THE IMPACT OF CUSTOMER RELATIONSHIP MARKETING ON CUSTOMER SATISFACTION: (The case of Commercial Bank of Ethiopia)

Abstract

The main objective of this study is to investigate the impact of customer relationship marketing on customer satisfaction. It is explanatory type of research. Data were collected through a five points Likert scales of questionnaire. The questionnaire was physically distributed to 210 customers and 42 customer service managers. Out of 210 customers and 42 customer service manager questionnaires 193 customer and 42 customer service managers were completed and collected Descriptive, correlation and econometric analysis methods were used to analyze the collected data. Descriptive tools such as frequency, percentages, mean and standard deviation were employed to present results. Statistical analysis tool such as correlation coefficients was worked out and used to explore the relationships between variables. Econometric analysis through ordered logit regression was performed to study the effect of explanatory variables on customer satisfaction. Research findings indicate that there is a significant relation between relationship marketing components including trust, commitment, communication, conflict handling and competence on customer satisfaction and also to regression testing that all variables were examined simultaneously on customer satisfaction; results showed that all components have a significant impact on customer satisfaction. Lack of welcoming and smile face and deficiency in Customers’ treatment, cooperative, politeness and willingness to help customers by some employees, there is Frequent network problem, long wait in queue specially at the end of the month, invisible advice issued, and delay in Check clearance were viewed by respondents as a customer relationship marketing practice weakness. Therefore, based on the findings the researcher has recommended that the bank Should provide consistent quality services by minimizing frequent network failure/internet connection problems, Should regularly visit customers; making a discussion about customer needs, communicating policy changes and other important issues. The bank should work hard on improving conflict handling practice through designing and continuously providing comprehensive training to employees that could improve conflict handling skill, attitude and ability gap.