DETERMINANTS OF CUSTOMER LOYALTY IN THE CASE OF COMMERCIAL BANK OF ETHIOPIA

Abstract

Customer loyalty is very necessary for the competitive market environment. The growing charisma of relationship marketing efforts has led to augmented competition among product/service providers. So banking industry is more of service oriented, effecting by customers’ interest. To attain the enviable customer to the business, for this purpose Relationship marketing efforts would have to be placed into practice to determine whether frequent visitor is loyal to the particular company. In an environment which becomes globally competitive, service quality as important measure of customer satisfaction and customer’s satisfaction leads to customer’s loyalty This research attempts to analyze the determinants of customer loyalty and their relationships with banking industry in the case of Commercial Bank of Ethiopia Addis Ababa. The study reviewed literature on the concepts Determinants of customer loyalty. Data was collected through the administration of both close ended and open ended questionnaires. Questionnaires were administered to 204 customers of Commercial bank of Ethiopia in Addis Ababa .Convenience sampling technique was used to distribute questioner for customers..In order to explain the relationship between customer loyalty and its determinants explanatory and quantitative approach method used.Descriptive statistical analysis technique was employed to obtain useful summary of responses. Perceived Quality, Satisfaction, customer Complaint Handling, Switching Cost, Commitment, Trust and Brand Image were the factors that influence the Loyalty of the bank customers. These factors also influence each other as well. The correlation and multi-co linearity of the determinant factors with each other were also studied and the SPSS software was used to analyze the primary data gathered from the respondents.