University Sultan Zainal Abidin, Terengganu, MalaysiaMazuri Abd Ghani
University Sultan Zainal Abidin Terengganu, Malaysia
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Purpose: This study aims to inspect the relationship between Customer's Perception of Public Relation (PRP), Customer Perceived Value (CPV) on E-Loyalty; further test the moderating role of Switching Cost and Brand Image in that relationship. Design/methodology/approach: Data were collected in a survey from customers of Commercial Bank. Questionnaire was adapted from research work of Eriksson et al.; Gefen; Levesque et al.; Zeithaml et al. Pearson correlation, multiple and moderating regression were used to examine the hypothesis relationship. Findings: The findings confirm that Customer's Perception of Public Relation and Customer Perceived value are the antecedent of E-loyalty. Moreover, results prevailed that the impact of Customer's Perception of Public Relation and Customer Perceived Value on E-Loyalty is stronger and significant when Switching Cost and Brand image is favorable. Research limitations/implication: Further research is indicated, to identify the effects of these variables on other services provider companies. Banking sector in Pakistan should pay more attention on Customer's Perception of Public Relation, Customer Perceived Value in order to enhance the E-loyalty. Originality/value- This study is the first in its nature, so far there is no research work that reflects on Customer's Perception of Pubic Relation and customer perceived value with moderating effect of switching cost and Brand Image on E-Loyalty. This study contributes to the field of e-commerce marketing and will helpful for managers to adopt appropriate strategies that will lead banking sector towards prosperity.
Customer's Perception of Public Relation, Customer Perceived value, Switching Costs, Customer E-Loyalty, Brand Image, Moderating Regression
In early days before the arrival of conventional banking, there was a system of direct finance where the owner of capital deals directly with user. But with the passage of time it is updated into structured form to fulfill the need of industries and individuals [1-3]. E-commerce is the application of information technology to facilitate business exchanges among different parties. The first online banking services which used internet was established in 1994 by Stanford Federal Credit Union (SFCU). It spreads quickly in the world . Sathye  defines internet banking “it involves provision of facilities such as accessing accounts, funds transfer, and buying financial products or services online”. Internet banking is a banking channel that allows consumers to do a wide range of financial and nonfinancial services through a bank's website [6,7]. According to Shariq , there are as many definitions of the Internet banking as there are researchers. Chaffey  explains that it as a physical network that links computers across the globe. Information technology is using to improve customer services, marketing and the information orientation of the firm [10,11].
Banks are dealing in various transactions like receiving, transferring, paying, lending, and investing in order to achieve consumer’s insights Wolf et al. . As per Domegan ; Earl ; Goetsch ; Liao et al.  one of the major force behind this change is technology. Burgetz  research investigates that internet has great impact on progress of Small medium enterprises. According to Bharadwaj et al. ; Chaffey, ; Shariq  by using technology you can get better information about their customer needs and wants. Furst et al. ; Kardaras et al.  argues that banking sector is the most important sector to analyze and get the advantage by using E-commerce services. As per Orr ; Rahi ; Tan et al.  electronic banking is low cost alternative as compare to traditional banking. Bauer et al. ; Singh et al.  explain internet banking process will helpful for customer satisfaction. Gerrard et al. ; Mattila et al. ; Polatoglu et al. ; Rahi  research focus is on the importance of internet banking Barnes-Vieyra et al. ; Daniel ; Jayawardhena et al. ; Mols ; Zhuang et al.  argue that online transaction is the future of our companies. Loyalty for any products or services have been seen the core element of marketing activities and its promotion [34,35]. Shamma et al.  highlight the importance of customer perceived value in their research with relation to E-loyalty.
Customer’s Perception of Public Relation
L'Etang  narrates, it does not matter how you see your relation with the customer, and the thing matter is you have to see entirely that how customers feel comfort at one place. Ledingham et al.  explain that there are different dimension to see the public relation, it depend on organization systems and its policies, and you can see as a positive or negative point of view of the customer that how they perceive the things. Stone, Woodcock et al.  narrate that it is a situation where both parties get benefits as a company you can get feedback about your product and can improve the quality. Grunig ; Ramkissoon et al.  also highlights the importance of the public relation and proved that it is as essential as other marketing elements.
