Quality Perception of Gen Z Consumer on Traditional Banking Services

In developing countries, digital banking has been introduced and, although it has grown tremendously, it still coexists with traditional banking, with branch service. The objective of this study is to explore the elements in the quality perception of Generation Z that makes them prefer traditional banking to digital banking in the context of a developing country, Mexico. The study of quality perception is implemented through the application of the SERVQUAL model with 22 items. There were applied 394 online surveys to users of traditional or digital banking from generation Z. Qualitative content analysis is used to understand the customer’s quality perception of traditional banking, in which the variables considered were: tangibility, reliability, responsiveness, assurance, and empathy, which were evaluated through a 7-point Likert-type satisfaction survey (1 = Completely disagree, 7 = Completely agree). In this study, it was identified that the responsiveness variable which considers the attitudinal aspects of the branch staff and communication with the staff in traditional banking services, is the one that has the greatest impact on generation Z consumers, regardless of their socioeconomic status, and therefore, explaining the preference for traditional banking services over digital ones. In addition, from favoring traditional services, Generation Z users have evolved from a product perspective to a service perspective, where the aspects of tangibility and reliability take the background, giving greater relevance to responsiveness, assurance, and empathy which are focused on the employeeconsumer internment. This study offers a strategic starting point that will facilitate the banking sector to plan the development of strategies that stimulate the migration of banking services to digital banking services.


Introduction
Economic development of countries is closely related to their financial system. A stable financial system will promote job development and improve investors' confidence in national markets, easing tax collection for the government, providing solidity, and consequently supporting infrastructure projects such as hospitals, highways, among others (World Bank, 2020).
In the case of the Mexican financial system, the economic crises that began with 1994's devaluation have generated major changes in the financial system during the last two decades. The main was the restructuring of the system, causing the privatization of banks, the internationalization of financial markets and the decline of the sector as a source of financing for the private sector (Villafani-Ibarnegaray & González, 2006).
These changes have hampered the solidity of Mexican financial system, especially in the banking sector. This is the reason why banks have focused on market niches that they previously did not consider relevant (consumer). In this case, they have had to develop a new offer of products and services by virtue of their needs (Villafani-Ibarnegaray & González, 2006).
On the other hand, the development of products and/or services in the banking sector can be considered since the integration of technology. The evolution began in the sixties culminating in the nineties with modern banking (Casilda, 1997), understanding modern banking as the integration of digital and traditional banking services.
During the sixties, banks focused on cost reduction, encountering various limitations in the transmission of information and staff training. In the 1970s, the objective of banks was modified, focusing on providing better customer service. Meanwhile, the integration of telecommunications in the banking sector began. This decade was characterized by the incorporation of services, such as the automatic teller machine (ATM) (Casilda, 1997).
The eighties are distinguished by the proliferation of bank branches. Finally, the nineties were differentiated by the development of digital banking, causing bank's decentralization of functions, allowing people to carry out operations remotely through digital banking (Casilda, 1997).
During the 21st century, the banking sector has increased its offer of products and/or services through the integration of technologies. As a result, traditional and digital banking services coexist within banking services today. Consequently, during the next few years, digital banking services will predominate in the banking sector. It is noteworthy that traditional banking services as any other service require the physical presence of the consumer or user and a bank employee in a bank branch.
However, several authors question the benefits of transferring services to a predominantly digital modality. Among the most relevant arguments are the influence of personal contact as a competitive advantage, the waste of a corporate image built over the years, the development of trust and image through tangible aspects, among many others (Márquez, 2000;Rexha et al., 2003;Torres & Vásquez-Párraga, 2005).
Particularly, in Mexico these aspects are relevant according to the 2018 national financial inclusion survey conducted by the National Institute of Statistics and Geography (INEGI, 2018), in the Mexican banking sector there are 79.4 million potential consumers aged 18 to 70 years. Of which only 54 million (68%) have a financial product, this figure has not increased since the 2015 survey.
The most recurring financial product is the bank account with 37.3 million consumers, followed by the credit with 24.6 million. Specifically, within the bank accounts section, the payroll account is the most representative with 22.5 million, which corresponds to 60% of the users of bank accounts (INEGI, 2018).
In relation to digital banking, only 11.8 million Mexicans indicated having used a digital banking service, in contrast 42.2 million Mexicans indicated using traditional banking, one of the main reasons was the preference of service such as window (INEGI, 2018). Therefore, it is important for the banking sector to identify which aspects of traditional banking services are considered most relevant by consumers when determining the perception of quality in products and services. Being fundamental in two senses, it will mainly serve to develop more efficient service strategies focused on stimulating consumers to integrate and stay within the banking sector.
Currently, there are several studies about the quality perception in the banking sector, for example, in the Middle East, there are the studies of Ali & Raza (2015) in Pakistan, Ananda & Sonal (2019) in Oman. In Europe, the study by Canals (2002) in Spain and in Latin America that of Carvajal, Leguina, & Zamorano (2013) in Chile. In Mexico, the studies by Vera & Trujillo (2018) and Vega et al. (2008). These studies on the quality perception in the banking sector have, for the most part, contributed with positive results to the academic literature. However, they have put aside the segmentation of banking, by considering the services of the banking sector in a global way, without making any distinction between traditional banking and digital banking. This is found in most quality perception studies of the banking sector, which omits two essential aspects in this sector. The first one is not to separate traditional banking services from digital banking services. This is fundamental since modern banking is defined as a traditional and digital banking services union. In the case of investigations in Mexico, this omission will create a bias. The results of national inclusion surveys regarding the use of digital and traditional banking show approximately 80% of the consumers of banking services in Mexico use only traditional banking.
A generation is defined as a set of historical events and related phenomena that create a distinct generational difference (Parry & Urwin, 2011). Every generation arises according to the date of birth, and they have a specific social behavior. Generation Z or centennials are defined as those people born between the years 1996 and 2007 (Oblinger, 2003). Most of the people belonging to genera-tion Z have used the internet from a very young age and are comfortable with technology and social networks. Generation Z people are estimated to make up 23.7% of the world's population.
Also, most of the studies perform little stratification in relation to the consumer, in some cases excluding aspects such as life stage, income, consumption characteristics, socioeconomic status, among others. With this, limiting the understanding of quality perception of banking services in the various consumer segments that currently exist in the sector.
Therefore, before conducting a quality perception study in the banking sector, it is necessary to consider the different types of consumers in relation to life stages, income status and consumption characteristics. As well as its affinity with technology, which can be considered as a fundamental factor when referring to digital and traditional banking. Hence, this research seeks to quantify which aspects are more decisive in the Mexican Gen Z consumers, when developing quality perception towards traditional banking services through the application of the SERVQUAL model proposed by Parasuraman, Zeithaml, & Berry (1988).
Additionally, this research will segment consumers based on aspects such as socioeconomic status and gender.

