A Study of Effects of Relationship Marketing Strategies on Customer Satisfaction: Public and Private Sector Banks in India

The business challenge for banks is to retain customers. If they are satisfied, banks can move towards extension of its customers' base and survival for long-term. In this regard, banks must have reliable bond with customers so that they can be connected for a long run. Banks have to follow different strategies to achieve their retention targets and increase in the existing numbers. Relationship marketing is a technique by which banks can make the relationship with customers by giving them better services, wishing them in their special occasions, etc. In this way, customers feel related themselves with banks. This study is to know the impact of relationship marketing on customer satisfaction. To achieve the objective, the study has been divided into three parts. The first part explores about the customer perception regarding the relationship marketing strategies in public and private sector banks in National Capital Region and the second part confirms and validates the factors extracted.The third part calculates the impact of relationship marketing on customer satisfaction. Data was collected from 450 customers of public and private sector banks. Exploratory Factor Analysis and confirmatory Factor Analysis have been used for the purpose of data analysis. The different statements representing the customer relationship strategies can be reduced into five significant Factors extracted are services of customers, management of data, healthy communication with customers, strong bond with very important customers and technical support. The factors score of all the extracted relationship marketing factors are estimated in the study while applying principal component analysis in factor analysis. These factors have confirmed later by using AMOS software. Multiple regression method has been used to check the impact of relationship marketing on customer satisfaction. The results of the multiple regression analysis indicate that the probability value of all the t statistics for relationship marketing factors is found to be less than 5 percent level of significance. The results of the regression analysis also indicate that the major influencing factor ismanagement of database followed by strong bonding with important customers, technical support, healthy communication and services to customers. The conclusion of the study is positive impact of relationship marketing on the customer satisfaction. This study has been done from the perspective of customers. Five constructs have been found to be important for the relationship marketing.