The paper “ The Role of Service Quality in Enhancing Client Satisfaction and Loyalty; Perspective from Saudi Retail Banks" is a potent research proposal on marketing. Driven by oil revenues, the economy, and population of the Kingdom of Saudi Arabia (KSA) has reached “ first-world” status in a relatively short period of time, from a dusty and largely undeveloped nation in the 1930s to a member of the important Group of 20 (G-20) nations in 2009 (The Group of 20, 2009). One of the consequences of KSA’ s prosperity is a relatively financially-secure, young, internationalized population; as of 2009, expatriates and youths under the age of 15 accounted for approximately eight million and 8.6 million respectively of KSA’ s estimated 28.7 million people (Population Reference Bureau, 2011). With respect to the Saudi banking industry, there appear to be three main challenges.
First, the industry must be prepared to serve the younger generation, a generation with a more global outlook and greater access to new technology – such as electronic banking – than their predecessors. Second, because of KSA’ s position as an important global trading partner, Saudi banks must be prepared to meet international standards for service and governance.
And finally, as the historic home of Islam, Saudi Arabia strictly follows Islamic law, which provides extensive guidance for commercial and financial transactions (Abdul Rahman, 2007, p. 142; Abraham, 2009, p. 42). In terms of the current state of the Saudi banking industry, its prospects appear very favorable; in October 2012 Moody’ s Investor Services published its quarterly world banking outlook and assigned KSA a risk rating of 2, the lowest risk level in the entire Middle East region and one of the lowest in the world.
In addition, the banking sector as a whole – which includes 12 major banks – posted slightly more 11% year-on-year income growth and a more than 15% growth in deposits in 2012 (Ahmed, 2013). Yet despite the success of the Saudi banking sector, complaints about customer service are, anecdotally at least, rather common. For example, in a July 2011 article in the Saudi Gazette, customers listed a number of grievances, including the slow adoption of electronic banking services, long queues, understaffing in bank offices, and slow processing of transactions (Khan, 2011). 1.2 Research Area of Interest, Aims, and ObjectivesThe main research area of interest for the proposed study is the response of customers to perceptions of customer service quality in Saudi retail banks.
The primary research aim is to determine and measure the degree to which customer service quality impacts the customer’ s choice to start or maintain a relationship with a bank, as opposed to other factors such as fees and interest rates, bank locations, or banking product offerings. The study has three main objectives: To identify a method of measuring service quality.
A likely candidate is the SERVQUAL model, developed for use in marketing research by Parasuraman, et al. (1985, 1988). This is discussed in greater detail in the literature review below. To conduct a survey of banking customers from each of the 12 major Saudi banks to gather information on their perceptions of service quality, and the relative importance they attach to service quality in making loyalty decisions. To develop a description of the impact of service quality on customer loyalty towards Saudi banks through the analysis of the survey data according to the measurement model.