Customer Relationship Management and Customer Retention in Jordanian Bank

This study examined the impact of CRM Activities on bank’s customer retention in Jordan. In order to collect the data of study the researchers designed a survey, the sample was collected from (405) customers of Jordanian banks' as respondents for the research questionnaire in 2016, by using a random sampling method, using Google form and survey monkey. 388 questionnaires were usable, incomplete returned questionnaires had been eliminated. The statistical results provide evidence on the significant positive relationship between CRM Activities and Attitudes of bank’s customers. the significant analysis revealed that there is a significant positive relationship between the independent variables ( i,e CRM Activities represented Solving customers, Quality of service, Behavior of the employees, CRM technology; and Activities to retain) and Attitudes of Banks Customer as a dependent variable (trust, affective commitment, and customer retention), also the statistical analysis revealed that there is a no significant relationship between behavior of the employees and affective commitment, and activities to retain and customer retention.


Introduction
Meeting the desires, needs and expectations of customers or make the product or service is always at their fingertips which allowing them the way for the re-purchase and customer retention, this is called customer satisfaction (Anton, 1996).While lemon et al, (2002) defined customer satisfaction as comparing the expectations of the customers of the product before purchasing with the results obtained after purchasing the product.On the other hand, there are several things to ensure customer satisfaction by the persistence of the company to produce new products and improving existing products, and this is what makes the customer continue shopping for a long period of time, speaks about the company products with pride, and does not care for trademarks for companies that compete with the company's products, and indifferent to the price, in addition to offer the ideas and proposals for better products and services (Kotler, 2000).
As for Tarhan (2004), the capacity to deal with customers in different ways and the practices which focus on the needs and values of each customer, this enables companies to maintain their customers; and this subject is one of the most important topics in these days because of the lack of customer satisfaction.Companies should maintain a relationship with customers to maintain them for a longer period, and this can only be done through the provision of services that meet and exceed their needs (Ang & Buttle, 2006).Winer (2001) focuses on the need to establish successful reciprocal relationships with customers through understanding their behaviors and focus on customer retention who achieve a profit in the long term for the company.While Egan (2004) contradict him, because he said that no company can continue the retention to all of its customers.This is due to several factors, the most important is that the customer can choose another product or service, whether temporary or permanent period in highly competitive markets.Egan (2004) also said that the issue of maintaining the customers for a long time is likely to be prohibitive and not profitable for companies.He also believes that firms must know when to 'cut and run' (Egan, 2004).Thus, the companies consider the idea of customer retention as a strategy.Moreover, Egan (2004) defined customer retention strategies as the strategies that aimed at maintaining the existing customers of the company in order to ensure customer loyalty over time.

CRM
In 1920s, the concept of "Relationship Marketing'' has emerged, in the late of 1990s, it has begun attention to the concept of '' Customer Relationship Management'' (CRM) clearly among academics and partitions.The last name has focused on different vital sides, especially on the importance of having a direct relationship between the clients and the markets, in addition to maintaining the current customers, and the most important is to build strong relationships in the long term with customers instead of dealing with them only in order to achieve the profitability of the company in the light of the growing economy nowadays (Ismail & et. al., 2007, Jayachandran & et. al., 2015).So that, the organization drew attention to manage customer relationship management and investment abundance in the necessary infrastructure with particular attention to the significant progress in the area of information technology (Ismail & et al., 2007;Jayachandran & et. al., 2015).Therefore, Egan (2004) believed that the improvement of performance can be developed by focusing on the customer relationship management.
CRM is one of the most important objectives in at least 60% of the projects in the world.The great advances in technology was an important reason for the division of territories in the market, strengthen relationships with customers, and provide adequate information that will help in finding effective methods of dealing with customers.From the perspective of Ang & Buttle, (2006), CRM would be realization and understanding in terms of beneficiaries if they have flexibility in the use and implementation.
Researchers disagree in determining the definition of customer relationship management.This difference is caused by a difference of scientific information for each one of those researchers.The first definition was by Swift (2000), he defined CRM as a tool to realize the behavior of customers by the great communication with them to increase the effectiveness of performance that can be achieved only by attracting customers, retaining them and increasing loyalty and profitability to them.Based on the above, we can see that CRM definition is that the most successful way to understand the behavior of customers is the communication itself with the organization.As for Stone et al., (2011), the definition of CRM was gathering a lot of information about customers and keeping them in order to divide the territories, analysis and reuse.This definition of CRM focuses on gathering and keeping information.Another definition to this concept was the use of company's capacity in the area of research methodology and e-commerce technology for customer relationships management (Stone et al., (2011).Here we see that the definition depends on the skill of the use of technology in order to deal with customers.Moreover, the definition of Parvatiyar and Sheth (2012) showed that CRM is an integrated plan that can be used in order to collect customers, keep them and deal with them to achieve a great relationship between the company and the customer.In this plan, it should be combining the functions of marketing, sales, series of exposition and customer service in order to reach a better level of efficiency and effectiveness in the provision of added value for customers.CRM is also considered as a strategy aims to provide excellent value to customers by improving productivity, marketing and satisfaction.

