Abstract

Bank Loyalty as a Basis for Understanding Sales Relations of Banks

The need for explanation and the permanence of abstract services, together with the object of the services, money, are the causes for the fact that the establishing of bank connections and the acceptance of problem-solving services face customers with difficult decisions. In view of their uncertain situation, the human element as the holder of preferences moves into the foreground as far as the banks’ sales instrumentarium ‘is concerned. It ıs primarily the personal contact between customer and employee that decides whether the learning process of bank loyality develops in favour of a bank or not. If the human element, via the advisory function, is regarded as an integral part of otherwise colourless services of mixed banking institutions that require explanation, their qualitative competition in respect of service features and assortment policy takes the form of competition in personnel quality, especially in the case of problemsolving services. This is also true of the communications sphere, when decisions are made on the employment of impersonal advertising media or sales personnel. Economic considerations require that a salesman should be employed where customers are still in the initial phase of the process of learning bank loyalty. Locationpolicy deliberations must take into account whether, in addition to routine services, problem-solving services are to be included in the assortment of a new branch office; this will probably prove necessary above all when branch office policy is offensive and aimed at winning customers from competing banks. In price policy one must proceed from the assumption that, in principle, the price sensitivity of customers diminishes as bank loyalty grows; this is true, however, only up to the point where the increasing degree of economic knowledge and the economic power of the customers result in a network of banking connections within which shifts in business are oriented to price differences