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Measuring Attitudes Towards Internet Banking. Empirical Evidence from Finland Heikki Karjaluoto1 University of Jyvskyl School of Business and Economics Rethinking Consumer Decision Making

P.O.Box 35 (MaE), FIN-40351 Jyvskyl, Finland. Tel:+358-40-536 1636. Fax:+358-14260 2968. E-mail: heikarj@st.jyu.fi

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MEASURING ATTITUDES TOWARDS INTERNET BANKING. EMPIRICAL EVIDENCE FROM FINLAND. Abstract
This paper examines the role of attitudes in consumer decision making. Attitude research in the area of electronic business provide new challenges and opportunities for many players in the field of information technology. In fact, research has not focused widely on attitude research in Internet banking. The aim of this paper is to shed light into attitude research in Internet banking. In this study we have measured bank customers attitude towards Internet banking. For the purpose of this study, we have developed a tool to measure bank customers attitude towards Internet banking. Keywords: consumer behavior, attitude measurement, Fishbein model, Internet banking

Purpose of the Research


The major goal of this paper is to identify beliefs and attitudes consumers have towards Internet banking in general, and show how persons attitude can be a good predictor of a persons behavior. It has been widely argued that it is important to distinguish between attitude and belief. Belief is a descriptive thought that a person has about something. Beliefs may be based on knowledge, faith, opinion, and may carry an emotional charge. Beliefs are one component of the attitude. Marketing theory and research support that consumers' attitudes toward product attributes influence their behavior toward those products or services. Consumers form those attitudes based on their image of the product/service from the dual perspectives of its tangible and symbolic attributes. Further, beliefs are information received from the environment, or by way of various inference processes. With time a person learns and forms a number of beliefs about an object. In other words, a person associates the object with different attributes. The totality of individual consumer beliefs serves the informational base that ultimately determines his or her attitudes, intentions, and behaviors. Attitudes play an important role in purchase decisions in which consumers are likely to engage in systematic information processing. Attitude research creates the basis for predicting consumers behavior. Although, many studies have demonstrated discrepancies between attitude and behavior.

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Attitude has over one thousand definitions, but in general attitude is relatively stable, overall evaluation of a concept. As Fishbein put it: attitudes are learned predispositions to respond to an object or class of objects in a favourable or unfavourable way. Attitudes have been defined as representing covert feelings of favourability or unfavourability toward an object, person, issue, or behavior. People learn attitudes over time by being in contact with the object directly (experience) or through receiving information about the object. Consumers use learned attitudes as a guide to their overt behavior with respect to the attitude object, giving rise to consistently favourable or unfavourable patterns of responses. Attitude measurement can provide understanding of purchase predisposition for a particular brand or service. Attitudes are assumed to be precursors of behavior. If a person is favourably predisposed toward a brand or service, that favourable predisposition should lead to favourable behaviors with respect to the brand, service, or program.

Measurement of Attitudes and Beliefs


The components of attitudes must be measured reliably because attitudes are to form the basis for marketing strategies. The general approach is to develop rating scales so that consumers can identify the degree to which they think an object has a certain attribute or the degree to which they like or dislike an object. In measuring beliefs about an object, it is necessary to identify the attribute that is linked to the object. Beliefs can be measured in three alternative ways. First, the likelihood of an object having a certain attribute can be measured in a sevenpoint scale from improbable to probable. Second, beliefs can be measured with a scaling device known as the semantic differential that uses opposite adjectives on a seven point scale too. The third scale measures beliefs about the accuracy of the description. These three methods measure beliefs in a different way and there is no agreement in the literature which one is the best. However, the semantic differential is the most widely used attitudinal scale because it is easy to construct and administer, and it is relevant to marketing strategy. Fishbein argue that there are some scales that appear to be related to the evaluative dimension under most circumstances. Among these measures are a subjects self rating of liking the object (e.g., like-dislike), of his favourability with respect to the object (e.g., favourableunfavourable, approve-disapprove), and his evaluation of the object on a single good-bad scale. Furthermore, these scales may not always be perfect indicants of a persons attitude. Although many different scales may sometimes correlate with appropriate measures of attitude, they cannot be assumed to measure attitude under all conditions. The most influenced multiattribute attitude model in marketing has been the Fishbein model. Within the framework of the Fishbein model, a persons attitude toward an object is a function of his beliefs about the object and the implicit evaluative responses associated with those beliefs. The basic formula for a multiattribute model is:
n

