Research

Contents

Introduction……………………………………………………………………………………………………………………. 2

The operational definition of variables……………………………………………………………………………… 12

Procedures……………………………………………………………………………………………………………………. 12

Validity and reliability measures……………………………………………………………………………………… 14

References……………………………………………………………………………………………………………………. 15

Appendix……………………………………………………………………………………………………………………… 17

Questionnaire…………………………………………………………………………………………………………….. 17

Introduction

Promotional strategies are a crucial point of differentiation for commercial banks that seek growth and sustainability. Banks are a typical example of a highly sophisticated service industry that provides a variety of high-value financial products and services to consumers. Banks operate in a dynamic business environment that is continually influenced by economic, political, social and technological changes that limit growth options. Focusing on customer growth and retention through valid promotion can help banks meet strategic and profitability objectives for better responsiveness to business challenges. The purpose of this research is to explore the vital role played by personal selling in the promotion and sale of commercial banking services, to provide strategic recommendations for banks to adopt.

Background and significance

Commercial banks are considered one of the riskiest business ventures since they quickly respond to environmental factors in the internal and external business contexts. Increased competition and complexity of the financial services business environment, has imposed a lot of pressure on banking organizations to be proactive in formulating and designing strategic responses to competition and consumer behaviour to secure competitive business position. According to Joie, Brian &Joe (2019), commercial banks have two primary avenues for business growth. The two channels include; taking advantage of mergers and acquisitions to build capacity or grow organically by attracting new customers and retaining existing ones through favourable product offerings that meet consumer financial needs. While focusing on customer growth and retention, research has shown that the nature of customer relationship in banks plays a significant role in enhancing the consumer experience and influencing customer behaviour (Joie, Brian &Joe, 2019). Quality customer relationships develop through quality service delivery as well as effective communication and engagement of the consumer.

The research proposes the use of personal selling to appeal, attract and retain customer segments. Personal selling has the potential to ensure that banks introduce, define and position their financial products and services more succinctly to customers. Personal selling helps commercial banks deliver specially designed messages to prospective consumers, offering a flexible platform for relationship marketing. Erevelles&Fukawa (2013) defines personal selling as the individual presentation of bank products and services directly to the customer with the aim of building sales, appealing to customers and building consumer relationships. Personal selling provides a point of personal contact with the target consumer. It is considered a more responsive communication tool since it creates an opportunity for the customer to receive in-depth information on brand products and provide rapid feedback. The face to face nature of personal selling makes it an interpersonal form of interaction which encourages the development of mutually benefiting customer- buyer relationship. Personal selling allows a brand of directly studying customer behaviour and adjusting communication strategies to suit specific audience needs.

Consumers are susceptible to banking options since they directly affect financial outcomes. Personal selling as a communication tool can foster better customer relationships based on mutual trust, confidence and respect, which can help a bank achieve organic growth and competitiveness. A survey conducted by Vukoji (2017) among 106 commercial banking staff, concluded that personal selling influenced sales growth and was an essential instrument in the positioning of goods and services among target consumers. The nature of interactive communication fostered by personal selling inspires positive customer characteristics such as trust and confidence, which enhance customer intention to purchase and remain loyal to a given brand. According to Joseph et al. (2014), personal selling has a profound effect on customer relationships and customer retentions since it helps to guide and educate customers for better financial decision making.

The research will particularly help to inform marketing decisions of large scale banks that operate across diverse customer segments. Commercial banks aim to build sustainability and competitive advantage in a complex business environment. Personal selling will help improve performance by influencing higher investments, more extensive market shares and higher customer retention rate, which made the sector a favourable choice for studying strategic personal selling. The main aim of promotional activities at commercial banks is to generate consumer interest and confidence in a brand, leading to purchase decision. The research will play a significant role by ensuring the bank can develop more responsive and relevant relationship management strategies.

The research will be underpinned by the AIDAS theory of selling as well as the behavioural equation theory. The AIDAS selling theory suggests that prospective buyers pass through five main stages of attention, interest, desire, action and satisfaction before making a buying decision, as shown in the diagram below:

Source: Mullins & Panagopoulos (2019)

According to the theory, a salesperson must desire to inspire these processes in the mind of the prospective buyer to help encourage positive behaviour. The buying behaviour theory, on the other hand, states that a seller must set the right conditions to help influence favourable consumer decision. According to the buying equation theory, a consumer has a need which they seek to satisfy by buying certain products and services (Mullins & Panagopoulos, 2019). A salesperson must strive to influence a favourable purchase decision by providing sufficient information about a product or service to help the consumer develop a positive association between the consumption of the product or service and their satisfaction.

