The Review of the Relationship between Marketing Performance and Competitive Advantage in Commercial Banks

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1 International Research Journal of Management Sciences. Vol., 4 (1), 36-47, 2016 Available online at ISSN X 2016 Review of the Relationship between Marketing Performance and Competitive Advantage in Commercial Banks Rasoul Izadpanah Qeshmi 1, Rasoul Vazifeh 2* 1 Department of Management, Qeshm Branch, Islamic Azad University, Qeshm, Iran 2 Department of Business Management, Parsabad Moghan Branch, Islamic Azad University, Parsabad Moghan, Iran * Corresponding Author vazifeh_r@yahoo.com ABSTRACT: In this study, the relationship between marketing performance and competitive advantage in the commercial banks has been examined. Marketing performance of each of the banks in terms of efficiency, effectiveness and adaptability as well as their competitive advantage with five indicators: the obvious advantage, the compound advantage, sustainable advantage, the dynamic advantage and heterogeneous advantage are examined. This study is practical in the term of purpose and it is descriptive and correlational in the purpose of method, it has been used the library studies and the distribution of questionnaire to collect information. Sampling was done randomly and questionnaires were distributed among customers and employees of these banks: Melli, Keshavarzy, Tejarat, Refah Kargaran, Saman, Sarmayeh, Pasargadae, Sina and Iran Zamin, all of which have been selected randomly from among banks. results of this study show that there is a significant relationship between marketing performance and competitive advantage of studied banks. Keywords: Marketing Performance, Competitive Advantage, Commercial Bank. INTRODUCTION Today, people's need for banking services is increasing more than ever before and people expect more and faster services from their banks. complexity of marketing systems and competition among banks has created a situation in which if it is not paid attention to competition, logical and intelligent solutions, some banks will be suffered from a failure and gradually eliminated from the competition. In the current situation, banks must prepare themselves for competition by perception of the environment and look to the winding road of future of banking. What determines the final value for the customers is the ability of banks to provide their services so for being effective, the banks require obtaining sufficient information from the customer, understanding their interests and needs and developing a relationship with him. As Mac Cruming knows the bank's revenue growth dependent on well-functioning marketing, this is why the customer satisfaction has been attracted greater attention as a new approach in quality of businesses and institutes in recent years. Marketing creates fundamental partnership for long-term business success, so performance evaluation of marketing is a key task for is management. Achieving of organization to their financial goals and market in today's competitive environment requires marketing that it should be both efficient and effective. Market assessment is necessary because of market fragmentation due to the diversity, increasing consumer sophistication and reduction of levels of return rate on investment (Da Gama, 2011). Banking system is one of effective key factors in the economic development of any country. Banks are economic entities like any other economic entity must earn a profit to survive and grow. In today's world, the 36

