Examining the mediating effect of multi-channel integration quality in the relationship with service quality, customer satisfaction and customer loyalty in the Saudi banking sector

Abstract

PurposeSince banks do not sell tangible products, they rely heavily on customer interactions and retention, which requires service quality, customer satisfaction and customer loyalty. Banks must innovate and develop new services and expand customer engagement efforts beyond stores, kiosks, direct mail and websites to include social media, mobile applications and location-based services in order to meet their customers’ growing demands. A multi-channel strategy that integrates the offline and online presences of banks can increase quality, customer satisfaction and loyalty. This paper aimed to use a service quality scale to: (1) examine the association between service quality and customer satisfaction; (2) examine the association between customer satisfaction and customer loyalty; (3) examine the indirect association between service quality and customer loyalty through customer satisfaction; and (4) examine the mediation effect of multi-channel integration quality in the relationships between service quality, customer satisfaction and customer loyalty.Design/methodology/approachThe data was obtained from banks in Saudi Arabia. The analysis was based on an online survey of 265 Saudi bank customers. The multi-channel integration quality model and Statistical Package for the Social Sciences (SPSS) were used to test the proposed hypothesis and conduct the analysis.FindingsThe results found that there was a statistically significant link between service quality and customer satisfaction in the Saudi banking industry. Service quality did not directly affect customer loyalty. When multi-channel integration quality was moderate to high, service quality affected customer loyalty through customer satisfaction. For service quality and customer loyalty in the Saudi banking sector to be achieved, customers must be satisfied, but also the bank’s brand must manage the quality of integration channels provided to them with care, and thus branding plays a key role in achieving customer loyalty in the Saudi banking sector.Originality/valueThe academic community has provided little evidence to support how the relationships between constructs such as service quality, customer satisfaction, customer loyalty and multi-channel integration quality apply to the Saudi banking sector. A conceptual framework was proposed to show how these constructs affect the Saudi banking sector. An empirical study was conducted to see how the framework held up in banking settings. The conceptual framework serves to advance the fields of business and management and banking and their respected literature, as well as advance the understanding of multi-channel integration in boosting customer satisfaction and loyalty through high service quality in the Saudi banking sector.