Customers Experience Management And Loyalty In The Banking Industry

Project and Seminar Topics with material for Banking and Finance

Customers Experience Management And Loyalty In The Banking Industry


Abstract


This study was carried out to examine customers experience management and loyalty in the banking industry using First Bank Plc, Gwarinmpa, Abuja as a case study. The study was carried out to determine whether there is a significant relationship between customer experience management and customer loyalty in the banking sector, ascertain the determinants of effective customer experience management in the banking sector, determine the effectiveness of customer experience management in the banking sector, and ascertain the factor affecting the effectiveness of customer experience management in the banking sector. The survey design was adopted and the simple random sampling techniques were employed in this study. The population size comprise of staff of First Bank Plc, Gwarinmpa, Abuja. In determining the sample size, the researcher conveniently selected 41 respondents and 35 were validated. Self-constructed and validated questionnaire was used for data collection. The collected and validated questionnaires were analyzed using frequency tables and mean scores. While the hypotheses were tested using Pearson correlation statistical tool, SPSS v23. The result of the findings reveals that there is a significant relationship between customer experience management and customer loyalty in the banking sector. The study also revealed that the factor affecting the effectiveness of customer experience management in the banking sector includes: high investment on CRM, lack of atonement to customers’ needs, competitive business environment, ineffectiveness of customer attendants. Therefore, it is recommended that measures should be taken by policy makers to improve the service quality dimensions which in turn can influence positively customer satisfaction and trust in banking industry. To mention but a few.


Table of Content


  • Title Page
  • Certification
  • Dedication
  • Acknowledgement
  • Table of Content
  • List of Tables
  • Abstract

Chapter One:

Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the Problem
  • 1.3 Objective of the Study
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Scope of the Study
  • 1.8 Limitation of the Study
  • 1.9 Definition of Terms
  • 1.10 Organisations of the Study

Chapter Two:

Review of Literature

  • 2.1 Conceptual Framework
  • 2.2 Theoretical Framework
  • 2.3 Empirical Review

Chapter Three:

Research Methodology

  • 3.1 Research Design
  • 3.2 Population of the Study
  • 3.3 Sample Size Determination
  • 3.4 Sample Size Selection Technique and Procedure
  • 3.5 Research Instrument and Administration
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis
  • 3.8 Validity of the Study
  • 3.9 Reliability of the Study
  • 3.10 Ethical Consideration

Chapter Four:

Data Presentation and Analysis

  • 4.1 Data Presentation
  • 4.2 Analysis of Data
  • 4.3 Answering Research Questions
  • 4.4 Test of Hypotheses

Chapter Five:

Summary, Conclusion and Recommendation

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendation
  • References
  • APPENDIX
  • QUESTIONNAIRE

Chapter One


Introduction

1.1 Background of Study

In the business environment today, loyal customers are considered to be the pivot behind the success of many service businesses especially the banking sector of Nigeria; this goes to other organization under the service sector like the insurance, hospitality industry etc.

The assumption is that with customer satisfaction; loyalty, retention and profitability will automatically follow. The current thinking is that the relationship between satisfaction and loyalty is more complex than was originally proposed, however. As commoditization of many service offerings continues, new sources of competitive differentiation/advantage will come from focusing on the management of customer experiences. Because loyalty is so very important to the survival and profitable growth of a company, measuring it becomes all the more important. Existing approaches to the measurement of loyalty have not proved to be very effective in this task.

For any organization, loyalty is considered as the key of success and which ultimately becomes the reason for the survival of that organization (Parasuraman, Zeithaml, and Malhotra, 2005). And a minor change in the number of loyal customers affects the growth and the over-all profitability of the organization (Rorio, 2015)

The ultimate outcome of creating the loyalty is something that is to develop the brand, advocates that brand and repeat patronage for the brand. It has been generally identified that customer achieves low level of satisfaction in this sector. Hence the quality of service and customer satisfaction can become frontier to attain the competitive advantage in the banking sector (Teixeira et al. (2012); and Rorio,(2015)
Realizing customers as experience creators, organizations should find out various ways to enhance customer experience. Knowing about customer experiences, whether favourable or otherwise, could help the firms in achieving customer satisfaction, and with satisfaction come loyalty, retention and profitability (Murwisi, 20018). The customer as an experience creator could also assist the firm in developing and customising its offerings; tailored according to the nature of the customer.

Satisfied and loyal customers tend to spend more money and purchase repeatedly, are less price sensitive, have higher intention to refer others, and are more economical to maintain (Murwisi, 2018).

Hence, loyal customers are vital to the survival and success of many service industries, especially in the hospitality, insurance, and financial sectors (Technozim, 2019). A slight change in the percentage of loyal customers is said to bring about a huge change in profits and also the overall value of the company (Technozim, 2019).

Hence, loyal customers are vital to the survival and success of many service industries, especially in the hospitality, insurance, and financial sectors (Technozim, 2019). A slight change in the percentage of loyal customers is said to bring about a huge change in profits and also the overall value of the company. Marketers are hence eager to understand the key to building strong, long-lasting customer relationships.


1.2 Statement of the Problem

The study on customer experience management and loyalty in the banking industry came about as a result of challenges and obstacle an organization face while trying to impact on the delivery of a positive customer experience. Finally, most of the research has been carried out on customer experience management but not even a single research has been done on customer experience management and loyalty in the b banking industry.


