Analysis of Service Quality Impact on Customer Loyalty in Banking
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This report delves into the crucial relationship between service quality and customer loyalty within the banking sector. It investigates the impact of the SERQUAL model, encompassing tangibles, reliability, responsiveness, assurance, and empathy, on customer loyalty. The research employs a quantitative approach, collecting data from 100 university students to assess their perceptions of service quality across these five dimensions. Statistical techniques, including factor analysis, correlation coefficients, and regression analysis, are utilized to analyze the data and determine the strength and nature of the relationships between service quality dimensions and customer loyalty. The findings suggest a positive association between the five dimensions of service quality and customer loyalty, with reliability exhibiting a significant positive impact. The report provides detailed analyses of each dimension, presenting the results of factor analysis, reliability tests, correlation analysis, and regression analysis. It also includes a comprehensive literature review, outlining the existing research and theoretical frameworks related to service quality and customer loyalty. Finally, the report concludes with a summary of the key findings, recommendations for banks, and limitations of the study, as well as suggestions for future research.
Running head: IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING
INDUSTRY
Impact of Service Quality on Customer Loyalty in Baking Industry
Name of the Student
Name of the University
Course ID
INDUSTRY
Impact of Service Quality on Customer Loyalty in Baking Industry
Name of the Student
Name of the University
Course ID
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1IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
Abstract
The paper intends to analyze the effect of service quality on loyalty of customers in the
banking industry. Banking sector is one vital sector for an economy in terms of its contribution
to the economic growth and development. Growing competition with local and foreign banks
significantly increases competition within the baking sector. The increasing competition in the
competition makes it vital for marketers to focus of service quality. In order to measure service
quality, the paper takes five attributes of service quality namely tangibles, reliability,
responsiveness, assurance and empathy. Sample responses are collected from 100 university
student related to different dimension of service quality. The collected responses are then
analyzed using statistical techniques of factor analysis, correlation coefficient and regression
analysis. Result obtained from the analysis suggests that there is a significant positive
association between the five different dimension of service quality and customer loyalty. This
implies an improvement in tangibility, reliability, responses, empathy and assurance banks can
improve customer loyalty. Further, regression analysis has been done to estimate the relation
between customer loyalty and different dimension of service quality. All the attributes of service
quality however do not have a significant influence of customer loyalty in the banking sector. It
is only reliability that is found to have a positive significant impact on customer loyalty.
Abstract
The paper intends to analyze the effect of service quality on loyalty of customers in the
banking industry. Banking sector is one vital sector for an economy in terms of its contribution
to the economic growth and development. Growing competition with local and foreign banks
significantly increases competition within the baking sector. The increasing competition in the
competition makes it vital for marketers to focus of service quality. In order to measure service
quality, the paper takes five attributes of service quality namely tangibles, reliability,
responsiveness, assurance and empathy. Sample responses are collected from 100 university
student related to different dimension of service quality. The collected responses are then
analyzed using statistical techniques of factor analysis, correlation coefficient and regression
analysis. Result obtained from the analysis suggests that there is a significant positive
association between the five different dimension of service quality and customer loyalty. This
implies an improvement in tangibility, reliability, responses, empathy and assurance banks can
improve customer loyalty. Further, regression analysis has been done to estimate the relation
between customer loyalty and different dimension of service quality. All the attributes of service
quality however do not have a significant influence of customer loyalty in the banking sector. It
is only reliability that is found to have a positive significant impact on customer loyalty.
2IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
Table of Contents
Chapter 1: Introduction....................................................................................................................6
1.1 Background of the study........................................................................................................6
1.2 Problem statement.................................................................................................................7
1.3 Research aim..........................................................................................................................8
1.4 Research questions.................................................................................................................8
1.5 Research objective.................................................................................................................9
1.6 Structure of the research........................................................................................................9
Chapter 2: Literature Review.........................................................................................................10
2.1 Service Quality....................................................................................................................10
2.2 Service quality model..........................................................................................................12
2.2.1 Tangibility.....................................................................................................................13
2.2.2 Reliability.....................................................................................................................14
2.2.3 Responsiveness.............................................................................................................14
2.2.4 Empathy............................................................................................................................15
2.2.5 Assurance......................................................................................................................15
2.3 Customer Loyalty................................................................................................................16
2.4 Linkage between service quality and customer loyalty.......................................................17
2.4.1 Customer Loyalty and Tangibles......................................................................................19
2.4.2 Customer Loyalty and Reliability.................................................................................19
Table of Contents
Chapter 1: Introduction....................................................................................................................6
1.1 Background of the study........................................................................................................6
1.2 Problem statement.................................................................................................................7
1.3 Research aim..........................................................................................................................8
1.4 Research questions.................................................................................................................8
1.5 Research objective.................................................................................................................9
1.6 Structure of the research........................................................................................................9
Chapter 2: Literature Review.........................................................................................................10
2.1 Service Quality....................................................................................................................10
2.2 Service quality model..........................................................................................................12
2.2.1 Tangibility.....................................................................................................................13
2.2.2 Reliability.....................................................................................................................14
2.2.3 Responsiveness.............................................................................................................14
2.2.4 Empathy............................................................................................................................15
2.2.5 Assurance......................................................................................................................15
2.3 Customer Loyalty................................................................................................................16
2.4 Linkage between service quality and customer loyalty.......................................................17
2.4.1 Customer Loyalty and Tangibles......................................................................................19
2.4.2 Customer Loyalty and Reliability.................................................................................19
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3IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
2.4.3 Customer Loyalty and Assurance.................................................................................19
2.4.4 Customer Loyalty and Empathy...................................................................................20
2.5 Hypotheses...........................................................................................................................23
Hypothesis 1..........................................................................................................................23
Hypothesis 2..........................................................................................................................24
Hypothesis 3..........................................................................................................................24
Hypothesis 4..........................................................................................................................24
Hypothesis 5..........................................................................................................................25
2.6 Conceptual framework ........................................................................................................25
Chapter 3: Methodology................................................................................................................25
3.1 Outline of the research method............................................................................................25
3.2 Research onion.....................................................................................................................26
3.3 Research Philosophy............................................................................................................27
3.4 Research Approach..............................................................................................................28
3.5 Research design...................................................................................................................29
3.6 Data collection method........................................................................................................30
3.6.1 Quantitative data...............................................................................................................30
3.6.2 Collection of primary data............................................................................................31
3.6 Method of sampling and sample size...................................................................................31
3.7 Technique of data analysis...................................................................................................32
2.4.3 Customer Loyalty and Assurance.................................................................................19
2.4.4 Customer Loyalty and Empathy...................................................................................20
2.5 Hypotheses...........................................................................................................................23
Hypothesis 1..........................................................................................................................23
Hypothesis 2..........................................................................................................................24
Hypothesis 3..........................................................................................................................24
Hypothesis 4..........................................................................................................................24
Hypothesis 5..........................................................................................................................25
2.6 Conceptual framework ........................................................................................................25
Chapter 3: Methodology................................................................................................................25
3.1 Outline of the research method............................................................................................25
3.2 Research onion.....................................................................................................................26
3.3 Research Philosophy............................................................................................................27
3.4 Research Approach..............................................................................................................28
3.5 Research design...................................................................................................................29
3.6 Data collection method........................................................................................................30
3.6.1 Quantitative data...............................................................................................................30
3.6.2 Collection of primary data............................................................................................31
3.6 Method of sampling and sample size...................................................................................31
3.7 Technique of data analysis...................................................................................................32
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4IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
3.8 Ethical consideration...........................................................................................................32
3.9 Limitation of the data...........................................................................................................32
3.10 Time frame.........................................................................................................................33
