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Article
Publication date: 30 August 2024

Cong Zhao, Abu Hanifa Md. Noman and Mohammad Zoynul Abedin

As opposed to conventional promotional methods, Word-of-Mouth (WOM) communication, especially when negative, significantly shapes customers’ repurchase decisions and preferences…

Abstract

Purpose

As opposed to conventional promotional methods, Word-of-Mouth (WOM) communication, especially when negative, significantly shapes customers’ repurchase decisions and preferences. Therefore, this study aims to examine the interplay between negative WOM and bank service failures, with a focus on the mediating role of customer switching intentions and the moderating role of switching costs in this relationship.

Design/methodology/approach

Using an online semi-structured questionnaire survey, a dataset comprising 411 responses was gathered from retail bank customers in China. This dataset was subsequently analyzed using SPSS PROCESS.

Findings

Consistent with the social exchange theory, our study revealed a significant relationship between service failure and both bank customers’ intention to switch and negative WOM communication. Additionally, we observed that switching intentions significantly influence negative WOM communications, acting as a mediator between service failures and negative WOM. Furthermore, our findings indicated that switching costs moderate the direct effect of service failures on negative WOM and moderate the indirect effect of service failures on negative WOM through switching intentions.

Research limitations/implications

This study provides significant policy implications aimed at minimizing bank service failures and subsequent negative WOM communications among bank customers.

Originality/value

This study empirically investigates the role of service failures in promoting negative WOM communication, demonstrating a partial mediation effect of switching intentions in this relationship. Moreover, the study highlights that switching costs moderate service failures’ impact on customers’ switching intentions.

Details

International Journal of Bank Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0265-2323

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