EFFECTS OF NEW PRODUCT DEVELOPEMENT ON CUSTOMER SATISFACTION: A CASE STUDY OF COMMERCIAL BANK OF ETHIOPIA HAWASSA CITY, ETHIOPIA

Abstract

In today's dynamic and highly competitive market, new product development has become one of the primary activities towards survival of any businesses. New product development has become potentially valuable way of securing competitive advantage by improving organizational performances and improving customer satisfaction through quality service. The general objective of the thesis was to identify the effect of new product development on customer satisfaction in CBE (Tabor, Fura and Geburial branch). It conceptualized and developed by five independent variables (reliability, trust, perceived ease of use, perceived usefulness and relative advantage) and dependent variable (on customer satisfaction). The study has theoretical and methodological scope. This study used both descriptive and explanatory research designs. The total population for the study was 45,550 and the sample size for this figure was 396. Those Sample respondents for this study were selected by using non probability, convenience sampling method. Data were collected from primary sources through closed structured questionnaire and analyzed through both descriptive and inferential methods. For the sake of achieving the objectives of this study, questionnaires were analyzed using descriptive and inferential analyses with the help of SPSS version 21 statistical software program. The descriptive analysis was conducted by using (frequency, percentage, mean and standard deviation). On the other hand, inferential analysis was conducted by using Pearson correlation method and linear multiple regression method. The study reveals that all new product development dimensions such as reliability, trust, perceived ease of use, perceived usefulness and relative advantage have statistically significant relationship and statistically positive and significant effects on CBE customer satisfaction. Based on the findings, the researcher recommends that management of the bank has to improve reliability of the products, trust, easiness to use, perceived usefulness and relative advantage of the products and the bank should evaluate its performance so as to understand customers’ need and to get continuous competitive advantage in the banking industry