Customer brand engagement and experience : the case of online banking in The Netherlands

(1)

Master’s Thesis

Customer brand engagement and experience The case of online banking in The Netherlands

Author:

B.J. (Barend) Visscher Student Number: 11017457

University of Amsterdam, Amsterdam Business School Executive Programme in Management Studies

Supervisor: Dr. drs. S. (Stephan) von Delft

University of Amsterdam, Amsterdam Business School

(2)

Statement of Originality

This document is written by Student Barend Jan Visscher who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

(3)

Preface

Dear reader,

After three years of working, I am finishing my Executive Master in Business Studies at the University of Amsterdam. I started this master to challenge myself at an academic level. During the pre-master, I had to get used to the fact that all lectures were in English and that I had to give up a lot of social time.. During the master year, I felt that I was achieving my main goal and I was really enjoying the new thing we learned at the university.

I am grateful to my supervisor Stephan von Delft, who helped me during the thesis period. Furthermore, many thanks to my colleagues and manager at Rabobank Amsterdam. Not to forget, my fellow students for the moments we studied together.

I would like to dedicate my final words to my boyfriend: many thanks for your patience and trust in me! Thank you for support especially in times when the master took a lot of our free time.

Sometimes it was not easy, but now writing the preface of my thesis I can say that I am happy and proud that I have achieved my goal. By handing in this thesis I feel a great period at the University of Amsterdam has ended.

I hope you will enjoy reading this thesis!

Bart Visscher

(4)

List of figures

Figure 1. Conceptual model ... 30

Figure 2. Measurement scale of customer brand engagement ... 35

Figure 3. Measurement scale of online brand experience ... 36

Figure 4. Measurement scale of brand satisfaction ... 37

Figure 5. Measurement scale of brand loyalty ... 37

Figure 6. Mediation effect online on satisfaction ... 43

Figure 7. Mediation effect online on loyalty ... 45

Figure 8. Mediation effect ... 46

List of tables

Table 1. Demographic statistics ... 33

Table 2. Descriptive statistics ... 39

Table 3. Reliability analysis ... 39

(7)

Abstract

Due the rapid pace of digital developments nowadays, the way in which brands and

customers interact with each other has changed to a great extent. This interesting shift from a physical to a more digital product and service context has given birth to new initiatives from both the customer as well as the brand. Within the literature it has become

increasingly more relevant how companies can get their customer to feel more connected to their brand.

As customer engagement has become an important theme, which has not been sufficiently investigated in the Dutch banking sector, it needs to be further explored what this concept entails and how banks can use this to upgrade their performance. Additionally, how

customers perceive an online experience in this digital age also has the attention of many researchers and its effect on brand satisfaction and brand loyalty.

This study has examined to what extent these factors influence each other and deepens the understanding of the concept customer brand engagement within the context of the Dutch banking sector.

This research shows significant relationships among the variables and therewith highlights the degree of importance of customer engagement in the Dutch banking sector.

Keywords: Dutch banking sector, customer brand engagement, online brand experience,

(8)

1 Introduction

Organizations strive to create and maintain long-term relationships with customers, because loyal customers enhance organizational performance outcomes such as sales growth and cost reduction (Kahn, Rahman, & Fatma, 2016). Customer loyalty is important since loyal customers are less likely to switch to offerings from competitors (Evanschitzky et al., 2012; So, King, & Sparks, 2014). Yet, in the digital age companies face challenges in creating and maintaining such long-term customer relationships. For example, face-to-face interaction is decreasing as more and more customers transact online (Larson, 2016). The challenge lies in the fact that in an online environment there is no direct physical contact between the customer and the organization, therefore a customer cannot use the physical cues, such as observing the sales person or the physical environment of the brand, in order to judge trustworthiness (Reicheld & Schefter, 2000). In addition to this, trust is still an important factor in establishing commitment from customer’s perspective towards a brand. In turn, commitment is an important factor in creating a long-term relationship (Yap, Wong, Loh, & Bak, 2010).

Another challenge organizations face today – according to Maslowska, Malthouse, and Collinger (2016) – is that the role of customers changed from a passive to an active role. Customers can no longer be seen as a listening audience, but they have become observers, initiators, participants and co-creators. Customers interact with organizations, other customers and media simultaneously. The article of Moran, Muzellec, and Nolan (2014) explains this as that customers no longer only receive brand information through marketing campaigns provided by the brands, as if the customers act like a listening audience, but

(9)

customers now turn to their peers to seek and gather information themselves about the brand.

Mawslowka et al. (2016) explains that this new type of customer behavior is a consequence of digitalization and has inspired brands to start looking for ways to create engagement with their customers but also with their followers and friends. But there is more to that, Mawslowka et al. (2016) and other authors like Brakus, Schmitt, and Zarantonello (2009), Nysveen and Pedersen (2014) and Kahn et al. (2016), bring up another point of interest which is the (online) experience customers have with the brand and state customer brand engagement is an antecedent of brand experience. This has become important because customers share their experiences about the brand with other customers in order to form their opinion about the brand. Besides this, the online environment tends to open up the possibilities for other forms of interaction, experience and engagement but can also lead to, because of the lack of physical clues, uncertainty and intangibility (Foo, Douglas, & Jack, 2008; Kohllmann & Suckow, 2008). The extent of customer brand engagement can therefore be important for the evaluation of the brand in total.

Considering the possibility of a mutually beneficial relationship between company and customer, but also being aware of the challenges brands face today, it is not surprising that this topic – customer brand engagement, and brand experience– became important areas of scientific and business research (Van Doorn et al., 2010; Hollebeek, 2011a; Verhoef, Reinartz, & Krafft, 2010).

In the following paragraphs the theoretical relevance and the practical relevance will be described.

(10)

Theoretical relevance

A significant amount of articles investigate the concept of customer brand engagement: Hollebeek (2011a), Van Doorn et al. (2010), Hollebeek, Glynn, and Brodie, (2014) and Mawslowska et al. (2016). Nevertheless, Mawslowska et al. (2016, pp. 470) state that despite the numerous publications about customer brand engagement, its relevance is (still) apparent, because of ‘the era of big data and digital media’. In other words, customers and organizations interact more and more in a digital setting and as already mentioned this brings up new challenges to create a longterm relationship with the customers. That statement mirrors So et al. (2014) who also explain increased attention for customer brand engagement as a direct result of the aforementioned era of big data and internet, as after all, nowadays customers interact with businesses on websites and other platforms.

