THE RELATIONSHIP AMONG CUSTOMER SATISFACTION, LOYALTY AND FINANCIAL PERFORMANCE OF COMMERCIAL BANKS
Name and surname of author:
Jaroslav Belás, Lenka Gabčová
Commercial banks, customer satisfaction, customer satisfaction determinants, customer loyalty, cross-selling, banks´ additional income
DOI (& full text):
In the current banking sector, characterized by an increasing competition, efﬁcient management of selling additional products and services to existing satisﬁed customers represents a signiﬁcant…more
In the current banking sector, characterized by an increasing competition, efﬁcient management of selling additional products and services to existing satisﬁed customers represents a signiﬁcant opportunity to improve the ﬁnancial performance of a commercial bank. To sum up, the conclusion of the up to date literature is an idea that customer satisfaction leads to customer loyalty and loyalty leads to willingness to purchase additional products. However, there are practically no papers quantifying the inﬂuence of loyalty on additional products purchases. The aim of this paper is to create a model among customer satisfaction, loyalty and ﬁnancial performance of commercial banks in the Czech Republic. It is based on our original research realized as a survey with a total of 459 respondents that have been reached. The created model has proven that product quality, recognition of customers´ ﬁnancial needs and acceptance of prices by a customer have an impact on customer satisfaction, which then inﬂuences customer loyalty and this in return inﬂuences additional purchases potential of a customer. The regression model of relation between customer satisfaction and loyalty of bank customer has this form: CL = 0.01163 + 0.9191 x CS, where: CL – customer loyalty, CS – customer satisfaction. The regression model of relation between customer loyalty and additional purchases: APP = -0.05667 + 0.5848 x CL, where: APP – additional purchases potential, CL – customer loyalty. At the end, the paper is dedicated to a model example showing that if a commercial bank is able to increase the number of satisﬁed customers by 10,000, it can obtain additional yearly income of EUR 9.6 million.