Relationship disconnect in retail banking

Mark Durkin, Aodheen O'Donnell, Joe Crowe

Research output: Contribution to journalArticle

Abstract

It has been established that increasing the role of technology in a service organisation can serve to reduce costs and improve service reliability. It is argued however that that there remains an important role for personalised relationships in the delivery of any service proposition. Throughout this paper both of these perspectives will be discussed and an attempt is made to reconcile these apparently opposing views in the emerging age of technology-enabled remote relationships. Findings from a longitudinal research study with a large UK case bank which focused on the area of remote relationships are revisited and reinterpreted with management from the case bank in question. Through this reflective lens the bank’s recent strategic decision to no longer proactively relationship manage its personal customer base is examined. In light of this deliberate relationship disconnection strategy key marketing implications are discussed.
LanguageEnglish
Pages260-261
JournalJournal of Financial Services Marketing
Volume12
Issue number4
DOIs
Publication statusPublished - 2008

Fingerprint

Retail banking
Service organization
Marketing
Costs
Longitudinal research
Strategic decisions

Keywords

  • relationships
  • disconnection
  • remote
  • SST
  • banking
  • marketing

Cite this

Durkin, Mark ; O'Donnell, Aodheen ; Crowe, Joe. / Relationship disconnect in retail banking. In: Journal of Financial Services Marketing. 2008 ; Vol. 12, No. 4. pp. 260-261.
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abstract = "It has been established that increasing the role of technology in a service organisation can serve to reduce costs and improve service reliability. It is argued however that that there remains an important role for personalised relationships in the delivery of any service proposition. Throughout this paper both of these perspectives will be discussed and an attempt is made to reconcile these apparently opposing views in the emerging age of technology-enabled remote relationships. Findings from a longitudinal research study with a large UK case bank which focused on the area of remote relationships are revisited and reinterpreted with management from the case bank in question. Through this reflective lens the bank’s recent strategic decision to no longer proactively relationship manage its personal customer base is examined. In light of this deliberate relationship disconnection strategy key marketing implications are discussed.",
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note = "Reference text: 1. Murphy, J.A. (1996), Retail Banking. ‘Relationship Marketing: Theory and Practice’. F. Buttle. London, Paul Chapman Publishing Ltd: 74-90. 2. Moriarty, R.T., Kimball, R.C. and Gay, J.H. (1983), “The Management of Corporate Banking Relationships,” Sloan Management Review, Spring, pp. 3-15. 3. Lewis, B. and Speyrakopoulos, S. (2001), {"}Service Failures and Recovery in Retail Banking: The Customers' Perspective,{"} International Journal of Bank Marketing, Vol. 19, No. 1, pp. 37-48. 4. Stewart, K. (1995), An Exploration of Customer Exit with Empirical Findings from the Retail Banking Sector in Northern Ireland, National University of Ireland. 5. Storbacka, K., Strandvik, T. and Gronroos, C. (1994), “Managing Customer Relationships for Profit: The Dynamics of Relationship Quality,” International Journal of Service Industry Management Vol. 5, No. 5, pp. 21-38. 6. Durkin, M.G. and Howcroft, J.B. (2003), “Relationship Marketing in the banking sector: the impact of new technologies”, Marketing Intelligence and Planning, Vol. 21, No. 1, pp 61-71 7. Abram, H. (1995), 'Relationship Marketing in the Financial Services Industry', London, Abram, Hawkes. 8. Ibbotson, P. and Moran, L. (2003), {"}E-banking and the SME/bank relationship in Northern Ireland{"}, International Journal of Bank Marketing, Vol. 21, No. 2, pp. 91-103. 9. Caruana, A. and Calleya, P. (1998), “The Effect of Internal Marketing on Organisational Commitment among Retail Bank Managers,” International Journal of Bank Marketing, Vol. 16, No. 3, pp. 106-116. 10. Ricard, L., Prefontaine, L. and Sioufi, M. (2001), {"}New technologies and their impact on French consumer behaviour: an investigation in the banking sector{"}, International Journal of Bank Marketing, Vol. 19, No. 7, pp. 299-311. 11. Meuter, M.L., Ostrom, A.L., Roundtree, R.I. and Bitner, M.J. (2000), {"}Self-service technologies: understanding customer satisfaction with technology based encounters{"}, Journal of Marketing, Vol. 64, No. 3, pp. 50-64. 12. Durkin, M.G. and Howcroft, J.B (2003), ‘Relationship Marketing in the banking sector: the impact of new technologies’, Marketing, Intelligence and Planning, Vol. 21, No. 1, pp. 61-71. 13. Gronroos, C. (1997), “Value-Driven Relational Marketing: From Products to Resources and Competencies,” Journal of Marketing Management Vol. 13, No. 5, pp. 407-419. 14. Howcroft, J.B.; Hewer, P. and Durkin, M. (2003), “Banker-Customer Interactions in Financial Services”, Journal of Marketing Management, Vol. 19, No. 9/10, pp1001-1020 15. Zolkiewski, J. (2004), ‘Relationships are not ubiquitous in marketing’, European Journal of Marketing, Vol. 38, No. 1/2, pp24-29. 