The Effect of Relationship Marketing on Customer Loyalty in the Bank Industry in the Case of Bank of Abyssinia
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Date
2022-06
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Addis Ababa University
Abstract
Ethiopia’s banking sector is showing growth and the competition is becoming tense. This makes it necessary for Banks to build core strategy to acquire new customer and manage to retain them. Thus, this study is conducted to examine how customer relationship marketing affect cus-tomer loyalty in case of Abyssinia banking, Addis Ababa.330 questionnaires were collected to get the required data from customers and interviews were conducted with few branch managers and marketing experts. The collected data was analyzed using SPSS. A quantitative method with deductive approach is applied and follows Causal-comparative/quasi experimental research ap-proach method. Non-probability, convenient sampling technique was used to select the bank branches to disseminate questionnaires. However Cochran sampling technique was used to select respondents. Regression analysis is carried out to see the association between each independent variable: trust, commitment, communication, conflict handling and technology on the dependent variable: customer loyalty, then variables that showed significant associations is included in a single model and multiple linier regressions is performed to identify the most significant predictors.95% CI and P-value (0.05) was used to assess the degree of statistically significance. The findings showed that customer relationship marketing dimensions have effect on customer loyalty. Four of the independent variables except technology are significantly associated with customer loyalty particularly in Abyssinia bank and in general in banking industry. Also, they are expected to contribute more on attracting new customers and retaining the existed ones with regard to relationship marketing to increase customer loyalty. Based on the findings it is recommended that banks should invest more in creating and developing customer trust, show commitment, good communication and apply effective conflict handling in order to be winner in the competitive field in acquiring loyalty of customers.
Key words: Customer relationship marketing, Customer loyalty, Trust, Commitment, communi-cation Conflict handling and technology
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Bussiness