The Effect of Customer Relationship Management (CRM) On Customer Satisfaction

THE EFFECT OF CUSTOMER RELATIONSHIP MANAGEMENT (CRM) ON
CUSTOMER SATISFACTION
A STUDY OF SELECTED COMMERCIAL BANKS
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ABSTRACT
The primary objective of the study was to examine the effect of customer relationship
management on customer satisfaction in three commercial banks in Lagos State Nigeria. The
study explored the ways in which customer satisfaction can be achieved with the use of customer
relationship management. The study adopted the descriptive survey research design. The data
for the research was collected through a well design and structured questionnaire. 208
questionnaire were administered to the respondents out of which 197 were completed and
returned. The study employed both descriptive and inferential statistics to analyze the data
retrieved from the questionnaire. The study was guided by four research questions and
hypothesis. Among the findings reveals by the study were customer participation and
involvement have positive and significant effect on customer satisfaction, customer service
support have positive and significant effect on customer satisfaction. The study recommend that
effective customer relationship management is a reliable tool to increase customer satisfaction.
Hence, Nigeria commercial banks should ensure customer satisfaction at all time. Management
of the banks should always seek customer opinion before taking decision that is binding on the
customers. The study conclude that there is a direct relationship between customer relationship
management and banks customer satisfaction. The banks management is therefore encourage to
pursue customer relationship management programmes with rigor so that they can survive in the
present competitive business environment.
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CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Customers are important and are said to be the driving source to the success of a business and a
good business is one which considers customer’s interest (Mithas, Krishnan, & Fornell, 2005). In
the light of the aforementioned, customer satisfaction is therefore key and a subject to be
addressed. Although, customer satisfaction can be weighed on individual customer interests but
the sampling of varying interests from customers would give an estimate of the average customer
value and satisfaction.
Concepts which later developed into full-fledged working system such as the Customer
Relationship Management (CRM) system comprising of people such as business marketers,
relationship officers, liaison officers and managers, processes and technology that work together
for a common goal have been dedicated to cater for customer needs in a bid to improve
satisfaction (Chen, 1997). Well, it is evident that customers’ response to such systems are
debatable.
According to (Zainurrafiqi, Sukoharsono, & Hamid, 2012), there are varying direct and indirect
effects of customer relationship management (CRM) to customer satisfaction. An analysis of the
perception, value and the resultant effect to the customer forms the motive for this research
work. If the customer value assessment can be studied, more findings to customer satisfaction
would be revealed and value can be determined through proper study of business markets which
can be represented with strategies that relate to Customer Relationship Management (CRM)
(Anderson, Jain, & Chitanguata, 1992).
Commercial banks in Nigeria are excelling in this form of customer appreciation through
promotion, digital marketing, social media presence, customer involvement and other customer-
oriented business strategies. Popular methods revolve round support services and channels
encouraging customer involvement. These methods have enabled the businesses done to be
solution based focusing on customers’ needs. Healthy competition can be found among these
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banks on Customer Relationship Management (CRM) but the question is how effective are the
approaches being used?
Customer involvement was studied in over 259 firms and the empirical results reveal that this
has brought about effects in the innovation capabilities of customer service (Ngo & O'Cass,
2013). This shows that there is a relationship between customer involvement and customer
services including customer support services. Because of the strong ties between this two variant
but identical variables, we intend to measure the individual results and compare their
effectiveness in regards to customer satisfaction.
Incentives also are known to be one of the best ways for positive reinforcement and behavioral
psychology re-engineering (Robinson & Berridge, 2001). Customer behavior sometimes stems
from present emotions such as anger, happiness etc. (Grandey, Dicter, Sin, & Sin, 2004). But
incentives on the other hand, creates a bridge that separates possible resultant actions from
current emotional state. Beyond customer satisfaction, incentives through various innovative
services may be used to win back an angry customer (Griffin & Lowenstein, 2001). In other
words, to study the effects of Customer Relationship Management (CRM) on customer
satisfaction, we should also consider measures that can reverse customer dissatisfaction and its
effect for proper understanding.
Part of the mechanism to implement the use of incentives is the accommodation of customer
involvement and customer participation. With the integration of incentive oriented marketing
strategies through customer participation, there is an opportunity available for customers to
appreciate product value and add their input to the business activities.
There is a close bond between these Customer Relationship Management (CRM) concepts:
Customer involvement and participation; Customer support services; Incentives. This forms the
basis of this project and the motivation behind the scaling down of the dependent variables
namely customer involvement, support services and incentives and their effect to customer
satisfaction. At the end of the project, the empirical values of each variable would have been
ascertained considering the sampling of customers’ opinion of three different Nigerian banks and
conclusions can thereby be drawn.
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1.2 Statement of the Problem
Researches on the effect of Customer Relationship Management (CRM) on customer satisfaction
has been on for a long period of time (Zainurrafiqi, Sukoharsono, & Hamid, 2012). There have
been diverse operational variables to measure Customer Relationship Management (CRM) from
lack of trust to partnerships, empowerment etc. Contemporary Customer Relationship
Management (CRM) problems have evolved from just customer attitudinal study or mentality to
the perception of services offered by businesses in relation to Customer Relationship
Management (CRM). A major concern is how effective incentives, support services and
customer involvement is to customer satisfaction as this sort of research leads the forefront of
contemporary Customer Relationship Management (CRM) questions.
Presence of an extensive customer relationship might also be argued to be operationally cost

ineffective and might not worth a lot of investment but it may be profit inclined (Krasnikov,
2009). A common argument that follows this ideology is the debunking of claims that customers
are always right (Grandey, Dicter, Sin, & Sin, 2004). This surrounding claims even further
reiterate that if customers are giving more privileges than they ought to have, the insatiable
nature of customers may be continually harnessed (Grandey, Dicter, Sin, & Sin, 2004).
At a point where there are varying point of views in the effects of Customer Relationship
Management (CRM) on customer satisfaction, it is paramount we conduct a research sampling
the Customer Relationship Management (CRM) methods of three commercial banks in Nigeria,
one of which is an old generation bank and coming to a consensus on whether the effects tends to
the positives or the negatives on customer satisfaction in order to discover the truth. The research
would not only measure these effects but also consider each effect in a bid to proffer a
sustainable solution to the problem stated.
1.3 Objectives of the Study

The main objective of this project is to consider the effects of customer relationship management
(CRM) on customer satisfaction. The specific objectives entails:
i. To investigate the effect of customer involvement and participation on customer

satisfaction.
ii. To determine the effect of customer support services on customer satisfaction.
iii. To ascertain the effect of incentives on customer satisfaction.
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iv. To determine the joint effect of CRM elements on CS
1.4 Research Questions

The research questions pertinent to the project study are as follows:
i. What is the effect of customer involvement and participation on customer satisfaction?

ii. What effects do customer support services have on customer satisfaction?
iii. Does incentives to customers have an effect on customer satisfaction?
iv. Does the joint of CRM elements have an effect on CS?
1.5 Research Hypotheses

The hypotheses developed for this project are as follows:
Hypothesis one
H0:Customer involvement and participation has no significant effect on customer satisfaction.
H1:Customer involvement and participation has a significant effect on customer satisfaction.
Hypothesis two
H0:Customer support services has no significant effect on customer satisfaction.
H1:Customer support services has a significant effect on customer satisfaction.
Hypothesis three
H0: Incentives has no significant effect on customer satisfaction.
H1: Incentives has a significant effect on customer satisfaction.
Hypothesis four
H0: The joint of CRM elements has significant effect on CS.
H1:The joint of CRM elements has no significant effect on CS.
1.6 Significance of the Study

Conclusion from this project would help businesses realize the effect of customer relationship
management on customer satisfaction. Furthermore, the suggestions proffered by this project
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would help companies in developing strategies or maybe performing an overhaul in the customer
relationship management approaches being used.
It would also be significant to the customer in appreciating customer relationship management

with the suggestions it recommends and also in attaining satisfaction.
Furthermore, employees and people who are involved in the system that manages customer
relationship would be able to understand better the needs of the customer in regards to
satisfaction and proffer sustainable solutions.
1.7 Scope of the Study

Three Nigerian banks would be considered for this project namely: Wema, Zenith and the United
Bank of Africa (UBA). Observations show that these banks have a working system of Customer
Relationship Management (CRM). Customer participation and support services are also a
priority to these banks. Considering this condition, these banks were most suitable for the
research adding to the fact that the banks are of close proximity to where the research is going to
be carried out. For this project, there would be no extension of study to other customer
relationship management variables except customer involvement and support services.
1.8 Operationalization of Variables

Keeping in mind the aim of the study which is to consider the effects of customer relationship
management (CRM) on customer satisfaction, the mathematical expressions can therefore be
presented as follows:
Y=f(X)
Y= Dependent variable
X= Independent variable
Y represents Customer Satisfaction (CS)
X represents Customer Relationship Management (CRM)
The mathematical model can therefore be expressed as: CS=f (CRM)
Where:
Customer Satisfaction =f (Customer Relationship Management)
Y*= (y1,y2,y3)
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y1=Customer repurchase behavior (CRB)
y2=Expectation from product (CP)
y3=Loyalty (LT)
However, we are considering 3 variables on Customer Relationship Management (CRM) which

are:
X1= Customer Involvement and Participation (CIP)
X2= Customer Support Services (CSS)
X3= Incentives (IN)
So therefore:
CS= f(CIP)....obj1
CS = f (CSS)....obj2
CS= f(IN)....obj.....3
CS=f(CIP, CSS, IN)...combined effect of CRM elements on CS....obj 4
1.9 Definition of Terms

Customer: This is a person who patronizes a business or shop, buying its products and possibly
engaging in further dealings.
Customer Satisfaction (CS): This relates to the measure in which customer’s expectation of a
business product is realized or surpassed.
Customer Relationship Management (CRM): It is a concept that explains the various

technologies, processes, strategies and people involved in maintaining a relational framework for
the customer over a specified duration.
Customer Support Services (CSS): This is a Customer Relationship Management (CRM)

technique that caters for the effective use of business products sold to customers.
Customer Involvement (CI)): It is an aspect and also an extended form of Customer

