An assessment of customer relationship enhancement strategies on service satisfaction in banking: a case study of Sterling Bank
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Background of the Study
In today’s competitive banking environment, customer relationship management (CRM) has emerged as a critical determinant of service satisfaction and overall business sustainability. Sterling Bank, like many financial institutions, has increasingly adopted customer relationship enhancement strategies aimed at improving communication, building loyalty, and personalizing service delivery (Afolabi, 2023). The evolution of CRM in the banking sector reflects broader shifts toward digital transformation, where advanced data analytics, social media integration, and automated feedback systems are used to capture customer preferences and tailor services accordingly (Okoro, 2024). These strategies are designed not only to attract new clients but also to retain existing ones by fostering a more engaging and responsive service environment. Studies have demonstrated that effective relationship management is linked to higher customer satisfaction and repeat business, which in turn leads to improved financial performance (Eze, 2023).
Sterling Bank’s initiatives, including loyalty programs, personalized banking solutions, and enhanced digital touchpoints, are implemented with the goal of creating a seamless customer journey. However, despite these efforts, gaps remain in fully understanding how these strategies translate into service satisfaction, particularly in the face of rapidly evolving customer expectations. Emerging trends indicate that customers increasingly value timely communication, transparency in operations, and personalized experiences. As banks invest in technology and human resource development to manage relationships more effectively, the need for empirical research that critically assesses these initiatives becomes paramount (Bello, 2023). This study aims to evaluate the direct impact of Sterling Bank’s customer relationship enhancement strategies on service satisfaction. By integrating quantitative data from customer surveys with qualitative insights from frontline employees, the research seeks to identify key drivers of satisfaction and areas where the bank can refine its practices. The outcome is expected to contribute to both academic literature and managerial practices, offering a framework for optimizing CRM in banking that aligns with modern customer expectations (Oluwaseun, 2024).
Statement of the Problem
Despite significant investments in customer relationship strategies, Sterling Bank continues to encounter challenges in achieving uniformly high levels of service satisfaction. One of the primary issues is the inconsistency in service delivery across various customer touchpoints, which can lead to fragmented experiences. While digital channels provide opportunities for personalized engagement, they also risk depersonalizing the interaction if not managed correctly (Afolabi, 2023). Furthermore, there is a noticeable gap between the bank’s intended customer experience and the perceptions held by its clientele. Customers have reported that despite the availability of sophisticated CRM tools, the responsiveness and resolution of service issues remain suboptimal. This misalignment between strategy and execution suggests that while technology has enhanced communication capabilities, it has not fully replaced the need for human-centric interaction (Okoro, 2024).
The problem is compounded by the rapid evolution of customer expectations in a digital age. As new digital platforms and communication channels emerge, customers demand quicker, more efficient, and more personalized service. Sterling Bank’s current CRM strategies, while robust in design, appear to struggle with adaptability and consistency in practice. This study, therefore, aims to bridge the gap by investigating the specific elements of relationship enhancement strategies that contribute most significantly to service satisfaction and by identifying the operational bottlenecks that undermine these efforts (Eze, 2023). By addressing these issues, the research will provide actionable recommendations that can help the bank realign its CRM practices with contemporary customer expectations, ultimately leading to improved service outcomes (Bello, 2023).
Objectives of the Study:
1. To evaluate the effectiveness of current customer relationship enhancement strategies at Sterling Bank.
2. To analyze the impact of these strategies on overall service satisfaction.
3. To recommend improvements for aligning CRM practices with customer expectations.
Research Questions:
1. How do Sterling Bank’s relationship enhancement strategies influence customer service satisfaction?
2. What are the key drivers and barriers to effective CRM in the banking context?
3. What improvements can be made to enhance the overall customer experience?
Research Hypotheses:
1. Effective customer relationship strategies positively influence service satisfaction at Sterling Bank.
2. Personalized communication channels are significantly correlated with higher customer satisfaction.
3. Enhancements in CRM practices lead to improved customer loyalty and retention.
Scope and Limitations of the Study:
This study focuses exclusively on Sterling Bank, examining its CRM strategies within both digital and traditional service channels. The research is confined to customer feedback and internal performance metrics over the recent period. Limitations include potential biases in customer self-reporting and challenges in isolating CRM effects from other operational factors.
Definitions of Terms:
• Customer Relationship Management (CRM): Strategies and technologies used by banks to manage interactions with current and prospective customers.
• Service Satisfaction: The level of contentment experienced by customers with the quality and efficiency of banking services.
• Personalization: Customizing services to meet individual customer needs.
• Customer Loyalty: The likelihood of customers to continue using a bank’s services over time.
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