The relationship intention of banking and life insurance industry customers
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In the increasing competitive market environment, it becomes increasingly important for organisations, such as banks and life insurance organisations, to implement relationship marketing strategies to improve their competitiveness. Relationship marketing, properly implemented, will be advantageous to organisations by building long-term relationships with their customers, thereby increasing their customers' spending over time and improving the organisations1 long-term success. However, relationship marketing cannot be applied to all the customers of the organisation, as not all customers intend to form a relationship with the organisation. Organisations therefore need to identify and target those customers who intend to build long-term relationships with them by identifying customers with high relationship intentions. The aim of this study was to measure the relationship intentions of customers within banking and life insurance organisations by considering five relationship intention constructs, namely involvement, expectations, forgiveness, feedback and fear of relationship loss. A self-administered questionnaire was designed that measured respondents' relationship intentions. The questionnaire was distributed among respondents living in Gauteng who use banking or life insurance services, by means of a non-probability, convenience sampling method. In total, 401 respondents participated in the study, of whom 202 used banking and 199 life insurance services. From the data analysis it was determined that 264 (65.83%) respondents had low intentions and 137 (34.17%) respondents had high intentions to build long-term relationships with the organisation. The results indicate that nine factors should be considered when measuring banking and life insurance customers' relationship intentions, namely continuing involvement, fear of relationship loss, fear associated with switching to competitors, forgiveness, feedback response, feedback for improved service delivery, expectations, feedback to avoid conflict, and initial involvement. A further analysis of the data concluded that customers1 relationship length should not be considered an indicator for relationship intention. It is recommended that banking and life insurance organisations should use the nine identified factors to determine their customers' relationship intentions. Targeting only high relationship intention customers rather than all customers for relationship building will result in more effective and efficient relationship building investment by these organisations. Banking and life insurance organisations should furthermore not assume that customers who have been dealing with them for a long period automatically would want to build a long-term relationship with them. Recommendations for future research include the possibility of replicating this study in service industries other than banking and life insurance organisations to determine the validity of the identified factors used to measure relationship intention for other services. Respondents from other South African provinces could also be included to determine if differences exist between respondents from different regions in terms of their relationship intention.
- ETD@PUK