Relationship Management (CRM) that engages the customers in contributing to business success
through suggestions, participations, marketing etc.
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Incentives (IN): This is an extra service or gain given to a customer by a firm which is usually
done in form of a promise and it is usually dependent on a particular effort by a customer. It is
done to encourage and motivate customers.
Customer Repurchase Behavior (CRB):This is the consumer's actual behaviour resulting in

the purchase of the same product or service on more than oneoccasion.
Expectation from Product (CP):Customer satisfaction reflects the expectations and
experiences that the customer has with a product orservice. Consumer expectations reflect both
past andcurrent productevaluation and user experiences.
Loyalty (LT):Customer loyalty is both an attitudinal and behavioral tendency to favor one brand
over all others, whether due to satisfaction withthe product or service, its convenience or
performance, or simplyfamiliarity and comfort with the brand.
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CHAPTER TWO
REVIEW OF LITERATURE
2.1 Conceptual Review
2.1.1 Concept of Customer Relationship Management
The term “Customer Relationship Management” (CRM) was first used in a general sense by
management scholars such as Peter Drucker and Theodore Levitt in the 1960s
(Venoos&Madadiyekta 2005). Customer Relationship Management includes individuals,
processes and technology and it is seeking for the customers’ conception of an organization.
George, Emmanuel and Christiana, (2012), view the concept of Customer Relationship
Management as a process of ascertaining customer needs; comprehending and inducing customer
behavior, making use of quality communications strategies so as to obtain and maintain
customers’ satisfaction. Apart from the fact that Customer Relationship Management entails
handling customers and observing their behavior, it also seeks to adjust customer’s behavior,
thereby leading to increase in the company’s revenue, because the company will decide the
customers to choose and those leaving. The primary objective of Customer Relationship
Management is to identify and render customized services to every customer. Customer
relationship management empowers organizations to deliver exceptional actual customer service.
Several researchers hold different definitions of Customer Relationship Management. Picton and
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Broderick (2005) viewed CRM as a cordial relationship that must exist between an organization
and its consumers. It comprises a strategic and tactical management tasks aimed at achieving
customer relationships, and positive communications in the long run. Berkowitz (2006) also
defines customer relationship management as the effort made by organizations to improve cost-
effective and long-term connection with the consumer for the gain of both the organization and
the customer.
Godsen, (2004) suggest that CRM is a set of business practices designed to make an organization
closer to its customers in order to be able to better understand each customer so that each one
becomes more important and more valuable to the organization.
Kotler and Armstrong (2004) define CRM as the overall process of building and maintaining
profitable customer relationships by delivering superior customer value and satisfaction.
Furthermore, Payne and Frow (2005) explain that CRM is considered to unite the potential of
relationship marketing strategies and Information Technology (IT) in order to create profitable,
long-term relationships with customers and other key stakeholders. Thus, CRM provides
opportunities to utilize data and information to understand customers and co create value with
them.
According to Wali and Nkpurukwe (2008), customer relationship management can be
appreciated from three perspectives: information technology perspective, the customer life circle
perspective and business strategy perspective. Wali and Nkpurukwe (2008) defined customer
relationship management as the process of customer acquisition, customer retention, customer
extension and the delivering of a sustainable competitive advantage. Peppard (2000) posits that
CRM is aimed at creating an emotional connection with the customer; understanding customer
needs; differentiate between customers via market segmentation and performance analysis of
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customer loyalty. Ozuru and Kalu (2009) defined Customer relationship management as the
function of building trust, bond or connection between an organization and a customer with the
aim of influencing a repeat purchase.
Ogbadu and Usman (2012) posited that customer relationship management deals with customer
data management and the management of customer touch in order to maximize customer loyalty
by building and maintaining profitable customer relationships and delivering superior customer
value and satisfaction. CRM can also be seen as a business strategy which identifies profitable
customers and prospective customers and devoting time and attention to expand such
relationships with those customers (Kotler and Armstrong 2008).
2.1.1.1 Customer Involvement and Participation (CIP)
There are several terms describing customers’ involvement in organizational practices that is
customer involvement (Matthing, Kristensson, Gustafsson, &Parasuraman, 2004), customer
participation (Dong, Evans &Zou 2007), co-creation (Grönross&Voima 2013), and customer
integration (Mota, 2012). Customer involvement can be seen as the process, deeds and
interactions where a service provider collaborates with current or potential customers to learn
about the market and alter organizational behavior(Matthing et al. 2004). Thus, customer
involvement emphasizes a close relationship between organizations and customers, in order for
both parties to learn from each other and create mutual understanding (Edvardsson, Gustavsson,
Kristensson, Magnusson and Matthing 2006).
Participation has been defined as the degree to which the customer is involved in producing and
delivering the service. Customer participation can be defined as the specific behaviors, degree of
consumer’s effort and involvement, both mental and physical that relate to the production and
delivery of a service (Cermak, File & Prince, 1994). In terms of marketing construct,
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participation refers to the types and level of behavior in which buyers actually engage.
Participation factors include tangibility, empathy, attendance at meetings, and meaningful
interaction. For many services, the customer is required to participate to an extent in order for the
service to occur and be consumed. Participation is vital in some services for good quality and a
satisfactory outcome. Participation could be in the form of acquisition of service-related
information or the exertion of effort. For example when a person goes to physician, the patients
are required to participate in the form of giving information on their ailments or symptoms in
order for the physician to make a diagnosis of the illness. One of the major reasons for the high
percentage of incomplete transactions on the Internet may be the frustration of customers with
the inefficient websites. In addition, we expect customer efficiency has a long-term influence on
a firm’s profitability through enhancing customer loyalty. On one hand, efficient delivery of
consistently high-quality service depends on efficient performance of customers at the website.
After experiencing high-quality service, customers will enhance his or her relationship with the
organization and possibly with other customers. As a result, customers show increasing loyalty
to the organization by repeatedly returning to the organization. On the other hand, as a loyal
customer repeatedly visit the same organization, it is possible for his or her efficiency to improve
as a result of climbing a classical learning curve. Therefore, we expect there exists a positive
relationship between customer participation and customer efficiency. Czepiel et al. (1985)
argued that due to inseparability, Customers would inevitably be involved in the production
process. More the participation, the easier it is for customers to evaluate services because
customers would associate a dissatisfactory outcome with the services to themselves instead of
the service firm.
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2.1.1.2 Customer Support Services (CSS)
According to Loomba (1998), Customer support (CSS) can be simply defined as set of activities
that ensures product availability for trouble free use to consumers over its useful lifespan.
Customer support is also referred as product support, after sales service, technical support or
simply service (Goffin& New, 2001). The authors Goffin and New (2001) explained that
customer support service can be generally viewed as product support as added value, after sales
service or simply service. For every service provider customer support is must to achieve
customers satisfaction which also spotlighted by many researchers- (Armistead & Clark, 1992;
Cespedes, 1995; Teresko, 1994). Customer support provides competitive advantage over other
homogeneous products and services (Goffin, 1998). Companies are increasingly looking to CSS
as potential source of competitive advantage to win market share. In this technological
revolutionary era it is hard to use each and every appliance without support of technical persons
and to reduce this gap of knowledge regarding products almost every company are emphasizing
more on customer support. This plays most important role for highly technology based company
(Goffin, 1994; Lawless and Fisher, 1990). Good customer support is an essential for succeeding
customer satisfaction. It can increase success rate of services and can directly contribute to
competitive advantage.
2.1.1.3 Incentives (IN)
Incentives have been defined and used in different areas. From organizational standpoints,
incentive is defined as a technique, which is usually used by employers to carry out their end of
the employment contract, a form of compensation to the employees for their effort (Hartman,
Kurtz & Moser, 1994). Incentives are tangible or intangible rewards used to motivate a person or
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group of people to behave in a certain way (Collins, Tinkew&Burkhauser, 2008). Similar
definition is given by Zurn, Dolea and Stilwell (2005), incentive is an explicit or implicit
financial or non-financial reward for performing a particular act. Meanwhile Banjoko (2006)
generally regards incentive as variable payments, which are made to employees or a group of
employees on the basis of the amount of output or based on the achieved result. Optionally, it
can be the payment made with the aim of pushing employee daily work performance in an
attempt to reach a common goal. Incentive could also be defined as compensation other than
basic salaries or wages that usually fluctuates based on employee exceptional performance and
their attainment of some standard set by the organization (Martocchio, 2006).
2.1.2 Concept of Customer Satisfaction
Customer satisfaction is the core of every business philosophy and objective which focuses on
the creation of worth for customers, forestalling and managing customers’ expectations, and
signifying capacity and responsibility that will satisfy customers’ needs (George, Emmanuel &
Christiana, (2012). The provision of good quality services and the satisfaction of customers are
critical points in the growth and development of every organization (Dominici&Guzzo, 2010).
Berkowitz (2006) points out that the whole essence of business is customer satisfaction.
Therefore delivery of high quality service is paramount to achieving sustainable organization
performance.
Hansemark and Albinson (2004) defined satisfaction as an overall customer attitude towards a
service provider, or the difference between customer expectation and customer perception
concerning the satisfaction of some wants needs, desire or goals. Oliver (1981) defined
satisfaction as a totality of psychological state that arises in relation to his or her expectations.
(Kotler, 2000) defined satisfaction as an individual’s feeling of pleasure or displeasure resulting
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from matching a product perceived performance (The level of satisfaction may perhaps differ
according to customers’ experiences and their immediate circumstances result) customers expect
and/or require by listening to their customers. Several Studies have posited that there are various
elements that bear on the customer satisfaction and these include: friendliness, courteousness,
knowledgeable and helpful customers; competitive pricing; service quality; good value; and
quick service (Hokanson, 1995). According to (Changhong, 2008) listening and capturing the
voice of the customer is one of the important aspects that helps to determine and improve
customer satisfaction. Organizations are able to know what they are when expectations are joined
with the customer’s prior emotional state as regard the consumption experience. Customer
satisfaction, eases the defection and it is positively connected with retention, purchase intention
and loyalty (Cameroon, 2010).
2.1.2.1 Customer Repurchase Behavior (CRB)
The concept of repurchase and the factors influencing it has been investigated by many scholars
(Evans & Gentry 2003; Law, Hui& Zhao 2004; Mittal & Kamakura 2001; Quick and Burton
2000; Seiders et al. 2005; Wanke&Fiese 2004). Repurchase is defined as a consumer’s actual
behavior resulting in the purchase of the same product or service on more than one occasion. The
majority of consumers’ purchases are potential repeat purchases (Peyrot& Van Doren 1994).
Customers buy similar products repeatedly from similar sellers, and most purchases represent a
series of events rather than a single isolated event. Repurchase is the actual action, repurchase
intent is defined as the customer’s decision to engage in future activities with the retailer or
supplier (Hume, Mort &Winzar 2007). Two forms of repurchase are identified: the intention to
re-buy (repurchase), and the intention to engage in positive word-of-mouth and recommendation
(referral) (Zeithaml, 1996).
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2.1.2.2 Expectation from Product (EP)
Customer satisfaction reflects the expectation and experiences that the customer has with
aproduct or service. Customer expectation reflects both past and presents product evaluation and
user experience. This information influence our expectations and gives us the ability to evaluate
quality value and the ability of the product or service to meet our needs and expectations.
Customer hold both explicit and implicit performance expectation for attributes, features, and
benefit sof the product and services. The nature of these expectations will dedicated the form and
even the wording of customer satisfaction. Customer expectation refers to the perceived value or
benefits that the customer seek when purchasing a good or availing a service. They are the result
of the learning process and can be formed very quickly because even first impression matters a
lot (Leonard 2003).
2.1.2.3 Loyalty (LT)
Loyalty is a multidimensional construct, which is defined and viewed differently by researchers.
Consumer loyalty is comprised of three distinct constructs: behavioral loyalty, attitudinal loyalty,
and composite loyalty (Taylor, Hunter, & Longfellow, 2006) 2006). These constructs affect
consumers’ expectations, satisfaction (Leingpibul, Thaweephan, Sunil, Allen & Robert, 2009) and
repurchase behavior. In order to build loyalty and to retain consumers, some companies impose
high switching costs, which in turn impede switching intentions (Lee &Romaniuk 2009). These
switching costs negatively affect consumer relations with the provider. Taylor et al. (2006)
identified that the problem lies in the disagreement on the definition of loyalty, due to the
multitude of constructs.
Loyalty is a positive (or negative) attitude of the customer toward the business organization and
its products and services. It is considered important because the loyal customer will contribute to
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organization in long-range. Therefore, customer loyalty is basically related to provider’s ability
to retain customers and persuade them to recommend its products and services to potential
customers (Zeithaml, 2000). Often, there are three levels of loyalty according to the model of
customer loyalty. Firstly strong loyalty where the customer is willing to buy all the times,
secondly moderate loyalty where the customer has a loyalty to more than two trademarks, and
lastly weak loyalty where the customer's preferences are varied from brand to another (Casalo,
Flavian, &Cand, 2010; Lin and Wang, 2006), The purpose of customer loyalty is to retain the
customer as long as possible if not always-preserved.
2.2 Theoretical Review
Two theories was used in this study, they are: Relationship management theory and Motivation
Need theory.
2.2.1 Relationship Management Theory
The term relationship management refers to the process of managing the relationships between
an organization and its internal and external publics. Ledingham (2003) defined an organization
public relationship as the state which exists between an organization and its key publics in which
the actions of either can impact the economic, social, cultural or political well-being of the other.
Moreover, the concept recognizes relationships as the core focus of public relations. A strategy
engaged by an institute in which an endless level of arrangement is retained between the institute
and its target market. Relationship management is between a business and other businesses
(business relationship management) and between a business and its customers (customer
relationship management). Relationship management purposes to create a trust between the
institute and its target market instead of transactional relationship. Customers who sense that an
organization responds to their want and needs will continue to use the products and patronize the
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services that the organization offers. Furthermore, sustaining a level of communication with
customers enables the organization to ascertain potential causes of pricy problems before they
happen.
2.2.2 Motivation Need Theory
Abraham Maslow identified five levels of needs of human beings. These are physiological,
security, social, esteem and self-actualization needs. In customer relationship management, this
theory is highly appreciated because banks must strive to understand the needs of variety of
