An evaluation of the strategies used by banking industry to retain it customers : A case of Kenya commercial Bank Limited
Fast-changing global business environment has resulted in organizations having to change their business strategies and processes so as to remain competitive. As organizations try to explore new markets and expand their business operations, they are faced with challenges posed by new entrants in the market who are deploying more efficient technologies, hence the need for organizations to try and retain existing customer base. This study aimed at evaluating the customer retention strategies used in the banking industry with a critical look at Kenya Commercial Bank Ltd (KCB). The research sought to evaluate whether KCB had a formal documented strategy on customer retention and the various strategies the bank applied in ensuring that their existing customers remained loyal. This was a descriptive study where data was collected using two sets of questionnaires; one targeting the employees and another targeting the customers. An interview was also Iconducted in head office where the Nairobi Region Customer Care Manager was interviewed. A total of 318 questionnaires were sent out and 265 were returned registering 83% response rate. Findings of research indicated that KCB did not have a formal documented customer retention strategy, although one was in the pipeline. However, the research found out that despite the fact that there was no formal strategy, KCB still applied several strategies in retaining its customers and these were communicated to the staff through its core values. The first core value is putting the customer first while the another is caring for the Community. It also emphasized on employees issues through the value of working together as a team. It was found that KCB was strong on pricing strategy, where 86% of customers indicated that KCB charges fairly for their services, wide branch network also came out strongly where customers indicated that the fact that they were able to transact across the region makes them stay in KCB. Corporate Image was also a strong factor in that KCB has given a lot back to the community through its corporate social responsibilities activities under the cover of KCB Foundation. KCB was however challenged with service quality, communication with customers, competitiveness and lack of documented customer retention strategy.