Drivers and consequences of consumer alienation in the French retail banking sector

The value co-destruction process has been heavily studied in recent years. However, most studies have focused on the value of co-destruction's emotional and behavioral consequences without considering its psychological impact on consumer behavior. This study bridges this research gap by examining consumer alienation as a fundamental psychological state that underpins the value co-destruction process. Its primary objective is to delve into the significance of alienation within retail banking, uncovering its underlying causes and consequences. Furthermore, the study examines how the external locus of control affects the behavior of alienated consumers. The data were collected from 211 French retail bank users. Structural Equation Modeling was used to test the hypotheses. The study showed that consumers’ discontent, perceived differential treatment, and financial distress lead to value destruction and influence consumer alienation toward retail banking service providers. A high level of alienation leads to payment delinquency, negative WOM, and switching intentions to internet-only banks. The external locus of control moderates these relationships. By identifying the antecedents and consequences of consumer alienation in retail banking, this study provides practical advice to retail banking providers on retroactively identifying alienated consumers. This study provides ideas on restoring lost value, retaining customers, and preventing them from switching to internet-only banks. Our research enriches the Service-Dominant Logic theory by exploring the role of consumer alienation on the value co-destruction process. It enhances the understanding of consumer alienation in retail banking.