customers and how to meet them. This is why some banks are ahead of others because they have
all the services and products to satisfy the existing customers and to attract potential ones. When
customers’ needs are satisfied, their friends and relatives will hear about it, that is bringing more
customers. If it is otherwise, they will also hear, meaning reducing customers. Therefore, bank
marketers must be guided by this theory. Interaction with customers will unveil their needs and
give room for plans to satisfy them. The existence of a need motivates a customer to look for
where to meet it. For instance, a customer who wants to transfer money outside the country
needs a bank to do so at reduced cost and timely. This is a need and must be met. The bank that
could do this with little or no stress on the side of the customer gets the credit and opportunity to
have more with that same need. Abraham Maslow put forward his hierarchy of needs in 1943,
since then, business schools and marketing classes adapted Maslow’s theories to explain the need
to tailor marketing messages to customers in a particular way. Successful marketing campaigns
must not only bring awareness to a product, but also establish its place somewhere on the
hierarchy of needs. Customers are motivated to prioritize purchases toward the base of the
hierarchy, so it is vital that companies draft a message that instills a sense of need or urgency in
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customers. Marketers have been able to use motivation-need theory very effectively by creating
an artificial need for customers (Ohio, 2016).
2.2.3 Stakeholder Theory
This theory states that organizations do not exist only to maximize shareholders value but to also
protect the interest of variety of stakeholders whose negative reactions may adversely affect the
going concern of the establishment. These stakeholders are: customers, suppliers, employees,
host communities, creditors/lenders and even the government. Since the study is focused on the
customer relationship management, stakeholder theory therefore maintains that customers are the
life wire of every establishment because without them, revenue cannot flow which is the only
reason organizations exist. To be able to maximize shareholders value, firms have to maintain a
good relationship with customers who are actually the major source of income and the reason
why there are companies. That means no customer, no firm. Banks have variety of ways to
protect customers’ interest especially from external intruders such as electronic fraudsters who
specializes in diverting customers’ money to themselves. This protection call for personal
relationship with customers and putting in place stringent measures to ensure the safety of
deposits under their care. When a customer’s interest is protected, he keeps patronizing the bank
and will also recommend it to others. The mismanagement of one customer can drive away so
many who would have wish to give their patronage.
2.3 Empirical Review
2.3.1 Effect of Customer Relationship Management on Customer Satisfaction
Yao and Khong (2011) examined the effectiveness of customer relationship management on
customer satisfaction in the commercial banks of Taiwan. A regression model was adopted to
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evaluate the criteria to measure the level of CRM implementation on customer satisfaction. The
study indicated that CRM implementation is associated with customer satisfaction; and there are
significant interactions amongst information technology capability, contact rate management and
recovery management with customer satisfaction.
Robert, Bashir &Georgina (2015) studied the impact of customer relationship management on
bank growth in Nigeria, with special focus on one first generation bank, First Bank Nigeria Plc.
and one new generation bank, GTB Nigeria Plc. Pearson Product Moment correlation model
through the SPSS Software was used to analyze the data gathered for the study. Their findings
revealed that there is a direct relationship between customer relationship management (CRM)
and customer loyalty, sales volume and market share.
Kenneth, Justin &Adiele (2013) conducted a study on the impact of customer relationship
management (CRM) on the Business Performance (BP) of Nigeria money deposit banks. The
nomothetic methodology was adopted and forty copies of structured questionnaire were the
primary data collection instrument which was distributed to ten money deposit banks in south-
south zone of Nigeria. The hypotheses were tested by employing the Spearman Rank Correlation
Coefficient (SRCC) statistical tool statistical packages for social sciences (SPSS) software. The
study revealed that a significant relationship exists between CRM & BP. It was also discovered
that amongst the dimensions of CRM, customer identification and retention impacts more
significantly on business performance. The study therefore concludes that Nigerian money
deposit banks should increase their customer identification and retention strategies since there is
a proportionate impact on the performance level.
Peter and William (2016) investigated the role of customer relationship management strategy on
competitiveness of commercial banks in Kenya. The study made use of a descriptive
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correlational research design and data were collected from 34 out of the target population of 43
registered banks in Kenya. Data analysis and interpretation was based on descriptive statistics as
well as inferential statistics mainly linear regressions. The study found statistically significant
positive linear relationships between CRM strategy and organizational competitiveness. It was
found that organizational competitiveness is achieved through appropriate CRM strategy
practices. The study therefore provided managers invaluable insights on how to effectively build
their CRM strategy to give them a competitive advantage.
Awwad and Al-adaileh (2012) conducted a study aimed at investigating the factors determining
CRM practices within the context of Jordanian Commercial Banks (JCBs). 400 questionnaire
were distributed while 309 questionnaires were completed and returned which was analyzed by
using SPSS. Their study results apparently revealed that there were five factors generated from
this study including interactive management, customers prospecting, customer surveying,
responsiveness to customers, and partnerships respectively that contributed to CRM
implementation in JCBs.
2.3.2 Effect of Customer involvement and Participation on Customer Satisfaction
The simultaneity of production and consumption of service means that customer participates in
service definition, production and delivery when service is being performed. Customer
participation not only influences the productivity and service quality of service organization, but
also influences their own satisfaction.
Chan, Kimmy, Yim, & Lam (2010)empirically test hypotheses regarding effect of customer
participation on value creation and satisfaction for both customers and employee with different
cultural value orientations in the context of professional financial services. Using data collected
from 349 pairs of customers and service employees in two national groups (Hong Kong and The
21
United States) of a global financial institution, this study examines how (1) CP drives
performance outcomes (customer satisfaction. Employed job satisfaction and employee job
performance) through the creation of economic and relational values and (2) the effect of CP on
value creation depend on participants cultural value orientations. Promoting CP could be a
double-edged sword for firms. CP enhances customers’ economic value attainment and
strengthens the relationship bond between customers and employees, but is also increases
employees job stress and hampers their job satisfaction. Moreover, the effect of CP on value
creation depend on the cultural values of both customers and service employees, this result
implies that arranging customers and service employees with “matched” cultural value
orientations could facilities the creation of value through CP.
Kristensson, Matthing, & Johansson (2008) propose a conceptual framework consisting of
research propositions concerning the key strategies required for the successful involvement of
customers in the co-creation of new technology based services. The methodology involves a
single case study from which data are derived and analyzed using the grounded theory
methodology of “constant competitive analysis.” User generated ideas for future mobile phone
services are collected from four user involvement projects and analyzed at several workshops
attended by senior managers from telecommunications firms. Seven key strategies are identified
as being essential for successful user involvement in new product development. Each strategy is
described and illustrated in relation to existing theory and presented as a research proposition.
The exploratory nature of the research means that the findings are tentative and need to be
confirmed in other settings by other researchers, including quantitative large-scale studies. The
results of this study provide management with guidelines for organizing successful user
involvement projects with a market-oriented approach.
22
Arvidsson (2008) highlights the importance of customer in the society. He argues that social
production including customer co production follows a very particular economic logic-that is, an
ethical economy where value is related to social impact rather than monetary accumulation. A
detailed analysis of the logic of this ethical economy is offered; it draws out some implications
for the successful management of ever more customer-centric brands, whereby the consumers
are directly involved in the processes that add value.
Edmonds (2008) highlights the importance of customer loyalty to a firm. Co-creation was
predicted to be a key contributor to a firms‟ competitive advantage in the future by involving
customers in the creation of value. The ability to gain loyalty through co-creation will have great
benefits for independent retail outlets in a fast moving and highly competitive market place.
Etgar (2008) investigate linkage between co-production and customization. It also specifies five
distinct phases of the production activity chain where consumers can become involved in
coproduction-
(1) Development of antecedents conditions, (2) development of motivations which prompt
consumers to engage in co-production (3) calculation of the co-production cost-benefits (4)
activation where consumers become engaged in the actual performance of the co-producing
activities (5) generation of outputs and evaluation of the results of the process.
2.3.3 Effect of Customer Service Support on Customer Satisfaction
Eggert et al. (2006) examined customer-perceived values in a recent article. Their contribution to
the discussion on how customers’ value-in-use is formed was based on a long-term study
focusing on the significance of perceived quality for the continuation of the relationship. The
ultimate question is whether it is the core product/service or the support service that is the most
decisive for building and maintaining long-term relationships. The authors claim that it was not
23
possible to establish the effect of the duration of the relationship on the perception of the core
service as more or less significant in comparison and related to the supporting service. In other
words, it is not a matter of course that customers consider the core product to be the most
important when they continue their relationship with a company.
The studies referred to so far support static perceptions of the service with an assisting function
of customer support. However, there are studies that tie in with the dynamic view. For example,
the idea underpinning the notion of value-in-use (Vargo&Lusch, 2004) is that when customers’
views are considered relevant in service development or strategic decision-making it follows that
customer-perceived perceptions rather than objective states have to take precedence in the design
of the service composition. In other words, it is not beneficial to contrast core and support
service, but it is the role of each in the customer relationships that is important. The perspective
of the customer is fundamental in the determining of particular offerings, such as customer-
support service, in order to facilitate the creation of value-in-use.
Hennig-Thurau, Gwinner, Dwayne, &Gremler (2002) point out in their study on relationship
understanding through marketing outcomes (customer loyalty and word-of-mouth) that
customers look to factors other than the core service for perceived benefits. The authors refer to
studies with a different kind of focus (on antecedents), in which antecedents such as customer
satisfaction, perceived quality, customer commitment and trust (Hennig-Thurau& Klee, 1997;
Morgan & Hunt, 1994) have been found to affect outcomes. The interest in the present study is
in the mechanism behind customers’ evaluation processes in terms of distinguishing between
antecedents categorized as driving and not driving the relationship when continuation (loyalty of
customer) is the concern.
24
Kesuma, Hadiwidjoj, Wiagustini, &Rohman (2013) investigated the effect of service quality on
patients’ loyalty and customer relationship management at private hospital industry. The results
showed that service quality has positively and significantly influenced customer loyalty. In
addition, implementation of CRM mediated the relationship and effect of service quality on
customer loyalty. On the other hand, Surarchith and Singh (2013) explore the key dimensions of
service quality for mobile services in the telecom sector and to ascertain which aspect of service
quality have significant impact on customer satisfaction. Results approved that obtaining
customer satisfaction depends to a large extent on ensuring that the firm maintains high service
quality standards. Also, quality mechanisms have significant effect on the level of customer
satisfaction. Among the service quality variables that significantly affected customer satisfaction
include competence, courtesy, tangibility, reliability, responsiveness and communication.
ALghaswyneh (2014) explores the kind of relationship marketing strategies that Umniah Mobile
Company of Jordan is pursuing in today's rapidly changing and highly competitive environment,
and to analyze it’s outcome on the service quality and satisfaction of customers. Also, it focuses
on studying the relationship between the consumers and staff working in the Umniah mobile
company of Jordan. Results of the study indicate that there exists a relationship between them,
but it needs further growth. Melisidou, Venetsanopoulou, and Sergopoulos (2015) conducted a
study entitled “Service Quality and CRM Implementations: Keys for Excellence in Hospitality
Industry”, the aim of this study was to investigate the effectiveness of practicing Customer
Relationship Management Systems and its positive impacts in Service Quality issues, also to
sustain that CRM application can be consider as a tool to improve customer satisfaction,
retention and service quality, and finally to assess that the implementation of service quality,
perceived as the major potential for the competitiveness and substantial benefits to hotel
25
enterprises, in terms of long-term profitability. Results indicated that perceived quality and
satisfaction have been shown to be good predictors of visitors’ future behavioral intentions.
2.3.4 Effect of Incentive to customer on customer satisfaction
(Abdul, 2014) customers motivation plays a vital role in satisfaction of customers, the purpose of
the research is to examine the impact of customer motivation through incentives on customer
satisfaction in banking sector of Pakistan that is Askari Bank Ltd, Habib Metropolitan Bank Ltd ,
Bank Al-Habib Ltd in this study, through structured questionnaire, Primary Data has been
collected ,For data analysis author used Correlation and Regression technique with Chi-Square
Test for further support to the results , from the study the findings concluded that customer
contentment is powerfully sway by customer motivation in the chosen banks, thus the banks
should focus in customer enthusiasm intended for higher customer satisfaction.
motivation intensity influence both working environment as well as customer satisfaction, the
aimed of this study is to explore the effect of employee performance by the motivational factor
of training in employees performance, to acquire accurate result descriptive test, correlation, and
regression test is applied, 30 questionnaires are distributed in different universities of Pakistan,
assemble 150 questionnaires total, The result of (Asim, 2013) study reveals that motivation of
employee through training play a significant role to enhance employee’s performance of
educational sector, if the employees are motivated they efforts more for organization success
which results high customer satisfaction.
Masood, (2013) studied the effect in superior financial recital, satisfy employees and costumers
play vital role. The key reason of this study is to find out two main relations, straight link among
employee satisfaction and customer satisfaction as well as, indirect affiliation linking financial
performance and employee satisfaction, author used quantitative research and collected data
26
through 600 questionnaires in life Insurance Corporation branches, to check the direct and
arbitrate link among variables ,correlation, reliability and regression test are applied, findings
concluded that positive link endure among customers and employee satisfaction and also finds
that vastly satisfied employee are really motivated to gratify costumers, which lead the elevated
financial performance of firm.
2.4 Summary and Gaps in Literature
The existing body of literature is exposed to a number of limitations in terms of scope and
context of this work, which this study attempts to address. In terms of context, this study seeks to
address the paucity of studies on the effect of customer relationship management on customer
satisfaction with special emphasis on customer involvement and participation, customer support
services and incentive which has not been researched extensively. In terms of scope, this study
will extend the coverage of the study of customer relationship management to the geographic
boundaries of Nigeria and to the banking industry in particular. Thus, this study will expand the
generalization of studies on the subject as suggested by previous studies.
27
2.5 Conceptual Model
The conceptual model of Customer Relationship Management and Customer Satisfaction
INDEPENDENT VARIABLE DEPENDENT VARIABLES
Customer Relationship Management (CRM) Customer Satisfaction (CS)
Customer Involvement Customer Repurchase

