The mediating role of financial service branding on investment decisions: an emerging market's perspective

Abstract

Purpose

This study seeks to assess the mediating role of financial service branding on investment decisions from the perspective of financial service investors.

Design/methodology/approach

Field data were obtained from 403 individuals and corporate investors in financial service institutions who invested savings and pensions funds into short to medium term financial instruments from an emerging market in sub-Saharan Africa (SSA). Data were analysed using the partial least squares structural equation modelling technique (PLS-SEM).

Findings

Branding significantly mediates return on investment (ROI) decisions. However, the ROI did not have a significant direct effect on investment decisions. ROI has a significant indirect effect on investment decisions due to branding influence on investors.

Research limitations/implications

Data collected was cross sectional. Future research can use longitudinal data for better long term planning. Study can also be done in other emerging economies to determine how the financial sector characteristics for each country can be a source of difference from branding and investment standpoint.

Practical implications

Although consumer investment decisions are logically influenced largely by ROI, investors place savings and pensions into financial instruments largely managed by reliable corporate brands with solid reputation known as safe havens for hedging lifetime investments.

Originality/value

This study covers the research gap in brand power and the reputation of financial service institutions as well as the investment decisions of financial service investors in emerging Sub-Saharan African.

Citation

Dzogbenuku, R.K., Amoako, G.K. and Martins, A. (2023), "The mediating role of financial service branding on investment decisions: an emerging market's perspective", International Journal of Emerging Markets, Vol. 18 No. 11, pp. 4709-4733. https://doi.org/10.1108/IJOEM-05-2021-0718