Customer Retention
There are many researchers considered that CRM should utilize technology to achieve customers' satisfaction.For instance, Stone et al., 2011 defined the term CRM as the way to manage customer relationship by the use of research, technology, and e-commerce.
In addition, Feinberg & Kadam 2002 stressed on the importance of using technology such as online business and internet as tools in CRM.They proved their point of view by conducting a study on 42 different e-CRM features used by retailers.They found that there is a link between using the features of CRM in retailers' websites and the satisfaction of the customers.Moreover, Azzam (2014) inspected the effect of CRM on consumer satisfaction in Jordanian banks.The study recommended that there is no statistical relationship between customer relationship management components and consumer satisfaction as a dependent variable.The statistical analysis uncovered that there is a significant relationship between (CRM components represented by service quality, employee's behavior, customer data base, solving customer problems, physical environment, and social network interaction) as independent variables and the dependent variable consumer satisfaction in the banking industry.
To get a deep understanding of the effect of customer loyalty programs on customer retention, the study of Ang & Buttle, (2006) was connected on Jordanian clients, exploring the effect of loyalty programs: (point system, tier system reward, charges an upfront fee for VIP benefits and nonmonetary programs), on (customer retention) using a survey.The results showed a significant impact of all loyalty programs on building and keeping up customer retention.The major impact was for Tier framework reward followed after by charge Up-front fee for VIP benefits, and after that point frame point system work, the weakest impact was for non-monetary programs

Research M
The current st research meth questionnaire

Research M
The study que the responden with options r stomers.
of banks' reviewed n banks complete

Data Analysis Methods
After the data collection and research based on Structural Equation analysis, it was thoroughly analyzed by researchers in order to elicit the results using the statistical analysis (SPSS 22 Amos).

Results and Discussion
After the data collecting and for research based on Statistics techniques used in the preceding chapter, the researchers has analyzed these data that was collected to elicit the results of The Effect of CRM on Customer retention.This Chapter includes two main parts; the first part is concerned with the methodology.The second one is concerned with data analysis and results, including four main aspects; the first of which is concerned with the research tool reliability testing.The second one is concerned with the descriptive analysis.The third aspect is a further assurance for validation of data.As for the fourth one, it represents testing the research hypotheses using Structural Equation analysis.

Research Tool Reliability Testing
To obtain the necessary data for this research, the researchers have designed a questionnaire using it as a tool for the research, in order to be answered by the customers of Jordanian banks.
The questionnaire consisted of two sections as shown in Table 1.One of the most essential elements should be taken into consideration when preparing a questionnaire is testing it and making sure it has the reliability element, by which we mean the stability of the scale and that it does not contradict itself.In other words, it has to give the same results if it is re-applied to the same sample.To conduct reliability test for the questionnaire questions, the researchers has used the internal consistency equation by using the Cronbach's Alpha coefficient whose value reached as follows: As given in Table 2, it is noted that Cronbach's Alpha coefficient ratios indicate there is a high degree of reliability for all of the questionnaire questions, where alpha coefficient was statistically acceptable for the whole components of the questionnaire since all of the variables ratios were higher than (60%) (Aladham et al., 2015), in which the questionnaire had, as a whole, a reliability degree of 0.841.

Descriptive Analysis
The researcher has distributed 405 questionnaires on the research sample; (17) were excluded due to the lack of seriousness from respondents when filling out the sections of questionnaire.Thus, the final sample of the research is represented by (388) questionnaires.Table 3 illustrates the demographic distribution of the research sample.

Validation
The proposed model was evaluated using Path model (Structural Equation analysis) which consists of measurement model and structural model assessment.The measurement model represents how measured variables come together to represent constructs while structural model shows how constructs are associated with each other (Hair et al., 2006).SPSS AMOS 16.0 was the statistical software used in the study.
Table 5 shows various fit indices.We do not use χ2 statistics because of its high sensitivity to number of sample size (Hong et al., 2003;Levesque et al., 2004).Instead we used the ratio of χ2 and degree of freedom and obtained the value of 2.181 which is within the value of 3.00 recommended by Hayduk (1987).Moreover, in order to test fitness of model, Comparative Fit Index (CFI) is used.The range of this value is from 0.00 to 1.00.In general, a reasonable model represents the value of CFI which is larger than 0. 90 Bentler, (1990).While we obtained the value of 0.921 for CFI which is bigger than the value of 0.90 recommended, we admitted that our constructs are usable.On the other hand, the value of Root Mean Square Error of Approximation (RMSEA) is 0.039 which is within 0.05 recommended by Hu and Bentler (1999).The value of (GFI) is 0.907 which is larger than 0.8 recommended by Bagozzi and Yi, (1988).The value of (AGFI) is 0.834 which is larger than 0.8 recommended by Hu and Bentler (1999).The value of (NFI) is 0.946 which is larger than 0.9 recommended by Bentler (1990).For this reason, we conclude that our model fitness is reasonable and usable to explain the relationship between CRM elements and customer retention.Moreover, we tested convergent validity as shown in Table 6.Firstly, all of factor loadings are larger than the value of 0.50 recommended by Hair et al. (1998).Secondly, the values of average variance extracted (AVE) for each construct are larger than 0.50.Thirdly, the composite reliability (CR) is higher than 0.7 (Alsheikh et al., 2016).Thus, we could conclude that our constructs had the convergent validity.4. Behavior of the employees is not related with affective commitment. 5. CRM technology is positively related to customer retention.6. CRM technology is positively related to trust.7. Activities to retain customers is not related with customer retention.8. Activities to retain customers is related positively with affective commitment.

