Academic journal article International Journal of Marketing Studies

Comparative Analysis of Internal Service Marketing Strategy and Customers' Satisfaction in Nigerian Banking Industry between 2005-2009 and 2010-2013

Academic journal article International Journal of Marketing Studies

Comparative Analysis of Internal Service Marketing Strategy and Customers' Satisfaction in Nigerian Banking Industry between 2005-2009 and 2010-2013

Article excerpt

Abstract

The internal crises in Nigerian banking industry between 2005 and 2009 which manifested failures of some banks and subsequent reforms that have recorded some improvements between 2010 and 2013 warranted this study. The purpose of the study is to examine the impact of internal service marketing strategy on customers' satisfaction in Nigerian banking industry between 2005 and 2009 and what was responsible for the subsequent improvements made in 2010 to 2013. The customers' satisfaction variables measured are service/product quality, market share, return on owners' investment and customers' loyalty. Sample size was determined using Taro Yeman's formula. Pilot survey and Cronbach's Alpha were used to confirm the validity and reliability of the study respectively and their variables of measures. Spearman's rank correlation coefficient(r), simple regression and partial correlation analyses were the statistical tools used. Consequently the following major findings among others were obtained: (1) Internal marketing strategy had positive and weak relationship with product/service quality, market share, return on owner's investment and customer loyalty in the years 2005-2009. (2) There was positive and significant relationship between internal service marketing strategy and customers' satisfaction with technology moderating them in 2010-2013. We conclude that internal service marketing strategy was weak hence had weak impact on customers' satisfaction in Nigerian banking industry between 2005 and 2009. We recommend market orientation to banks in order to increase customers' satisfaction.

Keywords: bank, improvement, service, marketing, delivery, strategy, satisfy, customer

(ProQuest: ... denotes formula omitted.)

1. Introduction

1.1 Background of Problem

This study examined the internal marketing practices in Nigerian banking industry from 2005 to 2009 (which then centred on product, pricing, promotion and place strategies) and its limitations in improving service delivery alone. Banks' burning desire to improve corporate financial goals using internal strategies without incorporating marketing objectives strategies to create customers' satisfaction failed. This among others led to the 2005 to 2009 crises of size, financial inadequacies, fraud and corruption resulting in low liquidity and loss of many customers' deposits. Many banks like Savannah bank, Pan African bank, National bank failed while All-state Trust bank eventually witnessed major distress and was acquired. Standard Trust bank merged with United Bank for Africa and Intercontinental bank to form the new United Bank for Africa and Habib Bank merged with Platinum Bank to form Bank PHB (Keystone bank). This trend had not stopped till today.

1.2 Statement of the Problem

Banks were in real problem of how to cope with exposed fraud and mismanagement of resources. Hard selling, transactional marketing and poor relationship marketing methods were practised which are inconsistent with standard international banking practices. These studies therefore established the relationships between internal marketing strategy and product/service quality, market share, return on owners' investment and customers' loyalty from 2005 to 2009 and compared it with the situation in 2010-2013 banking industry using the following hypothesis: There is a significant relationship between internal service marketing strategy and service/product quality, market share, return on owners' investment and customers' loyalty. Quasi experimental design used in descriptive research was employed. The primary data were obtained using questionnaires. The data were fitted into regression, partial regression and Spearman's rank correlation equations to establish the relationships between the variables in the hypotheses, thus the study redirected the banking industry to implement market orientation and sustain technology application.

2. Literature Review

It was evident in the introduction that all were not well with banking industry between 2005 and 2009. …

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