Source: Mullins &Panagopoulos (2019)

Based on the selling and buying theory proposed by the AIDAS and behavioural equation theory, Joseph et al. (2014), states that there are six profound stages to effective personal selling. The first phase involves selection, training and empowerment of sales representatives. The sales representatives require a strong knowledge of the business products and services and also demonstrate strong selling skills. The sales agents also need a strong understanding of the competitive environment and factors to be more effective in positioning the products as having superior value over competitor products. The second phase of the personal selling process involves collecting information on the prospective customers and the criteria used to make purchase decisions to develop a better positioning strategy of the brand. Following training and prospecting, the third phase of the personal selling process entails approaching of customers. The customers range from individuals, groups or business organizations who seek to benefit from given products and services. The salesperson adopts favourable communication and relationship building skills to capture the attention of the consumer (Joie, Brian &Joe, 2019). The fourth phase of the personal selling process is the presentation and demonstration process in which the salesperson demonstrates and presents the products and services, explaining all the accrued benefits of the product. Some presentations require demonstrations and calculations to inspire more interest and engagement for better convincing. The sixth is the customer decision-making stage. In this phase, the customer asks questions and probes into the details of the presentation. The sales representative confirms and clarifies any unclear information and assures the consumers that buying the product or service is the best decision. The seventh stage involves monitoring and evaluation of the business product and its impact on customer satisfaction. The salesman identifies areas of product improvement that could improve sales prospects and positive consumer behaviour in future.

Personal selling as a promotion design suits the taxonomy of marketing activities. Alternatives to personal selling include social media advertising, TV and radio advertising and public relations. Social media advertising involves the use of strategic social media tools such as Facebook, Instagram and Twitter to send consumer messages that create awareness and positive behaviour towards business products. TV and Radio advertising uses traditional media to engage specific customer segments such as those with no access to digital devices as well as older customer segments who are more accustomed to conventional channels of communications. Public relations involve the use of company reputation and image to inspire positive customer behaviour. Public relations can be achieved through sustainable practice as well as responsible organizational engagement of the community. The main point of differentiation between alternative methods and personal selling is the interpersonal communication involved in personal selling, that helps build. According to Bubnjević (2017), the primary roles of personal selling are persuasion and information. The information role involves a two-way process in which the seller informs target or existing consumers about banks products and services. In the reverse process, the customers enquire and probe about the nature of products and services. The face to face interaction also serves a persuasive role by enhancing the knowledge, perceptions and attitudes of a customer towards the products

Research Objectives

The primary aim of the study is to investigate the role of personal selling in enhancing sale effectiveness in the banking sector. The general objectives of the research will be:

• To demonstrate the relationship between personal selling and customer purchase intention
• To investigate the effect of personal selling on customer loyalty
• To examine the impact of personal selling on customer brand trust
• To explore the impact of personal selling on relationship quality with customers
• To identify the barriers and opportunities for personal selling that exist for commercial banks in the current market environment

Research Hypothesis

H1: There exists a positive relationship between personal selling and positive consumer behaviour towards bank services

Based on the central hypothesis, there will be four secondary hypotheses to be defined:

H1a: There is a significant correlation between personal selling and customer purchase intention

H1b: There exists a positive correlation between personal selling and improved customer relationship quality

H1c: There is a significant correlation between personal selling and customer retention

H1d: There is a significant correlation between personal selling and enhanced consumer trust

Research population and sample

The research population refers to the group of individuals with common characteristics selected to participate in the research. Based on research theory, it is impossible to study the entire community since it contains a large number of people who would be inconvenient and uneconomical to study. Consequently, the researcher will draw a satisfactory sample to represent the attitudes and opinions of the population. As a result of access and practical reasons, the research will focus on collecting data from commercial bank customers to help capture their perceptions and attitudes towards personal selling. The study aims to conduct the survey online, using the Survey-monkey as a web-interface to access willing respondents. Online reviews are a cheap and flexible way of obtaining a more comprehensive research audience. The research will target at least 600 respondents who will be selected through judgmental or purposive sampling. The purposeful sampling approach is a sampling technique where participants are chosen based on researcher knowledge or intention. The purpose of using the purposeful sampling approach, in this case, will be to access banking consumers in the market to get access to their opinions. While there are a lot of consumers in the online domain, the research will purposefully seek to acquire data from banking consumers, thus the tailored sampling approach.

