers’beliefs with regard to the service qualitydimensions identified by Parasuraman et al.(1988) should lead to repeat patronage. Aservice firm that offers prompt and reliableservice to its customers, for example,increases the probability of positive word ofmouth and repeat visits. Boulding et al.(1993), add their voice on this issue and sug-gest that service quality has a positive effecton behavioural outcomes such as loyalty.Service quality has, therefore, the potential toaffect service loyalty positively. At this stage,it is interesting to note that customers’ behav-ioural intentions have often been used assurrogate indicators of the loyalty construct.Fornell (1992), for example, measured loyaltywith items that capture repurchase intentionsand the price differential needed to makeloyal customers switch. Recently, Zeithaml etal. (1996) used a set of five behavioural out-come variables namely: saying positive thingsabout a company to others, recommending thecompany to someone else, encouragingfriends and relatives to do business with a
[ 57 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
company, considering the company the firstchoice from which to buy services, and doingmore business with the company in the nextfew years, to define and measure serviceloyalty. Moreover, despite the fact that littleresearch has investigated the relationship,customers’ overall assessment of corporateimage is also deemed to influence customerloyalty (Reynolds et al., 1974-1975). Indeed, thenotion that a favourable store image caninfluence repeat patronage has been proposedby Dick and Basu (1994). Based on thereported research, the following hypothesesare proposed:
H6: Higher levels of customer satisfactionlead to service loyalty.
H7: Higher levels of perceived service qual-ity lead to service loyalty.
H8: Favourable evaluations of corporateimage lead to service loyalty.
The eight hypotheses presented form a modelin which perceived service quality and cus-tomer satisfaction have a direct effect onperceived service value, corporate image andservice loyalty. In addition, perceived servicevalue has an impact on corporate image, andin turn image has a direct effect on serviceloyalty.
Method
SampleThe model was tested in banking serviceswith data collected from the customers of acredit union. The credit union is a majorbanking institution located in the majorcities and it ranks amongst the top five in thechosen areas. In all, a total of 12 branchesparticipated in the study. These city brancheswere located within close proximity to theother major banking institutions and werefacing strong competition for market share. Itwas therefore believed that the nature of thiscompetition would provide for better mea-sures of service loyalty, since customers hadthe choice to patronize a number of compet-ing institutions located in the immediateareas. A self-administered questionnaire,accompanied by a letter from the president ofthe credit union, was mailed to 2,500customers, a systematic probability sampletaken from the list of names provided by thecredit unions. Customers were instructed tocomplete the questionnaire and to return itwithin a three week period in a self addressedpostage paid envelope provided for the study.No follow-up letters were sent and tests ofearly versus late respondents were not per-formed. From the sample, a total of 1,224 com-pleted questionnaires were returned withinthis time frame. This represents a 49 per cent
response rate and is considered acceptablefor this type of survey method (Malhotra,1996).
MeasurementThe review of the literature, personal inter-views held with the directors of the creditunion, and two focus group interviews heldwith the customers of the banking institutionprovided the basis for the generation of theitems used to measure each of the constructsunder study. Items were selected based princi-pally on their relative importance tocustomers evaluating the financial institu-tion and its services during the group inter-views. Customer satisfaction was measuredwith the use of two items that captured cus-tomers’ overall satisfaction with the financialinstitution and customer’s overall satisfac-tion with the services offered by the institu-tion. This overall satisfaction measure agreeswith the work reported by Teas (1993) andDabholkar (1993) who propose that customersatisfaction and service quality can be exam-ined at both the transaction-specific andglobal perspectives. Studies on customersatisfaction with services have traditionallymeasured the construct with single itemmeasures (Bitner, 1990; Bolton and Drew, 1991;Cronin and Taylor, 1992). However, theapproach taken in this study favours a multi-item approach which is somewhat similar tothe work on satisfaction-loyalty undertakenby Oliva et al. (1992). Customer satisfactionwas measured, therefore, with a two itemseven-point Likert-type scale with anchors ofvery dissatisfied (1) and very satisfied (7).Similarly, the items friendly and courteousstaff, reliable and discreet staff, and speed ofservice formed the perceived service qualityscale. These items are part of the SERVQUALscale developed by Parasuraman et al. (1988),and were chosen because they were judged bycustomers to be the most pertinent in theirevaluation of service encounter quality. In thestudy, these three items captured customers’performance based evaluations of servicequality. This approach agrees with Carman(1990) and Cronin and Taylor (1992) who con-sider performance based measures of servicequality as superior.
