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Abstract
This study is entitled quality service delivery and customer patronage of Union Bank Plc services. The study was aimed at examining the effect or relationship between service quality and customer patronage using the dimensions of quality service delivery initiatives against the measures of customer patronage with special reference to Union Bank Plc in Bori. In doing this, three hypotheses were formulated. The population of this study is made up of 22 management and staff of Union Bank PLC Bori. The judgmental sampling technique was used for selecting the sample. The sample size of this study is judgmental sample of 20 respondents which comprise of both the senior and junior staffs of Union bank PLC, bori. In this study both the primary and secondary data were used. In analyzing the data, the SPSS package was used. The pearson product moment correlation coefficient was used to test the hypotheses. The study revealed that reliability, assurance and responsiveness and customer patronage of Union Bank Plc services. Based on the findings of the study, we recommend there is need for the various service providers to determine the optimal customer service reliability to prevent the occurrence of dissatisfaction of customers thereby leading to an increasingly lower patronage rate, it is advisable that every service provider view service assurance as a necessity for customer patronage and should become engaged in customer relationship management i.e. building strong relationship with their customers and the researcher therefore recommended that organizations should focus more attention on service reliability, because of its effects on customer satisfaction.
Table of Contents
Title Page i
Cover Page ii
Declaration iii
Certification iv
Dedication v
Abstract viii
Table of Contents ix
CHAPTER 1 1
INTRODUCTION 1
1.1 Background of the Study 1
1.2 Statement of the Problem: 3
1.3 Objectives of the Study 4
1.4 Research Questions 5
1.5 Research Hypothesis: 5
1.6 Significance of the Study 6
1.7 Scope of the Study: 6
1.8 Limitations of the Study 7
1.9 Definition of Terms 7
CHAPTER TWO 8
LITERATURE REVIEW 8
2.0 Introduction 8
2.1 Conceptual Framework 8
2.2 Theoretical Framework: 21
2.3 Empirical Framework 23
2.4 Summary of Review of Related Literatures 26
CHAPTER THREE 27
RESEARCH METHODOLOGY 27
3.1 Research Design: 27
3.2 Population of the Study: 27
3.4 Sampling Techniques Used 27
3.5 Sample Size 28
3.6 Source of Data 28
3.6.1 Primary Source (s) of Data 28
3.6.2 Secondary Source of Data 28
3.7 Research Instrument for Data Collection 28
3.8 Validity and Reliability of Instrument 29
3.9 Techniques for Data Analysis/Test of hypotheses 29
CHAPTER FOUR 30
DATA PRESENTATION AND ANALYSIS 30
4.1 DATA PRESENTATION AND ANALYSIS 30
4.2 DATA ANALYSIS 30
4.3 Hypotheses testing 37
4.5 Discussion of Findings 40
CHAPTER FIVE 42
SUMMARY, CONCLUSION AND RECOMMENDATIONS 42
5.1 Introduction 42
5.2 Summary 42
5.3 Conclusion 42
5.4 Recommendations 43
References 45
Appendix I 48
Appendix II 49
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
Service quality is very important component in any business related activity. This is especially so, to marketer a customer’s evaluation of service quality and the resulting level of satisfaction are perceived to affect bottom line measures of business success (lacobucci, Kim, and Moffitt, 1994). Customer expectations are beliefs about a service that serve as standards against which service performance is judged (Zeithml, and Bitner, 2003); which customer thinks a service provider should offer, rather than on what might be on offer (Parasuram, Zeithaml, and Berry, 1988). To some, service quality can also be defined as the difference between customer’s expectations for the service encounter and the perceptions of the service received. According to the service quality theory (Oliver, 1980), it is predicted that customers will judge that quality as ` low` if performance does not meet their expectations and quality as `high` when performance exceeds expectations. Closing this gap might require toning down the expectations or heightening the perception of what has actually been received by the customer (Parasuraman, Zeithaml, and Berry, 1985). According to Gronroos (1982), perceived quality of a given service is the result of an evaluation process since consumers often make comparison between the services they expect with perceptions of the services that they receive. He concluded that the quality of service is dependent on two variables: Expected service and Perceived service. Quality spells superiority or excellence (Taylor and Baker, 1994) (Zeithaml, 1988), or, as the consumer’s overall impression of the relative inferiority / superiority of the organization and its services (Bitner and Hubbert, 1994; Keiningham, Idson, Freitas, Spiegel, and Molden, 1994). Consumer behavioural intentions are also influenced by the standards of service quality (Bitner, 1990; Cronin and Taylor, 1992, 1994; Choi, Crowe, and Higgins,2004).