With these statements highlighting the timeliness of customer brand engagement, the different articles investigated for this research show that the authors have not met consensus about the conceptualization of customer brand engagement. Some articles (Hollebeek, 2011a; Brodie, Hollebeek, Jurić, & Ilić, 2011) discuss customer brand engagement from a psychological perspective and determine factors as commitment, pride and involvement as factors building engagement. This psychological perspective is more from a subjects’ internal perspective. Other authors state that engagement goes beyond the involvement or internal dimensions of the subject and focus more on the behavioral aspects like interactions with the object (e.g. a brand) that build and indicate engagement (Van Doorn et al., 2010). Moreover, Van Doorn et al. 2010 states that engagement should only include non-purchase behaviors, while Kunmar et al. (2010) states that in the determination of engagement of both non

(11)

purchase behaviors as well as transactions should be included. As a result some recent authors like Vivek, Beatty, and Morgan (2014) and So et al. (2014) have combined the different perspectives in conceptualizing customer brand engagement. For instance, So et al. (2014, pp. 210) define customer engagement as “a customers’ personal connection to a brand as manifested in cognitive, affective, and behavioral actions inside and outside of the purchase situation”. However, although Vivek et al. (2014) and So et al. (2014) agree on the fact that the two perspectives should be combined in conceptualizing customer brand engagement, the two different set of scales measuring customer brand engagement differ from each other. While Vivek et al. (2014) highlight the level of significance of including the physical contact in the determination of customer brand engagement, they did not put this dimension in the scale of measurement, as opposed to So et al. (2014). This implies that besides the discrepancies of the conceptualization of customer brand engagement, the method through which the construct is measured also needs further empirical investigation.

Customer brand engagement is also thoroughly discussed within the practitioner literature – as shown in the following paragraph.

Practical relevance

Practitioners – such as managers – increasingly turn their attention to customer engagement, which results in increased attention and publications from a managerial perspective. For example, The Marketing Science Institute (2014) called for more research on engagement in their 2006-2008 Research Priorities, because of the changing environment in which organizations and customers interact, since that setting is becoming predominantly an online

(12)

setting. They see this as a paradigm shift in the way organizations interact with their customers.

Also, one of the four largest accountancy and tax firms of The Netherlands, PricewaterhouseCoopers (PwC) state, in their rapport (2016) about customer engagement in the international energy sector, that engagement is more important than before because business models are becoming more customer-centric and reliant on customer interactivity. This statement follows the development of the digitalization of doing business online. PwC (2016) explains, furthermore, that customer expectations are changing as more and more immediacy, ease and control of wider online digital retailing, dictate the standard of customer needs to the organizations.

Moreover, Ernst & Young (EY)(2017) claims that customer engagement in the banking industry, “is one of the biggest challenges facing banks in today’s competitive, multichannel environment”. Because, according to EY, the apathy of customers is widespread, which means that a bank’s customer does not see much of a difference between products of one bank or another in The Netherlands. It is therefore a challenge for banks to connect with them and consequently stay connected or to stay relevant. On the other hand, EY explains that ”engaged customers are willing to interact and communicate with the bank and this often translates to owning multiple products thus decreasing the risk that they will switch to new competitors” (2017, pp. 3). In conclusion, these publications prove customer engagement’s relevance in the banking industry, as after all, it is widely discussed among practitioners.

(13)

Research gap

Based on the theoretical and practical relevance of the concept of customer brand engagement the following foundation of the research gap has been formed. To start with Nysveen and Pedersen (2014), they find that brand experience plays an important role in creating brand satisfaction and brand loyalty, and that it is critical to investigate how customers engage with a brand or organization in an online environment. Several studies discuss the potential influence of customer brand engagement on brand experience (Hollebeek, 2011a, b; Hollebeek et al., 2014; Nysveen & Pedersen, 2014; Van Doorn et al., 2010). They conclude that a positive relationship between the two variables exists but that in the current literature no consensus about the exact definition of customer brand engagement can be found. Kahn et al. (2016) also concluded that the concept customer brand engagement is only marginally empirically investigated and recommend doing more research in different settings to get deeper understanding of this notion.

Besides this Kahn et al. (2016) studied customer brand engagement as a single construct and they recommended to research this concept as a multiple constructs to get a greater understanding of the different dimensions of customer brand engagement.

Finally, Hollebeek (2011b) also concludes that the positive influence of customer brand engagement on loyalty may vary across different industries.

To conclude, the gap in the literature stems from the fact that previous studies focused largely on the concept customer brand engagement without empirically testing it (e.g. Hollebeek, 2011; Mawslowska et al., 2016). Furthermore, the more customer brand engagement is empirically tested in different settings, the more research can be used to get a deeper understanding of this notion (Kahn et al. 2016). So et al. (2014) state that little is known about the different dimensions of customer brand engagement, despite of more

(14)

organizations taking the effort of adopting customer engagement strategies, such as the implementation of an online strategy.

This thesis explores foresaid gap within the confines of the Dutch banking sector for two reasons. Firstly, that sector is about four times as big as the Dutch economy (total assets to GDP ratio) and with that it is, in comparison to other countries, relatively seen as one of the largest banking sectors in the world ("Bankensector Nederland", n.d.). Secondly, in a recent study (Wetenschappelijke Raad voor het Regeringsbeleid, 2016) it was concluded that the Dutch economy and society became more dependent on the banking sector after the crisis and this is even more strongly applicable for small and medium-sized enterprises. At the same time, the banking sector faces the same challenges highlighted above: customers no longer need to abide the banks’ opening hours or have actual physical contact with advisors, but instead can do their business online at any given time (Larsson, 2016). So how can banks establish a connection with customers to achieve those early mentioned positive performance outcomes, such as sales growth and cost reduction? To investigate this, it is necessary to understand the factors of customer brand engagement that eventually build and sustain customer loyalty in an online environment to create a long-term relationship between organizations and customers (Apenes Solem, 2016). And even more because Kahn et al., (2016) already mentioned that in the financial sector, and more specific, the banking sector, customer brand engagement is underexposed. Therefore, taking into account the size of the banking sector, additional research can provide new insight in the understanding of customer brand engagement.

Taking the academic and practitioner literature into consideration, it can be concluded that there is no consensus on the definition of customer brand engagement and the way it is measured. Additionally, customer brand engagement has not been widely empirically tested,

(15)

especially in the banking sector, which has proven to be an essential industry for The Netherlands. In order to address this research gap,

the following research question is formulated:

What is the effect of customer brand engagement on a customer’s brand experience, brand satisfaction and brand loyalty in an online banking environment?

