Influence of Relationship Marketing on Customer Retention in Sri Lankan Banking Industry
Abstract Banking sector has become turbulent with the immense competition; hence it is mandatory to retain customers to ensure long term survival. In contemporary business markets, Relationship Marketing (RM) is used as a new competitive weapon to conquer the minds of consumers. Most of the past studies have concentrated on the link between customer relationship management and customer retention or have treated the concepts separately. Relatively few studies have focused on the influence of RM on customer retention (CR) There is a lack of empirical evidences that directly treated this type of investigations especially in Sri Lanka. Through this study, researchers intend to measure "Influence of RM on CR with respect to the Banking Industry in Sri Lanka" The research objectives are to identify the salient dimension of RM and to examine the influence of RM on CR. This study is descriptive, correlational and conclusive in nature. People who are visiting a bank to get the service were considered as the population for this study. A sample of 250 people from Colombo and Kandy metropolitan area was selected by using the convenience sampling technique. Person who visits a bank to get the service was taken as the unit of analysis. Paired Sample T Test, Mean Analysis and Regression Analysis were performed to assess the hypotheses. The results demonstrated that Organizational dimension as the salient dimension of RM. And also it is identified that there is a strong positive influence of RM on CR with reference to Sri Lankan banking industry. The findings of this study contribute to the existing literature in the aspects of consumer behaviour and psychology. And the inference of this research can be used in developing strategies to enhance the level of CR through means of RM especially in the areas of training and development, creating new roles and responsibilities dedicated to RM and maintaining an effective database system to support marketing information systems which will ultimately lead banks to increase the competiveness in the banking industry and finally it contributes to the economic stability and prosperity of Sri Lanka. Keywords: Banking Industry, Relationship Marketing, Customer Retention