Delivering retail banking service in a physical context Case X-Pankki Oy / X-Bank Ltd

Abstract

Services industry has experienced significant growth during the past decades as manufacturers and retailers have shifted their focus towards service providing. As services are considered as intangible, physical evidence of the service, i.e. the service environment plays and important role in shaping customer perceptions about the service and the service provider. Service environments have been researched by various scholars and discussed by academics across the world. However, no attempts have been made to understand servicescapes in a cross-business environment. This study examines the service environment of a bank operating in the retail environment, inside a retail store. There is a research gap in studying this type of an atypical environment for a retail bank. The aim of this study is to narrow this research gap by exploring the service environment of a retail bank and examining the bank’s customer service in this context.

A framework for delivering banking service in a retail environment is developed on the basis of the literature review. In the empirical part of this study, the theoretical framework is compared to actual operations of the case company to find out whether the current delivery of customer service is successful and whether there are areas that should be developed further. The operations are studied through ethnographic observations and regular customer interviews.

The results of ethnographic observations and customer interviews show that customers are satisfied with the services the company has to offer, but partly unsatisfied with the service environment design. In addition, the customer service employees must be motivated to a greater extent. I find that the company has not been able to take full advantage out of its location inside the retail stores. Further development of service environment and concrete actions is needed to gain full customer satisfaction. A refined theoretical framework is developed on the basis of the empirical part of this study.