Consumer intentions, reactance and the marketing implications of policy induced mergers and acquisitions in financial services

Drawing upon the indirect effects of customer reactance from an emerging economy perspective, we sought to establish the marketing implications of policy-induced Mergers and Acquisitions (M&A) in Financial Services.

From an investigation of over 500 customers in the affected banks, we found a positive and significant relationship between immersive marketing communication and consumer intention.

The presence of consumer reactance highly influenced the relationship.

As a public policy tool, forced mergers and acquisitions was found to increase customer reactance.

However, when customers are frequently engaged with relevant and consistent marketing communications through appropriate channels, such reactance would only be partial.

When timely and relevant marketing communications are targeted at the customers who are directly impacted by the M&A process, they would experience reactance, but only partially.

This has a range of marketing implications for policy-induced M&A and its impact on consumer intention, reactance and attitudes towards the new entity.

The marketing of financial services literature has been silent on the implications of M&A from a policy induced perspective. This study, therefore, contributes to theory by highlighting that the “destruction” of brand value of the affected firms is relatively high in a policy induced M&A and thus increases the level of customer reactance.

This is because a regulator enforced M&A, as public policy, usually generates high public interest and public discourse, leading to a heightened customer reactance. However, when immersive marketing communications are targeted at the customers directly impacted by the M&A, they would experience reactance, but only partially.

How to cite: Mensah, K., Madichie, N.O., Mensah, G.K. and Awini, G. (2022), “Consumer intentions, reactance and the marketing implications of policy induced mergers and acquisitions in financial services”, International Journal of Bank Marketing, https://doi.org/10.1108/IJBM-10-2020-0516

Originally published at https://www.emerald.com.