Cross-buying evaluations in the retail banking industry

Abstract

Is a customer's past purchase experience of traditional banking products applicable to the continuing purchase of insurance and investment products at a bank branch? Are service attributes used with similar extensions evaluated differently from when used with dissimilar extensions? In response to these questions, this study develops and examines a framework of service attributes (e.g., locational and one-stop shopping convenience, functional and technical service quality, and firm reputation and size) having positive effects on cross-buying. Meanwhile, this study also examines the mediating roles of satisfaction and trust on the relationship between services attributes and cross-buying. Our results indicate that the relative importance of locational convenience and functional service quality is likely to decline, while the relative importance of one-stop shopping convenience and firm size is likely to increase as category dissimilarity increases. Technical service quality and firm reputation only have indirect effects on cross-buying dissimilar product categories through trust. Instead, satisfaction plays the mediating role for cross-buying similar product categories. Our findings reinforce the view that the relative effects of service attributes, satisfaction and trust on cross-buying vary under different category similarity conditions.

Modeling a Formative Measure of Relationship Quality and Its Effects: Evidence From the Hong Kong Retail Banking Industry

“…A review of the literature indicates few empirical studies investigating relationship quality in retail banking with the available work focused on satisfaction and trust dimensions. For instance, as shown in Table 1, it has been argued that relationship quality is unidimensional (e.g., Ndubisi, 2006;Ndubisi & Madu, 2009), two-dimensional (e.g., Liang & Wang, 2006;Liu & Wu, 2009;Wong, Hung, & Chow, 2007), and four dimensions (Roberts, Varki, & Brodie, 2003). In many instances, these works have modeled relationship quality as separate independent dimensions, and in some cases, having a direct effect on consumer behavior outcomes.…”

“…As such, cross-buying behavior reflects the breadth of a relationship, which is common among retail banks. Prior research has shown that customers' relationship perceptions (e.g., via attributes of trust and commitment) had a positive influence on cross-buying decisions in retail settings (e.g., De Wulf et al, 2001;Hennig-Thurau et al, 2002) and financial service settings (e.g., Aurier & N'Goala, 2010;Liu & Wu, 2009). Based on these findings, we argue that favorable relationship quality perceptions (via trust, commitment, and satisfaction) by retail bank consumers enhances cross-buying behavior since a strong relationship with the customer increases the customers' likelihood to purchase additional services such as insurance, stocks and loan products in the future.…”

“…Importantly, the concept of relationship quality has been found to be the core of maintaining a healthy relationship between buyers and sellers (Hennig-Thurau, Gwinner, & Gremler, 2002). In retail banking, it has been argued that the development of a strong, high quality customer relationship improves customer loyalty (Lewis & Soureli, 2006), and cross-buying opportunities (Liu & Wu, 2009;Soureli et al, 2008). Although relationship quality's relevance for maintaining successful relationships with customers has been discussed widely in relation to consumer markets (Athanasopoulou, 2009), it still has room for further advancement in retail banking in terms of its conceptualization and measurement properties.…”

Customer Orientation and Cross-Buying: The Mediating Effects of Relational Selling Behavior and Relationship Quality

“…Unfortunately, in a competitive environment, cross-buying is an important source of enterprise profits, and research in this area is rather minor (Liu and Wu, 2008). Moreover, in the antecedents of relationship quality, although some studies have pointed out that service quality would affect the relationship quality (Liu and Wu, 2009), whether or not the marketers have the motives of service is an important issue. Among the motives, this study chooses customer orientation as an origin to build a model to explain the process of customer orientation influencing cross-buying.…”

The impact of scale effects on the prevailing internet-based banking model in the US

“…Other recent papers in the fields of banking and management that have inspired and motivated our research are grouped in accordance with their focus: efficiency and productivity (Chen, 2009;Figueira and Nellis, 2009;and Sufian, 2009); client satisfaction and service quality, customer equity and brand equity (Liu and Wu, 2009;Nadiri et al, 2009;Proença and de Castro, 2007;Roofthooft, 2010;Wang et al, 2009); small business banking (Locke and Boulanaour, 2009); economies of scale and internal firm organization (Peris-Ortiz and RuedaArmengot, 2010); and perceived risk and trust for Internet banking (Yousafzai et al, 2009).…”