Two indicators, the degree to which inter-est rates were judged to be competitive andthe customers’ belief that management hadtheir best interest at heart, measured per-ceived service value. These items were judgedto be good indicators of value in the context ofa credit union, where customers are partowners of the institution. In this context, theability of the financial institution to offercompetitive rates was considered bycustomers to be a good indicator of the give
[ 58 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
and take component of service value (Boltonand Drew, 1992; Zeithaml, 1988). Although itcould be argued that competitive rates is aquality indicator, the interest charged onloans usually represent what is given by thecustomer for value and the financial institu-tion’s ability to offer good rates to memberswas judged to represents low price, wantsatisfaction, and a form of quality receivedfor the price paid in interest payments. Simi-larly, it can be argued that the rates paid oninvestments comprise the get component ofvalue, a type of quality that is received fromthe institution for the price paid to be a partof this co-operative form of organization. Itcan also be argued that from the customers’perspective, management’s concern for theirbest interest is want satisfaction and a part ofservice value that affects the customer’s over-all service experience with the financial insti-tution (Holbrook, 1986). As such, these twoitems were considered to reflect and regroupZeithaml’s (1988) definition of the value con-struct.
A multi-item approach was also taken tomeasure the corporate image construct.Although there appears to be a lack of consen-sus in the literature on how to best define andoperationalize the image construct, duringthe focus group interviews, two variables,namely the co-operative nature of the creditunion and its corporate identity, were judgedby customers to be good indicators of theimage reflected by the banking institution.Indeed, in credit unions customers are partowners; they share in profits and have a voicein the selection of managing directors and themembers of the Board of Directors. This co-operative philosophy is distinct from that ofbanks and influences the positioning state-ment of the institution. Consequently, the co-operative nature of the credit union formedthe first measure of the image construct. Inaddition, since this credit union serves aminority ethnic group, linguistic and cul-tural identity was judged to be an importantaspect of corporate identity and formed thesecond aspect of the corporate image con-struct. In the literature, although identityand corporate image are often used inter-changeably, Abratt (1989) stresses that corpo-rate identity is an index of the physical andbehavioural indicators conceived and con-trolled by a company, while corporate imageis a global impression, an attitude, formed inthe minds of customers. Therefore, corporateidentity was measured in relation to the lin-guistic and cultural nature of the customersthe credit union strives to serve. Finally,regarding the measure of service loyalty, twobehavioural intentions items were used assurrogate indicators of loyalty, namely the
customer’s intention to recommend the finan-cial institution to others, and the customer’spreference of the credit union to other finan-cial institutions. These two items were takenfrom the work reported by Zeithaml et al.(1996) who used a word of mouth and a prefer-ence item to measure behavioural intentionsin a study of four companies that provideservices to end or business customers. Withthe exception of customer satisfaction, all ofthe aforementioned constructs were mea-sured with the use of a seven-point Likert-type agreement scale with anchors ofstrongly disagree (1) and strongly agree (7).The items used for the customer satisfaction,service quality, value, corporate image, andcustomer loyalty constructs are presented inthe Appendix.
The scales used in this study were purifiedbased on item-total correlations. For a gen-eral-purpose scale, it is suggested to retainonly the items with a minimum item-totalcorrelation of 0.25 (Nunnally, 1978). The item-total correlations of all scale items weregreater than 0.55 (from 0.56 to 0.93). Asreported in Table I, the Cronbach’s alpha forthe scales used in the study ranged from 0.66to 0.88. In addition, discriminant validitybetween the customer satisfaction and ser-vice quality constructs was tested based onFornell and Larcker’s (1981) criterion. Thiscriterion involves computing, for each con-struct, the amount of variance extracted, andcomparing it with the variance shared byboth constructs. In this case, the varianceextracted by the satisfaction and qualityconstructs was estimated as 0.78 and 0.49respectively. These values are greater thanthe variance shared between the two con-structs, 0.13. Consequently, the Fornell andLarcker’s (1981) criterion for discriminantvalidity is satisfied. Figure 2 presents themodel and its indicators.
Analysis and results
The assessment of the measurement proper-ties of the scales and the test of the hypothe-sized relationships presented in the concep-tual model were undertaken with the use ofLISREL 8 (Joreskog and Sorbom, 1993). Themeasurement model was first assessed withconfirmatory factor analysis and the hypothe-sized relationships tested with the structuralequation model. In this study, the sample sizeof, 1,224 respondents was considered suffi-cient for this type of analysis (Bagozzi and Yi,1988).
Measurement modelThe results of the parameter estimates arepresented in Table I. The values of the
[ 59 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
standard errors associated with the maxi-mum likelihood estimates are low, and thefactor loadings are equal to or greater than0.70. In other respects, the error variances aresmall and the squared multiple correlationsare relatively high with the exceptions of Y2and Y3. These results appear to provideevidence supportive of the measures and
indicate that the structural model can beevaluated.
