Customer Relationship Management Strategies and Retention among Commercial Banks in Nakuru Town, Kenya
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Date
2018-05
Authors
Mecha, Jairus N.
Journal Title
Journal ISSN
Volume Title
Publisher
Kenyatta University
Abstract
Banks can attract customers on a daily basis. However, they have not been able to retain
most of their customers as noted by the high numbers of reduced customers. This study
sought to assess the customer relationship strategies applied by commercial banks in Nakuru
Town and their impact on customer retention. The objectives of the study were: to assess the
electronic banking, personalized selling, media advertisements and social customer relations
on their effectiveness in customer retention. The target population for the study was 66
customer relationship officers and managers from commercial banks in Nakuru Town. A
census strategy was adapted for the study where survey research design was used. Data for
the study was collected by administering questionnaires to the selected relationship
managers and officers. The data was then analyzed using descriptive statistics such as
frequency counts, percentages, means and standard deviation. Further, Pearson correlation
analysis was done between customer relation strategies and customer retention. The study
revealed a statistically significant correlation between the level of use of electronic banking
and customer retention in commercial banks in Nakuru Town; personalized selling strategy
was also found to have a statistically significant correlation with customer retention.
However, correlation analysis did not reveal any statistically significant relationship
between the media advertisement, social media relations and customer retention which could
be explained by choice of media about the audience involved. The study, therefore,
recommended that owing to the impact of electronic banking on the performance of
commercial banks, it was important that banks enhance their investment in more innovative
customer service technologies. There was also need for commercial banks to focus on
improving adoption of internet banking, and personalized selling which is more convenient
and cost-effective as it involves no other intermediaries such as mobile banking. The mode
of media advertisement and social media to be adopted need to be re-assessed and
reevaluated to determine the most effective medium to be used. It is hoped that the study
will give meaningful insight on different customer relationship strategies to enhance their
retention.
Description
A Research Project Submitted to the School of Business in Partial Fulfilment for the Requirement for the Award of Degree in Master of Business Administration (Strategic Management Option) of Kenyatta University