Introduction
A Financial institution or bank can be defined as an institution, which accepts deposit grant loans and makes payment. Customer loyalty refers to customer behavior that indicates a desire to improve the relationship with the company, customer willingness to purchase again from the company have preferences for the company or recommending the companies to other could indicate the customer desire to remain in a relationship with the company. Customer relationship management recognizes the long run value of a potential and current customer. The main objective of any financial institution is to maximize profit and to do this they must have a large pool of reliable customers who can stay with the institution, for the near future. To maintain these customers and make them loyal to the institution there must be a bond that keeps them together. This bond is in the form of contract and moral justice. Any relationship between the bank and customer must be a good one to enhance mutual benefits to flow to the parties involved. The benefit must not be on equal amount but the two parties must be satisfied. A customer is the heartbeat of a bank and other businesses. From financial perspective, customers own a bank and they must be there for it to continue for a near future.
Banks are competing intensely in a highly competitive environment to offer quality oriented services according to customers’ expectations. Many researchers to better understand and serve the community at large are studying various important parts of a banking sector like operations, service quality, employee satisfaction, customer satisfaction, financing products, efficiency, and financial performance.
The high quality relationship with customers is the main influence of a successful service provider “which determines customer satisfaction and loyalty”. Organizational outcome such as performance superiority is primarily influence by the service quality increasing sales profit, market share progressing customer relations, improving corporate image and promote customer loyalty. So service quality and customer satisfaction are related to customer loyalty through repurchase intentions. Banks must convey quality service to ensure success and survival in today’s competitive banking. It is logical that a satisfied customer will become at the end a repeat purchaser and a loyal buyer for many causes. This relationship between satisfaction and loyalty should conclude in improve marketing performance for a variety of reason.
1.1 Purpose of thesis
Purpose of this thesis is to examine the correlations between customer satisfaction and customer loyalty. “Customers became a center for all banking activities due to increased competition for a greater market share. Focusing on customer satisfaction has been the key to increasing service quality according to customers’ expectations in the banking sector,” suggested that the level of service quality is an indication of the organization’s ability to meet customers’ desires and demands. Therefore, organizations must improve their services to meet the customers’ needs and requirements.
Both qualitative and quantitative research methods are used. In addition this work relies on the researcher internship experience in the bank. One in-depth interviews was conducted with the manager on duty who is also the head of customer services in the bank. In addition, a questionnaire survey was conducted with the customers of the bank to find out the factors, which may influence their satisfaction and loyalty. Furthermore, a SWOT analysis was conducted to recommend a strategy for its future development. Customer satisfaction is regarded as an invisible asset. It is not only an improvement for the development of the financial institution but also can be used in predicting for the operation quality and development of Ecobank in general. To satisfy the customer and build their loyalty are the basics for an enterprise to be improved and developed. Customer satisfaction can be used as a standard to test a bank service quality. Service standard must start from the demands of customers and end with the satisfaction of customers.
1.2 Objective of thesis
The primary objective of this thesis is to minimize customer regress and to maximize customer intension rates to buy. Because satisfied customer may help firm both reduce marketing cost, developed more stable level of sales when a large number of satisfied buyers are return to purchase in the future. In addition, to know the relationship between banks and it customer, how this relationship helps to satisfied customer and make them remain loyal to their banks. Furthermore, to study the concept of customer satisfaction and loyalty and discover the factors influencing them. Lastly, to analyze the relationship between customer satisfaction and loyalty, how customer satisfaction and loyalty can be increase and as well increase the profit of the bank.
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