The Effect of Service Quality on Customer Retention A Case of CBE Tutiti Branch
Year: 2025
Type: article
Abstract: Customer retention became an important factor with the sudden increase in number of banks worldwide. Customers are seen hopping from one bank to the other, either of the public or private, depending on the kind of services provided by. What will happen in the future as a result of loss of quality service is loss of customers, damage to corporate image, low profitability, and loss of competitive edge. This study was, therefore, designed to assess the effect of service quality on customer retention using the CBE Tutiti branch as a case study. The study aimed at examining service quality of the branch and customers’ perception/expectation of service quality at the branch. The study was guided by the following research questions: What is the relationship between tangibility and customer retention in the branch? What is the relationship between reliability and customer retention in the branch? What is the relationship between responsiveness and customer retention in the branch? What is the relationship between assurance and customer retention in the branch? What is the relationship between empathy and customer retention in the branch? A sample size of 378 respondents was chosen for the study. The five determinants of the effect of service quality on customer retention i.e., tangibility, reliability, responsiveness, assurance and empathy were the identified independent variables while customer retention is as the identified dependent variable. In order to achieve the objectives, both primary and secondary sources of data were used. Data was obtained through the use of questionnaires. The primary data was collected through administrating questionnaire and was analyzed by using SPSS software (version 2020). Convenient sampling procedure was used to obtain responses from customers of the branch. Correlation and multiple regressions were used to investigate the relationship between dependent and independent variables. Demographic data was analyzed by descriptive statistics while the relationship between service quality and customer retention was analyzed using regression model. There was significant relationship between independent variables (tangibility, reliability, responsiveness, assurance and empathy), and dependent variable (customer retention).
DOI: 10.20372/nadre:19009
Author: Esayas Dejene Lule
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7082652242
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