2 attraction of customers is so much important for the banks that it has created a very strong competition in this field among them. Today, except the competition between the current public and private banking groups, the creation of new private banks, new financial institutions and credit as well as the expansion of loan institutions activities make the increase of competition in country's banking system in customers and financial resources attraction (Razani, 2003). Traditionally, analysis of marketing productivity (efficiency point of view) and the concept of marketing audit (from the perspective of effectiveness) are dominant approaches on marketing performance evaluation, but neither approach can provide a full framework for integrated assessment because of the executive and conceptual limitations (Morgan et al., 2002). Following to these two approaches, the initial work in evaluating the performance of enterprise-level marketing focused only measures and financial indicators, such as earnings, sales and cash flow. However, during the period 1970 to 1980, the common practice using one or more indicators based on volume, financial or digits was developed to a multi-dimensional view of marketing performance in which the internal and external patterns were used to evaluate marketing performance. Despite much cost spent by most banks to attract and retain the customers they are often failing due to lack of attention and correct identification of marketing performance and competitive advantage and activity in a complex competitive environment. Now the question is whether there is a relationship between marketing performance and competitive advantage in commercial banks. METHODOLOGY purpose of this research is applicable and the method of data collection is based on descriptive survey. Community and research sample: statistical population is those individuals or entities that have at least one common trait that the researcher wants to investigate for them (Sarmad et al., 2006). current study sample included public and private banks located in Qeshm which ten banks were selected by the use of a sample random method. number of 95 employees and 204 customers of these mentioned banks were selected as the sample and at hand. Data collection: main data collection tools in the study are questionnaire. Because there is no standard questionnaire on the subject, questionnaire was designed and after it approved by the Assembly of Experts, the final questionnaire was distributed. In the present study aspects of marketing performance and competitive advantage were analyzed separately. Reliability of Questionnaire: In the reliability, this question is answered whether the repeated measurements under the same conditions gives the same results or not. re are several ways to measure reliability. In this study, to measure the reliability of the questionnaire, the Cronbach's alpha and software SPSS18 were used. Cronbach's alpha coefficient is a value between zero and one. In a case questionnaire is reliable that Cronbach's alpha values is greater than 0.7 and whatever this value is closer to 1, the questionnaire has higher reliability. Table 1. Questionnaire reliability of competitive advantage. Dimension number of questions Cronbach's alpha coefficients Tangible benefits Sustainable advantage Dynamic Advantage Congruent Advantage Compound Advantage Total Coefficient According to the table above in this questionnaire alpha value for each dimension and total coefficient is higher than 7.0 which show the reliability of the questionnaire. Employees Customers Table 2. Questionnaire reliability of marketing performance. Dimension number of questions Cronbach's alpha coefficients Performance Effectiveness Adaptability Performance Effectiveness Adaptability Total Coefficient

3 According to the table above in this questionnaire alpha, value for each dimension and K coefficient is higher than 7.0, which shows the reliability of the questionnaire. validity of (credit) of questionnaire. RESULTS How is the relationship between marketing performance of the studied banks and their competitive advantage? To examine the relationship between two variables, Pearson correlation test was used. Pearson's test results are in the table below. Table 3. Results of Pearson correlation coefficient test between marketing performance and competitive advantage. Competitive advantage Marketing performance Pearson correlation coefficient = Sig. = (2-tailed) = N = 204 According to the results of the above table, there is a significant relationship between the marketing performance and competitive advantage of the studied banks at a significance level of 99% and its correlation coefficient is equal to Regression Model Practice: To study and present the model between the competitive advantage (Y) and marketing performance (X), it will deal with the presentation of the process model after the study of the model adequacy indicators in the table below: Table 4. Correlation between the variables. Correlation coefficient of Adjusted coefficient of SD Error Watson Durbin coefficient determination determination correlation between the independent and the dependent variables variable is equal to is obtained for determined coefficient, and this value indicates that 53% of the changes of the competitive advantage are concerned to the marketing performance from existing customers. Because these degrees of freedom is not taken into account, so the adjusted determined coefficient is used for this purpose, which is equal to 53% in this test. Since the Durbin-Watson statistics are between 1.5 and 2.5, therefore we can conclude independence of the left over. According to the mentioned indexes, the model has the necessary efficiency. table below has been calculated by the significance of regression. Table 5. Test F (ANOVA) the significance of the regression. Sum of squares df SS F Sig. Regression Left over Total Dependent variable competitive advantage According to the table above, the calculated significance level for this statistic is equal to which shows the significance of regression is at 1% level. Table 6. significance of the regression coefficients of marketing performance and competitive advantage. Model Non-standard factor Standardized coefficient t Sig. B Std.Error Beta Constant Value Marketing performance Dependent variable: competitive advantage 38

