Price changes and defection levels in a subscription‐type market: can an estimation model really predict defection levels?

Dawes, John

doi:10.1108/08876040410520690

Cited by 22 publications

(17 citation statements)

References 12 publications

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“…The authors reveal that imposing higher charges on customers, or increasing fees, can have opposite effects, such as encouraging outward switching and discouraging inward switching. In addition, Dawes (2004) shows that there is a positive relationship between price increases and defection rates in the banking industry. Therefore, the following hypothesis is proposed:…”

Section: Pricementioning

confidence: 99%

Customer switching behaviour in the Chinese retail banking industry

Clemes

Gan

Zhang

2010

International Journal of Bank Marketing

128

206

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of a thesis submitted in partial fulfilment of the requirements for the Degree of M. C. M. Customer Switching Behaviour in the Chinese Retail Banking Industry By Dongmei ZhangWith the intense competition and increasing globalization in the financial markets, bank management must develop customer-oriented strategies in order to compete successfully in the competitive retail banking environment. The longer a bank can retain a customer, the greater revenue and cost savings from that customer. However, customers are also more prone to changing their banking behaviour when they can purchase nearly identical financial products provided by the retail banks. In order to stay competitive, bank managers need to understand the factors that influence and determine consumer's bank switching behaviour. In general, the results of this research allow service marketers and practitioners to develop and implement services marketing strategies to decrease customer defection rates, and in turn, increase bank profits. Furthermore, this research provides useful information for future researchers who study switching-behaviour in the banking industry.

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Section: Pricementioning

confidence: 99%

Customer switching behaviour in the Chinese retail banking industry

Clemes

Gan

Zhang

2010

International Journal of Bank Marketing

128

206

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“…Season ticket products constitute a subscription market, where customers allocate the bulk of their business in a product category to one provider for a given period of time, and are usually contractually bound for that period (Dawes, 2004). In this sense, season tickets are similar to other subscription market products, such as phone services, insurance, banking and utilities (see Sharp & Wright, 2000;Sharp, Wright, & Goodhardt, 2002 for a full discussion).…”

Section: The Nature Of Subscription Marketsmentioning

confidence: 99%

“…The key differences between subscription markets and the more common repertoire markets are: (1) subscription products are bought infrequently, often annually; (2) consumers have much smaller number of brands they purchase in subscription markets, and are often solely loyal to one provider; and (3) subscription markets often involve being formally contracted to one specific provider for the period of purchase, such as annual cell phone contracts (Dawes, 2004).…”

Section: The Nature Of Subscription Marketsmentioning

confidence: 99%

Predicting which season ticket holders will renew and which will not

McDonald

Karg

Leckie

2014

European Sport Management Quarterly

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Research question: A major barrier to retaining existing customers is the difficulty in knowing who is most at risk of leaving (or 'churning'). Given the strategic and financial importance of season ticket holders (STH) to professional sport teams, this paper examines the effectiveness of a range of variables in identifying the STH who are most likely to churn. Research methods: A longitudinal field study was undertaken to reflect actual conditions. Survey data of a professional sport team STH were collected prior to the conclusion of the season. Actual renewal data were then tracked from team records the following season. This work was replicated across five professional sport teams from the Australian Football League, with renewal predictions made and tracked for over 10,000 STH. Results and findings: The results suggest that the 'Juster' Scale -a simple, one-item purchase probability measure -is an effective identifier of those most at risk of churning, more than 3 months in advance. When combined with ticket utilization and tenure measures, predictive accuracy improves markedly, to the point where these three measures can be used to provide an effective early warning system for managers. Implications: Whilst there is a tendency to view STH as highly loyal, these data reinforce the importance of actively managing all customers to reduce churn. Despite their commitment, STH do churn, but those most likely to can be predicted by examining their patterns of behaviour in the current season. Efforts to retain STH need to shift their focus from transactional value assessments.

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“…Service switching involves replacing or exchanging the current service provider with another provider, which has a huge negative impact on the organizations by re-ducing their customer base and market share (Dawes, 2004;Garland, 2002). Thus, minimization of customer churn is now a priority and for this service firms are adopting various schemes such as, loyalty programmes, customer relationship management, and service initiatives (Dowling & Uncles, 1997;Sharp & Sharp, 1997).…”

Section: Theoretical Framework and Hypotheses Formulationmentioning

confidence: 99%

Segmentation of Bank Customers by Loyalty and Switching Intentions

Kaur¹,

Sharma²,

Mahajan³

2014

Vikalpa: The Journal for Decision Makers

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In a highly competitive world, it is imperative to understand why customers switch, as switching has a significant impact on a firm's performance. Just as satisfied customers are not necessarily loyal, dissatisfied customers do not always exit (Yanamandram & White, 2006). Even then much attention has been diverted towards growing relationships as compared to ending of the same (Akerlund, 2005; Halinen & Tahtinen, 2002). This study aimed at predicting customer switching through various relational and switching factors, viz., quality, value, satisfaction, trust, commitment, loyalty, switching costs and barriers, particularly in the context of Indian private banking. Further, the study investigated those traits of the customers, which would facilitate bank managers in formulating different retention strategies. The main findings of the study are: Majority of respondents have no intentions to switch their prime bank, but at the same time these respondents cannot be classified as true loyals. There exist two groups of respondents, i.e., ‘loyal stayers’ and ‘spurious stayers’. A direct relationship exists between ‘customer switching intentions’ on the one hand and ‘quick and effective responses to service failures’, ‘core services up to expectations’, ‘reasonable prices’, ‘switching costs’ and ‘switching barriers‘ on the other. Thus, banks need to undertake the following initiatives, which would be useful for increasing customer retention among bank customers: Promote commitment by implementing and demanding higher standards of conduct from the bank employees. Develop schemes/services that provide value to their customers in a sustained way and maintain them overtime in order to generate competitive advantage. Satisfy its customers, which can be implemented only when customers' needs are known. Hence, every bank should have a separate R&D department, which can pursue market surveys on continual basis. Concentrate on the core service delivery and recovery, so as to seek competitive advantage. Focus on CRM strategies and develop wide-ranging relationships with their customers so as to make it difficult for them to switch their bank. In order to build profitable relationships, firms should not attempt to attract all customers in the market indiscriminately, but focus on those who are more valuable to the company.

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Price changes and defection levels in a subscription‐type market: can an estimation model really predict defection levels?

Cited by 22 publications

References 12 publications

Customer switching behaviour in the Chinese retail banking industry

Customer switching behaviour in the Chinese retail banking industry

Predicting which season ticket holders will renew and which will not

Segmentation of Bank Customers by Loyalty and Switching Intentions

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