Type of Investigation
The research methodology is cross-sectional according to the method used to retrieve the information, which was obtained through the application of a data collection instrument. The objective of the research is considered correlational-causal, by seeking the relationship between the variables. Therefore, this study is quantitative (Fernandez & Hernandez, 2014).

Object of Study
The object of study for this research was defined based on the ICC/ESOMAR International Code of Market, Opinion and Social Research and Data Analysis.
Particularly on article two subsection a & b. Due to the method to collect data for this study, the established age ranges are between 18 and 24 years.

Assessment Instrument
To collect the information, the SERVQUAL instrument was adapted and applied as a survey containing 22 items. The instrument measured the quality perception of traditional banking services considering the variables: tangibility, reliability, responsiveness, assurance, and empathy. The measures for the variables were adopted from an existing 7-point Likert-type scale (1 = Completely disagree, 7 = Completely agree).

Data Collection and Processing
The sample size for the study was determined by using the sample size formula for a finite population (Equation (1)) (Triola, 2004), with a confidence status of 95%, a margin of error of 5%, with probability of success, p, of 0.5, and a population of 2.4 million. Resulting in a sample size of n = 385. The study data were collected through a survey applied in various regions of the Valley of Mexico during the first quarter of 2020.
Equation (1). Sample size for a finite population. Where N is the total size of population, Z is the confidence status, d the error, p is the probability of success, q the failure probability and n the acceptable sample size.
Statistical reliability of the collected data was analyzed using a Cronbach's Alpha (Equation (2)). Subsequently, each one of the variables (tangibility, reliability, responsiveness, assurance, and empathy) was analyzed. Defining an α > 0.9 as a parameter of acceptance for the study (Domínguez-Lara & Merino-Soto, 2015).
Equation (2). Cronbach's Alpha. where α is Cronbach's alpha, To calculate the correlation between the variables, a multiple linear regression was used for each one of the study variables (Equation (3)). Additionally, as statistical support it was applied a Pearson's correlation coefficient (Equation (4)).
The acceptance criteria established is R 2 > 0.8 for the multiple linear regression and r > 0.9 for the Pearson's r (Santabárbara, 2019).
Equation (3). Linear regression correlation coefficient, where t is Linear regression correlation coefficient, X is the independent variable and Y is the dependent variable. Open Journal of Business and Management Equation (4). Pearson's correlation coefficient. Where r is Pearson's correlation, S x and S y are the standard deviation of X and Y respectively and S xy is the sample covariance.
Multicollinearity was calculated in the study variables to suppress errors in the calculation of linear regression. The multicollinearity was determined by using a Kendal's Tau (Equation (4)), with an acceptance parameter of T b > 0.8 (Lauren- Equation (5). Where T b is Kendal's Tau, P is the number of concordant pairs, Q is the number of discordant pairs, X 0 is number of pairs tied on the independent variable X, Y 0 is number of pairs tied on the independent variable.

