DETERMINANTS OF CUSTOMER LOYALTY PROGRAM IN ETHIOPIAN AIRLINES

Abstract

In today’s competitive business world central to relationship marketing is customer loyalty. The airline industry is facing challenges in customer loyalty program implementation. Most of customer loyalty programs are misunderstood and misapplied by customers and Airlines. The study seeks to examine the major determinants of loyalty program in Ethiopian airlines. The study will contribute to other service providers in Ethiopia, to broaden their understanding of customer loyalty program. A descriptive research design has been used and convenience and purposive sampling techniques were used to select target respondents. A questionnaire was designed based on the research frame work in order to examine the six major determinates of customer loyalty program in ET: trust, satisfaction, conflict handling, communication, rewards and commitment The questionnaires were distributed to 184 respondents which are Shebamile members, front line employees at ADD airport and Shebamile office employees at ET headquarters were taken as respondents.. The hypothesis has been tested using five point Likert scale. The findings of this research revealed that satisfaction, trust, commitment, communication and rewards have a positive and significant relationship with customer loyalty program in Ethiopian airlines. As a recommendation, in order to alleviate the problems in the emotional attachment with the airline and conflict handling, the company should set high standard in its customer loyalty program based on best industry practice so that the probability of switching to other competing carriers in the future will be minimized and the airline will be able to achieve passenger emotional attachment by providing personalized and customer focused services. The airline should also work hard to resolve and take proactive measures to minimize customer complaints.