Academic journal article Journal of International Business Research

Measuring Customer Satisfaction Based on Service Quality Gap at a Local Bank in Vietnam

Academic journal article Journal of International Business Research

Measuring Customer Satisfaction Based on Service Quality Gap at a Local Bank in Vietnam

Article excerpt

INTRODUCTION

The global trends and challenges in services in today's business world showed that "services companies are under a constant and dynamic change" while "customers are becoming less loyal, more price sensitive and discerning ..." (Sigala & Christou, 2006).

It is the common knowledge that customers are the lifeblood of any company's business nowadays. Because of their importance, customers perceive that they have the power to demand high service quality (Macdonald, 1995). This leads all companies to the battle competing for customers. Moreover, customers are now more aware of other service providers as well as the range of financial products available for them in the marketplace. Customer expectations rise accordingly, thus they are "more critical" when choosing the service (Akan, 1995). As a result, service providers must redouble their efforts if they want to be winners in this battle (Edvardsson, Thomasson & Ovretveit, 1994). And financial service providers are not exceptions for that.

In that context, service quality (SQ) is a prerequisite for the survival and development of any company (Parasuraman, Berry & Zeithaml, 1988). Many authors backed up this statement since the early of the 1980s until now. Their reasons are as followed.

First, it is a critical factor in achieving competitiveness in most service industries (Galloway & Ho, 1996). Only when SQ is paid enough attention to can the company differentiate itself from other rivals in the marketplace and gain a lasting competitive advantage in the long run (Galloway & Blanchard, 1996; Gounaris, Stathakopoulos & Athanassopoulos, 2003).

Second, SQ is a key to long-term profitability as it affects the repurchase intentions of both existing and potential customers (Anderson, Fornell & Lehmann, 1994; Caruana & Pitt, 1997; Leverin & Liljander, 2006). Furthermore, if customers stay long with the company, more profit can be gained by reducing customer acquisition costs and lowering costs thanks to serving repeat customers (Heskett, Jones, Loveman, Sasser & Schlesinger, 1994; Mittal & Lassar, 1998; Roig, Garcia, Tena & Monzonis, 2006).

And finally, SQ can be used to fan word-of-mouth advertising (Julian & Ramaseshan, 1994). This powerful tool can help the company to recruit new customers with lower cost. It is estimated that attracting new customers is about four times more expensive than retaining the current ones (Wang, Lo & Hui, 2003). The research topic, measuring customer satisfaction based on service quality gap, has been widely discussed by many researchers for years. In the scope of this research, the authors intended to provide insights into the gaps between customer expectations and customer perceptions towards the SQ which the local bank was offering. The researchers also explored the relationship between the age, gender of the respondents and their bank visit frequency.

The hypotheses the researchers aimed at testing including (1) There is a gap between customer perception and customer expectation towards the bank's SQ, and (2) There is an association between age/ gender of customers and the frequency of their bank visits.

While SERVQUAL framework is the most widely used SQ measuring tool in developed countries (Blanchard & Galloway, 1994), it has not been applied in developing Asian countries as popularly as it has been in developed countries in Europe and in the U.S. The authors put this powerful tool in a real organizational setting in Vietnam, one of the developing Asian countries, with the hope to contribute to the literature to some extent. Furthermore, the research also helped the local bank managers to gain deeper understanding of their business and their customers.

This paper began with a brief review of the relevant literature developed earlier, followed by the researchers' hypotheses and the methodology explanation. …

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