Chapter 4: Result Analysis and Discussion...................................................................................34
4.1 Factor Analysis....................................................................................................................34
4.1.1 All variables..................................................................................................................34
4.1.2 Tangibles.......................................................................................................................38
4.1.3 Reliability.....................................................................................................................39
4.1.4 Responses.....................................................................................................................41
4.1.5 Assurance......................................................................................................................42
4.1.6 Empathy........................................................................................................................43
4.1.7 Customer loyalty...........................................................................................................44
4.2 Reliability............................................................................................................................45
4.2.1 Tangibles.......................................................................................................................45
4.2.2 Reliability.....................................................................................................................46
4.2.3 Responses.....................................................................................................................47
4.2.4 Assurance......................................................................................................................47
4.2.5 Empathy........................................................................................................................48
4.2.7 Customer Loyalty.........................................................................................................48
4.2.6 Composite variables......................................................................................................49
3.8 Ethical consideration...........................................................................................................32
3.9 Limitation of the data...........................................................................................................32
3.10 Time frame.........................................................................................................................33
Chapter 4: Result Analysis and Discussion...................................................................................34
4.1 Factor Analysis....................................................................................................................34
4.1.1 All variables..................................................................................................................34
4.1.2 Tangibles.......................................................................................................................38
4.1.3 Reliability.....................................................................................................................39
4.1.4 Responses.....................................................................................................................41
4.1.5 Assurance......................................................................................................................42
4.1.6 Empathy........................................................................................................................43
4.1.7 Customer loyalty...........................................................................................................44
4.2 Reliability............................................................................................................................45
4.2.1 Tangibles.......................................................................................................................45
4.2.2 Reliability.....................................................................................................................46
4.2.3 Responses.....................................................................................................................47
4.2.4 Assurance......................................................................................................................47
4.2.5 Empathy........................................................................................................................48
4.2.7 Customer Loyalty.........................................................................................................48
4.2.6 Composite variables......................................................................................................49
5IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
4.3 Correlation Analysis............................................................................................................49
4.4 Regression Analysis.............................................................................................................51
4.5 Discussion............................................................................................................................54
Chapter 5: Conclusion...................................................................................................................55
5.1 Conclusion...........................................................................................................................55
5.2 Linking with the research objective.....................................................................................56
5.3 Recommendation.................................................................................................................56
5.4 Limitation and scope of further research.............................................................................56
References......................................................................................................................................58
4.3 Correlation Analysis............................................................................................................49
4.4 Regression Analysis.............................................................................................................51
4.5 Discussion............................................................................................................................54
Chapter 5: Conclusion...................................................................................................................55
5.1 Conclusion...........................................................................................................................55
5.2 Linking with the research objective.....................................................................................56
5.3 Recommendation.................................................................................................................56
5.4 Limitation and scope of further research.............................................................................56
References......................................................................................................................................58
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6IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
Chapter 1: Introduction
1.1 Background of the study
In the financial market banks are considered as important players playing a key role in
smooth functioning of an economy. Considering today’s world of a highly competitive
environment in the corporate sector services quality has turned out to be an important element to
develop customer loyalty resulting in satisfaction among customers. Factors related to quality of
services of different banks are considered as important factors helping banks to improve their
performance and determine successful operation in terms of higher profitability and larger
market share (Tee, Preko and Tee 2018). Service companies consider quality of service as a vital
instrument to develop their competitive advantage within the industry. Since competition among
different banks vary based on product differentiation, variation in services appear as the main
competitive tool. By offering a better quality service banks are able to attract a large group of
customer. Banks therefore carry out structural adjustment to make variation in service quality to
increase their competitiveness. Banks have a vital and significant role to play in development of
financial sector which in turn reflected in economic growth of a nation (Iddrisu et al. 2015). An
efficient baking system contributes to growth of different other sectors of the economy.
Domestic banks often face challenges to compete with global organization. Banks therefore need
a better understanding about changing requirement of customers and should adopt the latest
system of information technology to effectively compete on the global platform. Besides, banks
have the responsibility to offer best quality services to the customers to enjoy a sustainable
competing advantage. Given the critical service quality of businesses, it becomes challenging for
service providers to appropriately measure the service quality. The difficulty in measuring
quality of service arise from diversity, intangibility and problems of separation. In regard to this,
Chapter 1: Introduction
1.1 Background of the study
In the financial market banks are considered as important players playing a key role in
smooth functioning of an economy. Considering today’s world of a highly competitive
environment in the corporate sector services quality has turned out to be an important element to
develop customer loyalty resulting in satisfaction among customers. Factors related to quality of
services of different banks are considered as important factors helping banks to improve their
performance and determine successful operation in terms of higher profitability and larger
market share (Tee, Preko and Tee 2018). Service companies consider quality of service as a vital
instrument to develop their competitive advantage within the industry. Since competition among
different banks vary based on product differentiation, variation in services appear as the main
competitive tool. By offering a better quality service banks are able to attract a large group of
customer. Banks therefore carry out structural adjustment to make variation in service quality to
increase their competitiveness. Banks have a vital and significant role to play in development of
financial sector which in turn reflected in economic growth of a nation (Iddrisu et al. 2015). An
efficient baking system contributes to growth of different other sectors of the economy.