Discussion
H1 finds those solving customers' problems and complains periodically and in a short time leads to increasing trust between the customers and the bank, it finds also that when the banks dealing effectively with customer problem, review their complaints periodically, and tackle their problems in a short time affect their trust.H2 indicates that the quality of service is positively related to trust.It indicates also that when the bank provides services quickly, and Confidentiality in dealing with customers, it plays a significant role in customer trust.one of the most important issues related to the quality of services the bank provides when serving customers is confidentiality and accuracy on which customer satisfaction depends leading to increasing his/her trust in the bank.Besides, the speed of service delivery to the customer, along with developing the provided services and products and facilitating the access process to accounts through opening more branches; all together increase customer's trust in the bank.H3 shows that the kind behavior of employees, in addition to their rich skills and experiences are positively related to customer retention, it shows also that sincere treatment by bank employees, being helpful, Kindness, and providing banking services by highly skillful and experienced employees is important to customer retention.H4 finds that the behavior of employees is not related to affective commitment, it finds also that Sincere treatment by bank employees, being helpful, Kindness, and Providing banking services by highly skillful and experienced employees is important to affective commitment.researchers refers this to the fact that despite the importance of the bank's employees attitudes with their customers on customers commitment to dealing with the bank; yet, with reference to the descriptive analysis findings, as found in table (3), the majority of the ages in the study sample is young, particularly from university students whom their biggest dealing with the bank is through the (ATM) and their dealing with the bank's employees is very small compared to others who do many procedures that require a constant dealing with the bank's stuff; the matter of which leads, from the perspective of this study, to reducing the relationship between the behavior of employees and affective commitment.
Customer relationship management technology is considered to be one of the important issues that banks need to employ in order to be able to retain as many customers as possible.The findings of H5 & H6 indicate that CRM technology is positively related to both customer retention and trust as having developed technological systems that manage customers' relationships, provide personal services, and are capable of creating contacts with customers help increase customer's trust and customer retention.The bank's activities that aim at retaining customers increase their customer's commitment to the bank and may also cause them to promote for this bank to others.H8 finds that there is a statistically significant relationship between the activities to retain customers and affective commitment.On the contrary, H7 finds that there is no relationship between the activities to retain customers and affective commitment.H8 & H7 Find also that when The bank maintaining interactive communication, customizing products and services based on customers' needs, attempt to build a long term relationship with customers, and working to meet their service expectations, it affect customer retention and their affective commitment.The reason for this may go to the fact that the bank's activities to retain customers lead to customers' commitment of dealing with that bank; however, this does not necessary mean that the customer is so satisfied of the bank that he/she will positively talk about it and well promote it to other people.Besides, the majority of the study sample illustrated in the descriptive analysis table represents young ages of university students.Therefore, their promotion for a certain bank would be small since they have not yet reached the stage of promoting a bank to anyone else, especially that the dealing of such sort of customers is limited on certain procedures and thus, they lack the full knowledge of the bank.

Concluding Remarks
The process of effectively integrating the management of customer groups, head of an organization, and business is called Customer Relationships Management (CRM).It is actually a means used in facilitating business and therefore enhancing the relationship between customers and banks.The findings of this research, which has been supported by various data and quantitative analysis, indicate the importance of CRM in banks as it will benefit these banks by optimizing profitability and income and helping meet customers' needs.In fact, the most important thing an effective CRM provides to banks is customer retention as when the customer is satisfied, he/she will be loyal to the bank and will positively talk about it to others.As a result, the business will be improved and more profits as well as revenues will be generated.Accordingly, through this research, the researchers acknowledge three important variables affecting CRM: Customer retention, Trust and Affective commitment.

Limitations
Although the findings are encouraging and useful, the present study has a certain limitation.The questionnaire was distributed to a small sample, which means that the answers were, somehow, similar.In order to overcome this limitation, we could have broadened our sample to different age groups.
Also the researchers believe that the time frame to conduct the research was not enough.Therefore, if the questionnaire was distributed to people at different times, the results might have slightly been altered as the opinions of people differ with any minimal change in vision and sight, especially that the opinion about a bank of any customer have a new account differ when he\ she deal with the bank later.

Table 1 .
Research Tool Components

Table 2 .
Study Tool Testing

Table 3 .
Sample Characteristics (N=388)Table4views the descriptive analysis for the answers of the questions which are related to the variables of the study.It is notable from table 4 That the lowest variable in terms of the answers average is "CRM Technology", whilst the highest one is "Solving Customers Problems and Complaints" It is also clear from the table that the average of most of the answers is ranging between agree and mostly agree.

Table 6 .
Result of convergent validity Quality of service is positively related to trust.3.Behavior of the employees is positively related with customer retention.