"If you're interested in publishing papers, we can work together, contact me. Interest: Islamic banking + marketing".
By. MWO Maznah Wan Omar
Islamic banks' ability to withstand the global downturn has fuelled an expansion of Islamic finance around the world. Islamic banks have learned that customer loyalty and brand loyalty must be earned. Brand loyalty and relationship marketing among banking consumers particularly in the islamic banking system in Malaysia has captured great interest among the Malaysian public as a whole (i.e. relationship between employees and customers). Relationship marketing is not more than just getting the customers but it is also how to maintain the existing customers as much as possible. There are important dimensions that supported the strength of relationship marketing that can lead to brand loyalty. In relation, brand loyalty refers to the favorable attitude towards a brand in addition to purchasing it repeatedly by the customer. The customer tends to be loyal since there is relationship marketing between them and the organization. This study will show the influence of relationship marketing through Bank Islam employees in Malaysia on Brand Loyalty. The data for this study will be acquired from 3 Bank Islam business premises in Pulau Pinang, Kedah, and Perlis which represent the northern states of Peninsular Malaysia. Various data-analytic tools will be used to analyze the data such as test of differences, reliability analysis, factor analysis, and multiple regression analysis. The study tries to determine how relationship marketing which is measured through three dimensions, that is Customer trust on Bank Islam staff, Bank Islam Staff commitment during the service delivery, and the communication skills among Bank Islam Staff can have an influence on Brand Loyalty among Bank Islam customers.
In recent years there has been growing interest in relationship marketing (i.e. relationship between employees and customers) since there has been a change in terms of marketing philosophy which is marketing orientation. One of the most important areas in marketing orientation includes relationship marketing. Relationship marketing is not more than just getting the customers but it is also how to maintain the existing customers as much as possible.
There are important dimensions that supported the strength of relationship marketing that can lead to brand loyalty. In relation, Brand loyalty refers to the favorable attitude towards a brand in addition to purchasing it repeatedly by the customer. The customer tends to be loyal since there is relationship marketing between them and the organization. This study will show the influence of relationship marketing through Bank Islam employees in Malaysia on Brand Loyalty. The data for this study will be acquired from 3 Bank Islam business premises in Pulau Pinang, Kedah, and Perlis which represent the northern states of Peninsula Malaysia.
Various data-analytic tools will be used to analyze the data such as test of differences, reliability analysis, factor analysis, and multiple regression analysis. The study try to determine whether relationship marketing which is measured through three dimensions, that is Customer trust on Bank
Islam staffs, Bank Islam Staff commitment during the service delivery, and the communication skills among Bank Islam Staff do have an influence on Brand Loyalty among Bank Islam customers. Finally the study also attempts to determine if Customer Overall satisfaction would have a mediating effect on the relationship between relationship marketing and Brand Loyalty in the case of Bank Islam.
2. LITERATURE REVIEW
Brand management is an area of increasing importance to marketers today, particularly as organizations attempts to communicate the ever complex and intangible messages as part of brand management strategies (Davis, 2000; Goodchild & Callow, 2001). One of the many interesting questions facing today's brand managers concerns how to develop a better understanding of the appropriate relationship between constructs such as relationship marketing and brand loyalty, particularly in relation to the myriad of known antecedents to brand loyalty in the marketing literature (Taylor et al., 2004). In this study we assess the relative importance of many of the known antecedents to brand loyalty, including overall customer satisfaction.
By having a strong brand, companies not only could facilitate the differentiation of their offer from the competitors. With branding, financial companies are able to create customer confidence and loyalty in their performance, exert greater control over promotion and distribution of the brand, as well as commanding a premium price over the competitors; all while impacting the valuation of the business (Holverson & Revaz, 2006; Pass et al., 1995).
The added value that a brand name gives to a product is now commonly referred to as "brand equity"
(Aaker, 1991). Brand name adds value to each of these interested parties which include the investors, manufacturers, and the retailers. Brand equity and brand loyalty provides a strong platform for introducing new products and insulates the brand against competitive attacks. From the perspective of the trade, brand loyalty contributes to the overall image of the retail outlet. It builds store traffic, ensures consistent volume, and reduces risk in allocating shelf space (Cobb-Walgren et al., 1995). However, if the brand has no meaning to the consumer, automatically there wouldn't be of any value to the investors, the manufacturer, and the retailer unless there is value to consumer (Farquhar, 1989; Crimmins, 1992).