16. Levitt, T. (1986), 'The Marketing Imagination'. New York, Free Press. 17. Gronroos, C. (2004), ‘The relationship marketing process: communication, interaction, dialogue, value’, Journal of Business and Industrial Marketing, Vol. 19, No. 2, pp 99-113. 18. Marr, N.E. and Prendergast, G.P. (1991), “Strategies for Retailing Technologies at Maturity: A Retail Banking Case Study,” Journal of International Consumer Marketing Vol. 3, No. 3, pp. 99-125. 19. Marr, N.E. and Prendergast, G.P. (1993), “Consumer Adoption of Self-Service Technologies in Retail Banking,” International Journal of Bank Marketing, Vol. 11, No. 1, pp. 3-10. 20. Leblanc, G. (1990), “Customer motivations: use and non-use of automated banking”, International Journal of Bank Marketing, Vol. 18, No. 4, pp. 36-40. 21. Matilla, M.; Karjaluoto, H. and Pento, T. (2003), ‘Internet banking adoption among mature customers: early majority or laggards?’, Journal of Services Marketing, Vol. 17, No. 5, pp. 514-528. 22. Gwinner, K.P, Grender, D.D. and Bitner, M.J. (1998), {"}Relational Benefits in Service Industries: The Customer's Perspective{"}, Journal of the Academy of Marketing Science, Vol. 26, No. 2, pp. 101-114. 23. Bitner, M.J., Brown, S.W. and Meuter, M.L. (2000), {"}Technology Infusion in Service Encounters{"}, Journal of the Academy of Marketing Science, Vol. 28, No. 1, pp. 138-149. 24. Selnes, F. and Hansen, H. (2001), {"}The potential hazard of self-service in developing customer loyalty{"}, Journal of Service Research, Vol. 4, No. 2, pp. 79-90. 25. Dabholkar, P.A. and Bagozzi, R.P. ( 2002), ‘An attitudinal model of technology-based self-service: Moderating effects of consumer traits and situational factors’, Journal of the Academy of Marketing Science, Vol. 30, No. 3, pp. 184 – 201. 26. Lee, J. and Allaway, A. (2002), {"}Effects of personal control on adoption of self-service technology innovations{"}, Journal of Services Marketing, Vol. 16, No. 6, pp. 553-572. 27. Lang, B. and Colgate, M. (2003), {"}Relationship Quality, on-line banking and the information technology gap{"}, International Journal of Bank Marketing, Vol. 21, No. 1, pp. 29-37. 28. Harden, G. (2002), ‘E-banking comes to town: Exploring how traditional UK banks are meeting the challenge of technology and virtual relationships’, Journal of Financial Services Marketing, Vol. 6, No. 4, pp. 323-332. 29. O'Donnell, A.; Durkin, M.G. and McCartan-Quinn, D. (2002) “Corporate Banking In the UK : Personal Vs Remote Interaction”, International Journal of Bank Marketing, Vol. 20, No. 6, pp. 273-285. 30. Hollander, S. (1985), A Historical Perspective on the Service Encounter. The Service Encounter: Managing Employee/Customer Interaction in Service Businesses. J. A. Czepiel, M. R. Solomon and C. F. Suprenant. MA, Lexington Books. 31. Czepiel, J.A. (1990), “Service Encounters and Service Relationships: Implications for Research,” Journal of Business Research, Vol. 20, No. 1, pp. 13-21. 32. Rexha, N., Kingshott, R.P.J. and Aw, A.S.S. (2003), {"}The impact of the relational plan on the adoption of electronic banking{"}, Journal of Services Marketing, Vol. 17, No. 1, pp. 53-67. 33. Lee, J. (2002), {"}A key to marketing financial services: the right mix of products, services, channels and customers{"}, Journal of Services Marketing, Vol. 16, No. 3, pp. 238-258. 34. Dwyer, F., Schurr, P. and Oh, S. (1987), “Developing Buyer-Seller Relationships,” Journal of Marketing Vol. 51, No. 2, pp. 11-27. 35. Walsh, S., Gilmore, A. and Carson, D. (2003), {"}Managing and implementing simultaneous transaction and relationship marketing', The International Journal of Bank Marketing, Vol. 22, No. 7, pp. 468-483. 36. Howcroft, J.B and Durkin, M. (2000) “Reflections on bank-customer interactions in the new millennium”, Journal of Financial Services Marketing, Vol. 5, No. 1, pp. 9-20. 37. Pine, B.J. II, Peppers, D. and Rogers, M. (1995), {"}Do you want to keep your customers forever?{"}, Harvard Business Review, Vol. 73, No. 2, pp. 103-114. 38. Chase, R.B. (1978), “Where does the Customer Fit in a Service Operation,” Harvard Business Review Nov/Dec, pp. 137-142. 39. Kelly, S.W. (1989), {"}Efficiency in service delivery: technological or humanistic approaches{"}, Journal of Services Marketing, Vol. 3, No. 3, pp. 43-50. 40. Thornton, J. and White, L. (2001), {"}Customer Orientation and Usage of Financial Distribution Channels,{"} Journal of Services Marketing, Vol. 15, No. 3, pp. 168-185. 41. Nielsen, J.F. (2002), {"}Internet technology and customer linking in Nordic banking{"}, International Journal of Service Industry Management, Vol. 13, No. 5, pp. 475-495. 42. Yaklef, A. (2001), “Does the Internet Compete with or Complement Bricks-and-Mortar Branches?,” International Journal of Retail and Distribution Management, Vol. 29, No. 6, pp. 272-281. 43. Dibb, S. and Meadows, M. (2001), ‘The application of a relationship marketing perspective in retail banking'’ The Service Industries Journal, Vol. 21, No. 1, pp. 169-194.",
year = "2008",
doi = "10.1057/palgrave.fsm.4760080",
language = "English",
volume = "12",
pages = "260--261",
journal = "Journal of Financial Services Marketing",
issn = "1363-0539",
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}