This study focusses on the banking sector and specifically on small and medium-sized enterprises where the interaction increasingly takes place in an online setting. Chapter two provides a thorough research of the prior literature, which result in the main variables of this study. First, we elaborate on the concept of customer brand engagement, customer online experience, brand satisfaction and brand loyalty. Based on the literature, the research model with the expected relationships will be presented in combination with the proposed hypotheses in chapter three. The fourth chapter provides a description and the demographics of the sample and an explanation of how the variables in the research model have been measured. In the fifth chapter, the results of this study will be discussed followed by the sixth chapter where a discussion of the results and the limitations of this study in combination with recommendations for further research is presented. Finally, chapter seven contains the conclusions of this study.

(16)

2 Literature Review

2.1 Customer brand engagement

The next paragraph deals with the different sources about customer brand engagement. That material is analyzed, evaluated etc. in order to come to a workable definition of customer brand engagement within the context of this particular research.

2.1.1 Engagement: psychological and/or behavioural

Mawslowka et al. (2016) suggest that customer engagement definitions are dividable into two categories: the first focusses on the psychological state of engagement and the second on its behavioral components.

Hollebeek (2011a, pp. 780) describes engagement from a psychological perspective as “the level of an individual customer’s motivational, brand-related and context-dependent state of mind”. From the same perspective, Higgings and Schiler (2009, pp. 102) explain engagement as “a state of being involved, occupied, fully absorbed or engrossed in something”. Sprott, Czellar, and Spangenberg (2009) researched engagement as a way of including brands as part of their self-concept, which implicates a connection on a highly personal level.

Verhoef et al. (2010, pp. 247) define customer engagement from a behavioral perspective as “a behavioral manifestation towards the brand or firm that goes beyond transaction”. Van Doorn et al. (2010) also focus on the behavioral aspects of the customer-brand relationship excluding real transactions as a result from motivational drivers. Kumar et al. (2010) agree with Van Doorn et al. (2010), but also state that doing real transactions should be included as a part of customer engagement. They elaborate a bit further on the concept of non-transactional interaction with or about a brand, for example customers sharing opinions

(17)

with other customers and therewith influencing customers or customers providing online feedback to the organization. According to Kumar et al. (2010) these non-transactional interactions can be labelled as engagement behaviors towards the organization and therewith creates value for the organization (Kumar et al., 2010).

When the two different perspectives of customer engagement are compared to one another there are some overlapping views but also some different views noticeable. First, the psychological perspective of customer engagement of Hollebeek (2011a) acknowledge that customer brand engagement is context driven and that there is always a subject (customer) and an object (brand) involved. This is the same as the theory perspective from a behavioral point of view where Verhoef et al. (2010) explain that there is always some kind of action between the subject and the object. Besides this, both perspectives see engagement as a variable that provide predictive power of customer loyalty outcomes (Hollebeek, 2011a; and Kumar et al., 2010). The difference between those two perspectives lies in the fact that the physiological view of customer engagement is more focused on the internal process of the subject and looks at the cognitive and emotional variables such as commitment or involvement of the subject towards the object. These authors examined academic disciplines including sociology and psychology to determine these variables. As an example, Hollebeek (2011 a) examined an article in educational psychology by London, Downey and Mace (2007), who defined student engagement as students’ academic investment, motivation and commitment to their institution and their perceived psychological connection, comfort and sense of belonging towards their institution, which emphasize the psychological aspect of engagement. The behavioral view of customer engagement has got its theoretical roots in relationship marketing and emphasizes the notions of interactivity and customer experience. They state that engagement extends beyond mere involvement as it encompasses an

(18)

interactive relationship with the engagement object and requires the emergence of the individual’s perceived experiential value in addition to instrumental value (e.g. website) obtained from specific brand interactions. This implies a more active way of engaging a customer, whereas engagement is established after interactions or purchases.

Nevertheless, some academics include both psychological and behavioral components when defining engagement. These academics conceptualized customer brand engagement with both components to emphasize the importance of a deeper understanding of the individuals’ interactions and connection with the brand and with each other in relation to the brand. Vivek et al. (2012, pp. 133) combine the two perspectives and define customer engagement as “the intensity of an individual’s participation in and connection with an organization’s offerings or organizational activities, which either the customer or the organization initiates”. And customer engagement can be manifested cognitively, affectively, behaviorally or socially (Vivek et al., 2012).

It is not unexpected that Vivek et al. (2012) combines the two perspectives into one concept. Surely, the interaction between the customer and the brand (subject and object) is not solely based on the psychological aspects or the behavioral aspects. In fact, although both views overlap, they also differ enough from each other so they can only be used together to fully understand customer brand engagement.

Furthermore, Vivek et al. (2012) explain the separate dimensions of customer engagement. They explain that “the cognitive and affective elements of customer engagement incorporate the experiences and feelings of customers, and the behavioral and social elements capture the participation by current and potential customers, both within and outside of the exchange situations.” (pp. 133). Vivek et al. (2012 pp. 133) conclude the following:

(19)

“Customer engagement involves the connection that individuals form with organizations, based on their experiences with the offerings and activities of the organization. Potential or current customers build experience-based relationships through intense participation with the brand by way of the unique experiences they have with the offerings and activities of the organization.”

So et al. (2014) also conclude, similar to Vivek et al. (2014), that customer brand engagement is a multidimensional construct, which means that they focus in the conceptualization of customer brand engagement both on the psychological as the behavioral components. Just like Vivek et al. (2014) they claim this to be important because of the evolving marketing paradigm, where relationships are no longer just between customers and organizations but it has become any combination between organizations, customers, prospects and society. Customer brand engagement therefore becomes an extension of developing relationships with both current and potential customers and the domain of focus should also encompass beyond purchase.

As So et al. (2014, pp. 307) conclude: “the truly engaged customer must have an enduring psychological connection with the brand in addition to behavioral participation”, which implies a ‘deeper’ and proactive interactive relationship between customer and organization. Additionally, So et al. (2014) created a scale of 25 items for the concept of customer brand engagement – divided across the following dimensions: “enthusiasm”, “identification”, “attention”, “absorption”, and “interaction”.

Vivek (2009) also created a scale for measuring customer brand engagement with 21 items. While he emphasizes the importance of physical action as “an essential dimension of

(20)

customer brand engagement” (pp. 61) this element is absent in his scale, which makes it less comprehensive than So et al. (2014). Therefore, for this research the scale of So et al. (2014) is used to measure customer brand engagement, as this scale is more complete and fits this research the most.