4 inserted variable into the regression equation is the main core of regression analysis, which is in the above table. It can be said that with the promotion of one unit of the independent variable as much as the rate of written coefficient, the dependent variable will be promoted. Or in other words, by promoting one unit of marketing performance, unit of standard deviation of competitive advantage will be promoted, resulting they have a positive relationship. survey questions were tested by using structural equation modeling in order to ensure the statistical analysis and check the observed data appropriateness. Figure 1. structural model of research (general) in the mode of nonstandard estimation. output of software indicates the appropriateness of the research structural model process. ( ratio of X2 to df is less than 3), so the number of x2 Is a lower and appropriate one. Other indicators of appropriateness are given in the table below. Table 7. indicators of the appropriateness of the research structural model process (main research question). AGFI GFI RMSEA P-VALUE DF CHISQUARE above indicators show the appropriateness of the research structural model process. In other words, the observed data is based on a conceptual model of research to a large extent. Figure 2. structural model of research in the mode of standard estimation (the main research question). 39

5 According to the standardized factor loadings, it can be seen that each of the dimensions which has the higher load factor, it has a stronger relationship with the relevant variable. Every dimension of marketing performance can also be obtained by multiplying the load factor of marketing performance and dimension with the load and factor between the performance and advantage of relationship between competitive advantages. For example, the relationship between competitive advantage and performance is: = Figure 3. number of significant coefficients of research structural model (the main research question). obtained significant coefficients and parameters of the structural model show the competitive advantage and marketing performance. obtained coefficients are significant when the amount of their significant test is larger than 2 and smaller than -2. As it can be seen the significant coefficient among the structural model is equal to As a result, the relationship between these two variables is significant. How is the marketing system of studied banks? It has been used of non-parametric test ratio (binomial) with the study of the status of marketing efficiency system and its components among customers and the studied bank employees. According to 5 option-question of questionnaire, options (very low, low and moderate) is located in a group (q) and (high and very high) in the other group in (p). ratio of the test is 2 to 5 here; it means 40% for choosing the option of high and very high 40 percent and 60% for lower-middle options. In other words, with the possibility of 40%, every person can choose the option of high and very high among the existing 5 options. Table 8. To check the efficiency of the marketing system. Dimension Number SD Minimum statistic Performance in the employees f views Performance in the e customers view Binomial Test Performance in the employees f views Performance in the e customers view maximum statistics Table 9. Non-parametric tests to check the efficiency of the marketing system. First Second Total Classification Number of Views possibility of view q p Tested Possibility significance level (Sig) First q Second p Total

6 According to the test result, since for the studied dimension we have (sig= < α=0.05), thus there is a significant difference between the tested probability (0.6) and the observed probability for the performance dimension in both views (employees and customers). In both views for performance, it can be seen that the number of people with average to low opinions is less than the people with the opinion of high impact. As a result, it is said the people's level of agreement (whether employees or customers) with the performance of the studied banks is in good condition. Almost 100% (according to 1. 0 observed for P) have "agreed and completely agreed" opinions. (According to the probability of 0.8 observed for P) About 80 percent of customers has "agreed and completely agreed" opinions. Employees Customers Table 10. ANOVA. Changes Association of squares df MS F P-value Intragroup Intergroup Total Intragroup Intergroup Total Regarding the above table and the test results, it can be seen that performance scores are not equal based on studied banks. following tables show the difference between people opinion based on banks. y are ranked based on the favorability. Table 11. differences of customers and employees about the performance. Bank No. of of (customers) Number of Saman Sarmayeh Iran Zamin Pasargad Sina Melli Keshavarzi Mellat Tejarat Refah Total last line shows since the total average is greater than the average value of (3) as a result, the opinions of people have been positive. If it is paid attention to the average opinions of people based on the banks, it can be observed that Sina Bank allocates the first in the view of employees then Iran Zamin Bank allocates the first in the view of customers in terms of performance. How is the marketing system of studied banks? Table 12. study of marketing system efficiency. Dimension Number Standard deviation minimum Statistics maximum Statistics effectiveness in the view employee effectiveness in the view of customer