and Participation (CIP) Behavior (CRB)
Customer Support Expected from Product

Services (CSS) (EP)
Incentives (IN) Loyalty (LT)
Figure: Conceptual Model
Source: Researcher’s Conceptual Model 2018
The study adopted a conceptual framework based on the customer relationship management
(CRM) as a determinant of customer satisfaction (CS) in Wema Bank, Zenith Bank, UBA. The
study undertook to find out how customer relationship management (CRM) will improve the
customer satisfaction (CS). The efficiency as which the customer involvement and participation
(CIP), customer support service (CSS), incentives (IN) are in line with customer relationship
28
management (CRM). While customer repurchase behavior (CRB), expected from product (EP),
loyalty (LT) are in support to customer satisfaction (CS) are indicated in the models above.
29
CHAPTER THREE
RESEARCH METHODOLOGY
This chapter describes the research methodology of the study under the following subheadings –
research design, area of study, population of the study, sample size determination, sampling
technique, method of data collection, research instrument, pilot study, validity of research
instrument, reliability of research instrument, methods of data analysis, conceptual model,
limitation to the methodology, ethical consideration
3.1 Research Design
The study adopted the descriptive survey research design because it enables the researcher to
collect necessary information from the respondents on the subject matter. Furthermore, the
survey design was chosen because it allows the researcher to measure the variables of interest
and test their effects using appropriate statistical techniques.
3.2 Population of the Study
The study was carried out in three Nigerian commercial banks at Ikeja branch, Lagos namely;
(The Wema Bank, Zenith Bank, United Bank of Africa (UBA)) out of the 23 total Nigeria
commercial banks. The three commercial banks were used because there customer relationship
management is the best among all other banks in Nigeria.
The Nigerian commercial bank is a financial institution which is owned by private business
owners and offers services to the general public and companies.There are twenty-three (23)
commercial banks in Nigeria namely AB MFB, Aso-Savings, IBTC, Parallel MFB, Access
Bank; Diamond Bank; Eco Bank; Enterprise Bank, FCMB, Fidelity Bank, Jaiz Bank, First
Bank, GTB, Heritage Bank, Keystone Bank, Skye Bank, Sterling Bank, UBA, Union Bank,
Unity Bank, Wema Bank and Zenith Bank (CBN Economic and Financial Review, 2016). But
the researcher has chosen to work with only three commercial banks named above for
convenience.
The population of the study comprised of all staff of commercial banks in Nigeria. For the sake
of convenience, the study selected three commercial banks namely Wema Bank, Zenith Bank,
United Bank of Africa (UBA) at Ikeja branch, Lagos. From the available information obtained
30
from respective commercial banks, the population of the study is 434 employees. The breakdown
of employees based on departmental classification is presented as follows:
Table 3:1: Breakdown of Population of Study

