An assessment of CRM system upgrades on enhancing customer loyalty in banking: a case study of Sterling Bank
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Background of the Study
Customer Relationship Management (CRM) systems are fundamental to building lasting customer loyalty in the banking sector. Sterling Bank has recently upgraded its CRM system to include advanced analytics, real-time data integration, and multi-channel communication capabilities. These enhancements provide a comprehensive view of customer interactions, enabling the bank to tailor services, anticipate customer needs, and respond proactively to concerns (Okoro, 2023; Adebayo, 2023). With a 360-degree understanding of its customers, Sterling Bank can deploy targeted marketing campaigns and implement retention strategies that reinforce loyalty and reduce churn. The upgraded CRM platform also integrates digital channels—such as mobile and online banking—ensuring that customers receive consistent and personalized service across all touchpoints.
The strategic focus on CRM system upgrades aligns with the bank’s broader digital transformation agenda, which seeks to enhance operational efficiency and customer satisfaction. By automating routine processes and enabling faster response times, the bank not only improves service delivery but also creates a competitive advantage. Enhanced CRM systems facilitate data-driven decision-making, enabling the bank to monitor customer satisfaction levels and adjust strategies accordingly. Ultimately, these upgrades are expected to result in stronger customer relationships, increased lifetime value, and improved market positioning.
Statement of the Problem
Despite significant investments in CRM system upgrades, Sterling Bank continues to encounter challenges in fully leveraging the technology to enhance customer loyalty. A key issue is the incomplete integration of the new CRM system with existing legacy databases, which results in fragmented customer information and inconsistent service delivery (Onyema, 2023). This fragmentation impedes the bank’s ability to provide truly personalized services, as it lacks a unified view of customer interactions. Additionally, resistance to change among staff, coupled with insufficient training on the upgraded system, has led to underutilization of its advanced features. Variations in data quality across branches further contribute to inconsistencies in customer experiences, undermining retention efforts. The absence of standardized metrics to evaluate CRM effectiveness makes it difficult for management to identify improvement areas and fully capitalize on the system’s potential.
Objectives of the Study
1. To evaluate the impact of CRM system upgrades on customer loyalty at Sterling Bank.
2. To identify integration and operational challenges affecting the CRM system’s effectiveness.
3. To recommend strategies for optimizing CRM processes to improve customer retention.
Research Questions
1. How do CRM system upgrades affect customer loyalty at Sterling Bank?
2. What challenges hinder the effective integration of the upgraded CRM system with legacy databases?
3. How can Sterling Bank optimize its CRM strategies to enhance customer retention?
Research Hypotheses
1. H₀: CRM system upgrades do not significantly enhance customer loyalty at Sterling Bank.
2. H₀: Integration challenges do not significantly affect the effectiveness of the CRM system.
3. H₀: Optimization strategies do not significantly improve customer retention.
Scope and Limitations of the Study
This study focuses on Sterling Bank’s CRM system, drawing on customer retention data, system usage statistics, and interviews with HR and IT personnel. Limitations include potential data inconsistencies and differences in system adoption across branches.
Definitions of Terms
• CRM System: A technology platform for managing customer relationships and data.
• Customer Loyalty: The propensity of customers to continue using the bank’s services over time.
• Data Integration: The process of merging information from multiple sources into a unified view.
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