Botan et al.  describe different dimension of public relation with different theories research suggest that three key elements prior social responsibility like how much you are responsible socially second ethical and at last management issues, moreover research emphasize that without focusing on these three key elements it is impossible to maintain relation with your customer. Pavlik  research also emphasize on public relation theories it summarized whole researcher worker and conclude that public relation is important. Botan et al.  research point out public relation definition and theories of different researcher and suggested that social responsibility has core importance in public relation. Vasquez et al.  also emphasized on social responsibility of the companies. Vasquez et al.  narrate in research that though social responsibility is important however the professional practice is also important. Sen et al.  precisely narrate the concept of self-congruence that how consumer look the things what is the level like is the brand is worth full and the management who is running this brand is responsible, hence if your customer is satisfied about perception certainly it will enhance the degree of acceptance of you product in online system. By reviewing above literature we can propose following hypothesis
H1: Customer’s Perception of Public relation will positively impact on E-Loyalty
Customer Perceived Value
Customer value has various types of element Rahi ; Sweeney et al.  explain that value matter where you have your potential customer and it must be equal to what customer is paying and in return what he is getting. Rahi ; Sheth et al.  argued that there are number of dimension for customer perceived value like functional value where the operation comes, conditional value depend on conditions of the business nature moreover emotional value also matter like your customer intention towards your product hence social value also count and lastly epistemic values. Rahi ; Woodruff  explain the dimension of perceived value, functional value where the intention of purchase evaluate while emotional value where you create curiosity towards particular product and perceive it emotionally however, in this study we will focus on overall perceived value that will focus on complete process from purchase to use and its outcome. Oliver ; Rahi  describe perceived value with linkage of equity theory it include the ratio of outcome/input in both perspective from customer as well as seller point of view. Bolton ; Rahi  also explains customer perceived value it is a process of evaluation that what customer is paying and what they are getting in return moreover perceived value also include monetary and non-monetary concepts like how much time your customer consume, endeavor to find a product and in return what he gets it include all efforts physically to mentally. By reviewing above literature we can propose following hypothesis.
H2: Customer Perceived Value will positively impact on E-Loyalty
E-loyalty is defined as the customer’s favorable attitude toward an electronic business resulting in repeat buying behavior . Hallowell ; Rahi  narrates that customer loyalty is the key factor for your business and if you are doing business online it is more important to gain customer trust for customer loyalty. Customer Loyalty aim is retaining and making the customers loyal towards a brand or a product . Brown  narrates that customer loyalty have always been key factor for enhancing customer experiences, almost every entrepreneur has realized the importance of customer loyalty and know that it is tough to attain a new customer rather than to retain your old customers via customer loyalty. Chaudhuri  customer loyalty directly impact on companies sales and for companies it is essential that they must prioritize their customer needs and wants to make them loyal towards product. Edvardsson et al.  explain that confidence about the product motivate your customer towards customer loyalty moreover the value you are giving to your customer is also enrich the customer loyalty. Hallowell ; Rahi  explain that customer perceived value also impact on customer loyalty. Flavián et al. , explain that loyalty is close to psychological process and commitment that your customers have with your product. Hallowell  described the attitudinal and behavioral loyalty. Flavián et al. (2006) enlighten on behavioral component of customer loyalty it based on the customer visit to a shop to make a purchase with a special frequency. Nilsson et al.  explained behavioral and attitudinal loyalty however for internet banking we will chose attitudinal loyalty it is a state where your customer stay committed with your product otherness behavioral dimension is just a state of effectiveness [28,57,58].
After analyzing the literature and previous studies on internet banking a research framework designed that shows the relationship among Customer’s Perception of Public relation, Customer perceived value, Customer E-loyalty with moderation of switching cost and Brand Image. Following is the research framework for this study (Figure 1).
Kim et al.  describe psychological cost is the cost that involves curiosity and uncertainty and user face it when switch from one product to another , this research also highlight that switching cost can be used as a barrier for customer because it will take time to learn new things. Lee et al.  describe that switching cost when users switch from one service to another service it also include the cost of monitoring and endeavors that customer perform during switching. Dick  explains that switching cost is used as a barriers thus it could be a finest tool to enhance the customer loyalty and marketer use this tool always to bind their customer with their product for long time. According to Bauer et al. , there are three dimensions of switching cost and each dimension has its own importance foremost, procedural cost that usually includes set up cost and the process of evaluation that how customer evaluate the product before switching one product to another product, secondly financial cost as it appears with its name finance and its related cost that what customer is getting and what he is paying lastly, the relational cost that is also important in banking sector to maintain good relation it include relation with the management relation with product and its organizational environment. Anderson et al.  explain that switching cost has direct impact on customer loyalty the big advantage is the binding of the customer due to switching cost sometime customer hesitate to switch due to extra effort. Klemperer  narrates that frequently customer reluctant to switch because they know the risk he may face during switching it includes all types of switching dimension it may be procedural or it may be financial cost. Deng et al.  explain that switching cost is the key tool for customer loyalty due switching cost you can avail one more chance to entertain your customer hence, in banking sector it is difficult to switch, you have to familiar with other banking website operations like how to create online account what will be the charges against transactions, users look towards switching cost with different perspective and ultimately they become loyal to learn and use the same product .
