Abstract
Customer behaviour is a complex and dynamic area of investigation. Organisations, managers and researchers are interested in the potential of ethnicity as how it affects the behaviour of people in various domains. It influences organizational decisions to customise services and allocate resources to fulfil the needs of certain types of customers. The stiff competition among banks particularly in the dual banking system such as in Malaysia requires banks to win over customers and enhance loyalty among them. In response, this thesis examined the selection factors, satisfaction and loyalty behaviour among multi-ethnic customers in the Malaysian Islamic banking industry. The researcher adopts pragmatism paradigm that underpins the methodological choice, data collection techniques and analyses. The investigated issues were examined from two different perspectives; bank customers and bank managers. Accordingly, the data collection methods utilised were questionnaires for bank customers and semi-structured interviews with the bank managers.
The results indicated that there were significant differences between the ethnic groups in terms of their selection factors, satisfaction and loyalty. These differences indicated that ethnicity is a significant predicting variable to determine customer decisions. The factor analysis revealed five selection factors (religious and ethical, services and convenience, service quality and benefit, external, operational and charges) which attracted customers to choose Islamic banks in Malaysia. Further analysis discovered that the Reliability dimension significantly influenced customer satisfaction. In addition, there was a positive relationship between customer satisfaction and customer loyalty in this study. However, the combination of qualitative and quantitative approaches suggested that there were some inconsistencies regarding the issue of ethnicity as most of the bank managers held views that there was no difference among the ethnic groups in terms of their preferences or behaviours. The mix results demonstrated that bank management had not considered ethnicity as a potential variable to predict customer behaviour. Overall, the findings from this study provide useful information on customers within a multicultural society and this information could assist bank marketers in developing the right marketing strategy to optimise the diverse market opportunities.