As witnessed above, within academic literature (Hollebeek, 2011a; Verhoef et al., 2010; So et al., 2014) customer brand engagement is discussed from different perspectives. Also, scholars use different terms to describe customer brand engagement. For example, the term ‘customer engagement’ (Verhoef et al., 2010) is mentioned, while others pick ‘customer engagement behaviours’ (Van Doorn et al., 2010) or ‘customer brand engagement’ (Hollebeek, 2011). Despite this variation in terminology, in all these different articles the concept of engagement between a subject and an object is discussed. Depending on the context of the research a different term was used. In this research, it is about the engagement of a customer with a

brand. Therefore, in this research the term customer brand engagement is used.

Now that the concept of customer brand engagement is discussed, it is time to examine the next central concept of this research: online brand experience. Furthermore, in the next paragraph the relation between these two concepts is further explained.

(21)

2.2 Online brand experience

Brakus et al. (2009, pp. 53) claim that brand experience as a concept derives from the cognitive science, philosophy and management practices and might be defined as “sensations, feelings, cognitions and behavioral responses evoked by brand-related stimuli that are part of a brand’s design and identity, packaging, communications and environments”. It is noticeable that this definition does not seem to overlap all the different fields of science. After all, it seems rather difficult to determine in what way this aforementioned definition is overlapping the field of philosophy and science. For this research it is particularly relevant to acknowledge that Khan and Rahman (2015) name brand experience as an increasingly popular concept within marketing literature (Ha & Perks, 2005; Sahin, Zehir, & Kitapçı, 2011; Nysveen & Pedersen, 2014) because it generates brand satisfaction and loyalty. This is in line with the purpose of this research to determine the effect of customer experience on brand satisfaction and loyalty, because as mentioned, this is a good indicator for a long-term relationship and therefore relevant for this research.

Prahalad and Ramaswamy (2004) stated that customer experience has become increasingly important for brands to stay relevant. They explain that because great variety of product and services offerings, it is hard for brands to differentiate themselves. So brands should create value for customers through personalized interactions that are meaningful and sensitive to a specific customer, since not the offering but the experience creates unique value for individuals. And therefore companies shift their focus from a company-centric view to a customer-centric view, which emphasizes interaction between both parties instead of focusing on introducing products to markets.

(22)

After the publication of Prahalad and Ramaswamy (2004) many scientific publications were devoted to analyze their views on brand experience. For example Alloza (2008) described brand experience as “the perception of the customer, at every moment of contact they have with the brand, whether it is in the brand images projected in advertising or during the first personal contact” (p. 373). While other authors describe brand experience as a broad construct and state that brand experience includes both customer and non-customer experiences (Nysveen, Pedersen, & Skard, 2012). In this research, the focus lies on brand experience, given the fact that both customers and non-customers can have brand experience and therewith consider brand experience the broadest experience construct.

Furthermore, the focus of this research is at the online brand experience of the customer which is in line with So et al. (2014) who explain that the growing universal online environment gave birth to a range of media channels upon which organizations offer products and/or services to customers beyond a physical encounter – consequently organizations and customers interact evermore online. Brakus et al. (2009) explain that this development moved brand experience beyond mere physical services and products into the realm of online searching or buying. Moynagh and Worsley (2002) state that the online environment provides possibilities for interactivity and a real-time brand experience where customers can interact with the brand, and with fellow customers. But not all researchers were only positive about the movement from offline to online, as Morgan-Thomas and Veloutsou (2013) state that within this online environment without physical interaction, challenges of intangibility and uncertainty are stronger.

Related to the aforementioned marketing literature, this shift from offline to online can be seen as a positive development. It has hardly been negatively criticized and with this development new possibilities of interaction and real-time brand experience arise. Especially,

(23)

taking into account the fact that these large changes require adaptive capacity, not only for the customer but also for the banking sector. As an example, an article in the ABA Banking Journal states that banks stay far behind in the rise of the total experience economy, where technology and ease of use create today’s best brands. They explain that banks too often fall back to the same old process, in which they evaluate who they are and what they want to be. So it can be questioned if banks are able to make that shift from a company-centric view to a customer-centric view, and more importantly create that personalized online experience.

Nevertheless, this criticism did not prevent banks from focussing on online experience as a creator of value, which leads to the next question: ‘what does the literature tell us about online brand experience?’. Morgan-Thomas and Veloutsou (2013, pp. 22) define it as “an individual’s internal subjective response to the contact with the online brand”. Besides, they state that interaction between companies and customers through a range of activities results in different experiences., such as internet experience (Nysveen & Pedersen, 2014), customer experience in an online environment (Novak, Hoffman, & Yiu-Fai, 2000) and website brand experience (Ha & Perks). From this it can be concluded that conceptualization of online brand experience is divers.

Ha and Perks (2005) researched the concept of website-based brand experience, in order to study customer behavior in an online environment. They defined website-based brand experience as “a customer’s positive navigations (i.e. using web-based communities and participating in events) and perceptions (i.e. the attractiveness of cookies, variety and uniqueness of visual displays and value for money) with a specific website (p.440). They also found that customers generally prefer using a website that delivers a positive experience rather than just being informational (Ha & Perks, 2005). Therefore, this thesis will use the variable ‘online brand experience’ as the “holistic response to the stimuli within website

(24)

environment” (Morgan-Thomas and Veloutsou, 2013, p. 22) in order to research the online experience of using a bank’s website.

2.3 Brand satisfaction and loyalty

2.3.1 Brand satisfaction

Brand satisfaction is a core marketing concept because it attributes to long-term competitive advantage (Han et al., 2018 Heitmann, Lehmann, & Herrmann, 2007; Patterson, Johnson, & Spreng, 1996). Gustafsson, Johnson, & Roos (2005, pp. 210), based on an article by Johnson and Fornell (1991), define brand satisfaction as “a customer’s overall evaluation of the performance of an offering to-date”, which can occur after an online experience. They also state that this overall satisfaction has a strong positive effect on brand loyalty. Sahin et al. (2011) on the other hand, describe satisfaction as an effective response to a so-called purchase situation and Ganesan (1994) considers brand satisfaction as an outcome of a prior experience. Although these two definitions do not seem to confront each other, Gustafsson et al. (2005) further elaborate that an overall evaluation does not only take place when purchasing a product, but also within a service context, as service quality is an indicator of overall satisfaction.

This research aims to measure that exactly: a customer’s overall satisfaction with online service quality. Besides, in line with Sahin et al. (2011), brand satisfaction is considered a consequence of a prior online experience, which in turn is relevant in order to improve organizational performance. As Algesheimer, Dholakia, & Herrmann (2005) stated: a satisfied customer is more likely to become a loyal customer.

