THE IMPACT OF RELATIONSHIP MARKETING AS A TOOL FOR CUSTOMER SATISFACTION AND PROFITABILITY
ABSTRACT
Using Intercontinental Bank Plc Aba as a case study, this research work examines the definition of Relationship Marketing and its significance as a tool for customer satisfaction and profitability. This study was conducted to determine the extent to which relationship marketing can assist banks in satisfying their clients and maximizing profit. It attempts to investigate the necessity for the application of relationship marketing in solving some challenges in the banking sector, as well as make solutions where appropriate. The primary goal of this research is to determine the effectiveness of relationship marketing in achieving customer satisfaction and profitability. This has been accomplished through the use of an effective and efficient research design, appropriate data collection methods, and analysis in this work and various findings and recommendations.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Relational marketing is one of the pillars of Holistic marketing, a newly established marketing concept. It believes that “everything matters in marketing” and that a broad, integrated perspective is frequently required. Increasingly, a key goal of marketing is to develop deep, enduring relationships with all people or organizations that can directly attract the success of the firm’s marketing activities. Relationship marketing seeks to establish mutually beneficial long-term relationships with important stakeholders such as consumers, suppliers, distributors, and other marketing partners in order to gain and maintain their business. It strengthens the parties’ commercial, technical, and social ties.
Nonetheless, relationship marketing is a widely accepted word that only appeared in management literature in the 1980s; however, it reflects a concept that is as ancient as commerce itself and that is frequently practiced, if unintentionally, within small to medium-sized businesses. The concept of relationship marketing is illustrated with the example of a local shopkeeper who, through regular contact, would know most customers by name. As a result, he or she would talk to customers frequently, learn about their likes and dislikes, and be aware of any special requirements specific clients may have, such as cream on Friday. This direct information enables the shopkeeper to order merchandise, plan services, and value based on the needs of the clients.
Furthermore, customers are vital since they have the final say when it comes to purchasing items and services, and their needs must be met. Consumers are “Kings,” and they determine the marketers’ existence. If this is overlooked, one’s customer base will suffer. Consumers’ demands are paramount, both to themselves and to prospective suppliers; if they have a training issue, they will seek assistance from the providers of the financial services in question. They will expect a prompt and effective answer. If they do not receive the quality and services to which they are entitled, they will vote with their feet, will not return, and will not expect any recommendations. But, when clients obtain pleasant, efficient, and effective financial services, service, they come back for more and recommend your products and services to contact.
In the financial sector especially banks, the concept of customers relations arises from indirect financing with intermediaries accumulating surplus funds from surplus spending units and intending to lend them out to deficit spending units. This legally creates “banker customer relations” as that of a debtor and creator.
In essence, relationship marketing involves knowing about your customers, encouraging two-way communication with them, and seeking to create a mutually beneficial relationship with them where appropriate. The aim of relationship marketing is to convert am individual or organization with initial interest purchasing goods and services into a loyal customers and the focus is as much on relating existing customers as on bringing in new ones.
However, when customers are satisfied, they become unpaid agents and in return there will be profit maximization. Relationship marketing includes all marketing and efforts deigned by the banks to satisfy the needs of the customers profitable. That is why the slogan of intercontinental Bank is “Happy Customer, Happy Bank”.
1.1.1 PROFILE OF THE STUDY
Intercontinental Bank Plc came into existence in March 1989 as a product of the Partnership between some Visionary and dynamic Nigerian businessmen, to provide innovative and customer focused products and services that will satisfy the publics growing need for sophisticated banking services. Since its inception then as Nigerian Intercontinental Merchant bank Limited, the bank has been providing a wide array of products and services covering investments banking, retail and funds management.
The bank is managed by a dynamic , versatile and result-oriented team and easily won national acclaim by emerging as the most profitable merchant bank just five years after it takes off. Over the year, the bank has grown to symbolize innovation, services excellence and professionalism, with a diversities group structure spanning the various areas of financial service business. The subsidiaries and associate are today made up of vibrant commercial bank, equity Bank of Nigeria Limited, a flourishing insurance company, WAPIC Insurance Plc, Intercontinental Capital market Limited (ICML) and two associated companies, Intercontinental Securities Limited and Associated Discount House Limited (ADHL).
The discount House has acquired a majority interest in Gateway Bank Plc, while the equity Bank has the following subsidiaries: CBN Securities and CBN Finance Limited.
Intercontinental Bank has made significant investments in information technology, with all of its branches effectively linked to one another and to the head office using very small aperture Terminal (VSAT), which improves on-line real-time capabilities. This has simplified banking for the banks’ throngs of consumers around the country.
In July, 1999, the bank converted to a commercial Bank and later obtained a universal banking license to avail many more customers of its unique products and services as well as top into their market opportunities in the Nigerian Economy. Following a resolution of the Board in October 2001, the Bank Changed to a public Limited Liability company in June 2002 and following it up in July the same year with an initial public offering (IPO). The capitalization of the Bank was further boosted with N3.58 billion being proceeds of the IPO and by mid 2004 the banks shareholders funds had grown to N10 billion before the new minimum capital bases of N25 billion was set by the regulators.
Consequently, the bank returned to the capital market and raised new funds totally N22.4 billion thereby growing its shareholders fund to N34.7 Billion. The banks shares are listed on the Nigeria on stock .exchange (NSE), Since its debet in the commercial banking field, Intercontinental Bank Plc has purchased an aggressive branch network expansion programmes, As at March 2005. The bank has 63 branches making it sixth largest bank in the country in terms of network. In 2006 they executed another public offer that grossed about N100 billion with subscription level hiking an unprecedented 774%.