A questionnaire will be designed to acquire information from a sample of 100 banking consumers. The inquiry will contain 16 questions, 3 of which will enquire customer demographics while 13 questions will explore on customer behaviour. Respondents will be requested to express their opinions based on pre-determined statements on a Likert scale. The study participants will be asked to rate the frequency of their perception or experience with personal selling ranging from a level of ‘1’ Strongly agree, ‘2’ agree, ‘3’ neutral, ‘4’ disagree to ‘5’ strongly disagree. The numbers are attached will assign meaning to the answers provided by the respondents. The Likert scale is recognized as a reliable and simplified tool for evaluating respondents’ opinions, perceptions and attitudes towards a set of pre-determined questions (De Winter &Dodou, 2010). Based on the range of choices, respondents will select one that best reflects their attitude and perception. Respondents who are not sure about a response will be in a position to choose the neutral option in the Likert scale.

The questionnaires will be distributed online and targeted towards current users of a commercial bank. The survey contains 16 questions designed to help collect data about the attitudes, opinions and suggestions concerning the role and effectiveness of personal selling as a way of enhancing customer relations and bank sales.

The operational definition of variables

Procedures

The study will be a survey of quantitative nature. The study will adopt a descriptive research design involving a structured questionnaire as the primary data collection tool. The reason for using the descriptive design is to ensure the opinions and attitudes of study participants are adequately described using quantitative data analysis to help form conclusions. The descriptive research will help achieve research objectives by defining the views, beliefs and opinions of the target sample towards personal selling.

Statistical Analysis

Once the questionnaires are administered, the researcher will scan the questionnaires to sieve non- responses.  The researcher will conduct a graphical examination of the data to acquire basic knowledge of the data characteristics. Data will be fed into the SPSS software for more in-depth analysis. All data retrieved from the Likert scale will enter into the software in respective dependent or independent variables boxes. Using SPSS software, the researcher will first analyze the data using descriptive statistics to establish essential data characteristics. The data will be tested for the mode to determine the most common answer in each category. The median will be analyzed to identify the middle response for all data categories and the interquartile range to reveal the data variability.

The second phase of the analysis will use probability distribution to conduct hypothesis testing. Data fed to the SPSS software will be analyzed using the Mann-Whitney U Test since the study aims to evaluate ordinal data. The Mann-Whitney test is appropriate for the Likert scale data since it does not assume a normal distribution.

The data analysis will also involve analysis of the ordinal data from the Likert scale to determine the correlation of variables using the spearman’s correlation. Correlation outcomes reveal the degree of relationship between research variables. In this case, spearman’s correlation is used to assess the relationship between the independent variables of relationship quality, trust, purchase intention and conflict against the dependent variable, which is sales effectiveness.  The analysis will reveal the statistical relationship between all the distinct, independent variables to the dependent variable. The correlation process evaluates to what extent a given independent variable influences the outcomes of the dependent variable. The correlation coefficient often ranges between -1 and +1. The relationships between the different variables will be compiled on a Pearson correlation matrix at a significance level of 5%.

Study Limitations

1. Resource limitations – the study will run on a budget which may limit the researcher’s capacity to expand data collection and acquisition of more advanced tools and methods in research
2. Risk of broad generalization – the study may be affected by too much generalization, given that it is based on cognitive and emotional psychology. The research variables are highly intangible. The nature of variables may create too much generalization and limit objective reasoning.