(25)

2.3.2 Brand loyalty

Erciş, Ünal, Candan, & Yıldırım (2012) state that brands want their customers to feel strongly committed to their brands. First, in order to create a loyal customer, it is necessary to fulfill customer satisfaction. When customers are satisfied, they show commitment by continuously buying the same brand and thus become a loyal customer (Nysveen and Pedersen, 2014)

Oliver (1999, pp. 34) define it as “a deeply held commitment to rebuy or repatronize a preferred product/service consistently in the future, thereby causing repetitive same-brand or same brand-set purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior.” Several recent studies such as Uncles, Dowling, & Hammond (2003), So et al. (2016) and Pansari and Kunmar (2017) underline this definition, which indicates the relevance of this description.

In the marketing literature brand loyalty has often been used interchangeably with other definitions, as for example: repurchase, commitment, preference and allegiance (Sahin et al. (2011). But also, loyalty has been researched in different market-specific contexts, for example, store and vendor loyalty and service loyalty. Oliver’s (1999) earlier mentioned view on future brand loyalty is still relevant as the sharp and complete definition has yet to be surpassed by any other author.

In line with Oliver’s definition (1999), brand loyalty is conceptualized as intended loyalty in the future so the intention of staying a customer of the bank for the next five years, and the intention to recommend the bank to others (Nysveen & Pedersen, 2014).

(26)

3 Conceptual framework and hypotheses

Following Lemke et al. (2011) and Kahn et al. (2016), this study views customer brand engagement and brand experience as related to each other but different concepts. This is in line with Hollebeek et al. (2014), who explain that in contrast to customer brand engagement, brand experience does not include a motivational state and that brand experience is not an emotional construct and therefore two separate concepts. Some studies like Hollebeek (2011ab) and Nysveen and Pedersen, (2014) describe the relationships between the two constructs and argue that brand experience is a result of customer brand engagement and therewith influences the experience. They highlight the motivational state of customer brand engagement and therewith actually commits an individual to the brand. In addition to this, an online brand experience is actually a mix of sensations, behaviors, cognitions and feelings, which are, according to Brakus et al. (2009) evoked by brand-related stimuli, as for example the brand’s website.

Therefore, in line with So et al. (2014, pp. 210), customer brand engagement is perceived as “a customer’s personal connection to a brand as manifested in cognitive, affective, and behavioral actions inside and outside of the purchase situation” and propose a positive relation with the online brand experience. This is in line with Kahn et al. (2016) who state that if brands increase customer engagement levels, it leads to improved brand experiences. Moreover, practitioners as PricewaterhouseCoopers (PwC) and Ernst & Young (EY) emphasize the urgency to engage with customers because of the changing environment where more and more of the interaction with customers - and experiences of customers - take place online (PwC 2016; EY, 2017). As a result of this literature study, the importance of getting a greater understanding of the relationship between these two constructs is acknowledged,

(27)

but this relationship is not sufficiently researched yet in the Dutch banking sector. In consequence, study researches the positive influence of customer brand engagement on online customer experience, specifically in the banking sector. As a result, the following hypothesis was formulated:

H1. In the Dutch banking sector, customer brand engagement positively influences a customer’s online brand experiences.

Gustafsson et al. (2005, pp. 210; Johnson and Fornell, 1991) define brand satisfaction as “a customer’s overall evaluation of the performance of an offering to-date”. The authors further explain that this offering to-date also applies to services or experiences. Which is in line with Ganesan (1994) who stated that brand satisfaction is an outcome of a prior experience. It can therefore be said that if the service feature or the service itself has provided a “pleasurable level of consumption-related fulfilment” (Ha & Perks, 2005 p. 442)a customer can be satisfied. Moreover, satisfaction can be seen as an important indicator of the quality of the relationship between organizations and customers, which is also stated by Algesheimer et al. (2005) who describe that satisfaction leads to a long-term relationship with the brand. Because as Ha & Perks (2005) explain, satisfied customers tend to stay connected to the brand, because customers rely on their prior experience in making the decision to repurchase. Brakus et al . (2009) also identified positive influences of brand experience on brand satisfaction and brand loyalty.

Based on the aforementioned descriptions from the literature, a positive relation between a customer’s online brand experience and customer brand satisfaction is proposed

(28)

and to deeper understand this relationship in the Dutch banking sector the following hypothesis was formulated:

H2. In the Dutch banking sector, online brand experiences positively influence brand satisfaction.

Brand loyalty as described by Oliver (1999, p. 34) is “a deeply held commitment to rebuy or repatronize a preferred product/service consistently in the future”. Brakus et al., (2009) state in their research that customers are likely to develop brand loyalty, and repurchase when they receive positive brand experiences. This implies a direct positive effect between online brand experiences and brand loyalty. Other studies, like Nysveen and Pedersen (2014) and Khan and Rahman (2015) identified brand loyalty as a consequence of brand experience. Therefore, this research also proposes a direct positive effect of online brand experience on brand loyalty and because no other research has already examine this effect within the banking sector in The Netherlands, the following hypothesis is formulated:

H3. In the Dutch banking sector, online brand experiences positively influence brand loyalty.

Brakus et al. (2009, p 53.) define brand experience as “a subjective internal customer response created by sensations, feelings, cognitions and behavioral reactions evoked by brand-related stimuli like design, communications or experience with a website”. Furthermore, Hollebeek (2011) explains that opposed to the “responsive” character of brand experience, customer brand engagement includes a proactive character of customer cognitions, emotions and

(29)

behaviors, which indicates the difference but relevance of brand experience as an outcome of customer engagement. Furthermore, Sahin et al. (2011), Nysveen and Pedersen (2014) and Brakus et al. (2009) has found that a positive brand experience can lead to increased brand loyalty and brand satisfaction. As this relationship is not yet investigated for the Dutch banking sector yet, the following hypothesis is formulated:

H4. In the Dutch banking sector, online brand experience mediates the effect of customer brand engagement on brand satisfaction and brand loyalty.