Department Wema Zenith United Total
Bank of
Bank Bank
Africa
(UBA)
Customer Service 22 21 29 72
Operations 32 24 19 75
Administration/Human 28 32 31 91
Resources
Treasury 16 30 19 136
Risk Management 15 13 18 46
Corporate Communication 10 16 14 40
Information Technology 12 15 18 45
Total 135 151 148 434
Source: Human Resource Department of Selected Banks 2018

.
3.4 Sample Size Determination
The Taro Yamane formula is applied to determine the appropriate sample size based on the
population at 95% confidence interval and 5% error margin. The Yamane formula is
mathematically expressed as:
n= N/ (1+Ne2)
Where n= Sample size
31
N= Study Population, which is 434
e= Error margin, which is 5%
1=theoretical constant.
n= 434/ (1 + 434(0.05)2
n= 434/ (1+ 434(0.0025)
n= 434/ (1+ 1.085)
n= 434/ (2.085)
n= 208 staff
n= 208 staff
The study adopts the proportionate formula to determine the number of staff to be selected in
each Nigeria commercial bank.
Proportionate formula = Number of staff/Population x 100
Wema Bank: 135/ 434 x 100 = 31 staff
Zenith Bank: 151/434 x 100= 35 staff
UBA: 148/434 x 100 = 34 staff
3.5 Sampling Technique
Sampling techniques can be defined as the system of selecting elements (samples) to represent a
given population (Ojo, 2003). For the purpose of this study, the simple random sampling
techniques would be adopted in selecting the required sample size for the study. The random
sampling technique makes use of the principle of randomization which is the process of giving
every subject in the population an equal chance of being in the selection. Using the simple
random sampling technique ensures that the findings of the study can be generalized to the entire
population of the study to a very large extent.
32
3.6 Method of Data Collection
The questionnaires were personally administered to respondents in the study area by the
researcher. Prior to the administration of questionnaire, the researcher met with the supervisor
and discussed with him. The supervisor then gave the researcher an appointment on when to go
administer the questionnaires to the targeted respondents. The data collection took one week.
3.7 Research Instrument
Structured questionnaire titled “The Effect of Customer Relationship Management (CRM) on

Customer Satisfaction” was the instrument used to collect data from the respondents. The
questionnaire was divided into two parts. The first part provided information on the
demographics of the respondents.
The section part B-F consisted of six sub-scales namely customer involvement and participation
(CIP), customer support services (CSS), incentives (IN), customer repurchase behavior (CRB),
expectation from product (EP), loyalty (LT). Each of the sub-scales consisted of six items,
making thirty five (42) items in the second section.
All the items in the second part of the questionnaire were structured on a 6-point likert scale
ranging from strongly agree (6) to strongly disagree (1).
3.8 Pilot Study
Diamond Bank Plc, Illishan Remo, Babcock University was used for the pilot study. The
researcher visited the bank and administers the questionnaire to Twenty eight (28) randomly
selected staff of the bank, which is approximately 10% of the sample size.
3.8.1 Validity of Research Instrument.
Validity of a research instrument refers to the extent to which an instrument measures what it
supposes to measure. The validity of the instrument was subjected to face and content validation
by forwarding copies of the questionnaire to two experts in the field of marketing and business
administration. The experts were requested to assess the questionnaire in terms of content,
33
relevance, adequacy and suitability of rating scale. The modifications made by the experts were
taken into cognizance and were used to prepare the final draft of the questionnaire.
3.8.2 Reliability of Research Instrument
Reliability of a research instrument measures the degree of consistency in the result of the
instrument when tested on repeated trials. A trial test was carried out in order to determine the
degree of reliability of the instrument. One (1) commercial bank was randomly selected
Diamond bank at Babcock University campus and copies of the questionnaires were
administered to them. The result was analyzed using the Cronbach’s Alpha Reliability Test and
is presented in the table below:
Table 1: Cronbach Reliability Coefficient

S/N Sub-scales No. of Reliability Remarks
items Coefficient
1. Customer involvement 5 0.717 Reliable

Participation (CIP)
2. Customer Support Services (CSS) 5 0.709 Reliable
3. Incentives (IN) 5 0.624 Fairly Reliable
4. Customer Repurchase Behavior 5 0.730 Reliable

(CRB)
5. Expectation from Product 5 0.709 Reliable
6. Loyalty 5 0.683 Fairly Reliable
Source: Field Survey from Pilot Study (2018)
3.9 Methods of Data Analysis
Data were analyzed using descriptive and inferential statistics. Descriptive statistics (frequency,
percentage, mean, standard deviation) were utilized to describe items in the questionnaire. In
addition, in testing the research hypothesis the researcher made use of the regression analysis,
34
this was done to test the extent of the effect of the independent variable on the dependent
variable. The Statistical Package for Social Sciences (SPSS) was used to analyze the data
electronically.
Regression analysis
Regression analysis evaluates the relationship between the outcome variable (i.e. dependent
variable) and one or more risk factors or confounding variables which are known as predictors or
independent variables. In regression analysis, a single dependent variable Y is conceived to be a
function of one or more independent variable.
Y=f (X1, X2……Xn)
3.10 Model Specification
The basic objective of the study is to examine the effects of customer relationship management
(CRM) on customer satisfaction (CS). Customer satisfaction, being the dependent variables is
measured by customer repurchase behavior (CRB), expectation from product (EP), Loyalty (LT).
Customer relationship management, which is the independent variable, is proxied by customer
Involvement and Participation (CIP), customer Support Services (CSS), incentives (IN).
Four models are developed to examine the causal-effect relationship among the variables. The
first model estimates the effect of customer involvement and participation (CIP) on customer
satisfaction(CRB,EP, LT). The second model estimates the effect of customer support services
(CSS) on customer satisfaction(CRB,EP, LT). The third model estimates the effect of incentives
(IN) on customer satisfaction(CRB,EP, LT). and the fourth model estimates the joint effect of
Customer relationship management elements (CIP, CSS, IN) on customer satisfaction (CRB, CP,
LT).
Expressing the models in functional forms, it becomes:
35
Model 1:Effect of Customer Involvement and Participation on Customer Satisfaction
CIP= f (CRB, EP, LT) ………….3.1
CIP= α0 +α1CRB +α2EP + α3LT + µ….3.2
Where:
CIP= Customer involvement and participation.
CRB= Customer repurchase behavior
EP =Expectation from product

LT = Loyalty
Model 2: Effect of Customer Support Services on Customer Satisfaction
CSS= f (CRB, EP, LT) ………….3.3
CSS= α0 +α1CRB +α2EP + α3LT + µ….3.4
Where:
CSS= Customer Support Services

LT = Loyalty
Model 3: Effect of Incentives on Customer Satisfaction
IN = f (CRB, EP, LT) ………….3.5
36
IN= α0 +α1CRB +α2EP + α3LT + µ….3.6
Where:
IN = Incentives

LT = Loyalty
Model 4: the joint effect of Customer relationship management elements (CIP, CSS, IN) on
customer satisfaction (CRB, CP, LT).
CIP, CSS, IN = f (CRB, CP, LT) ………….3.7
CIP, CSS, IN = α0 +α1CRB +α2EP + α3LT + µ….3.8
Where:
CIP = Customer Involvement and Participation

CSS = Customer Support Services
IN = Incentives

LT = Loyalty
3.9 Limitation to the Methodology

The study is delineated to Nigeria commercial banks. In addition, analysis of data is confined to
descriptive statistics and lastly the statistical tool was based on regression analysis.
3.10 Ethical Consideration

The ethical issue that is taken into consideration during the course of data collection is
confidentiality. The information’s of selected banks are used exclusively for academic purpose.
37
CHAPTER FOUR
DATA ANALYSIS AND INTERPRETATION
4.0 Introduction
The main objective of this chapter was to examine the effects of customer relationship
management on customer satisfaction in Nigeria Commercial Banks in Lagos State. The chapter
is presented in three parts. First the Analysis of Respondents Demographic Characteristic,
second, the analysis of research questions and, the testing of hypotheses lastly, the discussion of
findings. The results of the finding were discussed under the following sub headings:
 Demographic information of the respondents: gender, age, academic qualification,
professional qualification, level at work and years of experience.
 Customer relationship management: Customer involvement and participation, customer
support services and incentives.
 Customer satisfaction: Customer Repurchase Behavior, Expectation from product and
loyalty.
4.1 Analysis f Respondents Demographic Characteristic
Table 4.1: Respondents Demographic Characteristic
Parameters Classification Frequency Percentage
Gender Male 98 49.7
Female 99 50.3
Total 197 100%
Age 20 – 30 years 74 37.6
38
30 – 50 years 66 33.5
50 – 60 years 57 28.9
Total 197 100%
Academic Qualification SSCE 18 9.1
OND/NCE 68 34.5
HND/BSc 67 34.0
PGD/MSc 35 17.8
PhD) 9 4.6
Total 197 100%
Professional
None 18 9.1
Qualification
ACA 29 14.7
ACCA 29 14.7
ICAN 52 26.4
MBA/MPA 30 15.2
CIM 20 10.2
OTHERS 19 9.6
TOTAL 197 100
Level At Work Junior Staff 137 69.5
Senior Staff 38 19.3
Management Staff 22 11.2
Total 197 100%
Years of Experience 2 – 10 years 105 53.3
11 – 20 years 70 35.5
20 – 30 years 22 11.2
Total 197 100%
Source: field survey, 2018