Structural modelThe test of the model first revealed that twopaths, satisfaction-image and quality-loyalty,were insignificant. Consequently, the mea-surement model was estimated without these
Table IParameter estimates for the measurement model
Error varianceCronbach’s λ Standard error (δ or ∈ ) R2
Construct alpha Variance extracted Indicators I II I II I II I IICustomer X1 0.96 0.93 0.03 0.03 0.24 0.28 0.76 0.72satisfaction (ξ1) 0.88 0.78 X2 1.00a 1.00 – – 0.17 0.17 0.83 0.83
Notes:a λ for X2, X5, Y1, Y4, and Y5 fixed to 1.00I = First model parameter estimatesII = Second model parameter estimates
X1 = overall satisfaction with institution Y1= interest rates are competitiveX2 = overall satisfaction with services Y2 = management has customer’s best interest at heartX3 = friendly and courteous staff Y3 = cooperative institutionX4 = reliable and discreet staff Y4 = corporate identity(linguistic and cultural)X5 = speed of service Y5 = intention to recommend
Y6 = preference of institution
Perceivedvalue of service
η1
Customersatisfaction
ξ1
Servicequality
ξ2
Corporateimage
η2
Customerloyalty
η3
y5
y6
y4y3
λ9λ8
y2y1
λ7λ6
x3
λ3
x4
λ4
x5
λ5
x1 x2
λ1 λ2
β21 β32
ζ3
ζ2
ζ1
φ12
Y11 Y21
Y31
Y12Y22
Y32
λ10
λ11
Figure 2The hypothesized model and its indicators
[ 60 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
paths and in this case proved to be signifi-cant. Therefore, in order to allow for compari-son, the results will be presented for bothmodels, i.e. I: First Model Estimates; II: Sec-ond Model Estimates.
Table II shows that the overall fit indices forthe proposed structural model were χ2 = 49.62with 34 degrees of freedom, p = 0.041, AGFI =0.99 with a root mean square residual of 0.021.The χ2 value indicates that the model does notfit the data (see Table II – I: first model esti-mates). In this case the two paths satisfaction-image and quality-loyalty are insignificant.These two paths were subsequently removedand a second test of the structural modelattempted with the same indicators. In thissituation, the structural model fit the data.The fit indices were χ2 = 39.96 with 36 degreesof freedom, p = 0.298, AGFI = 0.99 with a rootmean square residual of 0.022. (see Table II –II: second model estimates). The values of theparameter estimates and the t-statistics forthe two verifications are shown in Table II.
Hypotheses 1 and 2: satisfaction, qualityand value Customer satisfaction and service qualitywere found to be positively related to servicevalue as predicted (H1:γ11 = 0.12, t = 4.83;H2:γ12 = 0.62, t = 14.84). The results show thatquality exerts a stronger influence on servicevalue than does customer satisfaction. Thisfinding supports the work conducted byBolton and Drew (1991) who found quality to
be the most important determinant of value.As such, it also agrees with Zeithaml’s (1988)view on value in that value is a higher orderconstruct determined in part by customers’judgements about quality. In addition, theresults support the existence of a significantrelationship between satisfaction and quality(Taylor and Baker, 1994), but the strength ofthis association was lower than expected (φ12= 0.13, t = 5.70).
Hypothesis 3: quality and corporate image The path between service quality and corpo-rate image was statistically significant andsupports hypothesis 3 (H3:γ22 = 0.18, t = 2.88).This finding suggests that customers receiv-ing higher levels of service quality duringservice delivery will form a favourable over-all image of the financial institution (How-croft and Davis, 1986). What the customerreceives and the manner in which it isreceived, therefore, determine image evalua-tions (Gronroos, 1984). Quality was also foundto have an indirect effect on image via per-ceived service value (effect = 0.44, t = 8.53).
Hypothesis 4: satisfaction and corporateimageThe relationship between satisfaction andimage was not significant. Although this linkhas not previously been tested, the resultsnonetheless show that overall satisfactionhas an indirect effect on image via servicevalue (effect = 0.09, t = 5.39).
Table IIParameter estimates for the structural model
LISREL Estimate Standard error t-valueParameter I II I II I II
Notes:I: First model estimates II: Second model estimates
Goodness of fit index 0.99 0.99Adjusted goodness of fit index 0.99 0.99Root mean square residual 0.021 0.022Chi-square 49.62 39.96Degrees of freedom 34 36Coefficient of determination 0.81 0.77
[ 61 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
Hypothesis 5: value and corporate imageThe hypothesized relationship between ser-vice value and corporate image was found tobe statistically significant (β21 = 0.72, t = 9.87).This finding supports H5 and suggests thatthe financial institution should have a strongimage when its customers believe they aregetting high value from the services theyreceive (Barich and Kotler, 1991), a conse-quence of competitive interest rates and theknowledge that management has their bestinterest at heart.
