FORMING, MAINTAINING AND ENDING RELATIONSHIPS IN FINANCIAL SERVICES SECTOR: A CASE STUDY OF A NIGERIAN STOCKBROKING FIRM

Adeniran, Adetunji Adetola (2006) FORMING, MAINTAINING AND ENDING RELATIONSHIPS IN FINANCIAL SERVICES SECTOR: A CASE STUDY OF A NIGERIAN STOCKBROKING FIRM. [Dissertation (University of Nottingham only)] (Unpublished)

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Abstract

ABSTRACT

BACKGROUND

Many writers have stated that relationship marketing (RM) is becoming increasingly important in the financial service industry, mainly because of the intangible nature of products in this and other service industries that could be problematic for traditional marketers (Egan, 2004; Barnes and Howlett, 1998). This is particularly so for certain financial service organizations such as the stock broking firm. Krishnan et al (1999) felt that the stock broking firm is peculiar since the product delivered is not stock certificate but the investment it represents as well as other peripheral services such as account management and accurate periodic reporting (p. 1197). Hamilton (1968) identified three (3) core functions of the stockbroker with their role as advisers to their clients in the selection and administration of their investments being particularly important. This was considered important since it was felt that this interaction requires personal contact, confidence and trust because of the sensitive nature of securities and investments. It was further suggested that the emergence of insurance companies, pension funds and unit trusts acts as a powerful influence on forcing the stock broking firm to provide more efficient technical services for clients (Hamilton (1968). There has also been limited research on relationship development and management in financial services

As a consequence, it could be argued that examining the foundation of business to consumer relationships (BCRs) in this sector will provide insights for marketers, researchers, managers and firms in this sector on how relationships can be forged, strengthened and developed since managing relationships within these organizations can add value for the organization and increase its competitive advantage (Morgan and Hunt, 1994; Gruen, 1997; Palmer, 1997). Examining the nature of these relationships could also provide essential ideas and new strategies on how firms could better manage their relationships with clients.

AIM

To analyze how relationships are formed, maintained and dissolved in a Nigerian Stock broking firm focusing on business to consumer relational exchanges using a case study approach.

PRINCIPLE FINDINGS

The major findings were that most relationships within the stock broking firm are formed through referral from family members and friends with clients making contact with the firm through visits to the company or through the email. The study also found that many customers maintained their relationship with the firm once they are satisfied with the services; receive timely and accurate information and advice and interact with honest and friendly staff. The case study further revealed that customers will terminate their relationship with the firm if they experience dishonest and unfriendly staff and if they are dissatisfied with the service especially poor and inaccurate advice and information. Further it was found that most customers will inform the organization that they will terminate services with them but there was still a small group who will not inform the firm of their intentions to terminate. However the study found that most customers will restart a relationship with the firm once their problems are resolved or if they could not find an alternative firm. This is so despite the findings of the study that most customers maintained more than one broker.

CONCLUSIONS

The findings suggest that many business to consumer relationships in the stock broking firm are formed and established as a 'result of word of mouth' with friends and family members referring persons to the firm, it therefore implies that managers, marketers and firms need to ensure that customers receive high quality service and enjoy a positive experience with the firm so that they could continue to refer and mobilise others to establish relationships with the firm. This may also be even more important since many of the customers maintained a relationship with more than one broker suggesting that termination and switching may not be too difficult and/ or challenging.

The results of the study were also consistent with the literature that trust, communicating timely and accurate information, friendly staff and high quality of services were some of the key factors contributing to the maintenance of long standing relationships with clients and once some of these factors are not met, customers will terminate their relationships with the firm. This again suggests that managers and firms need to strengthen these aspects of service delivery to continue to maintain their relationships with customers. There is however the need for further research on relationship formation, maintenance and termination in other stock broking and financial firms before generalization of the results of this study could be done. Investigating the impact of instability amongst staff and high staff turnover rates on maintenance and termination of BCRs in firms would also be useful in providing further insights into relationship development and termination in the stock broking firm.

Item Type: Dissertation (University of Nottingham only)
Depositing User: EP, Services
Date Deposited: 15 Feb 2007
Last Modified: 18 Sep 2016 04:51
URI: http://eprints.nottingham.ac.uk/id/eprint/20608

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