The Influence of Mobile Money Transfer in sustaining customer loyalty at Safaricom Limited

Abstract

This research examines the influence of mobile money transfer in sustaining customer loyalty at Safaricom limited. The study looks at the background of Safaricom limited, currently the market leader in telecommunications in Kenya. Safaricom is also the provider of the most successful mobile money transfer globally branded, M-PESA. Despite of the many strategies to grow and retain their customer base, Safaricom has consistently maintained a market lead over the years. . The telecoms industry in Kenya has witnessed bitter rivalry between the four main players. Safaricom rivals have invested in a number of strategies to attract Safaricom customers to their networks. However, majority of Safaricom customers have remained loyal. This has been attributed to Safaricom’s mobile money transfer service, M-PESA. The study focused on M-PESA and was carried out from across Kenya. Demographic data as well as other data was collected from customers using researcher administered questionnaires. The study examined five constructs of customer loyalty; quality and availability of service, price, innovation, trust and switching costs. The reliability test was conducted for the items designed for the same construct. Cronbach’s Alpha which is a measure of reliability or internal consistency was used and found the data reliable and consistent. The relationship between the customer’s loyalty and other variables was measured using Pearson coefficient and t-value. Other measures used are statistical measures of mean, frequency and standard deviation. The results obtained in this research indicated that 86% of the respondents were loyal customers to Safaricom due to influence of its mobile money transfer service, M-PESA. The combination of quality and availability of service, price, innovation, trust and switching costs showed strong relationship with customer loyalty while demographic variables of gender, age, location and income levels also showed strong relationship.