Hypothesis 6: satisfaction and loyalty Proposition 6 hypothesized that levels ofcustomer satisfaction are related positively toservice loyalty. This hypothesis wassupported (H6:γ31 = 0.79, t = 27.04), indicatingthat when satisfied with services received,the customers of the financial institutionwere more likely to be loyalty prone (New-man and Werbel, 1973). This positive effect ofsatisfaction on loyalty supports previousstudies that have investigated the relation-ship (Anderson and Sullivan, 1993; Gotlieb etal., 1994; Kasper, 1988; LaBarbera andMazursky, 1983; Oliva et al., 1992).
Hypothesis 7: quality and loyaltyAlthough a positive relation between servicequality and loyalty was expected (Boulding etal., 1993; Dick and Basu, 1994; Fornell, 1992;Zeithaml et al., 1996), the path between qual-ity and loyalty was not significant. This find-ing appears to suggest that when a customerbecomes a member of a credit union, repeatpurchases may not be based on evaluations oftransaction-specific quality but rather ontheir sense of belonging or commitment tothe organization (Kelley and Davis, 1994) bymeans of corporate image. In this situation,to customers, image represents the co-opera-tive nature of the organization and the factthat it is positioned to serve the needs of aminority ethnic group. Therefore, loyalty tothis form of co-operative organization is afunction of corporate image and customers’overall satisfaction.
Hypothesis 8: corporate image and loyaltyThe final proposed relationship between cor-porate image and service loyalty was sup-ported (β32 = 0.14, t = 2.33). This finding sug-gests that customers who form a positive over-all impression of the image of the financialinstitution are more likely to prefer the orga-nization and recommend it to others.Although little research has been reported onthe link between customers’ assessments ofimage and service loyalty, Dick and Basu(1994) stress that a favourable store image can positively affect repeat patronage. As
previously noted, only two indirect effectswere found to be significant, namely customersatisfaction on corporate image via perceivedvalue (effect = 0.09, t = 5.39), and perceivedquality on corporate image via perceivedvalue (effect = 0.44, t = 8.53).
Discussion and implications
Previous studies have focused mainly oncustomer satisfaction and service quality todescribe customers’ assessments of service.For the most part, the work reported hasinvestigated the cues that signal service qual-ity to customers, the determinants of satisfac-tion, and the effect of customer satisfactionand service quality on purchase intentions.The present research contributes to the bodyof knowledge by proposing and testing a con-ceptual model that considers customer satis-faction, service quality, and value asantecedents to image assessments and cus-tomer loyalty towards the service firm.Understanding how customers’ overallassessments of services impact on serviceloyalty has important managerial implica-tions in the present competitive environmentgiven the potential effect on future profits ofbehavioural outcomes. As such, the study isunique in that it presents an overall approachto service evaluations which investigates aset of previously untested relationships.
Several potential limitations of the studyshould first be noted before discussing theimplications. First and foremost, the datawere collected from a sample of customerstaken from 12 branches of a credit union. Assuch, credit unions have an operating philos-ophy that is distinct from that of banks, andthe study does not allow for the generaliza-tion of the findings to all financial institu-tions or across service sectors. In otherrespects, although the data allow for the veri-fication of the hypothesis at one point in time,they are not an absolute proof of causality.The efficacy of the items used to measure theconstructs under investigation must also beconsidered. In the study, their selection wasbased on the review of the literature and onpersonal interviews held with the customersof the financial institution. However, at thisstage, the identification of the indicators thatbest represent the constructs continues tochallenge researchers in the field.
Managerial implicationsIn the first instance, the study shows thatcustomer satisfaction has a direct bearing onvalue and service loyalty. Given this finding,service managers should ensure that perfor-mance levels on all components of the service
[ 62 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
delivery system meet customer expectationsof service. In effect, the management andmonitoring of service encounters should leadto customer satisfaction. Contact personnelmust be trained and made to understandtheir role as relationship managers; andmanagement, by continuously focusing onthe importance of strong relationship market-ing, should increase the probability of cus-tomer satisfaction and service loyalty. More-over, to ensure customer satisfaction, contactpersonnel should be empowered to deal effec-tively with problems should opportunities forservice recovery arise. In this respect, servicecustomers should derive more value from theservice experience.
