| Title : | Factors affecting customer loyalty in banking sector of Nepal | | Material Type: | printed text | | Authors: | Shrijala Shrestha, Author | | Publication Date: | 2017 | | Pagination: | 103p. | | Size: | GRP/Thesis | | Accompanying material: | 9/B | | Languages : | English | | Descriptors: | Customer loyalty
Customer relations
| | Class number: | 658.812 | | Abstract: | Customer loyalty is a fundamental goal of marketing as the purpose of marketing is to satisfy customers. According to Bloemer and Odekerken-Schroder(2002), customer loyalty is the result of successful marketing that creates competitive value for consumers. Contemporary marketing efforts are geared towards meeting consumers’ needs and ensuring customer loyalty and strategizing on how to retain such customers (Hassan, 2008).Similarly, Customer loyalty is an attitudinal and behavioral tendency to favor one brand over all others, Customer loyalty encourages consumers to shop more consistently, spend a greater share of wallet, and feel positive about a shopping experience, helping attract consumers to familiar brands in the face of a competitive environment (Sawalqa2012). Customer loyalty is often regarded as the consequence of marketing activity performed by an organization so it has acquired a central position in marketing. Customer loyalty leads to change in attitude of customers, repeat purchase and ultimately brand loyalty. Origin of the concept of customer loyalty is derived from the marketing concept that profit is generated through satisfaction of customer needs and wants (Sabir et al., 2014).
Bank as a service sector has a great influence in the economy of the country. It plays very important role in economic development. The growth rate of economy largely depends on the rateof investment which, in fact depends on the level of saving. Higher saving leads to higher level of capital formation which is crucial for economic growth and development. The primary function of commercial bank is to accept deposit and provide loans. The commercial banks play major role in mobilizing saving for capital formation. The role of commercial banks in economic development includes saving promotion, saving mobilization, promotion trade, industry and employment allocation of funds, and transfer of money (Mishkin, 2011). Doostdar et al. (2013) argued that obtaining and maintaining brand loyalty is a key challenge in increasingly competitive markets. In vast competitive markets, brand loyalty provides several advantages including a barrier to competitors, more sales and revenue, lower customer acquisition costs and lower customer sensitivity to other competitors' marketing efforts.
The major objective of the study is to analyze the impact of various dimensions of service quality on customer loyalty of Nepalese commercial banks. The other objectives of this study are to analyze the perception of customers towards the level of service quality dimension (responsiveness, tangibility, empathy, assurance and reliability) of Nepalese commercial banks, to examine the relationship of selected service quality dimensions with customer loyalty, to determine the impact of selected service quality dimensions on customer loyalty of Nepalese commercial banks and to find out the most important service quality dimensions affecting customer loyalty of Nepalese commercial banks.
In order to achieve the objectives, primary data collection was performed by providing questionnaire to 200 customers of 25 commercial banks. The questionnaire were Yes, No, Ranking Scale, Likert and other demographic information were used to collect primary data. The Likert scale on the different variables on service quality dimensions and customer loyalty were measured in 5 point liker scale and weighted mean value of each variable were used to examine the relationship between independent and dependent variables as for the study purpose.
On the basis of regression result, the beta coefficient for responsiveness is positive and significant which reveals that higher the responsiveness, higher would be the customer loyalty. The beta coefficient for tangibility is positive and significant with customer loyalty which reveals that better tangibility leads to increase in customer loyalty. The results indicate that there is positive and significant impact of reliability on customer loyalty, which reveals that higher the level of reliability, higher would be the customer loyalty. Likewise, the study found that beta coefficient empathy is positive with customer loyalty which indicates that Nepalese commercial banks with highly empathetic employees are able to generate higher level of customer loyalty.
The result confirmed that tangibility, responsiveness and assurance are major factors affecting customer loyalty of Nepalese commercial banks. Similarly, tangibility, responsiveness and assurance are ranked as the most important dimension of service quality affecting customer loyalty of Nepalese commercial banks. Sincerely handling customer’s problem, providing services as previously promised, customer safety in transactions, good security management and personalized service and impressive staffs are ranked as the most important attributes affecting customer loyalty of Nepalese commercial banks. The study revealed that tangibility, responsiveness, assurance, reliability and empathy have positive relationship with customer loyalty indicating that higher the level of tangibility, responsiveness, assurance, reliability and empathy, higher would be the customer loyalty.