39
Table 4.1 presents the demographic characteristics of the respondents of the study. The table
reveals that 98(49.7%) are males while 99(50.3) are females.
Based on age, the analysis reveals that 74(37.6%) were between the age range of 20 - 30 years,
66(33.5%) of the respondents were between the age range of 30 – 50 years and 57(28.9%) of the
respondents were at the age range of 50 – 60 years.
Also, it was found out that 18(9.1%) of the respondents have SSCE, 68(34.5%) of the
respondents have OND/NCE, 67 (34.0%) of the respondents have HND/BSc, 35(17.8%) of the
respondents have PGD/MSc and 9(4.6%) of the respondents have PhD.
Base on professional qualification, it was found out that 18(9.1%) of the respondents have no
professional qualification, 29(14.7%) each of the respondents have ACA and ACCA
respectively, 52(26.4%) of the respondents have ICAN, 30(15.2%) of the respondents have
MBA/MPA, 20(10.2%) of the respondents have CIM and 19(9.6%) of the respondents have
other professional qualifications.
137(69.5%) of the respondents were junior staff, 38(19.3%) were senor staff and 22(11.2%) were
management staff.
Lastly, 105(53.3%) of the respondents have experience within 2 – 10 years, 70(35.5%) of the
respondents have experience of 11 – 20 years and 22(11.2%) of the respondents have experience
of 20 – 30 years.
4.2 Analysis of Research Questions
Research Question 1: What is the effect of customer involvement and participation on customer
satisfaction?
40
Table 4.2: Customer involvement and participation
A PA PD D SD Std.
Items SA Mean Dev.
Your organization spend more time 27 36 75 46 11 2

with the customers. 4.08 1.131
(13.7 (18.3 (38.1) (23.4 (5.6) (1.0)
) ) )
Your organization co-create with 27 47 90 21 6 6

customers to develop insights and 4.25 1.110
(13.7 (23.9 (45.7) (10.7 (3.0) (3.0)
better experiences.
) ) )
Your organization always send the 41 41 74 31 6 4

customers reminder to increase 4.35 1.179
(20.8 (20.8 (37.6) (15.7 (3.0) (2.0)
customer feedback and participation.
) ) )
Your organization always get 32 26 78 33 20 8

customers involved in it product and 3.94 1.304
(16.3 (13.2 (39.6) (16.8 (10.2) (4.1)
service
) ) )
Customers are always part of product 23 45 62 48 10 9

and service creation in your 3.98 1.249
(11.7 (22.8 (31.5) (24.4 (5.1) (4.6)
organization.
) ) )
Your organization always reward 38 36 39 28 43 13

customers to increase customer 3.77 1.576
(19.3 (18.3 (19.8) (14.2 (21.8) (6.6)
feedback and participation.
) ) )
Grand Mean (4.058)

Table 4.2 revealed that customer involvement and participation have a significant effect on
customer satisfaction considering the grand mean 4.058. It shows that spending more time with
customers, co-creating with customers, sending customers reminders, involving customers in
product and services creation and customers always been part of product and service creation are
the ways in which customers involvement and participation. The implication is that, it will
increase customer’s satisfaction.
41
Research Question 2: What effects do customer support services have on customer satisfaction?
Table 4.3: Customer support and services
A PA PD D SD Std.
Items SA Mean Dev.
The customer support service has 50 48 67 20 5 7

given a positive insight to customer's
(25.4) (24.4) (34.0) (10.2) (2.5) (3.6) 4.49 1.244
patronage to your organization.
There is always a staff person the 56 60 57 18 4 2

customer always like to commend
(28.4) (30.5) (28.9) (9.1) (2.0) (1.0)
because of the type of customer
support service your organization 4.71 1.098
practices.
Your organization customer support 27 50 66 28 12 14

service is always friendly and 4.05 1.354
cheerful throughout. (13.7) (25.4) (33.5) (14.2) (6.1) (7.1)
Your organization customer support 38 62 75 15 4 3

service always show knowledge of
(19.3) (31.5) (38.1) (7.6) (2.0) (1.5) 4.54 1.047
the products or services to the
customers
Customers always rate your 18 46 74 41 14 4

organization customer service
(9.1) (23.4) (37.6) (20.8) (7.1) (2.0) 4.01 1.132
support high.
Customer support service staffs are 41 20 37 50 26 23

always available to customers in a
(20.8) (10.2) (18.8) (25.4) (13.2) (11.7) 3.65 1.630
timely manner.
Grand mean 4.242

42
Table 4.3 indicates that the respondents strongly agree that customer support services have
significant effect on customer satisfaction considering the grand mean of 4.242. The respondents
strongly agree that the CSS have given positive insight to customer's patronage. They strongly
agree that the banks’ customer support service are always friendly and cheerful throughout,
customers always rate the organization’s customer service support high and customer support
service staffs are always available to customers in a timely manner. Hence, resulting to better
customer satisfaction.
Research Question 3: Does incentives to customers have an effect on customer satisfaction?
Table 4.4: Incentives
A PA PD D SD Mea Std.
Items SA n Dev.
Your organization gives customers 32 42 86 26 8 3

monetary reward in terms of
(16.2 (21.3 (43.7 (13.2 (4.1) (1.5
promotional item such as a t-shirt,
) ) ) ) ) 4.28 1.106
give card.
Your organization invites loyal 34 37 79 28 15 4

customers to special events.
(17.3 (18.8 (40.1 (14.2 (7.6) (2.0 4.18 1.218
) ) ) ) )
Your organization solves another 23 30 81 48 10 5

problem for them aside from account
(11.7 (15.3 (41.1 (24.4 (5.10 (2.5
issues. 3.96 1.138
) ) ) ) )
43
Your organization break it own rules 21 27 77 50 19 3
once a while for loyal customers.
(10.7 (13.7 (39.1 (25.4 (9.6) (1.5
3.86 1.152
) ) ) ) )
Your organization gives loyal 21 36 83 34 20 3

customers direct access to senior
(10.7 (18.3 (42.1 (17.3 (10.2 (1.5 3.97 1.154
staffs.
) ) ) ) ) )
Your organization always celebrates 29 22 49 63 28 6

customer’s special day.
(14.7 (11.2 (24.9 (32.0 (14.2 (3.0 3.71 1.337
) ) ) ) ) )
Grand Mean = 3.993

From table 4.4, it be seen that the respondents agree that incentives to customers have an effect
on customer satisfaction considering the grand mean of 3.993. Some of this incentives to
customers that affect customer’s satisfaction include monetary reward in terms of promotional
item such as a t-shirt, give card, inviting loyal customers to special events, solving customer’s
problem aside from account issues, organization breaking it own rules once a while for loyal
customers, given loyal customers direct access to senior staffs and celebrates customer’s special
days.
Table 4.5: Customer Repurchase Behaviors
Items SA n Dev.
44
Anytime your organization offers 40 29 75 43 7 3
more than one service, customers
(20.3 914.7 (38.1 921.8 (3.6) (1.5)
that purchase a specific service
0 ) ) )
behave differently over time
4.20 1.176
compared to other customers.
The probability the customer will 27 46 98 17 8 1

make another purchase of services
(13.7 (23.4 (49.7 (8.6) (4.1) (0.5)
and product in your organization is
) ) ) 4.32 .988
always high.
The average number of orders 39 60 75 14 6 3

customers place in the short/long
(19.8 (30.5 (38.1 (7.1) (3.0) (1.5)
term is always encouraging. 4.52 1.077
) ) )
The average revenue customers 38 54 78 19 5 3

generate in the
(19.3 (27.4 939.6 (9.6) (2.5) (1.5) 4.47 1.081
) ) )
Your organization direct their 30 47 83 25 10 2

marketing activities to improve
(15.2 (23.9 (42.1 (12.7 (5.1) (1.0)
customer attitudes and intentions,
) ) ) ) 4.28 1.093
which always have impact on
customers repurchase behaviors.
45
Your organization is always concern 23 22 48 53 31 20
about the level of need it services
(11.7 (11.3 (24.4 (26.9 (15.7 (10.2
satisfy the customer to enable
) ) ) ) ) )
customer repurchase.
3.45 1.449
Grand Mean 4.207

From table 4.5, it can be seen that the respondents strongly agree that customer relationship
management affect customer repurchasing behavior considering the grand mean of 4.207. Some
of this assertion concerning repurchasing behavior they agree on include: probability that the
customer will make another purchase of services and product in the organization is always high,
the average number of orders customers place in the short/long term is always encouraging,
organization is always concern about the level of need it services satisfy the customer to enable
customer repurchase and organization direct their marketing activities to improve customer
attitudes and intentions, which always have impact on customers repurchase behaviors.
Table 4.6: Expectation from product
SA A PA PD D SD
Std.
Items Mean Dev.
Your organization always work more 24 61 84 14 11 3

closely with the customers who
(12.2 (31.0 (42.6) (7.1) (5.6) (1.5)
develop the products of the company. 4.32 1.062
) )
46
Your organization has fulfil it 25 59 91 14 6 2
customer expectation for the year. 4.39 .971
(12.7 (29.9 (46.2) (7.1) (3.0) (1.0)
) )
Customers has helped your 25 43 98 20 8 3

organization gain a better
(12.7 (21.8 (49.7) (10.2 (4.1) (1.5)
understanding of the market and the
) ) )
competition by meeting up with their
4.26 .984
expectation.
Your organization always ask the 28 39 99 25 3 3

customers what the company can do
(14.2 (19.8 (50.3) (12.7 (1.5) (1.5)
to serve them better.
) ) ) 4.29 .996
The customers are always giving the 39 67 73 11 5 2

privilege to say what favorite service
(19.8 (34.0 (37.1) (5.6) (2.5) (1.0)
experience they have had, whether in
) ) 4.60 1.013
business or as a customer.
There is no recent example where 38 43 85 20 3 8

your organization have not met the
(19.3 (21.8 (43.1) (10.2 (1.5) (4.1)
customers’ expectations. 4.35 1.184
) ) )
Grand Mean = 4.368

Table 4.6 indicates that the respondents strongly agree that customer relationship management
have effect on customer expectation form product considering the gran mean 4.368. Among the
assertion the respondents agree on are: organization always work more closely with the
47
customers who develop the products of the company, organization has fulfil its customer
expectation for the year, customers has helped the organization to gain a better understanding of
the market and the competition by meeting up with their expectation, organization always ask the
customers what the company can do to serve them better, customers are always giving the
privilege to say what favorite service experience they have had, whether in business or as a
customer and there is no recent example where the organization have not met the customers’
expectations.
Table 4.7: Loyalty
Items SA n Dev.
Customers are not particularly loyal to 5 15 90 49 36

