Abstract
A cross-sectional and quantitative study design, with the aim of explaining the relationship between relationship marketing and customer loyalty, and the mediating role of word of mouth in this relationship was undertaken. A sample of 384 was determined from a population of the mobile telecommunication users based on Krejcie & Morgan sampling framework. The study utilized 384 questionnaires. The authors conducted confirmatory factor, correlation, regression, mediation and SEM for analysis, interpretation and results.While trust, relationship satisfaction and reciprocity components of relationship marketing have been found to be significant predictors of customer loyalty in other studies, our study findings reveal contrasting results. This is a unique finding in our study. However, in line with earlier studies, our findings indicate a positive significant relationship between relationship marketing components of communication, commitment and customer loyalty. The study also finds a significant positive relationship between the relationship marketing components of communication and commitment and word of mouth and a significant positive relationship between word of mouth and customer loyalty. Telecommunication companies should pay attention to relationship encounters that build commitment, should develop targeted communication channels which build positive word of mouth communication. This will ultimately create loyal customers for mobile telecommunication companies.
Highlights
Ever since Uganda gained its independence in 1962, the country experienced poor governance and leadership, political and economic instability which put the economy to its lowest from 1962 to 1986
Customer relationship marketing and customer loyalty The correlation results revealed positive and significant relationships between customer relationship marketing components and customer loyalty as follows: trust and customer loyalty (r = .414, p-value < 0.01), commitment and customer loyalty (r = .547, p-value < 0.01), communication and customer loyalty (r = .474, p-value < 0.01), reciprocity and customer loyalty (r = .454, p-value < 0.01), relationship satisfaction and customer loyalty (r = .469, p-value < 0.01), supporting hypotheses H1, H2, H3, H4, H5. This means that a positive change in customer relationship marketing components results in a positive change in customer loyalty
Our results are largely in line with earlier scholars that have found trust, commitment, relationship satisfaction, communication and reciprocity components of customer relationship marketing to have an influence on customer loyalty (Aydin, Özer, & Arasil, 2005; Bettencourt, 1997; Du Plessis, Jooste, & Strydom, 2005; Luarn & Lin, 2003)
Summary
Ever since Uganda gained its independence in 1962, the country experienced poor governance and leadership, political and economic instability which put the economy to its lowest from 1962 to 1986. The new government’s liberalization policy saw a number of mobile telecommunication companies enter the Ugandan market. The technological changes in the telecommunication sector have created a major shift of the customers from the use of landlines to increased use of mobile phones for business, social and political agendas. The boom in Uganda’s mobile market as a result of the clear policy of liberalization has brought in a number of market players, thereby creating a competitive business environment in the telecom sector. This has significantly lowered market prices, increased consumer knowledge and subsequently lowered the average revenue per user. Industrial and business hub the most affluent city in Uganda
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