An investigation on service quality and customer satisfaction in five commercial banks branches in Machakos town, Kenya

Abstract

Banks are now facing greater competition on a global scale. In Machakos Town, new banks are frequently emerging, all attempting to capture a significant market share. Customers are more informed about their entitlements and hold higher expectations than in the past. The main aim of the study was to explore the relationship between customer satisfaction and service quality in five commercial bank branches located in Machakos Town. Specifically, the study aimed to identify links between communication and customer satisfaction, bank infrastructure and customer satisfaction, bank employee’s responsiveness to customers, bank retention strategies and customer satisfaction and the relationships between the variables. Two theories and one view: the Resource Based View (RBV), the Actor Network Theory (ANT), and the Relationship Marketing (RM) theory served as the foundation for the investigation. The study employed a descriptive survey design. The target population in Machakos Town was 74 commercial bank customers. The challenge encountered was that most clients were not willing to be interviewed on spot. They preferred to fill the questionnaire later. Structured questionnaires were used to collect primary data while data analysis was aided by descriptive statistics, correlation, and regression modeling. Research findings revealed that F statistic of model 1 was 33.236(p=.000). According to this, the relationship between customer satisfaction and service quality was statistically significant at the 95% confidence level. The five commercial bank branches in Machakos town could therefore measure client satisfaction using this methodology. The variance in customer satisfaction was explained by bank infrastructure, communication, bank employees' responsiveness, and client retention strategies. Customer satisfaction was statistically impacted by bank infrastructure, and a one-unit improvement led to statistically significant gains. On the other hand, bank communication had statistically significant influence on customer satisfaction with a one unit change leading to a positive change in customer satisfaction. This was direct and statistically significant. Bank employees' responsiveness had insignificant influence on customer satisfaction with a one-unit change leading to an insignificant change in customer satisfaction. Moreover, customer satisfaction was significantly impacted by bank retention measures. Thus, by investing in cutting-edge innovation techniques that produce physically appealing features for customers, the management of those commercial banks should establish rules that can aid in customer sustainability. Also, management should establish guidelines supporting the modification of already-available products to develop new markets that cater for unique consumer needs.