Determinants of Customers’ Perceptions of Electronic Services: An Analysis in the Greek Banking Industry

Abstract

Purpose – To identify the main determinants of customers’ perceptions of electronic banking services, assess the effects of service improvements on customer satisfaction and evaluate banks’ performance regarding key e-banking quality areas. Evidence is drawn from Greek retail banking.

Design/methodology/approach – A research instrument based on a 26-items scale of e-banking quality measurement, from the literature and from conducting two focus groups, was used for data collection from a convenience sample of 302 e-banking users in Greece. Factor analysis was used to identify the underlying factor structure of the scale, regression analysis employed for the examination of the effects of service improvements on customer satisfaction and finally importance-performance analysis provided strategic directions for deploying quality resources.

Findings – Greek banks need to keep giving priority attention to the dimensions in the “keep-up-the-good-work” quadrant of the IP map, i.e. Accessibility-Convenience and Transaction Security. Special priority should be given to improving security in ATM banking and educating new users. The placement of both these attributes in the “concentrate here” quadrant indicates that customers expect visible improvements in these areas. Although Personalized Service and Innovation are currently located within the “low priority” quadrant, Greek banks should be prepared to face significant quality challenges with regard to these dimensions. Deploying resources to improve their recovery records and services to handicapped citizens would enhance their corporate image for social responsibility. Furthermore, improving connection to the service speed in Internet and Phone banking would improve their innovator image. Finally, banks should be aware that service quality is not static. As technological, economic and social trends affect customers’ preferences and needs, there will be changes in both importance and performance ratings. Frequent monitoring of customers’ perceptions helps firms to synchronize their services with the needs of their customer base.

Research limitations – The main limitations of this study is focusing on a single industry and convenience sam-pling that may have affected the generalizability of findings. Further research should be directed towards cross-national/cross-industry repetitions of the study, examining the stability and reliability of the scale, specifying the impact of demographic customers’ differences and alternative forms of e-banking on the findings.

Practical implications – The study identifies the factors of electronic banking service experience, and their underlined attributes, that fall into the quadrants of the importance-performance grid. Hence, it recognizes areas critical for service improvement and provides guidance for aptly directing resources in order to maintain and/or improve service delivery. Furthermore, by assessing the impact of factors of service experience the study provides to financial institutions valuable tools for decision making related to the prioritization of resource allocation.

Originality/value – Managers can exploit the approach taken by this study to improve service delivery management. Banks must constantly monitor the needs and wishes of their customers regarding electronic service delivery.

Keywords: e-Banking, Service Quality, Greece