The brand is the identity of the product and image explains that is brand valuable or not? .
Aaker ; Rahi  explain that brand is as important as product itself it differentiate the product with other products, brand is an emblem or symbol and this symbol motivate the customer to buy their product, symbol may be called differently like logo according to the easiness or trademark moreover the key role of a brand is to distinguish a product with other on behalf of quality or service, it create trust between customer and manufacturer and give competitive advantages. Kapferer  defines that brand is an identity of a product, there are many angles to see a brand for customer it includes overall experience from their buying process to using, and hence brand image comes when customers have overall experience about the brand. De Chernatony ; Rahi  narrate that for successful brand image it is important that companies must observe the needs of the customer deeply and it must be relevant what customer actually want and does your product fulfill the need of the customer. Aaker  explain in detail about brand image research emphasize on identity of you product if the product has unique qualities. Aaker ; Rahi  also narrate that if companies want good brand image they must be excellent to provide services, organizing, and must be anxious about product delivery. Ward  also enlighten that brand image is differentiate your product by making promise with customer to make product reliable, durable, and quality effective, moreover research shows that those companies who are committed with services and are providing distinctive product features get higher brand image like multinational companies mostly follow structured rules and become eminent in couple of years on contrary those companies who ignore commitment with product delivery and customer satisfaction have poorer brand image .
H3: The higher the level of Switching Costs, the greater is the likelihood that customer’s perception of public relation will lead to greater E-loyalty.
H4: The higher the level of Switching Costs the greater is the likelihood that customer perceived value will lead to greater E-loyalty.
H5: The higher the level of Brand Image the greater is the likelihood that customer’s perception of public relation will lead to greater E-loyalty.
H6: The higher the level of Brand Image, the greater is the likelihood that customer perceived value will lead to greater E-loyalty.
Researcher has used positivism paradigm as explained in Creswell et al. . Additionally Quantitative method has been used in this research suggested by Grinnell et al. . Focus of this research is on fresh data collection as this is the primary research . Collis et al.  narrate that the quantitative strategy works on objectives and measures through actions and opinions.
The first section of questionnaire was designed to capture the characteristics information of respondents for instance gender, age, education and region. Table 1 depicts the demographic information of respondents.
Table 1: Demographic Profile of Respondents.
Sample and Data Collection
Sample size is selected from 500 customers through structured questionnaire. Only 437 usable responses were received. Simple Random sampling technique has been used for data collection this technique also supported by Babbie  explains, “I recommend selecting a random sample in which each individual has an equal probability of being selected”.
Customer’s Perception of Public Relation
Customer’s Perception of Public Relation has been measured by 8-items with Likert-type scale. A sample item is “The messages about the Internet Banking towards PR (Public Relation) I obtain from surrounding (Media) are more than other competitive brands .
Brand image has been measured with a 3-item Likert-type. A sample item is “I feel that banks branding services (Internet Banking) possesses its practical function” .
Customer Perceived Value
Customer Perceived Value has been measured by 4-items with Likert-type scale. A sample item is “Compared to branch banking services internet banking provides more free services” adapted from study of Levesque et al. .
For data analysis, help was taken from SPSS (Statistical Package for Social Sciences) 20. Data was entered in the software SPSS-20 and various tests were applied to check the validity and reliability of the instrument.
Findings and Analysis
Validity and Reliability
To ratify the reliability of the instruments, Cronbach’s Alpha test has been employed with the help of SPSS software (Table 2).
Table 2: Cronbach’s Alpha Test α.
Interpretation of Reliability Analysis
Cronbach’s Alpha test has been employed. For a reliable instrument of data collection the value of Chronbach’s Alpha must be equal to or greater than 0.70 [7,58]. Table 2 depicts that all values are greater than 0.70, Customer Loyalty 0.75, Customer Perceived Value 0.90, Switching Cost 0.81 meanwhile Brand Image 0.98 and Customer’s Perception of Public Relation 0.76 that shows significant validity of the questionnaire (Table 3).