7 effectiveness in the view of employee effectiveness in the view of customer Table 13. Nonparametric test to evaluate the effectiveness of marketing system. Binomial test s Numb Classification er of Views observed possibility Tested Possibility significan ce level (Sig) First q Second p Total First q p Second Total According to the table, there is a significant difference between the tested probability (0.6) and observed probability value for the dimension of effectiveness, from the point of view of employees and customers. People s level of agreement (whether employee or customers) with the effectiveness of the studied bank is in good condition. 90% of employees (regarding the probability of 0.9 observed for p) had opinions based on agreed and completely agreed. Approximately 60 % of customers (according to the probability of 0.6 observed for p) had opinions based on agreed and completely agreed. Employee Customers Table 14. ANOVA. Changes Assembly squares df MS F P- value Intragroup Intergroup Total Intragroup Intergroup / Total According to the table above and the test results, it can be seen that the scores of effectiveness of the studied banks are not equal. Table 15. Differences between customers and employees about the effectiveness. Bank Number of Employees) No. (customers) (customers) Saman Sarmayeh Iran Zamin Pasargad Sina Melli Keshavarzi Mellat Tejarat Refah Total last line show that since the total average is greater than the average value (3) consequently the views of people were positive. But the customers level of agreement is generally lower than the employees. If it is paid attention to the average opinions of people based on the banks, it can be observed that Sina Bank has been allocated the first place according to the customers views and Mellat Bank has been allocated the first place in the dimension of effectiveness in the point of view of employees. 42

8 43 How is the Adaptability of marketing system in the studied banks? Table 16. To check the adaptability of marketing system. Dimension Number SD Minimum Statistics Maximum Statistic Adaptability in the view of (Employee) Adaptability of in the view of (customers) Table 17. Nonparametric tests to check the adaptability of marketing system. First Classification Binomial test Number of Views observed probability tested probability Significant level (Sig) q Second p Total q First Second Total - P According to the result, there is a significant difference between the tested probability (0.6) and observed probability value for the dimension of adaptability, from the point of view of employees and customers. People s level of agreement (whether employee or customers) with the adaptability of the studied bank is in good condition. 80% of employees (regarding the probability of 0.8 observed for p) had opinions based on agreed and completely agreed. 60 % of customers (according to the probability of 0.6 observed for p) had opinions based on agreed and completely agreed. Employees Customers Table 18. ANOVA. Changes Association of squares df MS F P-value Intragroup / Intergroup Total Intragroup Intergroup Total According to the table above and the test results, it can be seen that the scores of adaptability based on studied banks were not equal with each other. Table 19. Differences between the opinion of the customers and employees about the Adaptability. Bank Number of Employees) No. Saman / Sarmayeh Iran Zamin Pasargad Sina Melli Keshavarzi Mellat Tejarat Refah Total

9 last line show that since the total average is greater than the average value (3) consequently the views of people were positive. If it is paid attention to the average opinions of people based on the banks, it can be observed that Malli Bank has been allocated the first place according to the employees views and Saman Bank has been allocated the first place in the dimension of adaptability in the point of view of customers. How is the Marketing performance of the studied banks? Table 20. To check the marketing performance of studied banks. Dimension Number SD Minimum statistic Maximum statistic Marketing performance from the perspective of employees Marketing performance from the perspective of customer Marketing performance in employees views Table 21. Nonparametric tests to check the performance of marketing. Binomial test Classification Number of Views observed probability tested probability Sig. First q Marketing performance from the customers view first group p 92 Second q p Total According to the result of the test, there is a significant difference between the tested probability (0.6) and observed probability value for the dimension of marketing performance, from the point of view of employees and customers. People s level of agreement (whether employee or customers) with the marketing performance of the studied bank is in good condition. 100% of employees (regarding the probability of 1.0 observed for p) had opinions based on agreed and completely agreed. 80 % of customers (according to the probability of 0.8 observed for p) had opinions based on agreed and completely agreed. Employees Customers Table 22. ANOVA. Changes Total squares df MS F P-value Intergroup Intergroup Total Intergroup Intergroup Total According to the table above and the test results, it can be seen that the scores of marketing performance based on studied banks were not equal with each other. 44

