Electronic Loyalty of Islamic Banks in Saudi Arabia: Do E-CRM Practices Matter?

Electronic Loyalty of Islamic Banks in Saudi Arabia: Do E-CRM Practices Matter?

Layla Hodaed Alsheikh
DOI: 10.4018/IJCRMM.332883
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Abstract

This paper aims to explore the impact of electronic customer relationship management practices (website quality, ease of use, customer privacy, and information quality) on the customer electronic loyalty. The population of this study is customers of the Islamic banks in Saudi Arabia. The questionnaire is used as a basic tool in the survey related to the current research. The hypothesized structural equation model was tested using the AMOS software version 20. The study has found that with respect to the bank customers, e-CRM has a significant impact on electronic customer loyalty. Based on the results of the study, bank managers and decision makers should focus more on the optimal distribution of the available resources and strengthening their electronic relationship with customers in order to attract more customers, retain existing customers, and get rid of less profitable customers.
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Introduction

The growing global penetration of internet technology has drastically changed how organizations foster relationships with their customers. According to Yeo et al. (2021) the availability of the internet encourages customers to use the web more frequently and to be more comfortable with online applications. Further, a study by Potapova et al. (2022) confirmed the influence of societal digitalization on individuals’ banking transactions. Technological application refers to a set of systems that are represented by databases, analyses, and software applications, while organizational implementation refers to companies’ efforts to align internal structures, people, and processes with a customer relationship management (CRM) perspective that is customer-centric (Dalla et al., 2018). Internet usage in marketing presents great opportunities for marketers to develop creative strategies that were not previously possible. Farmani et al. (2021) state that to promote business success, e-commerce systems must be supported by effective e-CRM. Marketers must cultivate a comprehensive understanding of customer behaviour during online purchases. Consequently, marketing managers require CRM programs to better align with and satisfy customer preferences and needs. Internet technology has transformed CRM into electronic CRM (e-CRM) because companies can use internet technologies to capture new customers, track their preferences and online behaviours, and customize support and services designed primarily to create and manage long-lasting customer relationships (Naim, 2022). E-CRM is the latest paradigm in the world of CRM. Companies can no longer rely on past strategies; instead, they should adapt themselves to market progress (Fathollahzadeh et al., 2011; Chauhan et al., 2022).

E-CRM has become increasingly popular as a communication tool and relationship-building platform (Nadube & Ordah, 2023; Kumar & Mokha, 2021). It encompasses web browser activity, online customer care service via chat rooms and electronic forums, email, and systems for enhancing the management of social media content (Walsh et al., 2021). E-CRM comprises all the processes and techniques an organization employs in order to gain, increase, and maintain its customer base, as well as those processes that allow the organization to provide consumers with high-quality service via the internet (Alam et al., 2022). E-CRM is described by Balamuruganet et al. (2017) as ‘a business and marketing strategy that analyses consumers’ needs and behaviour to create an effective relationship between an organization and its consumers’. E-CRM is described as an electronic customer relationship management process (Sujitha & Johnson, 2017), enabling organizations to deliver the right product that satisfies a customer’s desires, thereby creating customer satisfaction and enhancing loyalty (Dolly & Pruthi, 2014; Al-Hawary & Alhajri, 2020; Dubihlela & Molise-Khosa, 2014). The use of e-CRM leads to increased profitability through the attraction and retention of customers (Shahnavazi et al., 2020).

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