2
any service/product in your
(2.5) (7.6) (45.7 (24.9) (18.3) 1.02
organization and always willing to try (1.0) 4.46
) 2
something new if they thinks it will
work just as well.
Your organization concentrate on 28 52 88 25 3 1

giving products rather than cash when
(14.2 (26.4 (44.7 (12.7 (1.5) (0.5)
they want to reward customers and 4.38 .964
) ) ) )
create loyalty.
There is an extent to which customers 24 24 44 51 28 26

increase their purchasing behavior in
(12.2 (12.2 (22.3 (25.9 (14.2 913.2 1.51
your organization. 3.42
) ) ) ) 0 ) 7
Your organization encourages the 27 55 88 13 13 1

customers to recommend the service
(13.7 (27.9 (44.7 (6.6) (6.6) (0.5)
and product of your company to their 1.04
) ) ) 4.34
friends or family. 5
48
advocate your organization products. 4.49
(12.2 (28.4 (47.2 (8.1) (3.6) (0.5) 4.66 4
) ) )

remain customers and/or do not use a
(21.8 (19.3 (46.7 (8.6) (2.0) (1.5)
competitor in your organization. 4.50 .997
) ) )
Grand Mean =4.293

Table 4.7 show that the respondents strongly agree that customer relationship management have
effect on customers loyalty considering the gran mean on 4.293.The respondents agree on the
following assertion concerning customer’s loyalty: organization concentrate on giving products
rather than cash when they want to reward customers and create loyalty, there is an extent to
which customers increase their purchasing behavior in the organization, organization encourages
the customers to recommend the service and product of your company to their friends or family,
there is an extent to which customers advocate the organization’s products and customers
remain customers and/or do not use a competitor in your organization.
4.3 Hypothesis Testing
This section presents the result of regression analysis which was used to test the hypotheses of
the study. The purpose of the hypotheses are to enable the researcher make definite inference
based on the end result of the tests.
Hypothesis one
49
H0: Customer involvement and participation has no significant effect on customer satisfaction.
H1: Customer involvement and participation has a significant effect on customer satisfaction.
Table 4.8: Coefficients
Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 2.627 .255 10.321 .000
CIP .410 .062 .428 6.614 .000
a. Dependent Variable: CS
R = 0.428, R-square =.183, Adjusted R square = .179, p<.05
Table 4.8 reveals a fairly positive correlation coefficient of 0.428 between the dependent variable
(customer satisfaction) and the independent variable (Customer involvement and participation).
The R-Square value of .183 implies that 18.3% of the variations in customer satisfaction can be
explained by customer involvement and participation. The output also show the unstandardized β
of .410; standardized β of .428 and a p-value = 0.000. Therefore, by having P-value of <.005, the
result reaches statistical significance. In other words, based on the outputs (R2 = 0.183 P < 0.000
& β= 0.428), it can be concluded that customer involvement and participation has a significant
effect on customer satisfaction. Hence, H1 which stated that customer involvement and
participation has a significant effect on customer satisfaction is supported.
Hypothesis two
H0: Customer support services has no significant effect on customer satisfaction.
H1: Customer support services has a significant effect on customer satisfaction.
50
Standardized
Model B Std. Error Beta T Sig.
1 (Constant) 3.166 .273 11.596 .000
CSS .265 .064 .286 4.165 .000
R = 0.286, R-square =.082, Adjusted R-square = .077, p<.05
Table 4.9 indicated a partially positive correlation co-efficient exist between customer support
services and customer satisfaction (R=.286). The R-Square value of .082 indicates that 8.2% of
the variations in customer satisfaction can be explained by customer support services. The output
also shows that by having P-value of <.05, the result also reaches statistical significance. In other
words, based on the outputs (R2 = 0.082; P < 0.000 & β=0.286), it can be concluded that
customer support serviceshas a positive significant impact on customer satisfaction. Hence, H1:
Customer support services has a significant effect on customer satisfaction is accepted.
Hypothesis three
H0: Incentives has no significant effect on customer satisfaction.
H1: Incentives has a significant effect on customer satisfaction.
Standardized
Model B Std. Error Beta T Sig.
51
1 (Constant) 2.723 .249 10.936 .000
IN .392 .062 .415 6.373 .000
R = 0.415, R-square =.172, Adjusted R-square = .168, p<.05
Table 4.8 reveals a fairly strong positive correlation coefficient of 0.415 between incentive and
customer satisfaction. The R-Square value of .172 implies that 17.2% of the variations in
customer satisfaction can be explained by incentives given to customers. The output also show
the unstandardized β of .392; standardized β of .415 and a p-value = 0.000. Therefore, by having
P-value of <.005, the result reaches statistical significance. In other words, based on the outputs
(R2 = 0.172, P < 0.000 & β= 0.415), it can be concluded that incentive given to customers has a
significant effect on customer satisfaction. Hence, H1 which stated that incentives has a
significant effect on customer satisfaction is supported.
Hypothesis four
H0: The joint of CRM elements has no significant effect on CS.
H1: The joint of CRM elements has significant effect on CS.
Standardized
Model B Std. Error Beta t Sig.
1 (Constant) 1.493 .327 4.571 .000
CIP .304 .062 .318 4.893 .000
CSS .096 .060 .103 1.587 .014
52
IN .290 .060 .306 4.788 .000
R = 0.541, R-square =.293, Adjusted R-square = .282, F= 26.622, p<.05
From the model in table 4.11, the three independent variables explain 29.3% of the variations in
the dependent variable. Thus, customer relationship management explains 29.3% of the variance
in customer satisfaction which is highly significant (Sig. = .000) as indicated by the F-value of
26.622. Furthermore, standardized Beta coefficients indicate customer involvement and
participation has the largest beta coefficient of .318 thus making the strongest contribution in
explaining customer satisfaction, when the variance explained by all other variables in the model
is controlled for incentives (.306) makes the second largest contribution followed by customer
support service at .103. Based on the beta sig level, it can be seen that customer involvement and
participation, customer support service and incentive have a positive effect on customer
satisfaction.
4.4 Discussion of Findings
The results from the analysis reveals that customer involvement and participation have positive
and significant effect on customer satisfaction on Nigerian commercial banks. This findings
support the findings of Chan, Kimmy, Yim, & Lam (2010). Their findings reveals that customer
participation and involvement enhances customers’ economic value attainment and strengthens
the relationship bond between customers and employees. The findings also support the findings
of Kristensson, Matthing, & Johansson (2008) and Edmonds (2008).
Secondly, the study reveals that Customer support services has positive and significant effect on
customer satisfaction in Nigerian commercial banks. This findings goes in line with the findings
53
of Vargo and Lusch, (2004) and Kesuma, Hadiwidjoj, Wiagustini, &Rohman (2013). Their
findings reveals that service quality has positively and significantly influenced customer loyalty.
In addition, implementation of CRM mediated the relationship and effect of service quality on
customer loyalty.
Thirdly, the findings of the study reveals that incentives to customers has positively and
significant effect on customer satisfaction in Nigerian commercial banks. The findings support
the findings of Abdul, 2014. Their findings reveals that incentives to customers have significant
effects on customer satisfaction.
Lastly the study reveals that CRM elements have joint effect on customer satisfaction in Nigerian
commercial banks. This findings support the findings of Yao and Khong (2011), there study indicates
that CRM implementation is associated with customer satisfaction. Also, the findings support the
findings of Robert, Bashir &Georgina (2015) and Peter and William (2016).
54
CHAPTER FIVE
SUMMARY CONCLUSION AND RECOMMENDATION
5.1 Summary
The findings from this study reveals the following findings
1. Customer involvement and participation have positive and significant effect on customer
satisfaction in Nigerian Commercial banks.
2. It was found out that customer service support have positive and significant effect on customer
satisfaction in Nigerian commercial banks.
3. The study also reveals that given incentives to customers have positive and significant effects
on customer satisfaction in Nigerian commercial Banks.
4. Lastly, the study reveals that Customer relationship management (Customer involvement and
participation, customer service support, incentives) have positive and significant effect on
customer satisfaction in Nigerian Commercial banks
5.2 Conclusion
The study examines the effect of customer relationship management in Nigeria commercial
banks. The study established a relationship between customer involvement & participation and
customer satisfaction; customer service support and customer satisfaction and incentives to
customers and customer satisfaction. The results from the data analysis reveals positive and
55
significant effect on the CRM elements on customer satisfaction in commercial banks in Nigeria.
It therefore, concludes that there is a direct relationship between customer relationship
management and banks customer satisfaction. The banks management is therefore encourage to
pursue customer relationship management programmes with rigor so that they can survive in the
present competitive business environment.
5.3 Contribution to Knowledge
The primary aim of the researcher in this study is to relook at the effect of customer relationship
management on customer satisfaction on a new perspective.
This study will contributes to the literature by critically examining the effectiveness of existing
customer relationship management that are currently in place at wema bank, zenith bank and
UBA (Nigeria). such as Customer Involvement and Participation (CIP), Customer Support
Services (CSS), Incentives (IN), Customer repurchase behavior (CRB), Expectation from
product (CP), Loyalty (LT) and what effects they have on the customer satisfaction, as this will
ultimately determine the bank’s customer satisfaction.
The management of financial institutions especially the banking sector will definitely find the
recommendations and findings of this work relevant and useful in charting a new course for
improved organizational customer satisfaction, through the utilization of customer relationship
management tools for customer satisfaction development.
5.4 Recommendation
The Nigeria banking industry must understand the importance of customer relationship
management in improving the organizational performance of the banks through customer
satisfaction. They should also realize that:
1. Effective customer relationship management is a reliable tool to increase customer base.
Hence, Nigeria banks should ensure proper customer relationship management at all time.
56
Management of the banks should always seek customer opinion before taking decision that is
binding on the customers.
2. Customer relationship management contributes greatly to the banks’ profitability. Hence,
Nigeria banks should designed a feasible customer relationship strategy that can identify the
most profitable customers to enabled tailoring services to their needs. They should also design a
way of turning the low balance i.e., unprofitable customer to be profitable. The management of
banks should always support any customer relationship strategy aim at improving the banks
performance. Customer satisfaction is dependent on employees’ happiness; therefore,
management should always support the employees as they represent the banks before the
customer.
3. Banks should identify the most profitable customers by ranking them according to their value
and then differentiating them based on what they need from the bank. After identifying the
customers’ needs, the bank has to develop unique strategies to focus on one to one marketing.
This will add unique functions of acquiring, increasing and retaining valuable customers.
4. Commercial banks in Nigeria should increase the incentives given to customers as this will go
a long way with increasing customers satisfaction..
5.5 Relevance of the Study
Firstly, the study will be relevanceto the customer in appreciating customer relationship
management in attaining satisfaction.
Secondly, employees and people who are involved in the system that manages customer
relationship would be able to understand better the needs of the customer in regards to
satisfaction and proffer sustainable solutions.
57
Thirdly, it ill help companies in developing strategies or maybe performing an overhaul in the
customer relationship management approaches being used.
5.6 Limitation of Study
The first limitation in the study is limiting the research work to customer relationship
management alone, research should also cover effect of other phases on customer satisfaction.
Secondly, the study was grounded on two theories within, this did not really make the research
work quote out many scholars, more theories can be used from more scholars, and this will
enable confidence on the research topic.
Thirdly, the limitation of this study is the limited extent to which the findings of the study can be
generalized to wider geographical locations and/or sectors of the economy because the study
covered three Nigeria banks (wema, zenith and UBA) only. As such, the findings cannot be
generalized to companies in other sectors.
Lastly, the sample for the present study comprised of 208 employees of eco bank. This sample is
only a very small proportion of the entire population of employees in (wema, zenith and UBA)
Nigeria. Therefore, research studies with much larger sample size would be required to ensure
appropriate generalization of the findings of the study.
5.7 Suggestion for Further Studies
Further studies should increases the number of commercial banks which will also leads to
increase in the sample size of the study and also, the commercial banks in other state within the
nation can also be used as case study to see if similar findings will be obtained.
58
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65
APENDIX 1
THE EFFECT OF CUSTOMER RELATIONSHIP MANAGEMENT ON CUSTOMER
SATISFACTION
(A Case Study of 3 Nigerian Commercial Banks)
Department of Marketing
Babcock Business School
Babcock University,
Ilishan Remo,
Ogun State.
Dear Valued Respondent,
66
My name is OkenwaObinna Christian, a final year student of the Department of Marketing in
Babcock University, Ilishan Remo, Ogun State. I am conducting a research on the above topic.
Your responses are very crucial for the completion of the data analysis aspect of the study. Be
rest assured that all responses will be treated with utmost confidentiality and will be used
exclusively for academic purpose.
Thank you.
Yours faithfully,
OkenwaObinna Christian
12/1182
SECTION A: Personal Data of Respondents
(Please tick out of the boxes provided for each questions)
1. Gender
(a.) Male [ ] (b.) Female [ ]
2. Age
(a.) 20- 30 years [ ] (b.) 30-50 years [ ] (c.) 50-60 years [ ]
3. Academic Qualification
(a.) SSCE [ ] (b.) OND/NCE [ ] (c.) HND/B.Sc [ ]
(d.) PGD/M.Sc [ ] (e.) PhD [ ]
67
4. Professional Qualification
(a.) None [ ] (b.) ACA [ ] (c.) ACCA [ ] (d.) ICAN [ ] (e.) MBA/MPA [ ]
(f.) CIM [ ] (f.) Others [ ]
5. Level at Work
(a.) Junior Staff [ ] (b.) Senior Staff [ ] (c.) Management Staff [ ]
6. Years of Experience
(a.) 2-10 years [ ] (b.) 11-20 years [ ] (c.) 20-30 years [ ]
SECTION B: Customer Relationship Management and Customer Satisfaction

