A model of customer loyalty and corporate social responsibility

Abstract

Purpose: This paper aims to examine the roles of corporate social responsibility (a non service‐related concept) and perceived service quality (a service‐related concept) in determining the attitudinal and behavioral loyalty of customers in the retail banking sector in Bangkok, Thailand. Design/methodology/approach: The study is quantitative in nature using the responses of 275 bank customers who answered a survey questionnaire. Data analysis was performed using partial least squares (PLS), a variance‐based structural equation modeling method. Findings: The results of the study demonstrate that corporate social responsibility (CSR) has a significantly strong and positive association with attitudinal loyalty. Perceived service quality mediated the relationship between CSR and repeat patronage intentions (behavioral loyalty). Direct effects were reported between perceived service quality and both attitudinal and behavioral loyalty. A positive relationship between attitudinal and behavioral loyalty was demonstrated. Research limitations/implications: While the results are clear and have strong salience for the retail banking industry, future research should take into account the specific industry context within the national culture. Practical implications: The study provides a set of findings relating to CSR initiatives and perception of service quality that could be readily incorporated into banks' corporate strategic plans. Originality/value: The paper demonstrates an empirical operationalization of CSR initiatives measured from the customers' point of view, and from which banks could learn for corporate strategy development.