Agustin and Singh, (2005) states that brand satisfaction is an essential component of brand loyalty. More studies have determined the relationship between brand satisfaction and brand loyalty, where brand satisfaction is an antecedent of brand loyalty (Bennett et al, 2005; Jones and Suh, 2000; Bolton, 1998). Moreover, increased brand satisfaction leads to increased brand loyalty (Bennett, Härtel, & McColl-Kennedy, 2005; Jones and Suh, 2000; Bolton, 1998). With these theoretical arguments for underpinning this relationship, the importance of brand loyalty is also widely discussed. To be specific, research has shown that brand loyalty enhances organizational performance outcomes such as sales growth and cost reduction (Kahn et al., 2016). And loyal customers also have a long-term relationship with organizations because they are less attracted to competitors’ offerings (So et al., 2014) and consequently resist switching (Evanschitzky et al., 2012). As no prior research has questioned this effect, specifically in the Dutch banking sector, the following hypothesis was formulated:

(30)

(31)

4 Methodology

4.1 Research design

The main goal of this study is to examine to what extent customer brand engagement influences brand experience, brand satisfaction, and brand loyalty within an online banking environment. The underlying research philosophy is based on a positivism point of view which focuses on a cause and effect between variables. Specifically, in this study outcomes are predicted by using a certain theory (Saunders & Lewis, 2012). Variables were deducted from the literature and existing measurements to examine the research question were used. Therefore, this research is explanatory, because it puts particular attention on the explanation of the relationship between variables (Saunders & Lewis, 2012). As a survey is a proper and suitable manner to collect quantitative data, which can be tested statistically in order to answer the ‘What’ research question and related hypotheses (Saunders and Lewis, 2012), in this study the survey strategy with a cross-sectional time horizon is used. Besides, this method makes it possible to collect data in a short period of time and reach a large group of people (Saunders and Lewis, 2012).

4.2 Case: banking in the Netherlands

The main focus area of this research is the financial sector in The Netherlands and more specifically the banking sector. Banking and financing are important service industries in The Netherlands (Statista, 2018). The size of the banking sector in The Netherlands has decreased since the financial crisis in 2008. In 2008, the number of bank offices was approximately 3400, now this number is less than 1700. In addition to this, The Netherlands is the country with the highest response of people who reported to already use online banking in the Benelux region

(32)

(Statista, 2018). The latter is interesting, because this research has taken the online brand experience into consideration.

The Dutch banking sector is relatively large in size in comparison to the banking sectors in other European Union (EU) countries. The banking sector in The Netherlands is characterized by a few large institutions which dominate its financial markets. Rabobank, ING Bank and ABN Amro Bank together holds a market share of 60 to 80 percent in outstanding amounts for mortgages, business loans and savings (Statista, 2018). The total interest income on loans and advances to customers of Rabobank, ING Bank and ABN Amro Bankreached 16, 18 and 9 billion euros respectively in 2016. Rabobank has a relatively large market share, as one out of four mortgages is provided by Rabobank (Rabobank, 2018).

This research focus on business owners of small and medium-sized enterprise (SME) in The Netherlands and specifically in the region of Amsterdam. Because of my work as an account manager at the local branch of Rabobank Amsterdam, we have asked SME clients at Rabobank to participate in this research.

4.3 Data collection

The quantitative data was collected through an online survey distributed by email and LinkedIn with help of Qualtrics Software. The questionnaire was based on existing scales of prior literature and modified to this research.

4.3.1 Description of the sample

The sample of this study is selected by using a non-probability sampling technique, also known as the convenience sampling technique. This method was used, as due to privacy legislation it is not allowed to send a survey to the whole target group of this study, which is small and

(33)

medium-sized enterprises (SME) of Rabobank. Some purposiveness was created by using selection criteria for respondents. This is relevant for the research reliability (Saunders & Lewis, 2012). The respondents should at least meet the following criteria: they have an online banking account and they have had banking experiences online. To reach as many online banking customers, the questionnaire was distributed via email and social media (i.e. Facebook, LinkedIn). Besides, 30 account managers of the Rabobank were asked to forward the survey to ten of their clients. The survey was available from 25th_{of May 2018 until 15}th_of

June 2018. In that period, 124 respondents have started the survey, who all met the requirements. The survey was completed by 95 respondents. Based on the amount of respondents who started the survey and the respondents who finished the survey, a response rate of 77% has been realized.

Translation of the survey

In order to establish a proper connection with the potential respondent, the survey is translated to Dutch. The survey is translated by three persons with more than five years of experience in the English language. After that the best translation was selected and used in this survey.

Table 1. Demographic statistics (N=95)

Characteristics Distribution (%) Characteristics Distribution (%) Characteristics Distribution (%) Gender male female gender neutral Age < 25 26 - 35 36 - 45 46 - 55 56 - 65 >= 65 77,9 21,1 1,0 1,0 27,4 41,1 20,0 9,5 1,0 Organization size < 1 million turnover 1 - 5 million turnover 5 - 10 million turnover > 10 million turnover Usage website

More than once a week Once a week Once a month Once a year No use 51,6 34,7 6,3 7,4 67,4 10,5 10,5 3,2 8,4 Bank Rabobank ING Bank ABN Amro Bank Other

90,5 1,1 3,2 5,2

(34)

In Table 1, the demographics of the sample are shown. The majority of the respondents or business owners are male with 77,9%. Most of the business owners are between 36 and 45 years old. Half of the business owners owns a relatively small organization with a turnover of less than 1 million euros. Despite of a small group of respondents (8,4%) almost every respondent has indicated to use their bank’s website.

4.4 Description of measures

4.4.1 Customer brand engagement

So et al. (2014) developed and attempted to provide a measure for customer engagement with a brand. They partially adapted the measurement from Hollebeek (2011) and Van Doorn et al. (2010). Just like Hollebeek (2011) and Vivek (2009) they define customer engagement as ”a multidimensional concept subject to a context- and/or stakeholder-specific expression of relevant cognitive, emotional and/or behavioral dimensions” (So et al., 2014, pp. 307). So et al. (2014, p. 307) state that ”a multidimensional approach will capture the full complexity of customer engagement”. Therefore, So et al. (2014) developed a scale for the concept of customer engagement from the factors of: ‘attention’, ‘enthusiasm’, ‘identification’, ‘absorption’ and ‘interaction’. All these factors are found to be significant for measuring customer brand engagement. The authors emphasize the factors attention and enthusiasm due their high factor loadings (So et al., 2014 p.324). The authors explain that increased attention can be reached by providing customers information that is relevant, personal and interesting. Enthusiasm can be enhanced through “outstanding service delivery, features that thrill customers and a positive brand image” (So et al., 2014 p. 324). The factors, identification,

(35)

absorption, interaction are evoked in a more engrossing way. In creating brand identification, organizations need to create a unique and clear identity, desired by the customer, to be able to create a sustainable differentiation of the offering (So et al., 2014). This can be triggered by offering memberships or classifying customers in line with other customers (So et al., 2014). Absorption can be realized by involving customers with activities full of immersion and concentration. Finally, interaction can be triggered by inviting customers to actively participate through recognition and reward schemes (So et al. 2014). For this research, the level of customer brand engagement will be measured by using the five items developed by So et al. (2014). The existing measurement scale is used in this research context. The items of this scale are shown in figure 2. These items are answered by using a 7-point Likert scale (1= Strongly disagree to 7= Strongly agree).