The results also confirm that service qual-ity leads to service value and favourable per-ceptions of corporate image. Based on thisfinding, service managers, in conjunctionwith contact personnel, must set qualitystandards that guarantee both the functionaland technical quality of services. Given thatcontact personnel are an important part offunctional quality, i.e. the manner in whichthe service is provided to customers, internalmarketing efforts must be directed at person-nel to convince them that quality is part oftheir jobs. Indeed, the offering of friendly andreliable service to customers over timeshould be a key objective. Similarly, servicemanagers in order to ensure prompt servicemust control the technical quality of services,i.e. what the customer gets as a consequenceof his interactions with the financial institu-tion. In this instance, service managersshould analyse every facet of the servicedelivery process and ensure that personnelcan offer good technical solutions tocustomers. Moreover, the process by whichservices are offered to customers shouldcontinuously be monitored to guarantee thatcustomers have access to services at all times.
Customers’ assessment of service value wasalso found to impact on the image of the finan-cial institution. In the context of this study,customers believe that they are getting highvalue when interest rates are competitive andmanagement has the customers’ best interestsat heart. Given this finding, managementshould ensure their availability to customers;and dealings with customers should be con-ducted in a consistent, caring and professionalmanner in order to add value to services. Inaddition, in order to position the financialinstitution in the competitive environment,management should ensure that both theutilitarian and experiential benefits derivedfrom service consumption are continuouslypromoted to customers. Indeed, convincing
customers that they are getting high valuefrom the financial institution should be a keyadvertising objective.
Customer satisfaction and overall imageassessments were found to affect positivelyservice loyalty. This indicates that in order todistinguish the offering from that of competi-tors, all service encounters must be viewedby management as opportunities to providesuperior service. The offering of reliable,error-free financial transactions should thusreinforce customers’ confidence in the finan-cial institution, and favourable attitude in theform of image assessments should motivatecustomers to resist competitive offerings. Asa consequence, marketing communicationsshould stress the overall benefits provided bythe financial institution.
Research implicationsFuture research might consider the relation-ships proposed in the present conceptualframework at various stages of service con-sumption. A better knowledge of how cus-tomer satisfaction, service quality, and valueinteract to influence image assessments andloyalty at the pre-consumption, consumptionand post-consumption stages promises toprovide useful insights for formulating com-petitive strategy. Future studies could alsotake into account such variables as serviceautomation, service usage patterns, and mar-ket segmentation when testing the proposedframework. Other moderating influencesaffecting corporate image and service loyaltymight also exist and could be included infuture studies. For example, given that ser-vices are intangible in nature, investigatinghow environmental cues impact on serviceevaluations appears warranted. Researchmight also investigate the relationships inthe framework on a longitudinal basis andacross service industries in order to betterunderstand how customers’ expectations andevaluations of service vary over time in vari-ous service environments. Additionalresearch is also needed to better grasp andunderstand the relationships that existbetween customer satisfaction, service qual-ity, and value. Although significant work hasbeen reported on these three major forms ofservice evaluations, the precise nature of theinteractions that exist between the constructsand their effect on image and service loyaltyremain key challenges for the academy.Addressing these service issues and broaden-ing customers’ assessments of service toinclude image and service loyalty promise tolead to a better understanding of customerbehaviour and behavioural outcomes.
[ 63 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
ReferencesAbratt, R. (1989), “A new approach to the corpo-
Ajzen, I. and Fishbein, M. (1980), UnderstandingAttitudes and Predicting Social Behaviour,Prentice-Hall, Englewood Cliffs, NJ.
Anderson, E.W. and Sullivan, M.W. (1993), “Theantecedents and consequences of customersatisfaction for firms”, Marketing Science, Vol. 12, Spring, pp. 125-43.
Bagozzi, R.P. and Yi, Y. (1988), “On the evaluationof structural equation models”, Journal of theAcademy of Marketing Science, Vol. 16, Spring,pp. 74-94.
Baker, J. (1987), “The role of environment in mar-keting services: the consumer perspective”, inCzepiel, J.A., Congram, C.A. and Shanahan, J.(Eds), The Services Challenge: Integrating forCompetitive Advantage, American MarketingAssociation, Chicago, IL, pp. 79-84.
Barich, H. and Kotler, P. (1991), “A framework formarketing image management”, Sloan Man-agement Review, Winter, pp. 94-104.
Bitner, M.J. (1990), “Evaluating service encoun-ters: the effects of physical surroundings andemployee responses”, Journal of Marketing,Vol. 54, April, pp. 69-82.
Bitner, M.J. (1992), “Servicescapes: the impact ofphysical surroundings on customers andemployees”, Journal of Marketing, Vol. 56,April, pp. 57-71.
