Loyalty of on-Line Bank Customers

Authors

Leif B. Methlie, Department of Strategy and Management, Norwegian School of Economics and Business Administration, Breiviksveien 40, 5045 Bergen, Norway
Herbjørn Nysveen, Department of Strategy and Management, Norwegian School of Economics and Business Administration, Breiviksveien 40, 5045 Bergen, Norway

Document Type

Research Article

Abstract

Electronic commerce changes the relationships between sellers and buyers dramatically. The new properties of electronic markets offer customers added values. New customer value propositions have to be established in most markets and new marketing strategies must be formulated. One of the business sectors most heavily affected is banking. How can banks retain loyal customers when moving into electronic banking? Research in marketing has unveiled several determinants of customer loyalty. However, this knowledge is based on research on customers in traditional markets. In this paper we focus on customers’ loyalty in on-line banking. The findings indicate that determinants of loyalty in on-line banking environments are similar to those in the physical market-place. However, customer satisfaction is found to have the most significant impact, followed by brand reputation, while switching costs and search costs, although significant, have minor explanatory power. The implications of these findings on banks’ marketing strategies are discussed.

DOI

10.1177/026839629901400406

Recommended Citation

Methlie, Leif B. and Nysveen, Herbjørn (1999) "Loyalty of on-Line Bank Customers," Journal of Information Technology: Vol. 14: Iss. 4, Article 6.
DOI: 10.1177/026839629901400406
Available at: https://aisel.aisnet.org/jit/vol14/iss4/6