Binding through branding: an investigation into the impact of brand experience and brand image on consumers’ perception of trust in the context of the UK financial services sector

Moin, S.M.A. (2016) Binding through branding: an investigation into the impact of brand experience and brand image on consumers’ perception of trust in the context of the UK financial services sector. PhD thesis, University of Nottingham.

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Abstract

The purpose of this thesis is to understand the impact of brand experience and brand image on consumers’ perceptions of trust in the context of the UK financial services sector. Since the financial crisis in 2008, trust has been an issue for financial services brands with scandals surfacing continually such as the “Libor Scandal” in 2012 (BBC News, 2013); the manipulation of foreign exchange markets by proprietary traders in large banking institutions (Financial Times, 2014); a number of banks being fined a total of £2.7 bn (BBC News, 2013) and so on. In these kinds of scenarios of declining trust, it is of paramount importance that financial services brands not only focus on their brand identity but also consistently deliver a favourable brand experience and build a strong brand image to contribute in the restoration of trust in financial services. Therefore, this study makes a timely contribution by providing a nuanced understanding of how and to what extent brand experience and brand image impact consumers’ perception of trust in the context of financial services from an interdisciplinary perspective.

The theoretical model incorporating brand experience, brand image and a number of important interdisciplinary trust constructs has been developed from the interdisciplinary literature on trust and brand (Mayer et al., 1995; Aaker, 1997; McKnight et al., 1998; McKnight and Chervany, 2001-2002; McKnight et al., 2002; Mayer et al., 2007; Ennew and Sekhon, 2007; Ennew et al., 2011; Brakus et al., 2009) through inductive top-down theorising (Shepherd and Sutcliffe, 2011). The model explains the relationship between a number of brand and trust constructs. It proposes that in the context of financial services sector, where the perceived risk is high, trusting belief positively impacts trusting intention (H1); the structural assurance dimension of institutional trust has a positive effect on trusting belief (H2) and on trusting intention (H3); the situational normality dimension of institutional trust has a positive effect on trusting belief (H4) and on trusting intention (H5); the faith in humanity dimension of dispositional trust has a positive effect on trusting belief (H6) and on structural assurance dimension of institutional trust (H7) – whereas the trusting stance dimension of dispositional trust has a positive impact on trusting intention (H8) and on structural assurance dimension of institutional trust (H9). The theoretical model also proposes that a positive brand experience has a positive impact on trusting belief (H10) and likewise a positive brand image has a positive impact on trusting belief (H11).

As part of theory testing following an objectivism ontological and positivism epistemological position, a survey-based quantitative approach was employed to test the hypotheses. Under the auspices of a large MNC with offices in the major cities of UK and in many countries of the world, a sample was drawn from its UK based employees, which was reasonably representative of the UK population. As the respondents were asked to answer questions about their main bank, any male or female who lives in the UK and has a UK bank account would qualify as being suitable subjects for this research. A total of 420 paper based questionnaires were distributed to this sample through customer services operatives and managers. Of them 301 questionnaires returned, 300 were usable and one was incomplete, thus resulting in a response rate of 71.46%. The measurement scale for trusting belief was adopted from Ennew and Sekhon (2007) and Ennew et al. (2011) trust index; the measurement scales for brand experience and brand image were adapted from Brakus et al. (2009) brand experience scale and from Aaker (1997) brand personality scale respectively – both of them were further validated in the context of financial services sector. The measurement scales for trusting intention, institutional trust and dispositional trust were developed from interdisciplinary trust literature (Mayer et al., 1995; McKnight et al., 1998; McKnight and Chervany, 2001-2002; Ennew and Sekhon, 2007; Ennew et al., 2011) and further validated. To test the factor structure and to identify poorly-performing items and scale reliability, Exploratory Factor Analysis (EFA) was conducted followed by Confirmatory Factor Analysis (CFA) for checking uni-dimensionality and validity (Garbing and Hamilton, 1996; Cadogan et al., 2009) of the measurement scales using Lisrel 8.80. Finally, hypotheses were tested through Structural Equation Modelling (SEM).

The findings validate the interdisciplinary brand-trust theories: out of eleven hypotheses tested, nine hypotheses were accepted and two hypotheses were partially accepted. The study sheds light on the role of institutional trust and dispositional trust on financial services consumers’ overall perception of trust through influencing their trusting belief and trusting intention; and underscores the importance of having a sound and strong financial structure to engender trust. Furthermore, it reveals that although consumers have noticed the efforts of financial services institutions and regulators in putting an overarching structure for financial systems in place, they are not fully convinced that the current situation is typical and normal. The study found strong links between consumers’ perception of a positive brand image and on their perception of trusting belief. In unveiling the relationship between brand experience and trusting belief, the study found that the affective dimension of brand experience has a significant influence in influencing consumers trusting belief, whereas the intellectual dimension of brand experience is not viewed favourably by the financial services consumers.

This research contributes to convergent theories of trust and mutually inclusive theories of trust and brand through adopting an interdisciplinary approach. In particular, it contributes to theory application by operationalising an interdisciplinary brand-trust conceptual model. The findings bring valuable insights that contribute towards the integrated brand-trust literature and validate the interdisciplinary theory of trust that centres around the seminal work of Mayer et al. (1995), McKnight et al. (1998), McKnight and Chervany (2001-2002) and Tan and Sutherland (2004). The research shows the impact of brand experience, brand image, institutional trust, and dispositional trust on consumers’ overall perceptions of trust in the context of the financial services sector. In addition, the study makes a methodological contribution through developing measurement scales for trusting intention, institutional trust and dispositional trust, which are particularly suitable for the financial services sector; and also by validating brand experience and brand image scales for financial services. Due to the divergent interdisciplinary perspectives of trust, the literature on trust still remains divided especially in its conceptualisation of the constructs. Hence this study makes an attempt to bring harmony to an on-going debate around trust. It also incites a debate whether trust in the context of the financial services sector should be conceptualised and operationalised from a single disciplinary perspective or through employing an interdisciplinary approach; and whether the issues of trust and branding should be treated as integrated phenomena or not.

The study is of relevance to managers and policy makers, for it will inform them of the importance of institutional trust, dispositional trust, brand image and brand experience on consumers’ overall perceptions of trust; and provide them with more sophisticated measures for brand experience and brand image for financial services, which in turn will create an opportunity for them to develop more effective branding strategy. The measures of trusting intention, institutional trust and dispositional trust that have been developed especially for the financial services sector as part of this study also offer significant implications for practice. In the light of this study, policy makers, commercial organisations and other interested stakeholders in the financial services sector can measure and track trust in a more comprehensive manner than previously. They will be able to monitor changes in perceptions of trust more accurately and in a more regular fashion, understanding the level of changes on each kind of trust and the reasons for these changes in the overall perceptions of trust. This will also help firms to develop a more effective strategy to restore or enhance consumers’ perceptions of trust as it provides policy makers and firms with guidance regarding where a particular focus on types of trust should be given.

Item Type: Thesis (University of Nottingham only) (PhD)
Supervisors: Devlin, James F.
McKechnie, Sally A.
Keywords: Brand name products, Management, Consumers, Attitudes, Trust, Financial services industry, Great Britain
Subjects: H Social sciences > HD Industries. Land use. Labor
Faculties/Schools: UK Campuses > Faculty of Social Sciences, Law and Education > Nottingham University Business School
Item ID: 35972
Depositing User: Moin, S
Date Deposited: 13 Feb 2017 10:38
Last Modified: 20 Jun 2017 10:23
URI: http://eprints.nottingham.ac.uk/id/eprint/35972

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