Measuring customer based corporate reputation in banking industry Developing and validating an alternative scale

Abstract

Purpose - The purpose of this paper is to develop and validate a reliable and valid alternative scale to measure customer-based corporate reputation (CBCR) specific to the banking industry only, where high risks and uncertainties of choosing a service provider exist. Design/methodology/approach - Both qualitative and quantitative methods were employed to develop and validate an alternative scale to measure CBCR in the banking industry. Following Churchill's (1979) paradigm and other prominent scale development studies, a scale development procedure was generated, which consists of three main stages: scale generation and initial purification, scale refinement and scale validation. Findings - As a consequence of the current study, a reliable and valid multidimensional scale was obtained, consisting of 20 items and four dimensions to measure CBCR in banking industry: financial performance and financially strong company, customer orientation, social and environmental responsibility and trust. Practical implications - This study provides insight to managers to comprehend and manage their CBCR. Since this study has empirically demonstrated that the four dimensions of the CBCR are associated with the five important customer outcome variables, the study provides further support toward the importance of corporate reputation in strategic marketing decisions in the banking industry. Originality/value - Numerous different disciplines have focused on corporate reputation measurement by adapting different perspectives and approaches. However, a reliable and valid measurement tool has been proposed here to evaluate corporate reputation from customers' perspective specific to banking industry.