Impact of Customer Relationship on Brand Equity in Chinese Retail Banking

Abstract

Building strong brand equity is imperative in the highly competitive financial services sector. Despite tremendous interest in brand equity and relationship marketing, little conceptual development or empirical research has addressed whether relationships exist between these important marketing issues. This study explores the associations between customer relationships and brand equity in the context of the Chinese banking system. A conceptual framework is proposed, in which the constructs of customer relationships including relationship closeness, relationship strength and relationship satisfaction are related to the dimensions of brand equity comprising of perceived quality, brand loyalty and brand associations combined with brand awareness. Empirical tests using structural equation modelling support the research hypotheses and reinforce the importance of the linkage between the two domains of branding and relationship marketing, which are traditionally apart. The research findings provide bank managers with a comprehensive understanding of how customer relationships impact on the dimensions of brand equity, which will enable them in turn to design more effective marketing strategies to enhance the evaluation of brand equity.