Relationship disconnect in retail banking. / Durkin, Mark; O'Donnell, Aodheen; Crowe, Joe.

In: Journal of Financial Services Marketing, Vol. 12, No. 4, 2008, p. 260-261.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Relationship disconnect in retail banking

AU - Durkin, Mark

AU - O'Donnell, Aodheen

AU - Crowe, Joe

N1 - Reference text: 1. Murphy, J.A. (1996), Retail Banking. ‘Relationship Marketing: Theory and Practice’. F. Buttle. London, Paul Chapman Publishing Ltd: 74-90. 2. Moriarty, R.T., Kimball, R.C. and Gay, J.H. (1983), “The Management of Corporate Banking Relationships,” Sloan Management Review, Spring, pp. 3-15. 3. Lewis, B. and Speyrakopoulos, S. (2001), "Service Failures and Recovery in Retail Banking: The Customers' Perspective," International Journal of Bank Marketing, Vol. 19, No. 1, pp. 37-48. 4. Stewart, K. (1995), An Exploration of Customer Exit with Empirical Findings from the Retail Banking Sector in Northern Ireland, National University of Ireland. 5. Storbacka, K., Strandvik, T. and Gronroos, C. (1994), “Managing Customer Relationships for Profit: The Dynamics of Relationship Quality,” International Journal of Service Industry Management Vol. 5, No. 5, pp. 21-38. 6. Durkin, M.G. and Howcroft, J.B. (2003), “Relationship Marketing in the banking sector: the impact of new technologies”, Marketing Intelligence and Planning, Vol. 21, No. 1, pp 61-71 7. Abram, H. (1995), 'Relationship Marketing in the Financial Services Industry', London, Abram, Hawkes. 8. Ibbotson, P. and Moran, L. (2003), "E-banking and the SME/bank relationship in Northern Ireland", International Journal of Bank Marketing, Vol. 21, No. 2, pp. 91-103. 9. Caruana, A. and Calleya, P. (1998), “The Effect of Internal Marketing on Organisational Commitment among Retail Bank Managers,” International Journal of Bank Marketing, Vol. 16, No. 3, pp. 106-116. 10. Ricard, L., Prefontaine, L. and Sioufi, M. (2001), "New technologies and their impact on French consumer behaviour: an investigation in the banking sector", International Journal of Bank Marketing, Vol. 19, No. 7, pp. 299-311. 11. Meuter, M.L., Ostrom, A.L., Roundtree, R.I. and Bitner, M.J. (2000), "Self-service technologies: understanding customer satisfaction with technology based encounters", Journal of Marketing, Vol. 64, No. 3, pp. 50-64. 12. Durkin, M.G. and Howcroft, J.B (2003), ‘Relationship Marketing in the banking sector: the impact of new technologies’, Marketing, Intelligence and Planning, Vol. 21, No. 1, pp. 61-71. 13. Gronroos, C. (1997), “Value-Driven Relational Marketing: From Products to Resources and Competencies,” Journal of Marketing Management Vol. 13, No. 5, pp. 407-419. 14. Howcroft, J.B.; Hewer, P. and Durkin, M. (2003), “Banker-Customer Interactions in Financial Services”, Journal of Marketing Management, Vol. 19, No. 9/10, pp1001-1020 15. Zolkiewski, J. (2004), ‘Relationships are not ubiquitous in marketing’, European Journal of Marketing, Vol. 38, No. 1/2, pp24-29. 16. Levitt, T. (1986), 'The Marketing Imagination'. New York, Free Press. 17. Gronroos, C. (2004), ‘The relationship marketing process: communication, interaction, dialogue, value’, Journal of Business and Industrial Marketing, Vol. 19, No. 2, pp 99-113. 18. Marr, N.E. and Prendergast, G.P. (1991), “Strategies for Retailing Technologies at Maturity: A Retail Banking Case Study,” Journal of International Consumer Marketing Vol. 3, No. 3, pp. 99-125. 19. Marr, N.E. and Prendergast, G.P. (1993), “Consumer Adoption of Self-Service Technologies in Retail Banking,” International Journal of Bank Marketing, Vol. 11, No. 1, pp. 3-10. 20. Leblanc, G. (1990), “Customer motivations: use and non-use of automated banking”, International Journal of Bank Marketing, Vol. 18, No. 4, pp. 36-40. 21. Matilla, M.; Karjaluoto, H. and Pento, T. (2003), ‘Internet banking adoption among mature customers: early majority or laggards?’, Journal of Services Marketing, Vol. 17, No. 5, pp. 514-528. 