Service quality andword of mouth: A study of the banking sector

Abstract

Purpose–The purpose of this paper is to explore the influence of the dimensions of service quality on customers’ word-of-mouth (WOM) in the context of the retail banking industry. Design/methodology/approach–A modified SERVQUAL instrument was used to capture customers’ perceptions of service quality followed by exploratory factor analysis to study the dimensionality of service quality in retail banking. Multiple regression was used to probe the influence of the dimensions of service quality on WOM. Findings–The study revealed four dimensions of service quality in retail banking, namely, attitude, competence, tangibles and convenience and showed that the service quality factor attitude is most important in influencing WOM. Research limitations/implications–Continued refinement of the scale for measuring service quality in retail banking, proposed in this study, is certainly possible based on further research and trends in retail banking. Further research may also incorporate multiple measures of the WOM construct. Practical implications–Retail bank managers must realise the importance of employees’ attitude towards customers, be sensitive to the intangible aspects of the service, particularly the customerorientation of its frontline personnel and engender and continuously rejuvenate a customer-oriented culture. This is because, the provision of personalised, courteous service and helpful employees who understand the customers’ needs is the strongest driver for WOM. Originality/value–This study explores the relationship between service quality andWOMby linking both constructs at their dimensional level. This increases the diagnostics of explaining customers’ propensity for WOM. © Emerald Group Publishing Limited.