Study Assumptions

• The study will assume that study participants will provide accurate information concerning their bank service consumption patterns
• The study will consider the objectivity of respondents in providing unbiased information

Validity and reliability measures

            The reliability of the research instrument will be evaluated by a test-retest strategy aimed to evaluate the effectiveness of the questionnaire in collecting intended information. The questionnaire will be given to a sample of ten respondents to test for clarity, precision and ambiguity after which necessary adjustments will be made to enhance the effectiveness of data collection tool. Reliability of data analysis methods will be measured using the CronbeachAlpha coefficient tool. The CronchbeachAlpha tests scale components to confirm relatedness and also confirms that the underlying variables are co-related. The instrument measures the relationship between variables based on scale. A reliability score of between 0.7 and 1 will be considered acceptable. To test for validity, the researcher will engage in a pilot study aimed at evaluating the clarity and precision of the questionnaire in carrying out intended research. The pilot study will involve ten students from the University. Following the recovery of the surveys, the researcher will scan the questionnaire for ambiguity and unclear language to optimize the validity of the research instrument.

Results/ expectations

• Personal selling is positively associated with improved customer relationships
• Personal selling has a positive impact on customer buying behaviour as it creates customer engagement and a deeper demonstration of product qualities
• Personal selling has a positive effect on customer retention by increasing the trust and confidence values of the customer
• Commercial banks should use personal selling more widely to facilitate informed decision making among customers
• Commercial banks should adopt personal selling to transform negative customer perceptions into positive ones
• Commercial banks should train their employees on effective interpersonal communication strategies to ensure effective personal selling

References

Bubnjević, D. (2017). Position and role of personal selling in contemporary marketing management. International Symposium, Serbia. Retrieved from http://www.tfzr.rs/emc/emc2011/Files/E%2007.pdf

Levellers, S., &Fukawa, N. (2013). The Role of Effect in Personal Selling and Sales Management. Journal of Personal Selling & Sales Management, 33(1), 7-24. doi:10.2753/pss0885-3134330102

Hain, J. S., Rutherford, B. N., & Hair, J. F. (2019).A taxonomy for financial services selling. Journal of Personal Selling & Sales Management, 39(2), 172-188. doi:10.1080/08853134.2018.1544078

Joie S. H., Brian N. R. &Joe F. H. (2019). A taxonomy for financial services selling. Journal of Personal Selling & Sales Management. Retrieved from https://doi.org/10.1080/08853134.2018.1544078

Joseph A. Anyadighibe, Nsobiari F. Awara, Benjamin BasseyEsu. (2014). The impact of personal selling on the productivity of selected banks in Calabar Metropolis. Retrieved from https://www.semanticscholar.org/paper/The-impact-of-personal-selling-on-the-productivity-Anyadighibe-Awara/05ba0a8f5f5742c08025f5afc6b72d3cf09e6525

Mullins, R. R., & Panagopoulos, N. G. (2019).Understanding the theory and practice of team selling: An introduction to the special section and recommendations on advancing sales team research. Industrial Marketing Management, 77, 1-3. doi:10.1016/j.indmarman.2018.03.001

Vukoja, O. M. (2017). The Impact of Personal Sales Choice on Banking Services. International Journal of Advances in Management and Economics (22783369). Retrieved from:www.managementjournal.info

Appendix

Questionnaire

PART A

Dear Participant, I am delighted to welcome you to participate in this research. The purpose of this research is to explore the role of personal selling in promoting bank products. There is a list of statements which you only need to affirm or refute.

Bank products are sensitive products to all of us since they affect the financial outcomes of an individual. The mode of communication helps build rich knowledge of the bank products, which ensures a consumer can make sound decisions. I hope to gain your insight into the appropriateness and effectiveness of personal selling as an avenue for bank communication. Your contribution to the research will be highly valued and significant for information marketing decisions among our banks.

   PART A

Put a tick mark on the response you believe describes your opinion, experience or attitude

1. Strongly disagree 2. Disagree 3. Neutral 4. Agree 5. Strongly agree

Part B

The following questions only help to know the respondent better, kindly feel free to provide any information. All information will be kept safe and confidential

1. What is your current age?
   1. Below 25 []
   2. Between 26 and 35 []
   3. Between 36 and 45 []
   4. Above 45 []
2. What gender are you?
3. Female []
4. Male []
5. What is your highest level of education?
6. High school []
7. Undergraduate[]
8. Diploma or Certificate []
9. Postgraduate []
10. None of the above []

I sincerely thank you for participating. I value and appreciate your contribution to the research. I am positive the information you provided will contribute positively to our banking communication systems.

In case of any further comments or suggestions, please feel free to contact me on (555) 555-1234