The Impact of Relationship Marketing on Customer Loyalty in Banking Industry, the Case of Commercial Bank Branches in Dessie Town

Abstract

This study is aimed to explore the impact of relationship marketing dimensions (trust, commitment, conflict handling, and empathy) on customer loyalty, by focusing on the commercial Bank of Ethiopia in Dessie town. A theoretical framework was used as a guideline to test the relationships between relationship marketing dimensions and customer loyalty. A quantitative method which is cross-sectional with deductive approach is applied in this study. In order to gather data, a self-administered questionnaire is designed and was randomly given to the customers of commercial Bank of Ethiopia in Dessie town. Semistructured interview questions are prepared to get information from the organization which is analyzed qualitatively. The finding of the study shows that relationship marketing dimensions have impact on customer loyalty. All the independent variables are positively and directly related to customer loyalty particularly in commercial Bank of Ethiopia in Dessie town and in general in banking industry. The relationship between relationship marketing and customer loyalty is significant. Therefore, banks should make the whole system on work with customers, and also they are expected to invest more on attracting new customers and retaining the existed ones with regard to relationship marketing to increase customer loyalty.