Abstract:
Customer loyalty enhances the customers to be committed to purchasing products and
services from a specific service provider and will resist the actions of competitors attempting
to usurp their patronage. However, the condition is not uniform in all places and all time
particularly in all sectors like CBE (commercial bank of Ethiopia). Thus, the purpose of this
study was to assess theeffect of relationship marketing on customers’ loyalty in CBE in Ambo
selected branches. Both descriptive and explanatory research design and quantitative
approach was used. A total of 365 questionnaires distributed and only 337 were filled and
returned by the respondents and this made a return rate of 92.33%. the results of correlation
of relationship marketing and customer’s loyalty and adjusted R Square is (.238) and it is
pointed out that 23.8 percent of relationship marketing can explain the dependent variable
that is customer’s loyalty. But, the remaining 76.2% of dependant variables can be explained
by variables which are not included in this study. In the regression analysis, the beta value
under standardized coefficients exhibited that that the beta value between customer Conflict
Handling and customer's loyalty in commercial Bank of Ethiopia was .327 and the p =.000.
Therefore, it is possible to conclude that 32.7% of customer’s loyalty is affected by
Communication at p<0.01. In addition, the beta value under standardized coefficients
exhibited that that the beta value between customer communication and customer's loyalty in
commercial Bank of Ethiopia was .159 and the p =.018. Therefore, it is possible to conclude
that 15.9% of customer’s loyalty is affected by Communication at p<0.05. From the ANOVA
statics, the processed data which is the population parameters, had a significance level of
100% which shows that the data is ideal for making a conclusion on the population’s
parameter as the value of significance (p-value ) is less than 1%. The calculated value was
greater than the critical value (21.682) an indication that, commitment, communication and
conflict handling is significantly influence the customer loyalty of CBE sites in Ambo town. In
general, the banks customers’ loyalty great determination by the Communication, conflict
handling and trust, implies that the customers’ were need to focus on these factors to be
strengthened.