1.3 Objectives of the Study

The broad objectives of this study is to investigate customers experience management and loyalty in the banking industry. The primary objective of the study is as follows:

  1. Determine whether there is a significant relationship between customer experience management and customer loyalty in the banking sector
  2. Ascertain the determinants of effective customer experience management in the banking sector
  3. Determine the effectiveness of customer experience management in the banking sector.
  4. Ascertain the factor affecting the effectiveness of customer experience management in the banking sector.

1.4 Research Questions

The following questions guide this study

  1. Is there a significant relationship between customer experience management and customer loyalty in the banking sector?
  2. What are the determinants of effective customer experience management in the banking sector?
  3. What is the effectiveness of customer experience management in the banking sector?
  4. What are the factor affecting the effectiveness of customer experience management in the banking sector?

1.5 Research Hypothesis

  • Ho: There is no significant relationship between customer experience management and customer loyalty in the banking sector.
  • Ha: There is a significant relationship between customer experience management and customer loyalty in the banking sector.

1.6 Significance of the Study

The study on customer experience management and loyalty in the banking industry will be an interesting one. The study will enable the industry allow the consumer to engage with their bank on the channels they prefer at the times they want to engage.


1.7 Scope of the Study

The scope of the study boarders on customers experience management and loyalty in the banking industry. Hence the study will be delimited to First Bank Plc, Gwarinmpa, Abuja.


1.8 Limitations of the Study

The researcher encountered minor obstacles when conducting the study, as with any human endeavor. The significant constraint was the scarcity of literature on the subject due to the nature of the discourse, so the researcher incurred more financial expenses and spent more time sourcing for relevant materials, literature, or information and in the data collection process, which is why the researcher resorted to a limited choice of sample size. Furthermore, the researcher did this investigation alongside other academic activities. Furthermore, the sample size was limited because only a few respondents were chosen to answer the research instrument, therefore the results cannot be generalized to other states. Despite the constraints encountered during the research, all elements were minimized in order to provide the best results and make the research effective.


1.9 Definition of Terms

Customer:

A person who buys goods or services from a shop or business.

Experience:

Knowledge or skill from doing, seeing, or feeling things.

Management:

The process of dealing with or controlling things or people.

Loyalty:

Faithfulness to commitments or obligations. faithful adherence to a sovereign, government, leader, cause, etc.

Banking Industry:

This is financial intermediaries are party to a transfer of funds from the ultimate saver to the ultimate user of funds.


1.10 Organization of the Study

The study is categorized into five chapters. The first chapter presents the background of the study, statement of the problem, objective of the study, research questions and hypothesis, the significance of the study, scope/limitations of the study, and definition of terms. The chapter two covers the review of literature with emphasis on conceptual framework, theoretical framework, and empirical review. Likewise, the chapter three which is the research methodology, specifically covers the research design, population of the study, sample size determination, sample size, abnd selection technique and procedure, research instrument and administration, method of data collection, method of data analysis, validity and reliability of the study, and ethical consideration. The second to last chapter being the chapter four presents the data presentation and analysis, while the last chapter (chapter five) contains the summary, conclusion and recommendation.


Chapter Five


Summary, Conclusions and Recommendations:

5.1 Introduction

This chapter summarizes the findings on customers experience management and loyalty in the banking industry using First Bank Plc, Gwarinmpa, Abuja as a case study. The chapter consists of summary of the study, conclusions, and recommendations.


5.2 Summary of the Study

In this study, our focus was to examine customers experience management and loyalty in the banking industry using First Bank Plc, Gwarinmpa, Abuja as a case study. The study was specifically carried out to determine whether there is a significant relationship between customer experience management and customer loyalty in the banking sector, ascertain the determinants of effective customer experience management in the banking sector, determine the effectiveness of customer experience management in the banking sector, and ascertain the factor affecting the effectiveness of customer experience management in the banking sector.

The study adopted the survey research design and randomly enrolled participants in the study. A total of 35 responses were validated from the enrolled participants where all respondent were staff of First Bank Plc, Gwarinmpa, Abuja.


5.3 Conclusions

Based on the findings of this study, the researcher concluded that;

  1. There is a significant relationship between customer experience management and customer loyalty in the banking sector.
  2. The determinants of effective customer experience management in the banking sector includes: social environment, customer expectations, cultural diversities of customers, and channel approach.
  3. Customer experience management is somewhat effective in the banking sector.
  4. The factor affecting the effectiveness of customer experience management in the banking sector includes: high investment on CRM, lack of atonement to customers’ needs, competitive business environment, ineffectiveness of customer attendants.

5.4 Recommendations

Based on the findings, conclusions and implications of the study, the following recommendations are made:

  1. Measures should be taken by policy makers to improve the service quality dimensions which in turn can influence positively customer satisfaction and trust in banking industry.
  2. The banking sector needs to comply with deadlines, valuing teamwork, showing experience; financial strength and post sales service so as retain its customers.
  3. It is imperative for the banks to maintain a clear and transparent relationship with their clients in order to be satisfied and thus loyal.
  4. Banks willing to improve their relationships with customers need constant monitoring of customer experience. The managers need to exercise some benchmarks which should be used as the basis for comparision with major competitors.

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