22. Gwinner, K.P, Grender, D.D. and Bitner, M.J. (1998), "Relational Benefits in Service Industries: The Customer's Perspective", Journal of the Academy of Marketing Science, Vol. 26, No. 2, pp. 101-114. 23. Bitner, M.J., Brown, S.W. and Meuter, M.L. (2000), "Technology Infusion in Service Encounters", Journal of the Academy of Marketing Science, Vol. 28, No. 1, pp. 138-149. 24. Selnes, F. and Hansen, H. (2001), "The potential hazard of self-service in developing customer loyalty", Journal of Service Research, Vol. 4, No. 2, pp. 79-90. 25. Dabholkar, P.A. and Bagozzi, R.P. ( 2002), ‘An attitudinal model of technology-based self-service: Moderating effects of consumer traits and situational factors’, Journal of the Academy of Marketing Science, Vol. 30, No. 3, pp. 184 – 201. 26. Lee, J. and Allaway, A. (2002), "Effects of personal control on adoption of self-service technology innovations", Journal of Services Marketing, Vol. 16, No. 6, pp. 553-572. 27. Lang, B. and Colgate, M. (2003), "Relationship Quality, on-line banking and the information technology gap", International Journal of Bank Marketing, Vol. 21, No. 1, pp. 29-37. 28. Harden, G. (2002), ‘E-banking comes to town: Exploring how traditional UK banks are meeting the challenge of technology and virtual relationships’, Journal of Financial Services Marketing, Vol. 6, No. 4, pp. 323-332. 29. O'Donnell, A.; Durkin, M.G. and McCartan-Quinn, D. (2002) “Corporate Banking In the UK : Personal Vs Remote Interaction”, International Journal of Bank Marketing, Vol. 20, No. 6, pp. 273-285. 30. Hollander, S. (1985), A Historical Perspective on the Service Encounter. The Service Encounter: Managing Employee/Customer Interaction in Service Businesses. J. A. Czepiel, M. R. Solomon and C. F. Suprenant. MA, Lexington Books. 31. Czepiel, J.A. (1990), “Service Encounters and Service Relationships: Implications for Research,” Journal of Business Research, Vol. 20, No. 1, pp. 13-21. 32. Rexha, N., Kingshott, R.P.J. and Aw, A.S.S. (2003), "The impact of the relational plan on the adoption of electronic banking", Journal of Services Marketing, Vol. 17, No. 1, pp. 53-67. 33. Lee, J. (2002), "A key to marketing financial services: the right mix of products, services, channels and customers", Journal of Services Marketing, Vol. 16, No. 3, pp. 238-258. 34. Dwyer, F., Schurr, P. and Oh, S. (1987), “Developing Buyer-Seller Relationships,” Journal of Marketing Vol. 51, No. 2, pp. 11-27. 35. Walsh, S., Gilmore, A. and Carson, D. (2003), "Managing and implementing simultaneous transaction and relationship marketing', The International Journal of Bank Marketing, Vol. 22, No. 7, pp. 468-483. 36. Howcroft, J.B and Durkin, M. (2000) “Reflections on bank-customer interactions in the new millennium”, Journal of Financial Services Marketing, Vol. 5, No. 1, pp. 9-20. 37. Pine, B.J. II, Peppers, D. and Rogers, M. (1995), "Do you want to keep your customers forever?", Harvard Business Review, Vol. 73, No. 2, pp. 103-114. 38. Chase, R.B. (1978), “Where does the Customer Fit in a Service Operation,” Harvard Business Review Nov/Dec, pp. 137-142. 39. Kelly, S.W. (1989), "Efficiency in service delivery: technological or humanistic approaches", Journal of Services Marketing, Vol. 3, No. 3, pp. 43-50. 40. Thornton, J. and White, L. (2001), "Customer Orientation and Usage of Financial Distribution Channels," Journal of Services Marketing, Vol. 15, No. 3, pp. 168-185. 41. Nielsen, J.F. (2002), "Internet technology and customer linking in Nordic banking", International Journal of Service Industry Management, Vol. 13, No. 5, pp. 475-495. 42. Yaklef, A. (2001), “Does the Internet Compete with or Complement Bricks-and-Mortar Branches?,” International Journal of Retail and Distribution Management, Vol. 29, No. 6, pp. 272-281. 43. Dibb, S. and Meadows, M. (2001), ‘The application of a relationship marketing perspective in retail banking'’ The Service Industries Journal, Vol. 21, No. 1, pp. 169-194.

