An Evaluation of Customer Perceptions on CRM within the UK Retail Banking

This paper aims to investigate customer perceptions of the concept of CRM and its relevance to customer satisfaction and loyalty in the UK retail banking industry. It also seeks to identify the critical factors that can impact on a consumer’s choice of bank. The main research instrument is a questionnaire. 240 questionnaires are randomly distributed. Two statistical modelling techniques namely multiple regression and multinomial regression are used to determine characteristics of customers’ satisfaction and loyalty and to identify key factors in managing customer relationships. Our findings indicate that, in order of priority, the three primary factors that significantly affect customer loyalty are the opportunity to evaluate service offerings; IT and Tele-banking services and opening and closing hours. Participants identified eight significant factors that affect their satisfaction. The three primary factors, in order of priority, are overall satisfaction; the speed of service and IT and Tele-banking services. The most influential factors in choosing a bank, in order of importance, are a bank’s opening and closing times; IT and Tele-banking services; account and transaction accuracy; customer loyalty and overall satisfaction. In conclusion, our results suggest that customers’ satisfaction and loyalty can be jointly predicted by these key CRM factors. Although customer satisfaction and loyalty has been the subject of much discussion and further research, this paper has developed CRM by applying multinomial regression to identify the most influential factors for choosing a bank.