Table 3: Showing Pearson Correlation.
Pearson Correlation: Pearson correlation has been implied for the checking of the relationship among variables.
Interpretation of Pearson Correlation
Researcher examined the results of Customer Loyalty with other variables includes Customer’s Perception of Public Relation, Customer Perceived Value, switching Cost, and Brand Image 0.96, 0.88, 0.87, and 0.89. Customer Perceived Value has also significant relationship with other variables include Customer Loyalty, switching Cost and Customer’s Perception of Public Relation and Brand Image 0.88, 0.99, 0.87 and 98. Meanwhile the relationship of Switching cost with other variables, Customer Loyalty, Customer Perceived Value and Customer Perception of Public Relation and Brand Image has found significant like 0.87, 0.99, 0.87 and 87. Hence, Relationship of Customer’s Perception of Public Relation with other variables includes Customer Loyalty, Customer Perceived Value and switching cost and Brand Image is also found significant for instance 0.96, 87, 87, 87. Furthermore the relationship of Brand Image with other related constructs like Customer’s Perception of Public Relation, Customer Loyalty, Customer Perceived Value and switching cost has found significant 0.85, 0.89, 0.98, and 0.96. By following statistics values researcher can say proposed research frame work is acceptable because values shows that there is a significant relationship between Customer’s Perception of Public Relation , Customer perceived value, switching cost, Brand Image and customer loyalty.
Researcher has implied regression analysis to check the level of relationship between dependent (E-Loyalty) and independent variables (Customer’s Perception of Public Relation) (Table 4).
Table 4: E-Loyalty as Dependent Variable.
Interpretation of Regression Analysis
Regression analysis has been entailed to check the level of dependency of E-loyalty with Customer’s Perception of Public Relation and Customer Perceived value. Result depicts that there is a significant relationship between variables. Table 4 depicts the values where constant -4.358, B (Beta) for Customer Perceived value is 0.123 and for Customer’s Perception of Public Relation 0.540. Furthermore significance value is less than 0.05 (Table 5).
Table 5: Necessary Statistics.
Interpretation of Necessary Statistics
Table 5 depicts the overall model fitness in which significance of F-test is less than 0.01 and on behalf of these values it can be concluded that model is good fitted. Furthermore value of adjusted R square is 0.945 which represent the combined effect of all independent variables on E-loyalty and in other words it can be explained that both independent variables Customer’s Perception of Public Relation and Customer perceived Value, have a combined impact of 94% on E-loyalty.
Moderating Regression Analysis
To check the moderation between variables moderated regression analysis was inferred. A moderator variable can be defined as a variable that systematically modifies either the form and/or strength of the relationship between a dependent variable and independent variable . Sharma et al.  differentiate two methods to identify moderator variables.
1) Moderated regression analysis
2) Subgroup analysis
MRA involves the comparison of three regression models De Ruyter et al. . The full model contains three terms: the dependent variable, the hypothesized moderator variable and the interaction term of these two. The restricted model omits either the interaction term or the hypothesized moderator. Tests are carried out by comparing the restricted model to the full model. In subgroup analysis the hypothesized moderator variable is used to split the sample. After subdividing the sample, regression analysis is carried out between the dependent and independent variables. A number of authors have recommended the use of MRA, since subgroup analysis is characterized by several shortcomings De Ruyter et al. . In applying MRA we will need three regression models. In this particular case the following three regression models are relevant to examine the effect of Brand Image as moderator (Table 6). If models (1), (2) and (3) are significantly different from each other (b2 b3 0), then switching costs is a quasi-moderator .
Table 6: Moderation of Switching Cost with Customer Perception of Public Relation and E-loyalty.
Moderation of Switching Cost with Customer Perception of Public Relation and E-Loyalty
Moderating Regression Equation
1. LOYi = a + b1 * PPR
2. LOYi = a + b1 * PPR + b2*DSc
3. LOYi = a + b1 * PPR+ b2*DSc + b3 * (PPR * DSc)
As revealed in Table 5 Switching Cost is a moderator variable for the relationship between Customer Perception of Public Relation and customer loyalty, as the partial regression coefficient of the interaction term (PPR*DSc) is significantly different from 0 . More particularly, Switching Cost is a quasi-moderator for the relationship between Customer Perception of Public Relation and Customer Loyalty, because the three models are significantly different from each other (Table 7).
