Relationship marketing: customer commitment and trust as a strategy for corporate banking sector in Sri Lanka

Abstract

Banking sector can be considered as main recipient in recent economic downturn. There is a need for better strategies in this sector. As a result of the continuing movement towards deregulation and the associated increase in competition, establishing a long-term institutional relationship with corporate clients becomes of great importance to the banks in order to gain a moderate or greater share of the financial market and of a corporation’s business. In effect, because the bank provides its corporate client with additional facilitating and supporting services, the demand for banking products and services by a partnership relationship client will be less sensitive to price than is the demand by a shortterm, non-relationship customer. This study examines the commitment-trust dimension of the relationship marketing paradigm in Sri Lankan’s corporate banking sector. Random sample method has been used with questionnaire. The findings show that the marketing strategy and a long-term marketing orientation were positively correlated with customer commitment and trust. And To continue to be successful in the corporate sector, banks must invest in the long-term relationship marketing activities.