(36)

4.4.2 Online brand experience

The online brand experience will be measured by using a scale of five items adapted from the study of Morgan-Thomas and Veloutsou, (2013). These authors view experience as an experiential response and defines online experience as the “holistic response to the stimuli within website environment” (Morgan-Thomas and Veloutsou, 2013, p. 22). An existing measurement scale is used for this research. The items of the scale are shown in figure 3. These items are answered by using a 7-point Likert scale (1= Strongly disagree to 7= Strongly agree).

Figure 3. Measurement scale of online brand experience

4.4.3 Brand satisfaction and brand Loyalty

Kahn et al. (2016) measured the construct brand satisfaction and used three items based on Fornell (1992) and Oliver (1980). Kahn et al. (2016) also measured brand satisfaction in a banking environment, similar to the context of this study, and was proven to suitable to use. The items of the scale are shown in figure 4. These items are answered by using a 7-point Likert scale (1= Strongly disagree to 7= Strongly agree).

(37)

Figure 4. Measurement scale of brand satisfaction

Brand loyalty will be measured by using the three items adapted from Nysveen and Pedersen (2014). An existing measurement scale is used for this research. The items of the scale are shown in figure 5. These items are answered by using a 7-point Likert scale (1= Strongly disagree to 7= Strongly agree).

(38)

5 Results

5.1 Data analysis

First, we have executed the frequency test and checked whether there were any errors in the data. We found no errors in the data but some respondents did not answer all the questions in the survey and therefore needed to be excluded from the data. Furthermore, no outliers were found.

A total of 124 respondents started the survey. From these 124 respondents, 95 respondents completed the survey. Nine respondents indicated that they are clients of another bank than the Rabobank and therefore they were excluded. The final group that indicated that Rabobank is their main bank consisted of 86 respondents. This whole group answered the questions about the online experience and therefore were included for further analysis. There were no counter-indicative items included in this survey, because all questions and statements in the construct of measurement were positively answered by the respondents using a 7-point Likert scale (1= Strongly disagree to 7= Strongly agree). In the following paragraphs, we will discuss the statistic tests which were executed. We tested the assumptions regarding normality and subsequently conducted reliability and correlation tests. For hypotheses 1, 2, 3 and 5 we performed linear regression analysis. Finally, we tested hypothesis 4 using the Process macro-tool by Hayes (2013).

5.2 Descriptive statistics

Descriptive statistics for the main variables customer brand engagement (CBE Total), online

(39)

Table 2. Descriptive statistics

Variables N Min max M SD Skewness Kurtosis

1. CBE Total 2. Online 3. Satisfaction 4. Loyalty 86 86 86 86 1.44 2.00 3.00 3.00 6.96 7.00 7.00 7.00 3.73 5.33 5.76 5.53 0.98 0.93 0.91 1.01 0.295 -0.853 -1.068 -0.725 0.514 1.186 1.046 0.067

Regarding the normality assumption for the distribution we checked the skewness and kurtosis for each variable. Within a normal distribution the skewness and kurtosis of each variable needs to have a value between -2 and +2 (Field, 2014). All the main variables have their skewness and kurtosis within this range and therefore we conclude that the data of the sample has a normal distribution.

5.3 Reliability analysis

A reliability analysis has been conducted in order to ensure the consistency of the items in the scales that we have used to measure the variables: customer brand engagement, online brand experience, satisfaction and loyalty. The calculated Cronbach’s alpha for each variable is presented in table 3.

Table 3. Reliability analysis

Variables Cronbach’s alpha

Attention Enthusiasm Identification Absorption Interaction CBE Total Online banking Satisfaction Loyalty 0.895 0.874 0.913 0.913 0.866 0.950 0.876 0.906 0.896

(40)

The Cronbach’s alpha for all the variables was high and above the threshold of 0.7 (Field, 2014) which implies a high reliability, i.e. the items show a high internal consistency. The variables attention, enthusiasm, identification, absorption and interaction together constructs the overall scale customer brand engagement. Therefore, we combined these variables and computed the scale mean and renamed it into CBE Total. Furthermore, we also computed the scale means of the other constructs and renamed them into Online banking, Satisfaction and Loyalty.

5.4 Correlation analysis

We conducted the correlation analysis to examine the presence of significant correlation between the variables in our research model. The outcome of the correlation analysis is presented in Table 4.

Table 4. Correlations between the main variables (cronbach’s alpha).

Note: CBE, customer brand engagement; ** p< 0.01.

The outcome of the correlation analysis shows that there are significant relations present in our research model. The relationship between the variables are all positive, meaning that when one increases the other also increases and vice versa. The strongest association is found between Satisfaction and Loyalty, r=.811, when satisfaction with the bank increases the loyalty towards the bank will also grow.

Variables 1 2 3 4 1. CBE Total 2. Online banking 3. Satisfaction 4. Loyalty (.950) .278** .464** .552** (.876) .454** .426** (.906) .811** (.896)

(41)

5.5 Regression analysis

We have already examined the correlation effect of the different variables in our research model and found the existence of a positive relation between the variables. The formulated hypotheses 1, 2, 3 and 5 suppose a direct effect between an independent variable and a dependent variable, with the independent variable predicting the dependent variable. A regression analysis is the appropriate way to examine the existence of this effect (Field, 2014).

Hypothesis 1 In the Dutch banking sector, customer brand engagement positively influences a customer’s online brand experiences.

Our expectation is that customer brand engagement predicts positively the customer’s online brand experience.

The simple regression has shown that the model was statistically significant. There was a statistically significant effect of customer brand engagement on the online brand experience, F (1, 84) = 7.062, P < . 01, R2_{= .078 B = .264. This means that if CBE Total increases with 1 unit}

the online brand experience increases with 0.264.

Hypothesis 2 In the Dutch banking sector, online brand experiences positively influence brand satisfaction.

Our expectation is that online brand experience predicts positively brand satisfaction. The simple regression has shown that the model was statistically significant. There was a statistically significant effect of online brand experience on brand satisfaction, F (1, 84) =

(42)

21.77, P < . 001, R2_{= .206 B = .444. This means that if the customer’s online brand experiences}

increases with 1 unit the brand satisfaction increases with 0.444.

Hypothesis 3 In the Dutch banking sector, online brand experiences positively influence brand loyalty.