Table 7: Moderation of Switching Cost with Customer Perceived Value and E-Loyalty.
Moderation of Switching Cost with Customer Perceived Value and E-Loyalty
Moderating Regression Equation
1. LOYi = a + b1 * CPV
2. LOYi = a + b1 * CPV + b2*DSc
3. LOYi = a + b1 * CPV+ b2*DSc + b3 * (CPV * DSc)
As shown in Table 7 Switching Cost is a moderator variable for the relationship between Customer Perceived Value and E-Loyalty, as the partial regression coefficient of the interaction term (IB*DSc) is significantly different from 0. More particularly, Switching Cost is a quasi-moderator for the relationship between Customer Perceived Value and Customer Loyalty, because the three models are significantly different from each other (Table 8).
Table 8: Moderation of Brand Image with Customer’s Perception of Public Relation towards E-Loyalty.
Moderation of Brand Image with Customer’s Perception of Public Relation Towards E-Loyalty
Moderating Regression Equation
1. LOYi = a + b1 * PPR
2. LOYi = a + b1 * PPR + b2*DBi
3. LOYi = a + b1 * PPR + b2*DBi + b3 * (PPR * DBi)
As per Table 8 Brand image is a moderator variable for the relationship between Customer’s Perception of Public Relation and Customer Loyalty, as the partial regression coefficient of the interaction term (PPR*DBi) is significantly different from 0. More particularly, Brand Image is a quasi-moderator for the relationship between Customer’s Perception of Public Relation and Customer Loyalty, because the three models are significantly different from each other (Table 9).
Table 9: Moderation of Brand Image with Customer Perceived Value and E-loyalty.
Moderation of Brand Image with Customer Perceived Value and E-Loyalty
Moderating Regression Equation
1. LOYi = a + b1 * CPV
2. LOYi = a + b1 * CPV + b2*DBi
3. LOYi = a + b1 * CPV + b2*DBi + b3 * (CPV * DBi)
Table 9 depicts that, Brand image is a moderator variable for the relationship between Customer Perceived Value and E-loyalty, as the partial regression coefficient of the interaction term (CPV*DBi) is significantly different from 0. More particularly, Brand Image is a quasi-moderator for the relationship between Customer Perceived Value and E-Loyalty, because the three models are significantly different from each other.
The findings suggest that E-loyalty brought significant change through Customer’s Perception of Public Relation, Customer perceived value switching cost and Brand image in banking sector. All hypotheses mentioned above are accepted and shown significant impact on E-loyalty. At prior step researcher took the descriptive statistical analysis first in which gender of respondent their age, region and education measured. Furthermore to check the reliability of the instrument researcher have employed the Chronbach’s Alpha test and found significant values, all values are greater than 0.07 that predict instruments are valid and useable for further statistical testing. To check the relationship between hypotheses, researcher has applied correlation test. The very first step was to check which test should be applied either Pearson of spearman correlation. Through scatter plot Researcher found that Pearson correlation will be applied. In Pearson correlation it has been proved that all variables have significant relationship.
Simple regression test has been implied to check the direct impact of Customer’s Perception of Public Relation, and Customer Perceived Value on E-Loyalty. The result shows that all independent variable have significant impact on Customer E-loyalty. In the meantime moderation relationship of switching cost on customer loyalty has also been checked. All the hypothesis depict moderation with Switching cost furthermore the level of moderation was qasi, on behalf of this detailed analysis researcher concluded that in banking sector Customer perception of Public Relation, Customer Perceived value with moderating variable of switching cost and Brand image have significant impact on E-loyalty.
Conclusion and Recommendations
Major finding was to investigate the moderating relationship of switching cost and Brand image. Research has proved that switching cost and Brand image have qasi moderation among Customer’s Perception of Public Relation, Customer perceived value and E-loyalty. The results evoke, banks that are determined to get E-loyalty should focus on Customer’s Perception of Public Relation and customer perceived value. In addition the relationship between Customer’s Perception of Public Relation and Customer Perceived Value towards E-Loyalty will be significant when Brand image and switching cost stronger. After conducting this comprehensive research it is precisely clear for policy makers that they should focus on Customer perception of Public relation and customer perceived value to enhance the Customer E-loyalty.
This research only explores the banking consumer of city Lahore and Islamabad because data collected from Lahore and Islamabad. Additionally research may conduct with other variables like Customer Satisfaction and Trust within banking context.