Services are a continuous process of on-going interactions between customers and service providers comprising a number of intangible activities provided as premium solutions to the problems of customers and including the physical and financial resources and any other useful elements of the system involved in providing these services (Grönroos, 2004). The customer is as old as business. The sole purpose of every business is to “Create Customer” (Drucker, 1973), adding more Drucker (1973) opined that the only economic and social justification existence of any business existence is to create customer satisfaction. The importance of the customer and customer patronage per se is so profound.
A person’s intention to behave in a certain way is contingent upon the attitude toward performing the behaviour in question and the social pressure on him/her to behave in that way (subjective norm).This suggests that attitudes and subjective norms differ according to the person involved and behavioural context (Odunayo, and Oluseye, 2014). The ability of every establishment of organization to entice, retain current customers and attract new customers is not only connected to its item for consumption or services, but essentially associated with the image and reputation it creates within and across the marketplace (Odunayo, and Oluseye, 2014). Customer retention goes beyond satisfying the present expectations of the customers instead it is helpful in anticipating their expectations so that they become loyal supporters and promoters for the company’s brand (Odunayo, and Oluseye, 2014).
It has been demonstrated that average business organizations loses around 30 percent of its customers due to their level of insensitivity to customer relationships (Jones, Beatty and Mothersbaugh, 2002).
Zeithml and Bitner (2003) stated that in retaining customers, it is important to deliver quality service that is distinct and consistent with the organizational value scheme and brand. Walsh, Groth and Wiedmann (2005) added that organization who strives to retain and satisfy customers requirements, will sure increase in profit. Uncles, Dowling and Hammond (2003) added that in a situation where an organization has an outsized number of customers with limited increase rate for customers’ retention, there will still be a progression in the profit level. Hence, for every organization to survival the competitive world, it is important to develop an effective customer retention strategy that that will meets the needs, aspiration, demands and requirements of the customers. Hence this study seeks to investigate the influence of quality service delivery on customer patronage of Union Bank PLC, Bori.
1.2 Statement of the Problem:
The inability to deliver quality services is a threat to investors in a business. Almost every Nigerian bank encounters similar problem in meeting customers’ expectation and customer satisfaction. For instance, the issue of delay in posting transactions such as money transfer and payments made between customers is a major problem that customers of Nigerian banks have been made to experience. In most cases, the customer hardly receives the notification that an account has been credited or debited immediately. The account holder may have to wait endlessly before seeing the notification or in worse cases, may have to visit the bank to confirm such transaction.
Also, the long queues and huge crowds in the banking halls can be highly devastating and discouraging, especially when the weekend is near. Most times, these long queues are as a result of the breakdown of the networks on the computers used for operation. Sometimes, it occurs as a result of the cash officers pushing duties to one another, as to who is to attend to the customer or not. Consequently, there is a problem of quality service delivery and customer patronage. One of the major requirements for banks’ efficiency is to match their service facilities with the needs of customers without much delay but in most Nigerian banks today the reverse is the case. Most customers complain of poor service quality delivery, poor customer service response, unreliable service and poor network.