PY - 2008

Y1 - 2008

N2 - It has been established that increasing the role of technology in a service organisation can serve to reduce costs and improve service reliability. It is argued however that that there remains an important role for personalised relationships in the delivery of any service proposition. Throughout this paper both of these perspectives will be discussed and an attempt is made to reconcile these apparently opposing views in the emerging age of technology-enabled remote relationships. Findings from a longitudinal research study with a large UK case bank which focused on the area of remote relationships are revisited and reinterpreted with management from the case bank in question. Through this reflective lens the bank’s recent strategic decision to no longer proactively relationship manage its personal customer base is examined. In light of this deliberate relationship disconnection strategy key marketing implications are discussed.

AB - It has been established that increasing the role of technology in a service organisation can serve to reduce costs and improve service reliability. It is argued however that that there remains an important role for personalised relationships in the delivery of any service proposition. Throughout this paper both of these perspectives will be discussed and an attempt is made to reconcile these apparently opposing views in the emerging age of technology-enabled remote relationships. Findings from a longitudinal research study with a large UK case bank which focused on the area of remote relationships are revisited and reinterpreted with management from the case bank in question. Through this reflective lens the bank’s recent strategic decision to no longer proactively relationship manage its personal customer base is examined. In light of this deliberate relationship disconnection strategy key marketing implications are discussed.

KW - relationships

KW - disconnection

KW - remote

KW - SST

KW - banking

KW - marketing

U2 - 10.1057/palgrave.fsm.4760080

DO - 10.1057/palgrave.fsm.4760080

M3 - Article

VL - 12

SP - 260

EP - 261

JO - Journal of Financial Services Marketing

T2 - Journal of Financial Services Marketing

JF - Journal of Financial Services Marketing

SN - 1363-0539

IS - 4

ER -