The different roles of switching costs on the satisfaction‐loyalty relationship

Abstract

PurposeThe purpose of this paper is to develop and empirically test the antecedent, mediating and moderating role of switching costs on the relationship between satisfaction and loyalty.Design/methodology/approachCompeting models are proposed based on previous studies investigating the influence of switching costs on satisfaction and loyalty. A survey was conducted with 7,461 customers of a large Brazilian bank. The four competing models were tested using structural equation modeling technique.FindingsThe analysis revealed that: switching cost is a significant antecedent of both attitudinal and behavioral loyalty; the mediating effect of switching cost is stronger in the relationship between satisfaction and attitudinal loyalty; and the moderating effect of switching cost is stronger in the relationship between satisfaction and behavioral loyalty.Practical implicationsThis study emphasizes the relevance of the switching cost construct in the banking industry. Customers with different switching costs levels will manifest distinct relationship between satisfaction and behavioral loyalty. Thus, investment on marketing strategies and campaigns should be oriented to better convert switching perceptions into effective loyalty considering its mediating or moderating effects.Originality/valueEven though there are several different approaches (i.e. direct, mediator and moderator) concerning the effects of switching costs on the satisfaction‐loyalty relationship, there is a lack of integration between these approaches. The paper tests and compares the different roles of switching costs. Another contribution is the inclusion of both attitudinal and behavioral aspects of loyalty, given that the current literature is incipient concerning the role of switching cost when considering the distinct loyalty components.

An integrated model of customer loyalty in the Macedonian mobile service market

“…The conceptualization of customer loyalty as a combination of behavioral and attitudinal dimension is additionally supported by many authors (Picón et al, 2014;de Matos et al, 2009;Wong & Sohal, 2003;Ganesh et al, 2000). Some authors add a cognitive dimension to conceptualizing customer loyalty (Bloemer et al, 1999;de Ruyter et al, 1998), referring to the brand's attributes evaluation in the buying decision-making process and to benefi ts from the repeat patronage (Caruana, 2002;Lee & Cunningham, 2001).…”

“…Therefore, companies should strive to understand factors which have a positive effect on customer retention, and thus apply a combined strategy, complementing the effects of customer satisfaction (Tesfom & Birch, 2011). In this study, our focus is on switching costs, since they are among the most analysed factors infl uencing the relationship between customer satisfaction and loyalty (de Matos et al, 2009;Burnham et al, 2003;Jones et al, 2002;Lee & Cunningham, 2001;de Ruyter et al, 1998).…”

“…Some authors add a cognitive dimension to conceptualizing customer loyalty (Bloemer et al, 1999;de Ruyter et al, 1998), referring to the brand's attributes evaluation in the buying decision-making process and to benefi ts from the repeat patronage (Caruana, 2002;Lee & Cunningham, 2001). In this study, the concept of customer loyalty is operationalized as a combination of a behavioral and attitudinal approach, measuring repurchase intentions, intentions for recommendations to friends, etc.…”

“…Additionally, switching costs and switching barriers are also viewed as key determinants of customer loyalty (de Matos et al, 2009;Lee et al, 2001). Namely, when switching costs are high, customers may stay loyal even if they are not highly satisfi ed (Santouridis & Trivellas, 2010).…”

“…This study strives to fi ll this research gap by proposing and testing an integrated model of customer loyalty. Moreover, the different effects of switching costs and switching barriers on the satisfaction-loyalty relationship are examined, since there is a lack of empirical studies testing these approaches simultaneously (de Matos et al, 2009).…”