This situation has led to poor efficiency in banking service delivery in Nigeria and has thus caused low customer satisfaction. Many Nigerian banking public has thus wondered when the endless desires of spending the least possible time for banking transactions will be met by banks in the country. Although one of the strong objectives of banks is to attract, retain customers and at the same time optimize profit, however, profit maximization in banking industry is a function of the management’s ability to provide quality services to customers at little or no time wastage. It is the above problems that necessitated the desire to undertake this research, to systematically examine the relationship between quality service delivery and customer patronage of union Bank services in Bori.
1.3 Objectives of the Study
The purpose of this study was to examine the relationship between quality service delivery and customer patronage of Union Bank Plc service in Bori, Khana LGA, Rivers State.
In specific terms, the study shall examine:
1. The relationship between service reliability and customer patronage of Union Bank Plc services, in Bori, Khana LGA, Rivers State.
2. The relationship between service assurance and customer patronage of Union Bank Plc services, in Bori, Khana LGA, Rivers State.
3. The relationship between service responsiveness and customer patronage of Union Bank Plc service, in Bori, Khana LGA, Rivers State.
1.4 Research Questions
The following research questions will guide the conduct of this research work:
1. Does service reliability has any significant relationship with customer patronage of Union Bank Plc services in Bori, Khana LGA, Rivers State?
2. Does service assurance significantly relate with customer patronage of Union Bank Plc services in Bori, Khana LGA, Rivers State?
3. Does service responsiveness has a significant relationship with customer patronage of Union Bank Plc service in Bori, Khana LGA, Rivers State?
1.5 Research Hypothesis:
In course of this research, the following hypothesis will guide its conduct:
H01: There is no significant relationship between service reliability and customer patronage of Union Bank Plc services.
H02: There is no significant relationship between service assurance and customer patronage of Union Bank Plc services.
H03: Service responsiveness has no relationship with customer patronage of Union Bank Plc services.
1.6 Significance of the Study
From the foregoing, it is believed that the completion of this work will provide empirical material on the relationship between quality service delivery and customer patronage. Also, the work is believed will serve as a stepping stone for future researcher as it will provide useful materials for their studies.
In another development, the result of this study will also guide marketers on the relationship between quality service delivery and customer patronage of Union Bank Plc services. This simply means that it will enable them to develop strategies that can lead to customers loyalty which will enhance the Nigerian banking sector performance.
1.7 Scope of the Study:
Content Scope: This study is delimited in two perspectives; firstly it is delimited contextually to examining the relationship between service quality delivery and customer patronage. The independent variable, service quality delivery has assurance, reliability and responsiveness as its dimensions while the measure of customer patronage is Patronage intention, Patronage Action and repeat purchase.
Geographical Scope: The study concentrated on Union Bank Plc, Bori.
Unit of Analysis: The unit of analysis for this study consist of both senior and junior staff of Union Bank PLC Bori at the time of the study.
1.8 Limitations of the Study
In course of carrying out this research, the researcher met with a lot of constraint. Among these constraint is: The time frame which this research was expected to be completed was too short.
Secondly, the cost in carrying out this research work act as a barriers as we were not financially buoyant to carry out all investigation.
Finally, assembling the relevant materials needed this work was a problem. It is difficult due to the fact that some of materials are not available.
1.9 Definition of Terms
Sales volume: Sales volume is the number of units sold within a reporting period.
Profit Margin: Profit margin is part of a category of profitability ratios calculated as net income divided by revenue, or net profits divided by sales.
Customer retention: Customer retention refers to the ability of a company or product to retain its customers over some specified period.
Service quality (SQ): It a comparison of perceived expectations of a service with perceived performance.
Customer Patronage: It is the share of an individual consumer’s expenditures in an industry or retail sector that is spent at one company.
Responsiveness: It is the quality of reacting quickly and positively.
Service assurance: It is the application of policies and processes Provider to ensure that services offered meet a pre-defined service quality level for an optimal experience.
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