Bitner, M.J. and Hubbert, A.R. (1994), “Encountersatisfaction versus overall satisfaction versus quality”, in Oliver, R.L. and Rust, R.T.(Eds), Service Quality: New Directions in The-ory and Practice, Sage, Thousand Oaks, CA,pp. 72-94.
Bolton, R.N. and Drew, J.H. (1991), “A multistagemodel of customers’ assessments of servicequality and value”, Journal of ConsumerResearch, Vol. 17, March, pp. 375-84.
Bolton, R.N. and Drew, J.H. (1992), “Mitigating theeffect of service encounters”, MarketingLetters, Vol. 3, pp. 57-70.
Boulding, K.E. (1956), The Image, University ofMichigan Press, Ann Arbor, MI.
Boulding, W., Karla, A., Staelin, R. and Zeithaml,V.A. (1993), “A dynamic process model of ser-vice quality: from expectations to behavioralintentions”, Journal of Marketing Research,Vol. 30, February, pp. 7-27.
Carman, J.M. (1990), “Consumer perceptions ofservice quality: an assessment of theSERVQUAL dimensions”, Journal ofRetailing, Vol. 66 No. 1, pp. 33-55.
Churchill, G.A. Jr and Surprenant, C. (1982), “Aninvestigation into the determinants of con-sumer satisfaction”, Journal of MarketingResearch, Vol. 19, November, pp. 491-504.
Cronin, J.J. and Taylor, S.A. (1992), “Measuringservice quality: a reexamination and exten-sion”, Journal of Marketing, Vol. 56, July, pp. 55-68.
Cronin, J.J. and Taylor, S.A. (1994), “SERVPERFversus SERVQUAL: reconciling performance-based and perceptions-minus-expectationsmeasurement of service quality”, Journal ofMarketing, Vol. 58, January, pp. 125-31.
Crosby, L., Evans, K.R. and Cowles, D. (1990),“Relationship quality in services selling: aninterpersonal influence perspective”, Journalof Marketing, Vol. 54, July, pp. 68-81.
Dabholkar, P.A. (1993), “Customer satisfaction andservice quality: two concepts or one?”, Pro-ceedings American Marketing Association,Summer, pp. 10-18.
Day, R. (1977), “Extending the concept ofconsumer satisfaction”, Advances in Con-sumer Research, Vol. 4, pp. 149-54.
Dick, A. and Basu, K. (1994), “Customer loyalty:toward an intergrated conceptual frame-work”, Journal of Academy of MarketingScience, Vol. 22 No. 2, pp. 99-113.
Donovan, R.J. and Rossiter, J.R. (1982), “Storeatmosphere: an environmental psychologyapproach”, Journal of Retailing, Vol. 58 No. 1,pp. 34-57.
Dowling, G.R. (1988), “Measuring corporateimages: a review of alternative approaches”,Journal of Business Research, Vol. 17, pp. 27-34.
Erickson, G.M., Johannson, J.K. and Chao, P.(1984), “Image variables in multiattributeproduct evaluations: country-of-origineffects”, Journal of Consumer Research, Vol. 11, pp. 694-9.
Fornell, C. (1992), “A national customer satisfac-tion barometer: the Swedish experience”,Journal of Marketing, Vol. 56, January, pp. 6-21.
Fornell, C. and Larcker, D. (1981), “Evaluatingstructural equation models with unobserv-able variables with measurement error”,Journal of Marketing Research, Vol. 18, February, pp. 39-50.
Garvin, D.A. (1984), “What does product qualityreally mean”, Sloan Management Review, Vol. 26 No. 1, pp. 25-43.
Golden, L.L., Albaum, G. and Zimmer, M. (1987),“The numerical comparative scale: an eco-nomical format for retail image measure-ment”, Journal of Retailing, Vol. 63 No. 4,pp. 393-411.
Gotlieb, J.B., Grewal, D. and Brown, S.W. (1994),“Consumer satisfaction and perceived qual-ity: complementary or divergent constructs,”Journal of Applied Psychology, Vol. 79,pp. 875-85.
Gronroos, C. (1990), Service Management andMarketing, Lexington, Toronto.
Gronroos, C. (1984), “A service quality model andits marketing implications”, EuropeanJournal of Marketing, Vol. 18 No. 4, pp. 36-44.
Hauser, J.R. and Urban, G. (1986), “The valuepriority hypothesis for consumer budgetplans”, Journal of Consumer Research, Vol. 12,March, pp. 446-62.
[ 64 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
Hirschman, E.C., Greenberg, B. and Robertson,D.H. (1978), “The intermarket reliability of retail image research: an empirical exami-nation,” Journal of Retailing, Vol. 54, pp. 3-12.
