ASSESSMENT ON THE CONTRIBUTION OF CUSTOMER RELATIONSHIP MANAGEMENT ON CUSTOMER LOYALTY THE CASE OF COMMERCIAL BANK OF ETHIOPIA

Abstract

This research studies contribution of customer relationship management in commercial bank of Ethiopia. CRM as a strategy has gained tremendous interest among researchers and practitioners in recent times. Thus, the study tries to assess the contribution of CRM on customer loyalty. In addition, this research considers different CRM dimensions such as trust, reciprocity, empathy, bonding and responsiveness. To achieve the objective of the study, primary data were collected through questionnaire from sample of 259 bank customers of CBE. These respondents were selected using simple random sampling technique. The data collected through questionnaire were analyzed using descriptive statistical analysis method and SPSS as a tool of data analysis. Interviews were also conducted with management bodies of the selected branches of CBE. The result of the study indicated that, there are some loopholes; such as, lack of continuous supervision and monitoring in the quality of bank services, weakness in giving individualized attention to customers and the common challenge is network interruption. The finding also suggests some measures which can be taken in to consideration in order to enhance CRM practices of the bank. The study also clearly revealed that the four CRM dimensions are strongly related. Thus, from customers as well as management bodies of the bank perspective, CRM has a significant influence on customer loyalty in CBE. Based on the findings of the study, the researcher forwards some recommendations as; the bank should make the whole system on work with customers, not in opposite of customers, continuous supervision on the quality of services, provision of training to employees, and also they are expected to invest more on attracting new customers and retaining the existed ones with regard to CRM to increase customer loyalty.