Consumer Satisfaction
The quality perception by the consumer of a service is essential for the success of organizations since aspects such as loyalty and behavior are based on consumer satisfaction (Kotler, 2016). On the other hand, consumer loyalty considers the influence of the environment as a behavior modifier (Oliver, 1999). In addition, the development of loyalty is a complex process that will depend to a large extent on the consumer's perceived quality.
Quality is to satisfy the expectations of the consumer in relation to the service provided (Zeithaml, 2001). Zelthaml also views leading companies as those that meet consumer expectations. Meanwhile, expectations are an appreciation or perception of what will happen in the future, in this case by the consumer about the service (Cosacov, 2007).
The gap between consumer expectations and the satisfaction generated by the product and/or service defines the perception of quality (Parasuraman, Zeithaml, & Berry, 1988). The better the consumer's expectations are satisfied, a higher quality perception is generated about the products or services offered, originating purchase satisfaction on the part of the consumer (Oliver, 1980). Convergence between digital and traditional banking services has made it difficult to properly identify which aspects the consumer considers relevant in digital and traditional banking services. Therefore, the priority for companies in the banking sector in Mexico should be to identify the perception of quality of traditional banking services since it is used by 30 million more users than digital banking.

SERVQUAL Model
To quantify quality perception, Parasuraman, Zeithaml, & Berry (1988), propose the Service Quality or SERVQUAL model. The model considers quality perception as the difference between expectations and the service received. Later studies showed that it is not necessary to quantify expectations, since the perception of the service generates the perception of quality (Cronin & Taylor, 1992).
According to the SERVQUAL model, the perception of quality is quantified based on five factors: tangibility, reliability, responsiveness, assurance, and empathy. In the traditional banking sector, these builders are considered as follows: • Tangibility refers to the appearance of the personnel, facilities, and equipment of the bank branch. • Reliability is defined as the bank's ability to provide proper service without errors within the bank branch. • Responsiveness is established as the service attitude of the bank branch employees towards the customer for helping them meet their needs. • Assurance is the technical capacity to provide confidence to the client by the employees of the bank branch and • Empathy is understood as the personalized or individualized attention that the bank branch gives to the client during the provision of the service.

Generations and Income in the Banking Sector
Generations will share aspects such as age, life stages and will be linked by a generational perspective that originates shared behavior, criteria, and opinions. However, these will be completely different from the predecessor and subsequent generations (Ortega & Gasset, 1933). Now, four generations can be classified in the banking sector: Baby Boomer (1947-1964), X (1965-1980), Y (1981-1995), and Z (>1995). The Boom or Baby Boomers generation is a generation made up of the population born between 1947 and 1964 who are currently between 55 and 73 years old. Concerning consumption, they are a large segment of the population, and their main channel of consumption is physical (Oblinger & Oblinger, 2005). Generation X or Xers is a generation made up of the population born between 1965 and 1980. Currently, they are between 40 and 55 years old. Regarding the consumption of this generation, their main channel is physical. Despite being a generation with technological skills, they have a low status of online shopping and a great income capacity (Smola & Sutton, 2002).
The NetGen generation, also known as Generation Y or Millennials, is a generation that is made up of the population born between 1981 and 1995 who are currently between the ages of 25 and 39. Regarding consumption, it is necessary to consider their great affinity with technology, their consumption channel is digital however, they can alternate with physical consumption (Seaton & Boyd, 2007).
Finally, the Generation Z or Gen Z is a generation conformed by the population born between 1996 and 2010, currently between 11 and 25 years old (Torocsik, Szucs, & Kehl, 2014). This generation can be referred to by other names like the Facebook generation (Prensky, 2001). They consider themselves technology experts for this reason the use of the internet is essential for them, they are used to getting answers immediately and their consumption is mainly by digital channels (Cassany & Ayala, 2008).
Specifically, in Mexico during the next decade, generation Z will experience significant changes in their life stages and income structures. These modifications are characterized by two aspects; the first one is that the income and consumption of this generation will increase considerably and, the second is that these changes will be sustained over time for a long time.
In Mexico, the Mexican Association of Market Intelligence and Opinion Agencies (AMAI) determines eight socioeconomic statuses. Socioeconomic statuses are classified by average monthly household income; where A and B are high-income statuses corresponding to 6.6% of the population, C+ and C are middle income being 26.5%, C− and D+ correspond to an average income with a 29.6% of the population, and finally D− and E are low-income corresponding to 37.3% (AMAI, 2018).

