Effect of relationship marketing on customer retention and loyalty in the money deposit bank industry

Abstract

Over the last decade, competition within the financial service market is increasingly stronger due to new entrants including mergers and acquisition. Consequently, in order to retain customers, customer satisfaction and loyalty becomes a fundamental issue for financial service marketing management and survival in competitive financial market. Data were collected through questionnaire method using the 5-point likert scale from 1200 respondents of the 20 local government area of Lagos state, Nigeria. Reliability test shows that data were significant at 0.73-082 levels. Regression and correlation tested and ANOVA, prove accepted. Results show that the variables are significant and have positive impact on both customer retention and loyalty in relation to customer relationship marketing in the MDBs industry. It also revealed that customer satisfaction, retention and trust influences customers loyalty in the market. Thus, it is necessary for MDBs to make their service delivery more effective to reduce dissonance and optimized their relationship with the existing clients through quick responds, politeness and favorably attention to customer’s complaints. Also as part of their success story in customer relationship marketing, MDBs should continuously educate their customers of any new developments, policies and technical advancement to make transactions easy and seamless, imbibe customer service delivery culture and be involved in assisting customers in solving their problems.

Keywords: relationship marketing, Customer satisfaction, Customer retention, loyalty, Banking Industry