Customer Loyalty in Retail Banking

Abstract

The concept of brand loyalty has intrigued researchers and practitioners for over 95 years. The extensive attention that is paid to the "loyalty" phenomenon, is due to the fact that, it is an integral part of companies' mission to create value - for customers and investors. With increasing the intensity of competition and globalization of financial markets, building customer loyalty becomes a strategy of critical significance for the success of financial companies. A problematic area in the theory of loyalty in the service sector is the variety in definitions and lack of consistency about concepts, views and opinions with respect to what is loyalty to a financial service provider, what are its dimensions and how to be defined, measured and managed. Which this in mind, the main focus of this paper is studying the theoretical fundamentals of customer loyalty in retail banking and outputting a relevant conceptual definition for the phenomenon. Basic operational and conceptual definitions are discussed and the specific features of customer loyalty are clarified from a financial sector perspective.