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Factors affecting customer loyalty in banking sector of Nepal [printed text] / Shrijala Shrestha, Author . - 2017 . - 103p. ; GRP/Thesis + 9/B. Languages : English | Descriptors: | Customer loyalty
Customer relations
| | Class number: | 658.812 | | Abstract: | Customer loyalty is a fundamental goal of marketing as the purpose of marketing is to satisfy customers. According to Bloemer and Odekerken-Schroder(2002), customer loyalty is the result of successful marketing that creates competitive value for consumers. Contemporary marketing efforts are geared towards meeting consumers’ needs and ensuring customer loyalty and strategizing on how to retain such customers (Hassan, 2008).Similarly, Customer loyalty is an attitudinal and behavioral tendency to favor one brand over all others, Customer loyalty encourages consumers to shop more consistently, spend a greater share of wallet, and feel positive about a shopping experience, helping attract consumers to familiar brands in the face of a competitive environment (Sawalqa2012). Customer loyalty is often regarded as the consequence of marketing activity performed by an organization so it has acquired a central position in marketing. Customer loyalty leads to change in attitude of customers, repeat purchase and ultimately brand loyalty. Origin of the concept of customer loyalty is derived from the marketing concept that profit is generated through satisfaction of customer needs and wants (Sabir et al., 2014).
Bank as a service sector has a great influence in the economy of the country. It plays very important role in economic development. The growth rate of economy largely depends on the rateof investment which, in fact depends on the level of saving. Higher saving leads to higher level of capital formation which is crucial for economic growth and development. The primary function of commercial bank is to accept deposit and provide loans. The commercial banks play major role in mobilizing saving for capital formation. The role of commercial banks in economic development includes saving promotion, saving mobilization, promotion trade, industry and employment allocation of funds, and transfer of money (Mishkin, 2011). Doostdar et al. (2013) argued that obtaining and maintaining brand loyalty is a key challenge in increasingly competitive markets. In vast competitive markets, brand loyalty provides several advantages including a barrier to competitors, more sales and revenue, lower customer acquisition costs and lower customer sensitivity to other competitors' marketing efforts.
The major objective of the study is to analyze the impact of various dimensions of service quality on customer loyalty of Nepalese commercial banks. The other objectives of this study are to analyze the perception of customers towards the level of service quality dimension (responsiveness, tangibility, empathy, assurance and reliability) of Nepalese commercial banks, to examine the relationship of selected service quality dimensions with customer loyalty, to determine the impact of selected service quality dimensions on customer loyalty of Nepalese commercial banks and to find out the most important service quality dimensions affecting customer loyalty of Nepalese commercial banks.
In order to achieve the objectives, primary data collection was performed by providing questionnaire to 200 customers of 25 commercial banks. The questionnaire were Yes, No, Ranking Scale, Likert and other demographic information were used to collect primary data. The Likert scale on the different variables on service quality dimensions and customer loyalty were measured in 5 point liker scale and weighted mean value of each variable were used to examine the relationship between independent and dependent variables as for the study purpose.
On the basis of regression result, the beta coefficient for responsiveness is positive and significant which reveals that higher the responsiveness, higher would be the customer loyalty. The beta coefficient for tangibility is positive and significant with customer loyalty which reveals that better tangibility leads to increase in customer loyalty. The results indicate that there is positive and significant impact of reliability on customer loyalty, which reveals that higher the level of reliability, higher would be the customer loyalty. Likewise, the study found that beta coefficient empathy is positive with customer loyalty which indicates that Nepalese commercial banks with highly empathetic employees are able to generate higher level of customer loyalty.
The result confirmed that tangibility, responsiveness and assurance are major factors affecting customer loyalty of Nepalese commercial banks. Similarly, tangibility, responsiveness and assurance are ranked as the most important dimension of service quality affecting customer loyalty of Nepalese commercial banks. Sincerely handling customer’s problem, providing services as previously promised, customer safety in transactions, good security management and personalized service and impressive staffs are ranked as the most important attributes affecting customer loyalty of Nepalese commercial banks. The study revealed that tangibility, responsiveness, assurance, reliability and empathy have positive relationship with customer loyalty indicating that higher the level of tangibility, responsiveness, assurance, reliability and empathy, higher would be the customer loyalty.
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