Domestic banks often face challenges to compete with global organization. Banks therefore need
a better understanding about changing requirement of customers and should adopt the latest
system of information technology to effectively compete on the global platform. Besides, banks
have the responsibility to offer best quality services to the customers to enjoy a sustainable
competing advantage. Given the critical service quality of businesses, it becomes challenging for
service providers to appropriately measure the service quality. The difficulty in measuring
quality of service arise from diversity, intangibility and problems of separation. In regard to this,
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7IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
services are required to be modelled using an independent framework to explain and measure
quality of service. Among different framework of service quality, the most widely used model is
the one built by Parasuraman et al., 1985, 1988. This is the most popular model in the field of
service quality dimension (Dubey and Srivastava 2016). This model by incorporating five main
dimensions of service quality helps to understand impact of overall service quality of behavior of
customers. Improvement in the delivery of service in the banking sector is expected to influence
service quality and customer loyalty. Customers use a range of attributes or dimensions for
identifying quality of services as offered by the banks. The attributes used by customers to
identify quality of service in turn are based on customer satisfaction. These are the indicators for
measuring service quality and customers’ loyalty (Izogo and Ogba 2015). As found in past
researches service quality influences loyalty of customers.
1.2 Problem statement
Banking sector today is considered as one of the driving force stimulating economic
growth of a nation. The commercial bank within a nation works as a financial intermediary in the
economy. Their objective is to accumulate profit through lending and borrowing to the individual
and other needed sector Banks aim to maximize its profit through transaction with different
profitable organization and issue various types of instrument of credit (Kaura, Durga Prasad and
Sharma 2015). In any economy, banks therefore hold an important position and contributes
significantly to the building process of the economy. In the context of an advanced economy,
banking sector forms the key element in the money market system making commendable
contribution to the economic development of a nation. The functions performed by banks in a
country include acceptance of deposits and issuing loans and offering a range of other services to
individual and other business ventures (Ngo and Nguyen 2016). Commercial banks have
services are required to be modelled using an independent framework to explain and measure
quality of service. Among different framework of service quality, the most widely used model is
the one built by Parasuraman et al., 1985, 1988. This is the most popular model in the field of
service quality dimension (Dubey and Srivastava 2016). This model by incorporating five main
dimensions of service quality helps to understand impact of overall service quality of behavior of
customers. Improvement in the delivery of service in the banking sector is expected to influence
service quality and customer loyalty. Customers use a range of attributes or dimensions for
identifying quality of services as offered by the banks. The attributes used by customers to
identify quality of service in turn are based on customer satisfaction. These are the indicators for
measuring service quality and customers’ loyalty (Izogo and Ogba 2015). As found in past
researches service quality influences loyalty of customers.
1.2 Problem statement
Banking sector today is considered as one of the driving force stimulating economic
growth of a nation. The commercial bank within a nation works as a financial intermediary in the
economy. Their objective is to accumulate profit through lending and borrowing to the individual
and other needed sector Banks aim to maximize its profit through transaction with different
profitable organization and issue various types of instrument of credit (Kaura, Durga Prasad and
Sharma 2015). In any economy, banks therefore hold an important position and contributes
significantly to the building process of the economy. In the context of an advanced economy,
banking sector forms the key element in the money market system making commendable
contribution to the economic development of a nation. The functions performed by banks in a
country include acceptance of deposits and issuing loans and offering a range of other services to
individual and other business ventures (Ngo and Nguyen 2016). Commercial banks have
8IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
significantly expanded their range of financial services offered to their clients along with its
focus on improving service quality. Therefore, studying the impact of service quality dimensions
on customer loyalty has become crucial for understanding the behavior of banks.
1.3 Research aim
The research paper aims to find out how SERQUAL affect customer loyalty in the baking
industry. In order to investigate the impact of SERQUAL the paper uses five dimensions of
service quality as suggested in the ‘RATER’ model. The five main dimensions of service quality
are Reliability, Assurance, Tangibles, Empathy and Responsiveness. The aim is to examine the
impact of each of the five dimensions on customer loyalty in the banking sector.
1.4 Research questions
The primary research question of the paper is given as
Does the service provided in the bank affect the loyalty and banking of customers?
Investigation of the primary research question involves addressing the following secondary
research questions.
Does factors related to reliability dimension of service quality affect loyalty and banking
of customers?
Does factors related to assurance dimension of service quality affect loyalty and banking
of customers?