(Please tick one out of the boxes provided for each item; SA= strongly agree, A=agree, PA=
partially agree, PD=partially disagree, D= disagree and SD=strongly disagree)
S/N ITEMS SA A PA PD D SD
CUSTOMER RELATIONSHIP
MANAGEMENT (CRM)
A. Customer Involvement and Participation
(CIP)
1. Your organization spend more time with the
customers.
2 Your organization co-create with customers to
develop insights and better experiences.
3 Your organization always send the customers
reminder to increase customer feedback and
participation.
68
4 Your organization always get customers
involved in it product and service
development.
5 Customers are always part of product and
service creation in your organization.
6 Your organization always reward customers to

increase customer feedback and participation.
B. Customer Support Services (CSS)

1 The customer support service has given a
positive insight to customer's patronage to your
organization.
2 There is always a staff person the customer
always like to commend because of the type of
customer support service your organiztion
practices.
3 Your organization customer support service is
always friendly and cheerful throughout.
4 Your organization customer support service
always show knowledge of the products or
services to the customers
5 Customers always rate your organization
customer service support high.
6 Customer support service staffs are always
available to customers in a timely manner.
C. Incentives (IN)
1 Your organization gives customers monetary
reward in terms of promotional item such as a
t-shirt, money, gift card.
2 Your organization invites loyal customers to
special events.
69
3 Your organization solves another problem for
them aside from account issues.
4 Your organization break it own rules once a
while for loyal customers.
5 Your organization gives loyal customers direct
access to senior staffs.
6 Your organization always celebrates customers
special day.
CUSTOMER SATISFACTION
A. Customer Repurchase Behaviour (CRB)
1 Anytime your organization offers more than
one service, customers that purchase a specific
service behave differently over time compared
to other customers.
2 The probability the customer will make
another purchase of services and product in
your organization is always high.
3 The average number of orders customers place
in the short/long term is always encouraging.
4 The average revenue customers generate in the
short/long term is always encouraging.
5 Your organization direct their marketing
activities to improve customer attitudes and
intentions, which always have impact on
customers repurchase behaviors.
6 Your organization is always concern about the
level of need it services satisfy the customer to
enable customer repurchase.
B. Expectation from product (EP)

1 Your organization always work more closely
with the customers who develop the products
70
of the company.
2 Your organization has fulfil it customer
expectation for the year.
3 Customers has helped your organization gain a
better understanding of the market and the
competition by meeting up with there
expectation.
4 Your organization always ask the customers
what the company can do to serve them better.
5 The customers are always giving the privilege
to say what favourite service experience they
have had, whether in business or as a
customer.
6 There is no recent example where your
organization have not met the customers
expectations.
C. Loyalty (LT)
1 Customers are not particularly loyal to any
service/product in your organization and
always willing to try something new if they
thinks it will work just as well.
2 Your organization concentrate on giving
products rather than cash when they want to
reward customers and create loyalty.
3 There is an extent to which customers increase
their purchasing behavior in your organization.
4 Your organization encourages the customers
to recommend the service and product of your
company to their friends or family.
5 There is an extent to which customers advocate
your organization products.
6 There is an extent to which customers remain
customers and/or do not use a competitor in
your organization,
71

The Effect of Customer Relationship Management (CRM) On Customer Satisfaction

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THE EFFECT OF CUSTOMER RELATIONSHIP MANAGEMENT (CRM) ON

A STUDY OF SELECTED COMMERCIAL BANKS

effective customer relationship management is a reliable tool to increase customer satisfaction.

present competitive business environment.

Presence of an extensive customer relationship might also be argued to be operationally cost

1.3 Objectives of the Study

i. To investigate the effect of customer involvement and participation on customer

1.4 Research Questions

i. What is the effect of customer involvement and participation on customer satisfaction?

1.5 Research Hypotheses

H0:Customer involvement and participation has no significant effect on customer satisfaction.

H1:Customer involvement and participation has a significant effect on customer satisfaction.

H0:Customer support services has no significant effect on customer satisfaction.

H1:Customer support services has a significant effect on customer satisfaction.

H0: Incentives has no significant effect on customer satisfaction.

H1: Incentives has a significant effect on customer satisfaction.

H0: The joint of CRM elements has significant effect on CS.

H1:The joint of CRM elements has no significant effect on CS.

1.6 Significance of the Study

It would also be significant to the customer in appreciating customer relationship management

1.7 Scope of the Study

1.8 Operationalization of Variables

However, we are considering 3 variables on Customer Relationship Management (CRM) which

CS=f(CIP, CSS, IN)...combined effect of CRM elements on CS....obj 4

1.9 Definition of Terms

Customer Relationship Management (CRM): It is a concept that explains the various

Customer Support Services (CSS): This is a Customer Relationship Management (CRM)

Customer Involvement (CI)): It is an aspect and also an extended form of Customer

Customer Repurchase Behavior (CRB):This is the consumer's actual behaviour resulting in

2.1 Conceptual Review

2.1.1 Concept of Customer Relationship Management

(Venoos&Madadiyekta 2005). Customer Relationship Management includes individuals,

Management as a process of ascertaining customer needs; comprehending and inducing customer

behavior, making use of quality communications strategies so as to obtain and maintain

Management is to identify and render customized services to every customer. Customer

relationship management empowers organizations to deliver exceptional actual customer service.

becomes more important and more valuable to the organization.

profitable customer relationships by delivering superior customer value and satisfaction.

According to Wali and Nkpurukwe (2008), customer relationship management can be

relationship management as the process of customer acquisition, customer retention, customer

aim of influencing a repeat purchase.

relationships with those customers (Kotler and Armstrong 2008).

2.1.1.1 Customer Involvement and Participation (CIP)

customer involvement (Matthing, Kristensson, Gustafsson, &Parasuraman, 2004), customer

Kristensson, Magnusson and Matthing 2006).

Participation factors include tangibility, empathy, attendance at meetings, and meaningful

satisfactory outcome. Participation could be in the form of acquisition of service-related

consistently high-quality service depends on efficient performance of customers at the website.

the service firm.

as potential source of competitive advantage to win market share. In this technological

2.1.1.3 Incentives (IN)

their attainment of some standard set by the organization (Martocchio, 2006).

2.1.2 Concept of Customer Satisfaction

Therefore delivery of high quality service is paramount to achieving sustainable organization

(Kotler, 2000) defined satisfaction as an individual’s feeling of pleasure or displeasure resulting

and loyalty (Cameroon, 2010).

2.1.2.1 Customer Repurchase Behavior (CRB)

(referral) (Zeithaml, 1996).

lot (Leonard 2003).