Customer value perceptions, attitudes, and behavior toward mobile financial services

Abstract

The adoption of mobile devices for various innovative processes and services has increased drastically. Mobile devices are used to deliver various mobile financial services such as mobile banking, mobile payment, and mobile phone-based financial services, mobile wallet etc. Customers utilize mobile financial services to perform account transaction, check account balances, perform stock trading, pay for goods and services (e.g. point-of-sale), send and receive money, obtain account information, monitor financial transactions, transfer funds, and withdraw money from ATMs. Besides, mobile services such as location-based mobile services are used to access direction information on mobile devices, others are used to access market prices and agricultural information. For example, in Kenya the mobile services are used to access market prices, and agricultural information, and conduct mobile payment services. These all help to improve the economic development of that country. This dissertation focuses on mobile financial service that uses mobile phone to deliver its financial services to the customers, based on SMS and USSD technologies. In Kenya, this mobile financial service is popularly known as mobile money service. The advent of this service has afforded mobile network operators the opportunity to provide mobile phone-based financial services to numerous customers. The unserved, underserved, unbanked and under banked population of the country now easily have access financial services. The service has helped to promote financial inclusion. In March 2007, Safaricom mobile network launched M-PESA innovative mobile phone-based financial service in Kenya. Since, its launch, about 80% of the adult population accounting for approximately 19.3 million of the customers have used the service to send and receive money in 2014. And in 2016, over 23 million customers used the service to send and receive money. This unprecedented adoption of M-PESA mobile financial services makes the servic to remain the dominate player in the Kenya market. The dissertation aims to add to the existing knowledge on mobile financial services by examining crucial factors that are germane to the adoption, usage, success and dominance success of M-PESA mobile financial service in Kenya. The dissertation examines customers’ value perceptions, attitudes, and behavior toward the service, and the attributes of the service that convey higher customer benefits and value. The dissertation adapted and extended the theory of consumption value, and the means-end theory, customer value hierarchy, customer value change framework, and IT continuance intention to the context of mobile financial service as it relates to the Kenyan customers’ perspective. The first study addressed in chapter 2 of this dissertation adapted and extended the theory of consumption values to investigate the influences of aesthetic, conditional, convenience, monetary, epistemic, self-gratification, and social value on customers’ pre-adoption choice behavior towards M-PESA mobile financial services. The study developed and utilized measures from prior studies. It used online survey technique to collect data from M-PESA registered customers in Kenya. 384 sample size from 524 respondents, and partial least squares (PLS) statistical tool were used to evaluate the research model and associated hypotheses. The results show that aesthetic, conditional, convenience, monetary, epistemic, and self-gratification value are positive determinants of customer pre-adoption choice behavior toward the use of M-PESA mobile financial services. Social value did not show any positive significance, except strong negative influence contrary to the hypothesis. The limitation of the study is that the survey participants were limited to only customers who use M-PESA mobile financial services, besides, the sample size is large enough compared to the customer base of M-PESA. However, within the context of student research, it is acceptable. The findings present important implications for marketing managers and academic researchers in the mobile financial services market. The study specifically identifies service value that are inherently needed at the preadoption stage of any mobile financial service for current and prospective customers to use the service. This study is one of the first empirical studies to have adapted and extended the theory of consumption value to empirically examine the impacts of customer value a customers’ pre-adoption choice behavior to use any mobile financial services. The second study addressed in chapter 3 of this dissertation investigated the hierarchical roles of mobile financial service and its service attributes in realizing instrumental and terminal values through series of desirable consequences in use situation. The study conceptualized a hierarchical model, and operationalized monetary price, quality and, reliability attributes of a MFS as reflective components of functional consequences

reliability, safety brand reputation, and compatibility attributes of a MFS as reflective components of safety sequences

and, compatibility, valence and visual appeal attributes of a MFS as reflective components of symbolic consequences at second-order of abstraction. The study utilized repeated indication technique, and data-set of 155 respondents randomly collected from customers who use M-PESA in Kenya to empirically validate the hierarchical research model. The measures and the model were empirically validated by the confirmatory factor analysis, and path analysis. The findings of the study suggest that the performances of monetary price, quality, reliability, brand reputation, compatibility, valence and visual appeal of mobile financial services produce functional, safety and symbolic consequences. At higher level of abstraction, desirable functional and symbolic consequences were observed to positively influence instrumental and terminal values. Desirable safety consequences did not have any significant impacts on the instrumental and terminal values. The results suggest that desirable functional and symbolic consequences are higher benefits of using mobile financial services. While both desirable functional and symbolic consequences facilitate the realization of instrumental and terminal values, desirable safety neither hinder nor foster those values. The limitation of this study is the model lacks general technique of estimation, sufficient literature and standard of reporting. Also, the sample size is small, and only focuses on M-PESA mobile financial service and its customer. The hierarchical impacts of MFS attributes on instrumental and terminal values through desirable consequences present another research direction in MFS context. The study presents some clues to the motives and personal values that customers seek to fulfill when they use any mobile financial services. MFS providers and marketing managers can leverage on these results to provide mobile financial services with service attributes that facilitates the actualization of customers’ important personal goals and values. The originality of this study is the utilization and extension of the means-end theory to investigate the cognitive structure that exist between a mobile financial service, its attributes, and the customers in a goal-focused environment, where customers use MFS to satisfy their personal needs. The third study addressed in chapter 4 of this dissertation investigated the impacts of MFS perceived value and MFS personal values on customers’ attitudes and behavior towards mobile financial services in the post-adoption stage. The study presents an integrated model grounded in means-end theory, customer value hierarchy, customer value change, and IT continuance intention. The MFS perceived value and MFS personal values hierarchy were connected to customer satisfaction and continuance intention by utilizing customer value hierarchy and customer value change frameworks. The study adopted formative-reflective type hierarchical component model and repeated indicator techniques to operationalize the second-order constructs of the integrated model (Ringle et al., 2012

Afthanorhan, 2014). A dataset of 366 respondents from among M-PESA customers was utilized to investigate the impacts of MFS perceived utilitarian and hedonic value, and MFS personal values on customer satisfaction and continuance intention at higher-level of abstraction. PLS structural equation modeling was used to validate the model. The findings suggest that MFS utilitarian value strongly influence continuance intention, and MFS hedonic value strongly influence both customer continuance intention and satisfaction, while MFS personal values strongly influence customer satisfaction. Also, customer satisfaction strongly influences continuance intention, and mediates the indirect impacts of MFS hedonic and personal values on continuance intention. The study presents a value-based framework for examining the hierarchical influences of MFS utilitarian, hedonic, and personal values on customer satisfaction and continuance intention toward mobile financial services. The findings provide theoretical implications for academia and researchers to understand the determinants of customers’ attitudes and outcome behavior in the post-adoption stage. It equally offers practical implications for both MFS providers and marketing managers to leverage upon to reposition their financial services to meet customers’ satisfaction and continued use and patronage. The realization of continuance intention and customer satisfaction are germane to realizing customer retention, which will consequently increase service providers’ market shares and profit maximization. And in the long run, will lead to the success and survival of the service in any financial service market.