Our expectation is that online brand experience predicts positively brand loyalty. The simple regression has shown that the model was statistically significant. There was a statistically significant effect of online brand experience on brand loyalty, F (1, 84) = 18.67, P < .001, R2₌

.172 B = .461. This means that if the customer’s online brand experiences increases with 1 unit the brand loyalty increases with 0.461.

Hypothesis 5 In the Dutch banking sector, brand satisfaction positively influences brand loyalty.

We expect that brand satisfaction predicts positively brand loyalty. The simple regression has shown that the model was statistically significant. There was a statistically significant effect of brand satisfaction on brand loyalty, F (1, 84) = 160.90, P < .001, R2_{= .653 B = .897. This means}

that if the brand satisfaction increases with 1 unit the brand loyalty increases with 0.897.

5.6 Simple Mediation

In the previous paragraphs we examined the correlation between the variables and the direct effect of two variables through regression analysis. In hypothesis 4 a mediated effect was proposed, however, a regular linear regression analysis is not sufficient and therefore we use the process template macro-tool by Andrew F. Hayes (2013). Our expectation is that customer

(43)

brand engagement predicts brand loyalty, which is mediated by both a customer’s experience online and a customer’s satisfaction. First, we will test two separate mediation models and thereafter we will test the full model with two mediation variables.

Hypothesis 4 In the Dutch banking sector, online brand experience mediates the effect of customer brand engagement on brand satisfaction and brand loyalty.

For this particular hypothesis we have used process template by Andrew F. Hayes model 4. We examined the indirect effect of customer brand engagement on and brand satisfaction through the mediator online brand experiences.

Figure 6. Mediation effect online on satisfaction

The effect of customer brand engagement (CBE) on online brand experience is .26, which means that two respondents that differ by one unit on CBE are estimated to differ by 0.26 units on online. The coefficient is positive, meaning that those relatively higher in CBE Total are estimated to be higher in their online banking experience. This effect is statistically different from zero, t = 2.66, p = < .01, with a 95% confidence interval from 0.07 to 0.46. The effect of online brand experience on brand satisfaction is .34. This indicates that two respondents who experience the same level of CBE but that differ by one unit in their level of

(44)

positive, meaning that those relatively higher in online are estimated to be higher in their satisfaction. This effect is statistically different from zero, t= 3.76, p = <.001, with a 95% confidence interval from .16 to .53. The indirect effect of .09 means that two respondents who differ by one unit in their reported CBE are estimated to differ by 0.09 units in their reported satisfaction as a result of their online banking experience, which in turn translates into greater satisfaction. This indirect effect is statistically different from zero, as revealed by a 95% BC bootstrap confidence interval that is entirely above zero (0.15 to 0.19). The direct effect of CBE, c′ = .34, is the estimated difference in satisfaction between two respondents experiencing the same level of online banking experience but who differ by one unit in their reported CBE, meaning that the person feeling more CBE but who experienced online banking equally is estimated to be 0.34 units higher in his/her reported satisfaction. This direct effect is statistically different from zero, t= 3.91, p = <.001, with a 95% confidence interval from 0.25 to 0.61. The total effect of CBE on satisfaction is c = .43 meaning two respondents who differ by one unit in CBE are estimated to differ by 0.43 units in their reported satisfaction. The positive coefficient means the person perceiving greater CBE reports higher satisfaction. This effect is statistically different from zero, t = 4.8, p = <.001, or between 0.25 and 0.61 with 95% confidence.

Furthermore, we examined the indirect effect of customer brand engagement on and brand loyalty through the mediator online brand experiences.

(45)

Figure 7. Mediation effect online on loyalty

The effect b1 = .32 indicates that two respondents who experience the same level of CBE that differ by one unit in their level of online are estimated to differ by b1 = .32 units in loyalty. The coefficient of b1 is positive, meaning that those relatively higher in online are estimated to be higher in their loyalty. This effect is statistically different from zero, t= 3.30, p = <.01, with a 95% confidence interval from .13 to .51. The indirect effect of .09 means that two respondents who differ by one unit in their reported CBE are estimated to differ by 0.09 units in their reported loyalty as a result of their online banking experience, which in turn translates into greater loyalty. This indirect effect is statistically different from zero, as revealed by a 95% BC bootstrap confidence interval that is entirely above zero (0.12 to 0.18). The direct effect of CBE, c′ = .48, is the estimated difference in loyalty between two respondents experiencing the same level of online banking experience but who differ by one unit in their reported CBE, meaning that the person feeling more CBE but who experienced online banking equally is estimated to be 0.48 units higher in his/her reported loyalty. This direct effect is statistically different from zero, t= 5.24, p = < .001, with a 95% confidence interval from 0.30 to 0.66. The total effect of CBE on loyalty is c = .57, meaning two respondents who differ by one unit in CBE are estimated to differ by 0.57 units in their reported loyalty. The positive coefficient means

(46)

the person perceiving greater CBE reports higher loyalty. This effect is statistically different from zero, t = 6.06, p = <.001, or between 0.38 and 0.75 with 95% confidence.

Our simple mediations show that the models were statistically significant and therewith found that there is a positive relationship between the variables.

To get a more clear understanding of the relationship between the two variables we also executed a double mediations analysis with the process template by Andrew F. Hayes model 6. We examined the indirect effect of customer brand engagement on and brand loyalty through the mediators online brand experience and brand satisfaction. The results are presented in the figure 8.

(47)

6 Discussion

In this chapter the findings of this research will be discussed. We will discuss the outcome of the statistically tested hypotheses and we will answer the main research question.

6.1 Discussion of the results

The first hypothesis (H1) stated that customer brand engagement positively influences the customer’s online brand experience. The results have shown that customer brand engagement has a significant positive effect on online brand experience. This means that H1 has been accepted. The higher the engagement of the customer with the brand the better the online brand experience of the customer is. This is in line with the study of Lemke et al. (2011) and Hollebeek et al. (2014) where they state that the two concepts are different but related to each other. The online brand experience does not include a motivational state and is not an emotional construct as opposed to customer brand engagement (Hollebeek, 2011) and Nysveen (2014). Therefore, it could be that the more engaged a customer feels to a brand and subsequently more motivated and emotionally connected, a better online brand experience can be realized. But if we look more closely to the results of the tested hypothesis 1, we see that although the results show a significant relationship, the score of between the variables customer brand engagement and online brand experience is not that high, as customer brand engagement should increase with one unit to increase the online banking experience with 0.264. This probably indicates that although the two constructs are significantly related, they also act on their own and should be treated as two separate constructs.

The second hypothesis (H2) stated that online brand experience positively influences brand satisfaction. The results have shown that online brand experience has a significant positive