Reliability Analysis
For the analysis 458 questionnaires were obtained, of which only 447 were filled correctly. The answers of non-residents of the Valley of Mexico, the ones that did not meet the age range, and those who had not purchased a product or service from the banking sector were excluded from the study, giving a total of 394 valid questionnaires, thus giving validity to the study. Regarding the demographic aspects of the respondents, about gender, the percentage of women was higher with 237 (60.15%) compared to men with 157 (39.85%). In addition, 1.02% reported belonging to socioeconomic status A, 3.81% indicated status B, 9.64% reported being part of status C+, 16.75% indicated status C, 20.81% reported being part of status C−, 25.13% part of status D+, 19.04% at status D and 3.81% status E (Table 1).
Before presenting the results of the structural model, the validity of the results for the 394 surveys was determined. Construct items: tangibility, reliability, responsiveness, assurance, and empathy were analyzed using a Cronbach's Alpha.
Later, the full constructs were analyzed. The validity analysis of the items resulted in values higher than 0.900 in all cases. The results by construct showed values of 0.962 for tangibility, 0.949 for reliability, 0.941 for responsiveness, 0.943 for assurance, and 0.944 for empathy. These values suggest that both the items and the constructs for the study are valid ( Table 2).
The multicollinearity analysis presented in Table 3 shows the assessment between tangibility, reliability, responsiveness, assurance, and empathy constructs.
To identify collinearity that may affect the subsequent analysis.    Responsiveness results had values of 0.736 for assurance and 0.718 for empathy. In addition, assurance showed a value of 0.724 for the empathy construct. Among the most significant results, the responsiveness construct showed signs of collinearity with empathy, reliability, and assurance constructs. However, collinearity is not considered significant depending on the study parameters; therefore these values do not affect or be considered for multiple regression analyses. Table 4 shows the results of the linear regression for tangibility construct where the general analysis presented values of 0.744 for Pearson's correlation and 0.554 for R 2 . In addition, the socioeconomic status analysis showed indicators below 0.800 for all statuses. As well as the gender analysis that shows values lower than 0.800 with an R 2 of 0.541 for women and 0.553 for men. Therefore, the results determine that the perception of the quality of the services of the traditional banking sector is not influenced by tangible aspects in these services, such as the presence of the staff, the image of the physical facilities, and the equipment of the branch.

Variable Analysis
Linear regression analysis results for the reliability variable are presented in   The analyses by gender set values for women of R 2 = 0.840 and Pearson's correlation = 0.916 and for men of R 2 = 0.905 and Pearson's correlation = 0.951.
The results indicate that aspects of responsiveness, such as employee-user communication, the attitude of service, and customer service, among others, contribute to defining the quality perception in traditional banking services.
The results of the assurance variable are presented in Table 7, which contains   Gender results showed indicators for men of R 2 = 0.905 and Pearson's correlation = 0.951 and for women of R 2 = 0.799 and Pearson's correlation = 0.841.
These results determine that at status A, B+, C+, and C, aspects like the confidence in the correct execution of transactions within the branch, the amiability of the staff towards the clients, and the knowledge of the employees, among other aspects influence the quality perception of traditional banking services. Likewise, concerning gender, this influence is only valid for men. Table 8   In turn, the analyses by gender showed results for women of R 2 = 0.814 Pearson's correlation = 0.902 and for men R 2 = 0.757, Pearson's correlation = 0.870.
These results indicate that empathy aspects in traditional banking services such as personal attention and the understanding of customer needs, among others, influence the creation of quality perception in socioeconomic status A, B, C+, and C, in women.

