Relationship Marketing Practices and Customer Loyalty: Evidence from the Banking Industry in Ghana

Abstract

The present competitive landscape in Ghana’s banking industry has accentuated the need for effective management of relationships as a customer retention strategy. The objective of this study is to explore the relationship between Relationship Marketing (RM) and customer loyalty in Ghana’s banking industry. In order to achieve the objective of the study, data was collected using questionnaires from 247 relationship marketing staff of universal banks in Ghana. Reliability test and multiple regression analysis were carried out using Statistical Package for Social Sciences (SPSS). The study found that the six RM constructs cumulatively had significant positive effect on customer loyalty. Individually, competence, commitment and communication were found to be significant drivers of customer loyalty. The study recommends that banks desirous of achieving customer loyalty and retention should consider RM as a strategy since it effective practice leads to customer loyalty.  In addition, top management must demonstrate genuine commitment and active involvement in relationship marketing issues.

Key words: Banking industry, Customer loyalty, Ghana, Relationship marketing