Ao = bi ei
i=1

where: Ao=attitude toward some object, bi=the strength of the belief that the object has attribute i, ei =the evaluation of attribute i, n=the number of beliefs about the object. The Fishbein model differs in various ways from other models presented in the literature. Fishbein model was developed to predict consumer attitudes. Although, marketers often use them to diagnose marketing strategies. The model is used to examine the component beliefs that underlie consumer attitudes. By comparing consumers beliefs about competing brands,

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marketers can learn about the bases for brand preferences. Furthermore, the model allows marketers to see what is important to consumers, how well their brands do in providing the attributes that are important, and how marketers stack up against their competitors.

Methodology
The data was collected by means of a questionnaire that was mailed to 3000 MeritaNordbanken customers in Finland. Responses were received after a follow up 1170. Thus the response rate was 39.0 per cent. The profile of the respondents was as follows: 51.5 per cent were male, aged under 34 10.1 per cent, 35-49 39.4 per cent, 50-64 31.6 per cent, and over 65 18.0 per cent. Household income: less than FIM100 000 per year 18.3 per cent, 100 001-150 000 17.8 per cent, 150 001-225 000 20.5 per cent, more than 225 000 43.5 per cent. The empirical data was divided into three groups, each group consisted of different kind of bank customers. Segmentation was done in terms of electronic banking experience. The first group called non users, consisted of consumers who were not using Internet banking services. The second group, called new users, consisted of customers who had the needed user ID and passwords for Internet banking, but who were relatively new users, or did not use Internet banking. Third group, old users, consisted of consumers who had used Internet banking already in the beginning of year 1997, and have used it since. This paper examines questions concerning consumers attitude towards Internet banking. Attitudes were measured with the Fishbein model, introduced in this paper. Moreover, due to space limits, we measured and analysed only new users and old users attitudes towards Internet banking.

Results and Implications


Attitudes were measured as suggested in the literature. Consumers had to rate each belief with scale ranging from 1 to 7 ( 1 = Strongly disagree to 7 = Strongly agree). Each of these beliefs were evaluated with scale ranging from -3 to 3. Belief strength (bi) and evaluation (ei) were measured with mean scores counted from the empirical data: In our overall attitude indicator the minimum attitude score is 12 (each belief strength (bi) is rated as 1 and each belief evaluation (ei) as 3). The maximum attitude score for this model is 84 (when each belief strength (bi) is rated as 7 and each belief evaluation (ei) as 3). With this framework we can use the total attitude score to make e.g. comparisons between the different target groups and also evaluate the overall attitude score. Based on the empirical findings, we have chosen four important beliefs consumers had about Internet banking: 1. 2. 3. 4. Internet banking is faster than ordinary bank (b1) Internet banking is cheaper (b2) Internet banking is easier to use (b3) Internet banking provides always good service (b4)

Figure 1 shows that the strongest belief consumers had about Internet banking was easier to use than other modes of payment. All other three beliefs had also significant positive rating ranging from mean scores 4.2 to 5.3. Service in the Internet bank was evaluated as not so important. Speed and easy to use were evaluated high with mean scores of 2.3 for each. Total attitude score for new users was 38 as Figure 1 depicts.

