Customer engagement in retail banks: Scale development and validation

The retail banking industry of South Africa is facing various challenges. Due to the direct influence that these banks have on the country's economic stability, retail banks need to remain sustainable. Progressively, more businesses are recognising the importance of customer engagement due to the various benefits of having engaged customers, including improved annual revenue. Consequently, the purpose of this paper is to develop a multi-item scale to measure customer engagement in the South African retail banking industry. The paper considered both the existing literature and a quantitative descriptive design. The target population included customers of the main South African retail banks in the Johannesburg metropolitan area. Furthermore, non-probability, convenience and quota sampling techniques were used to draw the sample and reliability, and validity tests were implemented to refine the items statistically. The study contributed a valid and reliable 14-item customer engagement scale, which can guide retail banks to improve their customer engagement and gain a competitive advantage in this challenging industry. Correspondingly, this paper contributes to the theory and practice with specific reference to customer engagement in South African retail banks.