10 Table 23. Differences between the opinion of the customers and employees about the marketing performance. Bank Number No. Saman Sarmayeh Iran Zamin Pasargad Sina Melli Keshavarzi Mellat Tejarat Refah total last line show that since the total average is greater than the average value (3) consequently the views of people were positive. If it is paid attention to the average opinions of people based on the banks, it can be observed that Sina Bank has been allocated the first place according to the employees views and Iran Zamin Bank has been allocated the first place in the dimension of marketing performance in the point of view of customers. How is the competitive advantage of the studied banks? Based on the 10-option of the questionnaire, option (5 and less of it) are located in one (q) and (option above 5) in the other group (p). ratio of test here is 5 to 10; it means 50% for choosing option p and 50% for choosing option q. In other words, every person can choose the options above 5 between the existing 10 options with the probability of 50%. Table 24. study of the competitive advantage of the studied banks. Dimension Number SD Minimum Maximum Statistics Statistics Competitive advantage Binomial test Table 25. Nonparametric test to study the competitive advantage. Classification Number of Views observed probability tested probability Sig. Competitive advantage First q Second p Total According to test results, there is a significant difference between the tested probability (0.5) and the observed probability for competitive advantage. As a result, people s level of agreement with the competitive advantage of the studied banks is in good condition. Customers Table 26. ANOVA. Changes Total squares Degree of freedom Mean square Statistics F P-value Intergroup Intergroup Total According to the above table, it can be seen that scores of competitive advantage based on the studied banks are not equal. 45

11 Table 27. of competitive advantage of banks. Bank No. (customers) (customers) Saman Mellat Keshavarzi Sina Tejarat Refaheh Kargaran Sarmayeh Iran Zamin Pasargad Melli total last line show that since the total average is greater than the average value (5) consequently the views of people were positive. If it is paid attention to the average opinions of people based on the banks, it can be observed that Mellat Banks' customers with an average score (6.76) has the highest rating for a competitive advantage and have been in the first place. n Saman Banks' customers, with an average score (6.31) have been in the second place and Refah Banks' customers with an average score (5.25) had the lowest rating level for the competitive advantage and it has located in the last (tenth). DISCUSSION AND CONCLUSION results of the analysis of the data obtained in this study generally shows that the most obvious advantage is the most effective factor in obtaining the competitive advantage which implies on the necessity of more attention to the location of bank branches, their employees appearance and their attitude and all cases which do not stay away from the eyes of customers. On the other hand, the efficiency has the greatest impact on marketing performance which has a direct relationship with the attraction of the customers, increase of the deposits volume, increase of the number of the branches, and the rate of given facilities. results show that marketing performance and competitive advantage of surveyed banks are not the same. results of surveys on the banks in the field of the marketing performance from the point of employees view shows the highest efficiency and effectiveness of the bank is concerned to Sina Bank and the highest adaptability is concerned to the Melli Bank and in general the highest marketing performance from the point of view of employees is concerned to Sina Bank. Also from the point of view of the customers, the highest performance is concerned to Iran Zamin Bank, the highest effectiveness is concerned to Mellat Bank, the highest adaptability is concerned to Saman Bank and in general the highest marketing performance from the perspective of customers is concerned to Iran Zamin Bank. Results of the survey conducted on 5 indicators of competitive advantage show that the customers in every ten banks (Saman, Sarmayeh, Mellat, Tejarat, and Refaheh Kargaran) allocated the highest score in terms of tangible competitive advantage to Keshavarzi bank, in terms of competitive stable advantage and competitive homogeneous advantage to Saman Bank and in term of competitive dynamic advantage and competitive combined advantage to Mellat Bank. In general we can say that the highest obtained scores for the competitive advantage are related to the Mellat banks. About the relationship between marketing performance and competitive advantage of studied banks, the results of correlation and regression model show that there is a significant relationship between marketing performance and competitive advantage. regression equation of model will be as follows: Marketing performance (0.731) = Competitive Advantage It can be said that the dependent variable will be prompted by upgrading a unit of each independent variable in the rate of written coefficient in other words by the promotion of a single marketing performance, standard deviation units of competitive advantage will be enhanced, consequently, they have positive relationship. Results obtained with the findings of Divandari et al (2007) are consistent. findings of these researchers show that the output of competitive advantage is equivalent with the bank's marketing performance and they are in direct and indirect relationship with each other. Regarding the performance of the marketing system of studied banks, the results show that the performance of banks are as moderate to high in the view of employees and customers. In both views of performance, it can be seen that the number of people who have the opinion of lower than average are less than the people who have the opinion of high and very high impact. As a result, it is said the people s agreement level (whether employees or customers) with the performance of the studied bank is in good condition and also performance is different in the point of view of employees and customers. result is consistent with the findings of Morgan et al (2002). findings of these researches 46