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b1 = 5,3

Faster
e1 = 2,3

Attitude Internet banking = bi ei


i=1

b2 = 5,3

Cheaper

e2 = 2,3

A0 = (5,28)(2,27)+(5,25)(2,25) +(5,65)(2,42)+(4,21)(0,04) A0 = 12,0 + 11,8 + 13,7 + 0,2 A0 = 38

Attitude A0 = 38

b3 = 5,7

Easier to use
e3 = 2,4 b4 = 4,2

Service

e4 = 0,04

FIGURE 1 New Users Attitude Towards Internet Banking

Figure 2 depicts attitude score for old users. Easy to use was considered as the most important belief about Internet banking with mean score 6.6. Speed was also considered high with mean score 6.4. Consumers evaluated the importance of speed, price and easy to use very high, with mean scores over 2.2 for each. Total attitude score 52 compared to new users attitude score 38 is significantly different.

b1 = 6,4 b2 = 5,7

Faster
e1 = 2,5

Attitude Internet banking = bi ei

i=1

Cheaper
e2 = 2,2

Attitude
A0 = 51 b3 = 6,6

A0 = (6,35)(2,46)+(5,73)(2,21) +(6,55)(2,44)+(4,59)(1,51) A0 = 15,6+12,67+15,98+6,93

Easier to use
e3 = 2,4 b4 = 4,6

A0 = 51

Service
e4 = 1,5

FIGURE 2 Old users Attitude Towards Internet Banking

In this paper we discussed consumers attitudes towards Internet banking in Finland. The results imply that the more consumers are familiar with the target attitude object the more positive attitude they have. As past literature also suggested, more positive attitudes will create more positive behavior toward the target object. Therefore old users are more likely to behave in a more positive way towards Internet banking than new users (e.g. provide more positive word-of-mouth). It is worth noting that this study was based on comparatively big sample, so the attitude scores towards Internet banking can be considered quite reliable. It is also important to underscore that the differences between attitude scores of new-Solo users and old Solo-users are statistically significant in addition to their obvious arithmetic differences. However, the results are more or less appealing from the choice of existing beliefs. Thus future studies will be necessary. We might, for example, compare attitudes between different countries. Finland

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is said to be one of the leading countries in the area of Internet banking, what might have had an effect on our results.

Key References
Assael, H.(1981). Consumer Behavior and Marketing Action. 3rd ed. Boston: PWS-Kent Publishing company. Fishbein, M. & Steiner, I.D. (1965). Current Studies in Social Psychology. New York: Holt, Rinehart and Winston, Inc. Fishbein, M. & Ajzen, I. (1975). Belief, Attitude, Intention, and Behavior: An Introduction to Theory and Research. Reading, Massachusetts: Addison-Wesley Publishing Company, Inc. Kerlinger, F.N. (1979). Foundations of Behavioral Research. 2nd ed. London: Spottiswoode Ballantyne Limited. Kotler, P. & G.Armstrong & J. Saunders & Wong, V. (1999). Principles of Marketing, 2nd European ed. Milan: Rotolito Lombarda. Lutz, R.J. (1975). Changing Brand Attitudes through Modification of Cognitive Structure. Journal of Consumer Research. March. ----, -----. (1981). Contemporary Perspectives in Consumer Research. Boston: Kent Publishing Company. Peter P.J. & Olson, J.C. (1990). Consumer Behavior and Marketing Strategy. 2nd ed. New Jersey: R.R.Donnelley & Sons Company. Runyon, K.E, & Stewart, D.E. (1987). Consumer Behavior and the Practice of Marketing. Columbus, Ohio: Merrill Publishing Company. Wilkie, W.L. (1994). Consumer Behavior. 3rd ed. New York: John Wiley & Sons, Inc. Wirtz, J. & Bateson, J.E.G. (1999). Introducing uncertain performance expectations in satisfaction models for services. International Journal of Service Industry Management. Vo. 10, No. 1. Zimbardo, P. & McDermott, J.J. & Metaal, N. (1995). Psychology, A European text. London: HarperCollins College Division.