Impact of Customer Relationship Management on Customer retention in Tanzania Airline industry

Abstract

This study investigated the impact of Customer Relationship Management (CRM) on customer retention in the Tanzanian airline industry, focusing on the influence of CRM practices, customer satisfaction, and customer loyalty. The study adopted a theoretical framework based on Relationship Marketing Theory to understand the relationship between CRM and customer retention. A cross-sectional research design was employed, collecting data from a diverse sample of Tanzanian airline passengers using simple random and purposive sampling techniques. A total of 251 airline passengers and 10 supervisors from airline companies and the Tanzania Airport Authority participated in the study. Data collection was conducted through structured questionnaires and interviews for qualitative data. The data was analyzed using Descriptive Statistics and Linear Regression Analysis in IBM SPSS Statistics 27, along with Thematic Analysis for qualitative data. The study's findings indicated that CRM practices (Beta = 0.598, p < 0.001), customer loyalty (Beta = 0.588, p < 0.001), and customer satisfaction (Beta = 0.229, p = 0.001) significantly influence customer retention. The findings suggest that while customers perceive CRM efforts positively, improvements are needed in trust, commitment, and pricing strategies. The study provides valuable insights for Tanzanian airlines to enhance service delivery and retain customers, contributing to the body of knowledge on CRM and customer retention in the airline industry.