The main objective of customer satisfaction programs is to increase customer retention rates. In explaining the link between customer satisfaction and loyalty, switching…
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.
Service organizations such as retail banks are attempting to increase their customers' lifetime value through the introduction of service innovations such as integrated banking. To date, these efforts have met with mixed success. This research proposes that strategic consideration of barriers to adoption can significantly alter and enhance the effectiveness of segmentation and communication efforts for service innovations.
The paper utilizes a latent class regression with concomitant variables on a large‐scale multinational consumer survey (n=2,702).
The results demonstrate that incorporating barriers to adoption significantly alters the segments into which customers are classified, resulting in improved model fit and out‐of‐sample prediction.
Future innovations will present other types of barrier. The authors show here that marketers can benefit from managing perceived barriers instead of directly analyzing consumer demographics.
This study aims at identifying the most critical factors affecting the customer switching behavior for mobile service providers in Jordan. A number of 580 questionnaires…
This study aims at identifying the most critical factors affecting the customer switching behavior for mobile service providers in Jordan. A number of 580 questionnaires distributed to a random sample of Jordanian mobile users. The questionnaire contains 33 items measured on a five‐point likert scale. The data were analyzed using regression analysis. It was found that all the independent variables (pricing, inconvenience, core service failures, service encounter failures, employee responsiveness to service failures, attraction by competitors, changes in technology, switching cost) had a significant effect on switching behavior of mobile service users except change in technology and employee responsiveness to service failure. Recommendations and directions for future research are proposed.
The present study seeks to examine how perceived uncertainty of reward schedule and reward frame (i.e. segregated vs aggregated) affect consumers ' evaluation of…
The present study seeks to examine how perceived uncertainty of reward schedule and reward frame (i.e. segregated vs aggregated) affect consumers ' evaluation of loyalty programs.
The authors conducted three experiments to test the hypotheses.
Ambiguity aversion was salient when the subjects perceived low uncertainty in the schedule of a loyalty program, which led to customers ' choice of a loyalty program with an aggregated frame. In contrast, the subjects displayed ambiguity proneness when they detected a high level of uncertainty in the reward schedule; as a result, the subjects preferred a loyalty program that employed a segregated frame.
The findings show that individuals adopt different types of attitudinal pattern and show dissimilar choice behaviors depending on reward schemes. The findings also provide insights to enhance the understanding concerning how consumers perceive the value of loyalty programs.
Previous research suggests the importance of random elements in relationship marketing. The present study supports this assertion by demonstrating that reward programs providing unexpected benefits can enhance the effectiveness of a loyalty program.
The results provide a more refined understanding about the relationship between perceived uncertainty and reward frame and the psychological mechanism underlying this relationship.