Discussion
The results of the variables tangibility and reliability revealed that aspects such as the presence of the branch staff, the image of the physical facilities, a low status of error during service, or an adequate waiting time, are not relevant factors for the quality perception of Gen Z when receiving any traditional banking service.
This can be explained according to the postulation by Castellano and González (2010), who indicate that quality perception in service will be defined based on the received treatment. Therefore, the attitudes and behavior of employees of bank branches will have a greater influence on the consumer's quality perception than aspects such as waiting times or physical facilities.
On the other hand, the variables assurance, reliability, and empathy are considered transcendental when determining quality perception. Indeed, this is correct from the stand of Aparecida, Lopes and Oliveira (2015) who postulate that the quality of services will be considered according to the behavior, attitudes, and skills of the service providers, which are the in employees of the bank branch.
Regarding gender analysis results, it is demonstrated that women's quality perceptions are determined by responsiveness and empathy variables. In contrast, men's perception of quality is defined by responsiveness and assurance variables.
In addition, socioeconomic analyzes had significant differences between the highest statuses (A, B, C+, and C) and the lowest (C−, D, D− and E). This difference can be observed in the variable's responsiveness, assurance, and empathy which are decisive in the perception of the quality of the higher statuses. Additionally, the reliability variable is important for status B and C+ and tangibility for B (Table 9).
On the contrary, at the lowest status (C−, D, D− and E), the quality perception of traditional banking services is determined solely by the responsiveness variable. The results indicate a preference on Mexican consumers for a service that favors employee-consumer interaction, due to the fact that the responsiveness variable is representative of all statuses.
The results of this study reaffirm the national financial survey outcomes that show that 80% of Mexican consumers in the banking sector prefer traditional banking to digital banking. According to the results, the preference for traditional banking is due to the ease of communication with the bank branch staff. As well as the service attitude that is more representative in this type of service.
In addition, it must be emphasized that 70% of the population in Mexico belongs to socioeconomic status C−, D, D− and E, which determine their perception of quality by the responsiveness aspects, reinforcing the importance of the attitude of the employees, as well as the communication channels with staff.
The results from the perspective of Flint, Lusch and Vargo (2014) demonstrate that generation Z consumers, despite of requesting or favoring traditional banking services, have evolved from a view on the product to one on services. As demonstrated in this study, tangibility and reliability aspects come in second, giving greater relevance to aspects like responsiveness, assurance, and empathy which focus on employee-consumer interaction.
To sum up, the stagnation of consumer migration from traditional banking to digital banking is the reason consumers favor responsiveness aspects such as a Table 9. Hypothesis comprobation by segment.

Independent variable Tangibility Reliability Responsiveness Assurance Empathy
Global good attitude of service and ease of communication between the consumer and the employee, which is more present in traditional services.

Conclusion
The restructuring of the Mexican financial system has maximized consumer importance as the center of the system. In fact, in the banking sector, the introduction of technology has helped develop several types of services focused on consumers. These can be classified into digital and traditional services. As shown by the 2018 financial inclusion survey, 80% of Mexican consumers prefer to use traditional banking services over digital. This trend is worrying, given that the banking sector as well as other sectors is migrating towards digital features. Therefore, the design of strategies focused on the migration of the consumer from traditional to digital services is essential in the banking sector. Since the population of Generation Z is the priority. Because, during the next decade, they will be the main axis of consumption in Mexico with 24.9% of the population, as well as their affinity to technology.
Therefore, this study is relevant since it defined the elements generation Z favors in traditional banking services, by determining significant variables in the quality perception of traditional banking services, adding segmentation according to their socioeconomic status and gender.
Among the most important findings is the responsiveness variable which considers the attitude of the branch staff and communication with the staff, among others. This variable is present in all socioeconomic statuses, explaining with it the preference for traditional services. While these aspects of communication are not found in digital services.
Likewise, a difference was identified between the highest socioeconomic statuses A, B, C+, C which considers 3 to 5 variables when defining their quality perception. In contrast, C−, D+, D and E statuses only consider responsiveness as a variable in the quality perception.
To the academy, this study contributes to the current literature by the segmentation of traditional and digital banking in quality perception studies in the banking sector, providing more precise results based on the relevant variables for the consumer. Additionally, this study presents empirical evidence of the quality perception in Mexico by Generation Z, a topic less studied in the literature.
This research will work as a guide to the banking sector when developing strategies for generation Z in different socioeconomic statuses, mainly, in strategies focused on the migration of consumers towards digital banking services. Moreover, it will help the design of strategies aimed at attracting generation Z consumers. In addition, the results besides being positive, offer information on a little-explored approach in the banking sector.
In conclusion, the knowledge of this information will make it easier for the banking sector to plan the development of strategies that stimulate migration to digital banking services. By offering an understanding of which aspects of traditional banking services are considered relevant by the consumer and being able to emulate them within digital banking services.