Holbrook, M.B. (1986), “Emotion in the consump-tion experience: toward a new model of thehuman consumer”, in Peterson, R. et al. (Eds),The Role of Affect in Consumer Behavior:Emerging Theories and Applications, Lexing-ton Books, Lexington, MA, pp. 17-52.
Holbrook, M.B. (1994), “The nature of customervalue: an axiology of services in the consump-tion experience”, in Oliver, R.L. and Rust , R.T.(Eds), Service Quality: New Directions inTheory and Practice, Sage, Thousand Oaks,CA, pp. 21-71.
Holbrook, M.B. and Corfman, K.P. (1985), “Qualityand value in the consumption experience:Phaedrus rides again”, in Jacoby, J.R.W. andOlson, J.C. (Eds), Perceived Quality, LexingtonBooks, Lexington, MA, pp. 31-57.
Howcroft, J.B. and Davis, J. (1986), “Image inretail banking”, International Journal ofBank Marketing, Vol. 4 No. 4, pp. 3-13.
Jacoby, J.R.W. and Chesnut, R. (1978), BrandLoyalty Measurement and Management, JohnWiley & Sons, New York, NY.
Joreskog, K.G. and Sorbom, D. (1993), LISREL 8User’s Reference Guide, Scientific SoftwareInternational, Chicago, IL.
Kasper, H. (1988), “On problem perception, dissat-isfaction, and brand loyalty”, Journal ofEconomic Psychology, Vol. 9, September,pp. 387-97.
Kennedy, S.H. (1977), “Nurturing corporateimage”, European Journal of Marketing, Vol. 11 No. 3, pp. 120-64.
Laaksonen, M. (1993), “Retail patronage dynam-ics: learning about daily shopping behaviorin contexts of changing retail structures”,Journal of Business Research, Vol. 28 Nos 1,2,pp. 3-174.
LaBarbera, P.A. and Mazursky, D. (1983), “A longi-tudinal assessment of consumer satisfac-tion/dissatisfaction: the dynamic aspect ofthe cognitive process”, Journal of MarketingResearch, Vol. 20, November, pp. 393-404.
LeBlanc, G. and Nguyen, N. (1988), “Customers’perceptions of service quality in financialinstitutions”, The International Journal ofBank Marketing, Vol. 6 No. 4, pp. 7-18.
MacInnis, D.J. and Price, L.L. (1987), “The role ofimagery in information processing: reviewand extensions”, Journal of ConsumerResearch, Vol. 13, pp. 473-91.
Mazursky, D. and Jacoby, J. (1986), “Exploring thedevelopement of store images”, Journal ofRetailing, Vol. 62 No. 2, pp. 145-65.
Newman, J. and Werbel, R. (1973), “Multivariateanalysis of brand loyalty for major householdappliances”, Journal of Marketing Research,Vol. 10, pp. 404-9.
Oliva, T., Oliver, R. and MacMillan, I.C. (1992), “Acatastrophe model for developing servicesatisfaction strategies”, Journal of Marketing,Vol. 56, July, pp. 83-95.
Oliver, R.L. (1980), “A cognitive model of theantecedents and consequences of satisfactiondecisions”, Journal of Marketing Research,Vol. 17 November, pp. 460-9.
Oliver, R.L. (1981), “Measurement and evaluationof satisfaction processes in retail settings”,Journal of Retailing, Vol. 57 No. 3, pp. 25-47.
Oliver, R.L. and DeSarbo, W.S. (1988), “Responsedeterminants in satisfaction judgments”,Journal of Consumer Research, Vol. 14, March,pp. 495-507.
Oliver, R.L. and Swan, J.E. (1989), “Equity anddisconfirmation perceptions as influences onmerchant and product satisfaction”, Journalof Consumer Research, Vol. 16, December,pp. 372-83.
Parasuraman, A., Zeithaml, V.A. and Berry, L.L.(1985), “A conceptual model of service quality and its implications for futureresearch”, Journal of Marketing, Vol. 49 No. 4,pp. 41-50.
Parasuraman, A., Zeithaml, V.A. and Berry, L.L.(1988), “SERVQUAL: a multiple-item scale formeasuring customer perceptions of servicequality”, Journal of Retailing, Vol. 64, Spring,pp. 12-40.
Parasuraman, A., Zeithaml,V.A. and Berry, L.L.(1994), “Reassessment of expectations as acomparison standard in measuring servicequality: implications for further research”,Journal of Marketing, Vol. 58, January,pp. 111-24.
Reynolds, F.D., Darden, W.R. and Martin, W.S.(1974-75), “Developing an image of the store-loyal customer”, Journal of Retailing, Vol. 50No. 4, pp. 73-84.
