The impact of switching costs on the customer satisfaction‐loyalty link: mobile phone service in France

Abstract

The main objective of customer satisfaction programs is to increase customer retention rates. In explaining the link between customer satisfaction and loyalty, switching costs play an important role and provide useful insight. For example, the presence of switching costs can mean that some seemingly loyal customers are actually dissatisfied but do not defect because of high switching costs. Thus, the level of switching costs moderates the link between satisfaction and loyalty. The purposes of this paper are: to examine the moderating role of switching costs in the customer satisfaction‐loyalty link; and to identify customer segments and then analyze the heterogeneity in the satisfaction‐loyalty link among the different segments. An empirical example based on the mobile phone service market in France indicates support for the moderating role of switching costs. Managerial implications of the results are discussed.

The impact of switching costs on customer loyalty: A study among corporate customers of mobile telephony

“…Switching costs interact with satisfaction to influence loyalty 54,55 and this relationship has been shown to hold among mobile phone customers in France. 56 On the basis of the above this is extended to corporate customers and it is argued that: H1: The higher the level of switching costs exhibited by corporate customers of mobile telephony the stronger the level of loyalty.…”

Getting what you paid for: Fighting wireless customer churn with rate plan optimization

“…12 This proposition is further confi rmed by Kim et al 1 who suggest that dissatisfaction regarding pricing remains important in infl uencing customers ' switching intention. Lee et al 3 argue that wireless carriers should analyze their customers ' changes in usage patterns, and provide them with special incentives as a way to increase their satisfaction and loyalty. All of these studies suggest that wireless carriers should focus not only on price setting, but also on matching appropriate rate plans to their customers, which is the core idea behind this study.…”

Investigating Time-in-Market Effects in Kuwait Health Clubs

“…Continual entry by new competitors would eventually siphon off customers from early entrants unless the pioneers had emphasized marketing efforts focusing on relationship marketing and/or the management continually updated design to meet customer expectations (Heiens et al, 2015). Relatedly, pioneering firms oftentimes need to develop customer switching costs in order to maintain a leadership position (e.g., Lee et al, 2001). This would require some sort of competitive advantage, whether derived from cost structure, image, design, etc.…”