CRM and Customer Loyalty: The Mediating Role of Frontline Employee’s Performance in Banking Sector

Abstract

In the dynamic landscape of the banking industry, maintaining customer loyalty through effective Customer Relationship Management (CRM) strategies is paramount for sustained success. This study examines the intricate relationship between CRM initiatives, frontline employee performance, and customer loyalty, with a specific focus on the banking sector. Drawing upon theoretical frameworks from CRM, service marketing, and organizational behaviour, this research investigates the mediating role of frontline employee performance in the relationship between CRM practices and customer loyalty.

Utilizing both quantitative and qualitative methods, data is collected from banking customers and frontline employees to gain insights into their perceptions and experiences. Statistical analyses such as PLS-SEM are employed to examine the direct and mediated effectswith bootstrapping method. The findings contribute to both theoretical and practical implications. They provide a deeper understanding of the mechanisms through which CRM practices impact customer loyalty, emphasizing the critical role of frontline employee performance as a mediator. Moreover, the study offers actionable insights for banking institutions to enhance their CRM strategies and frontline employee training programs, ultimately fostering stronger customer relationships and loyalty in a competitive market environment.