This study examined the impact of customer service delivery on customer retention, with particular reference to MTN Nigeria Plc using MTN Nigeria Plc as a study. A descriptive survey research design was adopted. The sample for this study consists of 184 customers of MTN Nigeria Plc. The main research instrument used was questionnaire. Data collected were analyzed using descriptive statistic; Pearson product Moment correlation analysis was used to test the hypotheses. The findings from the hypotheses tested reveal that there is a significant relationship between customer service speed and customer retention; that there is a significant relationship between quality service and customer retention; that there is a significant relationship between effective communication and customer retention and that there is a significant relationship between commitment to service and customer retention. The study thus conclude that good customer service delivery is very important issue as far as customer retention in today’s industry is concerned and that no business can exist without customers and also a business that caters to their customers’ needs will inevitably gain the loyalty of their customers, thus resulting in repeat business as well as potential referrals. In line with the aforementioned the study therefore recommended that Management of MTN Nigeria Plc needs to design a successful customer service delivery process so as to develop a specific service strategy by identifying and understanding the specific needs of the customer.
1.2 Background to the Study
The goal of every organization is to meet the needs and the requirements of its stakeholders not only ensure the survival of the organization but also allow it to flourish. Customers are presumed to be one of the most important stakeholders in any organization because without them, organizations are not likely to succeed (Sakwa and Oloko, 2014). Thus, the basic reason for an organization’s existence is to satisfy the needs of the customers and through that may make way for repeat patronage which will open the avenue for increased profit making (Appah and Bambo, 2012). No business organization operates in isolation but in a macro-environment. Retaining clients implies keeping them active with you through a good customer service that is built on “an understanding of their needs, preferences and want” (Oyeniyi and Abiodun, 2008). This calls for periodic review and restructuring of corporate administrative policies, client service delivery system and the evolution of innovations aimed at adding value to clients. To achieve this feat, efficient customer service becomes indispensable, especially as it facilitates client retention (Reichheld, 1996). It has been widely acknowledged that any sectorial growth and management need be effective; especially the food and beverages industry and the likes, an oriented customer service need be consciously achieved.
Customer service delivery (CSD) practice helps enhance a firm’s competitive positioning, enhance reliability, courtesy, and access to good services (Alan and Perry, 2002). Ivanovic (1997) defined customer service as a service given to a customer once he has made his decision to buy. It is the belief that customer service delivery is an effective tool for achieving positive organizational performance and which reflects an increase in profit, goodwill, better product and service delivery. In recent times, questions have been raised as regards the interactions between organizations and their customers. But the result is that many organizations have poor relationship with their customers and this will lead to loss of goodwill and low profit earning in the organization.
In service rendering organizations particularly the telecommunications industry, developing effective communication and interaction with customers and providing quality service is essential to build effective relationship and to retain the existing customers. In the competitive environment, retaining customer is a very challenging assignment , because organizations compete by providing distinctive services to attract new customers and retain the existing ones (Leverin and Liljander, 2006). The continual survival of any organization is highly depends on the quality of service delivery system and the relationship with its customers and organizations should develop effective relationship marketing to understand the requirement of their customers. The application of effective service delivery is vital in today’s fierce competition because when there is proper communication and smooth relationship with customers’ organization should retain their customers (Kotler and Armstrong, 2010). Moreover, though companies have been implementing different customer relationship marketing strategies to improve customer relationship and to provide better service, however some of these strategies fail to perform effectively (Ang and Buttle, 2006; Hendricks, Singhal and Strat man , 2007).
Organization performance has been the most important issue for every organization be it profit or non-profit one. It has been very important for managers to know which factors influence an organization’s performance in order for them to take appropriate steps to initiate them. However, defining, conceptualizing, and measuring performance have not been an easy task. Researchers among themselves have different opinions and definitions of performance, which remains to be a contentious issue among organizational researchers (Barney, 1997).
Furthermore, organizational performance refers to ability of an enterprise to achieve such objectives as high profit, quality product, large market share, good financial results, and survival at pre-determined time using relevant strategy for action (Koontz and Donnell, 1993). Organizational performance can also be used to view how an enterprise is doing in terms of level of profit, market share and product quality in relation to other enterprises in the same industry. Consequently, it is a reflection of productivity of members of an enterprise measured in terms of revenue, profit, growth, development and expansion of the organization.
1.2 Statement of the Problem
Since the main goal of an organization is to satisfy the needs of customers which will lead to increased profit. This indicates that without the existence of customers business activities will be futile. Business owners often concentrate on the improvement of their products; this is one of the basic features of the production concept. Often they ignore their customer care and relationship; as a result, many of their customers move their purchasing interests to organizations who can serve them better with better customer service speed. The problem here is that they fail to understand that customers‟ value, care and concern is far above the product quality. So organizations, particularly the banking industry tend to try their best as much as possible to retain their customers and even attract more.
