An empirical investigation of the relative effect of trust and switching costs on brand loyalty in the UK retail banking industry

El-Manstrly, D., Paton, R. , Veloutsou, C. and Moutinho, L. (2011) An empirical investigation of the relative effect of trust and switching costs on brand loyalty in the UK retail banking industry. Journal of Financial Services Marketing, 16(2), pp. 101-110. (doi: 10.1057/fsm.2011.9)

Abstract

The crisis in the UK financial services industry has led to retail banking customers treating transactions with growing scepticism. Retail banks are having to work very hard to regain customer trust. Despite recent research in marketing that acknowledges the importance of service loyalty to service firms, studies that have examined the relative effects of trust and the different types of switching costs on attitudinal and behavioural loyalty are scant. Therefore this article aims to build a model to examine the strength of the relationships between these constructs. Using survey data collected from a convenience sample of 290 retail banking customers in the United Kingdom, the article reveals that the main drivers of attitudinal loyalty are trust and relational switching costs. In contrast, the main drivers of behavioural loyalty are trust, relational switching costs and attitudinal loyalty. Interestingly, financial and procedural switching costs exert no significant effect on either attitudinal or behavioural loyalty. Trust and relational switching costs exert a stronger effect on attitudinal than behavioural loyalty.

• Item Type: Articles
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Paton, Professor Robert and Veloutsou, Professor Cleopatra and Moutinho, Professor Luiz and El-Manstrly, Ms Dahlia
• Authors: El-Manstrly, D., Paton, R., Veloutsou, C., and Moutinho, L.
• Subjects: H Social Sciences > HG Finance
• College/School: College of Social Sciences > Adam Smith Business School > Management
• Journal Name: Journal of Financial Services Marketing
• Journal Abbr.: J. Financ. Serv. Mark.
• Publisher: Palgrave-MacMillan
• ISSN: 1363-0539
• ISSN (Online): 1479-1846