12 show that the performance is the main indicators of marketing performance that its enhancement will lead to higher performance of organization. Also Razani (2003) in the "review and introduction of new and effective methods of attracting funds in commercial bank branches in Lorestan," came to this conclusion that the efficiency in attraction of bank resources which is one of the indicators of marketing performance is effective. Regarding the effectiveness of marketing system of the studied bank, the results show that the effectiveness is moderate to high in the point of view of employees and customers. In both views for the effectiveness, it can be seen that the number of people who have the average opinion of less than average it is lower than people who have the opinion of high and very high impact. As a result, it is said the people s agreement level (whether employees or customers) with the effectiveness of the studied bank is in good condition and this effectiveness is different in the point of view of employees and customers. obtained result is consistent with the findings of Morgan et al (2002). findings of these researches show that the effectiveness is the main indicators of marketing performance that its enhancement will lead to higher performance of organization. Regarding the adaptability of marketing system of the studied bank, the results show that the adaptability is moderate to high in the point of view of employees and customers. In both views for the adaptability, it can be seen that the number of people who have the average opinion of less than average it is lower than people who have the opinion of high and very high impact. As a result, it is said the people s agreement level (whether employees or customers) with the adaptability of the studied bank is in good condition and this adaptability is different in the point of view of employees and customers. obtained result is consistent with the findings of Morgan et al (2002). findings of these researches show that the adaptability is the main indicators of marketing performance that its enhancement will lead to higher performance of organization. Regarding the marketing performance of studied banks, the results indicated that the marketing performance is in moderate to high based on the views of employees and customers. It can be seen that the number of people who have the views lower than moderate is lower than the people who have the views based on great impact and very great impact for both view of marketing performances consequently it can be said that the level of people s agreement (either employees and customers) with the studied banks marketing performance are in an appropriate situation, as well as the marketing performance is different from the perspective of employees and customers. Finally, in order to improve the efficiency of the marketing system suggestions are presented: Equipping all bank branches to new technologies. Personnel selection based on technical, behavior and education competence. Create the proportionality between the number of labor and workload of banks. Set up branches to provide 24-hour services. Conflict of interest authors declare no conflict of interest REFERENCES Da Gama AP, An expanded model of marketing performance. Marketing Intelligence & Planning. 29 (7): Divandari A, Syed Javadein SR, Nahavandian M, Aghazadeh H, study of the relationship between market orientation and Iran Commercial performer. Electronic Journals Database Tehran University. 43(4). Morgan A, Clark H, Bruce Gooner R, Marketing productivity, marketing audits, and systems formarketing performance assessment. Journal of Business Research. 55: Razani B, study and introduction of new and effective ways to attract financial resources in Tejart banks of Lorestan, master's thesis. Faculty of Science, Azad University, Khorsgan Branch, Iran. Sarmad Z, Bazargan A, Hijazi E, Research methods in the behavioral sciences. Thirteenth Edition, Agah Publication, Tehran, Iran. 47