Over the past 15 years, a major shift has occurred in the ways that industrial companies deal with their customers and suppliers (Christopher et al., 1991; Ellram, 1995). This change has come about as companies have recognized that sustainable competitive advantage in the global economy increasingly requires companies to become trusted participants in various networks or sets of strategic alliances (Morgan & Hunt, 1994). Relationship marketing which is powered by the employees of an organization has emerged over the years as an exciting area of marketing that focuses on building long-term relationships among employees who is a proxy to their employer and customers that frequent to their business premises. As Gronroos (1993) observed: establishing a relationship, for example between an employee and a customer, can be divided into two parts: to attract the customer and to build the relationship with that customer so that the economic goals of the organization are achieved through that relationship.
3.1 The Objectives of This Study
b. To determine whether Relationship marketing within Bank Islam will have any influence on customer's overall satisfaction.
c. To determine whether customer Overall satisfaction with Bank Islam employee will have any influence on Brand loyalty.
d. To determine whether customer Overall satisfaction on Bank Islam employee mediates the relationship between Relationship marketing and Brand loyalty.
Hypothesis 1: There is positive relationship between relationship marketing and brand loyalty.1a: There is positive relationship between trust and brand loyalty.
1b: There is positive relationship between commitment and brand loyalty.
Hypothesis 2: There is a positive relationship between relationship marketing and overall satisfaction.H2a: There is a positive relationship between trust and overall satisfaction.
H2b: There is a positive relationship between commitment and overall satisfaction.
H2c: There is a positive relationship between communication and overall satisfaction.
Hypothesis 4: Overall satisfaction mediates the relationship between relationship marketing and brand loyalty.
3.3 Research Questions
From the previous discussion, we infer specific research questions for this study, they are:
Does customers trust towards the Bank Islam employee during their interaction influences Bank Islam Brand Loyalty?
b) Does Bank Islam employee's commitment towards their customers during employee/customers interaction influence Bank Islam Brand Loyalty?
c) Does Bank Islam employee's communications skills delivered during employee/customers interaction influences Bank Islam Brand Loyalty?
d) Does customer's overall satisfaction towards Bank Islam employee influences Bank Islam Brand loyalty?
e) Does customer's overall satisfaction mediates the relationship between Bank Islam relationship marketing and Bank Islam Brand loyalty?
The area of study for this research is limited to three Bank Islam business premises located in Pulau Pinang, Kedah, and Perlis. All the three states are located in the Northern States of Peninsular Malaysia.
4.1 Description of Methodology
Since the mailing list of Bank Islam customers/clients is not made available, a 2-stage systematic sampling technique will be employed.
A two-stage sampling technique is employed in this study. During the 1st stage = A random sampling technique is used to select the Bank Islam business premises. List of Bank Islam business premises will be retrieved from Bank Islam listing. 2nd stage = systematic sampling. A skip interval of 2 will be utilized in the selection of Bank Islam clients as our respondent (Arithmetic progression will be utilized).
A sample of 480 will be collected (16 items (independent variable) X 10 = 160 samples X 3 locations = 480 samples). To accommodate for non-responses, an additional of 20 samples will be collected. Therefore a total of 500 samples will be collected altogether for this study. Sample selected was based on 3 considerations:-
30< sample < 500. The size must be several times larger (10 times or more) for multiple regression analysis to be conducted.
b) Second considerations, Cohen & Cohen (1977); Sawyer & Ball (1981), believes that very large sample sizes usually allow even small effects to be statistically significant. It is especially important with highly powered research designs to measure and report effect sizes in addition to statistical significance.
Sawyer and Ball (1981) estimated that a proportion of 13% of the explained variance to effect size values, as a medium effect size for regression analysis. According to Sawyer and Ball (1981), the medium effect of 13% is sufficient for testing an existing model.
f² = R² = 0.13 = 0.1494
1- R² 1 – 0.13
ŋ* = L+K+1
= 13.62 + 3 + 1
= 117 samples.
Therefore, 117 samples x 3 locations = 351 samples (to be collected)
c) The third considerations, Issue's on response rate were covered. Response rate in Malaysia is between 15% - 30% base on the previous research/study/theses.
4.5 Questionnaire Design
Questionnaire consists of 3 Sections. Section A =Relationship marketing (Caceres & Paparoidamis, 2007). Section B = Overall customer satisfaction ( Bloemer & Ruyter, 1998). Section C = Brand loyalty (Aaker, 1996). An interval scale data (use for independent variable, mediating variable, and dependent variable) and a nominal scale data (demographic data) will be collected from the questionnaire distributed to the hotel guest. A Likert Scale of 1 to 5 will be used to frame answers in the questionnaire.
4.6 Translation Procedure