Reynolds, T.J. and Gutman, J. (1988), “Ladderingtheory method analysis and interpretation”,Journal of Advertising Research, Vol. 28,pp. 11-31.
Rust, R.T. and Oliver, R.L. (1994), “Service quality:insights and managerial implications fromthe frontier”, in Oliver, R.L. and Rust , R.T.(Eds), Service Quality: New Directions inTheory and Practice, Sage, Thousand Oaks,CA, pp. 1-20.
Sawyer, A.G. and Dickson, P. (1984), “Psychologi-cal perspectives on consumer responses tosales promotion”, in Jocz, K. (Ed.), Researchon Sales Promotion: Collected Papers, Market-ing Science Institute, Cambridge, MA.
Sheth, J. and Park, W. (1974), “A theory of multidi-mensional brand loyalty”, Proceedings, Asso-ciation for Consumer Research, pp. 449-59.
[ 65 ]
Nha Nguyen andGaston LeBlancThe mediating role of corporateimage on customers’ retentiondecisions: an investigation infinancial services
International Journal ofBank Marketing16/2 [1998] 52–65
Sheth, J.N., Newman, B.I. and Gross, B.L. (1991),“Why we buy what we buy: a theory of con-sumption values”, Journal of BusinessResearch, Vol. 22, pp. 159-70.
Smith, R.E. and Swinyard, W.R. (1983), “Attitudebehavior consistency: the impact of producttrial versus advertising”, Journal ofMarketing Research, Vol. 20, August, pp. 257-67.
Spreng, R.A. and Mackoy, R.D. (1996), “An empiri-cal examination of a model of perceived ser-vice quality and satisfaction”, Journal ofRetailing, Vol. 72 No. 2, pp. 201-14.
Spreng, R.A. and Olshavsky, R.W. (1993), “A desirescongruency model of consumer satisfaction”,Journal of the Academy of Marketing Science,Vol. 21 No. 3, pp. 169-77.
Taylor, S.A. and Baker T.L. (1994), “An assessmentof the relationship between service qualityand customer satisfaction in the formation ofconsumers’ purchase intentions”, Journal ofRetailing, Vol. 72 No. 2, pp. 163-78.
Teas, K.R. (1993), “Expectations performance evaluations and consumers’ perceptions ofquality”, Journal of Marketing, Vol. 57, October,pp. 18-34.
Tse, D.K. and Wilton P.C. (1988), “Models of consumersatisfaction formation: an extension”, Journalof Marketing Research, Vol. 25, May, pp. 204-12.
Woodside, A.G., Frey, L.L. and Daly, R.T. (1989),“Linking service quality, customer satisfac-tion, and behavioral intention”, Journal ofHealth Care Marketing, Vol. 9 No. 4, pp. 5-17.
Woodside, A.G., Sharma, A. and Bearden, W.(1980), “A dollarmetric approach for estimat-ing consumer brand loyalty”, Proceedings,American Marketing Association, pp. 73-85.
Yuille, J.C. and Catchpole, M.J. (1977), “The role ofimagery in models of cognition”, Journal ofMental Imagery, Vol. 1, pp. 171-80.
Zeithaml, V.A. (1988), “Consumer perceptions ofprice, quality, and value: a means-end modeland synthesis of evidence”, Journal ofMarketing, Vol. 52, July, pp. 2-22.
Zeithaml, V.A., Berry, L.L. and Parasuraman, A.(1996), “The behavioral consequences of ser-vice quality”, Journal of Marketing, Vol. 60,April, pp. 31-46.
Zimmer, M.R. and Golden, L.L. (1988), “Impres-sion of retailing stores: a content analysis ofconsumer images”, Journal of Retailing, Vol.64 No. 3, pp. 265-93.
Appendix: items for customer satisfaction,service quality, value, corporate image andcustomer loyalty scalesCustomer satisfactionX1: Overall, how satisfied are you with your
credit union?
X2: Overall, how satisfied are you with thearray of services offered by your creditunion?
Service qualityX3: The staff at my credit union is friendly
and courteous.
X4: The staff at my credit union is reliable anddiscreet.
X5: At my credit union, services are offered ina timely manner.
ValueY1: My credit union offers competitive rates
on loans and deposits.
Y2: At my credit union, I believe that manage-ment has the customer’s best interests atheart.
Corporate imageY3: I like the co-operative form of organisa-
tion that my credit union adheres to.
Y4: I like the fact that my credit union servesmostly the customers that belong to mylinguistic and cultural community.
Customer loyaltyY5: I have the intention of recommending my
credit union to others.
Y6: I prefer my credit union to other bankinginstitutions.
