Dries Els

This study investigates the role of brand loyalty in South African banking. More specifically, the study identifies brand loyalty factors in South Africa’s banking industry. Brand loyalty can significantly impact a bank’s competitiveness. Loyal customers do not switch banks and use more banking products; this earns a better income for a bank in the long run (such as home loans). The study’s primary aim is to identify factors of brand loyalty in South African banks. Data were gathered from South African banking customers using a Google Forms digitized format questionnaire with a 5-point Likert scale. More than 1,000 questionnaires were distributed, and 150 completed questionnaires were returned (representing a 15% response rate). The results show that the data are suitable for multivariate analysis. It has an adequate sample (Kaiser, Meyer and Olkin measure > 0.70), acceptable sphericity (p ≤ 0.05), and satisfactory reliability (α ≥ 0.70). The exploratory factor analysis identified four factors explaining a cumulative variance of 55%. These factors are: 1) customer service and satisfaction (34%); 2) negative publicity (7.5%); 3) regulatory compliance and trust (7.1%); and 4) trust and reputation (6.5%). South African bank managers can use the results to focus their brand loyalty strategies on their quest to be more competitive to face the strong competition in the banking industry.

The study investigates the relationship between customers’ loyalty, trust and satisfaction concerning an organization’s reputation in the South African banking sector. High service levels exist in this highly competitive and price-sensitive market. Access to banking has also digitized significantly, and banks adapted their service strategies to comply with COVID-19 restrictions such as hard lockdowns and limited movements. Customers were not able to attend banks. Hence the whole personal (contact) service and loyalty scenario required aggressive reengineering. A bank’s competitiveness can be impacted significantly by service quality, price competitiveness, and product diversity. As a result, the study with the primary objective is to determine the new relationships between customer loyalty and antecedents such as service quality, customer satisfaction, customer trust, brand image, reputation, customer loyalty, and word of mouth. Data were gathered from South African customers using a 5-point Likert scale distributed via an electronic platform (Google Forms). More than 1,000 questionnaires were distributed, and 150 were completed and returned (representing a 15% response rate). The reliability is satisfactory (Cronbach alpha coefficient on all antecedents exceeded 0.775). The literature model was confirmed using confirmatory factor analysis. The analysis showed that the model possesses convergent- (r2 < Sqrt AVE) and discriminant (AVE > 0.5) validity and possesses satisfactory fit indices (CFI = .951, TL = .941, NFI = .922, RMSEA = .089, CMIN/df = 129.072/592.188 = 2.188). This indicates that the model can be operationalized in South Africa to measure post-COVID-19 bank loyalty.