In 2007, a consortium of five foreign financial institutions invested & 161 million in the bank. This shared up the shareholder fund to $1.3 billion, making if the first Nigerian bank to cross the $1 billion capitalization threshold. They have about 250 branches spread all over the country, from 2008 to 2009, they become the number one bank in Nigeria, the first in E-banking and the second best bank in customers services. They have 8027 staff strength and they have 20 members pf board of directors, which is chairman by Dr. Raymond. C. Obieri (OON)
However, their Vision is to be the number one financial institution in Nigeria and among the top 100 in the world. And their mission is to help their stakeholders build and pressure wealth. Intercontinental Bank Plc offers a full range of consumer products covering a wide spectrum of the market. these include the Intercontinental Diamond Fund. (IDF). Intercontinental Valuable yield Account (IVY) Intercontinental Premium savings Account (IPSA).
Intercontinental Classic Current Account (I.CLASS), Intercontinental: Domicilary Additional Account (DAM), Intercontinental LEASING Account (I-Lease), Intercontinental Personal Loan (1-Pearl), Intercontinental Bank Value card, and Travelers Cheques (TC). They provide the following services:
Retail, banking, treasury and financial services, foreign trade operations, SMS banking, telephone banking, internet banking, investment banking, commercial banking, and electronic banking are all examples of businesses that use SMS banking. The bank is a direct agent for Western Union Money Transfer as well as a Master Card partner. A socially conscious organization. Intercontinental Bank has a long history of cooperative responsibility to the communities. It operates in the public health and education sectors and has had an impact on them.
Intercontinental Classic Current Account (I.CLASS), Intercontinental: Domicilary Additional Account (DAM), Intercontinental LEASING Account (I-Lease), Intercontinental Personal Loan (1-Pearl), Intercontinental Bank Value card, and Travelers Cheques (TC). They provide the following services:
Retail, banking, treasury and financial services, foreign trade operations, SMS banking, telephone banking, internet banking, investment banking, commercial banking, and electronic banking are all examples of businesses that use SMS banking. The bank is a direct agent for Western Union Money Transfer as well as a Master Card partner. A socially conscious organization. Intercontinental Bank has a long history of cooperative responsibility to the communities. It operates in the public health and education sectors and has had an impact on them.
1.2 STATEMENT OF THE PROBLEM
This study emphasis on the issue of customers satisfaction an profitability from the conceptual framework of the relationship marketing. However, the major problems we have is to know. To what extent the intercontinental bank Plc, is operating in relation with the relationship marketing. Moreover, how has the Intercontinental bank plc Aba been coordinating and managing their customers. To what extent has relationship marketing contributed to the organizational profitability?
Furthermore, how and to what extent have they gained Innovation through the application of relationship marketing? And to what extent have they achieved their organizational objective through relationship marketing.
1.3 OBJECTIVES OF THE STUDY
Having raised the problems stated in the problem statement. As a result, the following is the study’s goal:
i. Determine whether relationship marketing has anything to do with consumer satisfaction.
ii. Determine whether the relationships market helps to profit realization.
iii. Determine whether they met their objectives through relationship marketing.
iv. To assess the effectiveness of relationship marketing in generating organizational profitability.
v. To investigate the military factors opposing the use of relationship marketing.
1.4 RESEARCH QUESTION
Nonetheless, from the study’s objectives. The following pertinent researcher questions have been developed.
1. Is relationship marketing related to consumer satisfaction?
2. Can relationship marketing help with profit realization?
3. Does the organization meet its objectives through relationship marketing?
4. Can relationship operationalization and marketing ensure organizational profitability?
5. Are there any characteristics that influence the use of relationship marketing?
1.5 RESEARCH HYPOTHESIS
The following hypothesis as formed for testing based on the research problem and objectives of the study.
Ho: The relationship marketing has nothing to do with customer satisfaction.
HA: The relationship marketing has something to do with customer satisfaction.
Ho: The operationalization of relationship marketing do not ensure organization profitability.
HA: The operationalization of relationship marketing ensures organizational profitability.
Ho: Relationship marketing does not contribute to profit actualization.
HA: Relationship marketing contributes to profit actualization.
1.6 SIGNIFICANCE OF THE STUDY
Nevertheless, this study is basically and significant to the contemporary services organization and marketing business operating environment, for all kind of reason including the following.
i. It will enhance the management of the customer value
ii. It will help in understanding of who is a customer and how to satisfy them.
iii. It will enable the company to focus on its objectives through the help of relationship marketing
iv. The research study will form the basis of further researcher for the incoming students of marketing.
v. This study is also a prerequisite to partial fulfillment of the award of Higher National Diploma.
vi. It will guide the government in formulating polices on environmentalism and consumerism.
1.7 SCOPE OF THE STUDY
To obtain a precise analysis, this paper will investigate the relationship between marketing and customer happiness and profitability in the Intercontinental Bank Plc Aba during this moment of unpredictable economy in Nigeria. This paper focuses on the Intercontinental Bank Plc Aba branches. The work will purposefully target a demographic in Aba City. Consequently, within the boundaries of the intercontinental bank Plc Aba.
1.8 DEFINITIONS OF TERMS
Certain significant terms will be defined in this study area in order to get a comprehensive grasp of this work.
Marketing is described as the process through which organizations give solutions to customers’ needs and aspirations in exchange for cash, according to Kalu F.O (2002).
MARKETING CONCEPT: This is concerned with identifying customers’ needs and desires and meeting them more profitably than competitors.
According to Kotler (1999:497), relationship marketing is the process of developing, sustaining, and enhancing strong, value-laden connections with customers and stakeholders.
CUSTOMER: A person or company who purchases things on a regular basis. Marketing Glossary.
SATISFACTION is determined by perceived performance and expectation.
IMPACT: This is the significant impact that relationship marketing has on client satisfaction and profitability.
Leave a Comment