Customer demands for quality service in the telecommunication industry have become more and more apparent to professionals. Also customer relationships are a strategic asset of the organization and customer retention is the ultimate point to define business objectives. In this context, effective communication can create customer’s higher commitment and increase their return rate. Long-term and reciprocally advantageous relationships between customers and the quality service is becoming progressively important because of the highly positive correlation between customer’ overall satisfaction levels anthem probability of their loyalty to the service provider. In addition telecommunication are increasing their investments to improve service quality and their commitment to service perceived by their customer so as to achieve better customer satisfaction, loyalty, and retention thus, resulting in better relationships with each customer
Furthermore, various methods and strategies have been employed by organizations in order to make sure that they will achieve the above stated. But their efforts seem futile. It is on this premise that this study wants to examine the impact of customer service delivery on customer retention, with particular reference to MTN Nigeria Plc.
1.3 Aim and Objectives of the Study
The main aim of this study is to investigate if there is any link between customer effective service delivery and customer retention with particular reference to MTN Nigeria Plc, while its specific objectives are to
i. To examine the relationship between customer service speed and retention of customer
ii. To determine whether there is a relationship between quality service and customer retention.
iii. To examine the role of effective communication on customer retention
iv. To investigate the relationship between commitment to service and Customer retention
1.4 Relevant Research Questions
The research question here is guide to the study in its quest to provide answers to the problem being investigated. Such research questions are in line with the aim and objective of the study. Thus, the research questions can be seen as follows;
i. To what extent will customer service speed enhance a high level of customer retention?
ii. To what extent will Does quality service affect the retention of customer in MTN Nigeria Plc?
iii. To what extent will effective communication significant relate to customer retention?
iv. Is there any significant relationship between commitment to service and Customer retention?
1.5 Relevant Research Hypotheses
The following research hypotheses are formulated for this study using null hypotheses:
1. Ho: There is no significant relationship between customer service speed and customer retention
2. Ho: There is no significant relationship between quality service and customer retention.
3. Ho: There is no significant relationship between effective communication and customer retention
4. Ho: There is no significant relationship between commitment to service and customer retention
1.6 Significance of the Study
This research is expected to benefit the industry of understanding the effect of customer’s service delivery on customer retention, in the sense that a research like this is essential to assess and improve service delivery, because it will provide management with data that they can use in making inferences about the customers. Thus the results of this study should be proved useful for academics; business in the field of marketing and management researchers of customer retention and service quality especially in telecoms sectors organizations.
The study enables the researcher contribute meaningfully to the scientific knowledge, confirm existing theories on customer service delivery and customer retention.
This work is carried out because recent research findings show that customers still complain of ill-treatment by company customer care personnel and those entangled in service deliveries. This means that in some organizations, the customer is not yet the king as the saying goes that “the customer is king”.
It will review the improvement in the organization handling the customer service delivery and show equally the ways through which improvement could be accomplished finally this research will equally serve as a reference to students in this dignified institution and other school who may be interested to embark on a further research study of this nature.
The findings of this study will assist academicians in broadening and providing a deeper understanding of the critical factors that affect customer retention.
The study also serve as a useful reference material for students, academicians, institutions, corporate bodies and corporate managers who are interested in the subject of service recovery strategies and customer retention. The findings of the study also contribute to existing body of knowledge on customer relationship marketing tactics and offer opportunity for further study into the area.
1.7 Scope of the Study
The scope of this study enables the researcher to restrict his research within a manageable limit. It provides the researcher the opportunity to explain the boundaries of the study and describe the aspect of a general /wide problem area covered as well as what aspects will not be covered. The scope of the study is limited to the customers of MTN Nigeria Plc. As they are the direct complainer of service delivery.
1.8 Limitation of the Study
The expected limitation of the study include, the problem of getting information from the organization under study, because there is always the fear of giving out information to the public, this was addressed by assuring the organization under study that the information needed was be used solely for academic purpose and also confidentiality guaranteed. Also Time constraint equally was not left out; getting permission to leave office during the working hour and the issue of finance cannot be ignored as much was spent in procuring materials. However, with fact and judicial use of the limited resources, reasonable analyses were carried out in this research work.
1.9 Definitions of Terms
These terms are however discussed in details below for clarifications.
Competency means having the skills and knowledge needed to provide services.
Customer: An individual who exercises the right of acquisition and use over goods and services offered for sale by marketing institutions.
Marketing: A mutual exchange and fulfillment of premises.
Trust: Trust is a key component of the business relationship and defines that each side of the relationship, to what extent can trust on promise of other relationship party.
Customer satisfaction: Trust is a key component of the business relationship and defines that each side of the relationship, to what extent can trust on promise of other relationship party.
Customers Loyalty: A loyal customer has a specific bias about what to buy and from whom. His/her purchase is not a random event. In addition, loyalty connotes a condition of some duration and requires that the act of purchase occur no less than twice.
Customer retention refers to firm’s ability on providing the required services, without defections to profitable customers’ to satisfy and retain them
Organisational Performance: This is the actual output or result of a firm as measured against its intended outputs (or goals and objectives.)
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