An investigation into the determinants of user acceptance of personalization in online banking

Personalization is an innovative strategy which enables the bank to further differentiate from its competitors by drawing the client into increasingly deeper levels of mutually beneficial relationships. However, for any personalization effort to succeed both the bank and its client need to perceive it as being relevant and beneficial to their interests. The bank needs the client implicit and explicit consent to use their personal data to enable them tailor the clients experience to suit s/he?s purposes as well as meet their goals. On the other hand the client needs to see its relevance and desirability as well as trust the bank to deliver what it promises. Since such decisions are based on previous experience, a major determinant of success of the personalization effort is thus a function of the client?s perception of the bank and their current relationship with it. Consequently in this research we have focused on understanding the underlying factors involved in the client?s relationship with the bank and how they influence the acceptance of five concrete personalization features, namely adaptive login feature, adaptable settings, emails, adaptive banners adverts and adaptive financial advice. We adopted this approach because we view personalization as a relationship marketing strategy and therefore propose that the basic underlying factors in relationship marketing would be major determinants of acceptance of personalization. We used the Commitment-Trust Theory (Morgan and Hunt, 1994) and the Theory of Planned Behaviour (Ajzen, 1985) as analytical tools to model the relationship between the basic relationship marketing constructs and the specific highlighted personalization features. We added the variable Control (data) to our models because it has been indicated in research as being important in acceptance of personalization. We found that clients in general want more personalization. We also found that five variables namely, Control (self-efficacy), Contro (data), Relationship terminations costs, Relationship benefit and Subjective norm were significant determinants of acceptance of personalization in online banking. At lower levels we found various issues which linked these variables to the acceptance of the personalized features. For instance we found that clients were more sensitive to control of content than they were to control of the interface. This clearly raises issue of data control in acceptance. Also their perception of self competence on the site determined how effectively they used it. While we found as stated earlier that clients desire more personalization, the observed level of acceptance was relatively low. This shows there is a gap between what is on offer or how it is being offered and what they really want. There is a lot of room for improvement, a lot of the clients are passively engaged because it is a necessary service which they need. The bank, however, needs to take them from there to a position where they are actively engaged and driving the process.