Does factors related to tangibles dimension of service quality affect loyalty and banking
of customers?
significantly expanded their range of financial services offered to their clients along with its
focus on improving service quality. Therefore, studying the impact of service quality dimensions
on customer loyalty has become crucial for understanding the behavior of banks.
1.3 Research aim
The research paper aims to find out how SERQUAL affect customer loyalty in the baking
industry. In order to investigate the impact of SERQUAL the paper uses five dimensions of
service quality as suggested in the ‘RATER’ model. The five main dimensions of service quality
are Reliability, Assurance, Tangibles, Empathy and Responsiveness. The aim is to examine the
impact of each of the five dimensions on customer loyalty in the banking sector.
1.4 Research questions
The primary research question of the paper is given as
Does the service provided in the bank affect the loyalty and banking of customers?
Investigation of the primary research question involves addressing the following secondary
research questions.
Does factors related to reliability dimension of service quality affect loyalty and banking
of customers?
Does factors related to assurance dimension of service quality affect loyalty and banking
of customers?
Does factors related to tangibles dimension of service quality affect loyalty and banking
of customers?
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9IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
Does factors related to empathy dimension of service quality affect loyalty and banking
of customers?
Does factors related to responsiveness dimension of service quality affect loyalty and
banking of customers?
1.5 Research objective
Based on the research aim and research questions the primary research objective of the
paper can be stated as
To investigate how SERQUAL affects loyalty of customers in the banking industry.
In order to fulfil the primary research objective, the research paper considers the following
secondary research objectives
To investigate how reliability affects loyalty of customers in the banking industry.
To investigate how assurance affects loyalty of customers in the banking industry.
To investigate how tangibility affects loyalty of customers in the banking industry.
To investigate how empathy affects loyalty of customers in the banking industry.
To investigate how responsiveness affects loyalty of customers in the banking industry.
1.6 Structure of the research
The entire research paper is segregated into five main chapters. The first chapter is
introduction which include background of the research, research aims, research questions and
research objectives. The second chapter is literature review which discusses past literatures in the
chosen area of research. The third chapter is methodology which includes methods used in data
Does factors related to empathy dimension of service quality affect loyalty and banking
of customers?
Does factors related to responsiveness dimension of service quality affect loyalty and
banking of customers?
1.5 Research objective
Based on the research aim and research questions the primary research objective of the
paper can be stated as
To investigate how SERQUAL affects loyalty of customers in the banking industry.
In order to fulfil the primary research objective, the research paper considers the following
secondary research objectives
To investigate how reliability affects loyalty of customers in the banking industry.
To investigate how assurance affects loyalty of customers in the banking industry.
To investigate how tangibility affects loyalty of customers in the banking industry.
To investigate how empathy affects loyalty of customers in the banking industry.
To investigate how responsiveness affects loyalty of customers in the banking industry.
1.6 Structure of the research
The entire research paper is segregated into five main chapters. The first chapter is
introduction which include background of the research, research aims, research questions and
research objectives. The second chapter is literature review which discusses past literatures in the
chosen area of research. The third chapter is methodology which includes methods used in data
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10IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
collection and analysis of data. The fourth chapter is presentation of result and analysis. The fifth
chapter is conclusion which summarizes findings of the research.
Chapter 2: Literature Review
Quality of service is regarded as one important factor determining success of banks.
Service quality helps the bank to differentiate itself from its competitors. Realizing important of
service quality researchers have given considerable attention to determine several factors related
to dimension of service quality. Study made in this field have found that service quality results in
satisfaction among customers leading to repeated purchase of the product from the same service
provider (Paul, Mittal and Srivastav 2016). This by increasing loyalty among customers results
in larger revenue in longer term. Variations in the performances of services offered provide
opportunities to enhance service quality and increases loyalty among customers.
2.1 Service Quality
In today’s world because of increasing prevalence of intense competition the aspect of
service quality has become one important area of research. The studies have considered the
service quality as one important tools to increase customer satisfaction and customer loyalty.
Quality of service is regarded as a competitive advantage having a supporting relationship with
customer satisfaction. In the service industry also service quality has become one of the valuable
tools to increase customer loyalty (Osman, Mohamad and Mohamad 2015). As considered in a
paper developed by Saghier, and Nathan (2013), service quality is a vital concept in the service
industry especially for financial services. This is particularly relevant for financial service
provider since they face difficulty in showing much product differentiation to their customers.
