Effect of Customer Relationship Management on Customer Retention Among Smes as Consumers of Safaricom Products in Nairobi City County

Abstract

In the 21st century customer relationship management has become an important element for companies when coming up with a strategic plan. Firms are moving closer to customers by finding ways of creating value to customers and transforming customers problem into solution in which it results into good relationship rather than selling to customers. The objective of the study was to establish effect of customer relationship management on customer retention among SMEs as consumers of Safaricom products In Nairobi County. The study was anchored on two theories namely; relationship marketing theory and commitment-trust theory. The study adopted descriptive, cross-sectional design. The population of the study was 1050 SMEs in the data base of Nairobi county council. The study employed stratified random sampling, with a target of 210 registered SMEs within Nairobi County. The study was collected from managers or the owners of the SMEs. Analysis was done using simple regression and correlation analysis. It was established that customer relationship management practice had significant relationship with consumer retention. There was positive correlation between management information system, personalized services, electronic relationship and trust with customer retention. Except for communication which and insignificant relationship with customer retention. The research concluded that the extent to which customer relationship management practices have been adopted by SMEs in Nairobi Kenya was great extent. The recommends that enhance customer retention, SMEs should ensure that they have proper management information system so that to offer quality services and products to retain existing customers regardless of their pricing policy and also there should the frequency of communications between a firm and customers.