The Role of Direct Marketing in Financial Services: A Case of Awash Bank Head Office, Addis Ababa, Ethiopia

Abstract

Direct marketing is increasingly recognized as a vital tool for enhancing customer engagement and fostering growth within Ethiopia's financial services sector. Despite its potential, limited research exists on its localized application, particularly in institutions like Awash Bank's Head Office in Addis Ababa. This study addresses this gap by evaluating the effectiveness of direct marketing practices at Awash Bank, using a mixed-methods approach that incorporates surveys, interviews, and progress reports. Data was collected from a sample of 108 participants across management levels and analyzed using SPSS. Key findings reveal that personalized communication significantly boosts customer loyalty, with 61.1% of respondents acknowledging its impact. Technological integration drives customer engagements, evidenced by a 76.4% increase, while the bank's return on investment improved by 25% between 2015 and 2016. Enhanced communication frequency and the adoption of digital channels, such as social media, further contributed to customer acquisition and retention, with social media usage growing by 50%.The study underscores direct marketing's potential to advance financial inclusion in Ethiopia, offering actionable recommendations for Awash Bank. These include leveraging customer data analytics, adopting innovative digital marketing strategies, prioritizing staff training, and conducting regular evaluations to align marketing efforts with consumer preferences and industry trends. Despite challenges such as resource allocation and regulatory compliance, the integration of technology presents significant opportunities to strengthen customer relationships. In conclusion, direct marketing is a vital driver for sustainable growth in Ethiopia's banking sector. Future research should explore its long-term impact on business performance to enhance competitive advantage and foster enduring financial inclusion.