Different researchers have pursued their study on service quality (El Saghier and Nathan 2013).
collection and analysis of data. The fourth chapter is presentation of result and analysis. The fifth
chapter is conclusion which summarizes findings of the research.
Chapter 2: Literature Review
Quality of service is regarded as one important factor determining success of banks.
Service quality helps the bank to differentiate itself from its competitors. Realizing important of
service quality researchers have given considerable attention to determine several factors related
to dimension of service quality. Study made in this field have found that service quality results in
satisfaction among customers leading to repeated purchase of the product from the same service
provider (Paul, Mittal and Srivastav 2016). This by increasing loyalty among customers results
in larger revenue in longer term. Variations in the performances of services offered provide
opportunities to enhance service quality and increases loyalty among customers.
2.1 Service Quality
In today’s world because of increasing prevalence of intense competition the aspect of
service quality has become one important area of research. The studies have considered the
service quality as one important tools to increase customer satisfaction and customer loyalty.
Quality of service is regarded as a competitive advantage having a supporting relationship with
customer satisfaction. In the service industry also service quality has become one of the valuable
tools to increase customer loyalty (Osman, Mohamad and Mohamad 2015). As considered in a
paper developed by Saghier, and Nathan (2013), service quality is a vital concept in the service
industry especially for financial services. This is particularly relevant for financial service
provider since they face difficulty in showing much product differentiation to their customers.
Different researchers have pursued their study on service quality (El Saghier and Nathan 2013).
11IMPACT OF SERVICE QUALITY ON CUSTOMER LOYALTY IN BAKING INDUSTRY
There are a number of theoretical and empirical models that have been built for addressing issues
related to quality of service and drawn insights regarding importance of enhancing service
quality in various dimension. Various definitions and measures have been used to define quality
of service. Despite there is no consensus among researchers on a single definition of service
quality. One paper defined service quality as a complete evaluation as made by customer
services (Al-Azzam 2015). In some other papers researchers defined researched defined
customer service as the extent to which services offered by the organization helps to meet
necessity and satisfaction of the customers. Service quality is often described as the difference
between normative expectations of customers regarding service offered and their perception
about the performances of services. One study developed the service quality definition as it is an
overall evaluation of the particular service of an organization resulted from a comparison of
performance of a firm in line with normal expectation of its customers regarding how the firm
should behave in the industry. Different firms in the service industry especially banks should
understand various attributes related to service quality for designing a suitable marketing
strategy. For example, customers of a bank will use name of the particular bank, guarantees
offered by the bank, reliability of the bank and other facilities provided by the bank before
selecting particular bank. When marketers are able to rightly understand the attributes that
customers use to assess the service quality they are in a better position to manage marketing
strategy. It will also help them to manage its customers by influencing their perception of the
service quality (Zameer et al. 2015). Observing quality of service has been found to play a
crucial role in high involvement industries like that of banking service. Studies confirmed that
banks place a relatively high value on managing customer relationship both for retail and
commercial customers. The five major dimension of service quality are tangibility,
There are a number of theoretical and empirical models that have been built for addressing issues
related to quality of service and drawn insights regarding importance of enhancing service
quality in various dimension. Various definitions and measures have been used to define quality
of service. Despite there is no consensus among researchers on a single definition of service
quality. One paper defined service quality as a complete evaluation as made by customer
services (Al-Azzam 2015). In some other papers researchers defined researched defined
customer service as the extent to which services offered by the organization helps to meet
necessity and satisfaction of the customers. Service quality is often described as the difference
between normative expectations of customers regarding service offered and their perception
about the performances of services. One study developed the service quality definition as it is an
overall evaluation of the particular service of an organization resulted from a comparison of
performance of a firm in line with normal expectation of its customers regarding how the firm
should behave in the industry. Different firms in the service industry especially banks should
understand various attributes related to service quality for designing a suitable marketing
strategy. For example, customers of a bank will use name of the particular bank, guarantees
offered by the bank, reliability of the bank and other facilities provided by the bank before
selecting particular bank. When marketers are able to rightly understand the attributes that
customers use to assess the service quality they are in a better position to manage marketing
strategy. It will also help them to manage its customers by influencing their perception of the
service quality (Zameer et al. 2015). Observing quality of service has been found to play a
crucial role in high involvement industries like that of banking service. Studies confirmed that
banks place a relatively high value on managing customer relationship both for retail and
commercial customers. The five major dimension of service quality are tangibility,
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