Managing brand associations to drive customers' trust and loyalty in Vietnamese banking

Purpose - Vietnamese banks have relied in the past on short-term promotional techniques and attractive interest rates instead of developing strong brands. This research investigates how customers' perceptions of bank brands drive their trust and loyalty. It also addresses how customers' experience and their social compliance moderate the impact of their brand perceptions on their trust and loyalty. Design/methodology/approach - Customers' perceptions are measured through brand associations based on the bank's functional elements, its personnel and its overall image. A structural equation model linking brand associations to customers' trust and loyalty is tested using data from a sample of 557 Vietnamese bank customers. Findings - The results indicate that the personnel-based brand associations are the strongest driver of trust and have a negative direct impact on loyalty, while functional and corporate-based associations have a stronger impact on loyalty. Trust strongly mediates brand associations' impact on loyalty. In addition, corporate-based associations have a stronger impact on trust and loyalty for customers with little direct experience with the bank and personnel-based associations have a stronger impact for socially compliant customers. Practical implications - The findings indicate how different brand associations can be leveraged to trigger customers' trust and loyalty in the Vietnamese banking sector. Moderating effects of the extent of customers' experience imply that bank brand managers should integrate the customer relationship lifecycle in their segmentation/targeting and in their customer-brand relationship management. Originality/value - This study highlights the potential of branding in the Vietnamese banking industry as a strategy to build strong customer relationships. It also strongly points out the need for brand managers to take into consideration the Vietnamese context and more precisely customers' lack of banking experience and their tendency to social compliance.