Research on customer switching behavior in the service industry

2016 ◽  
Vol 39 (8) ◽  
pp. 925-939 ◽  
Author(s):  
Yi-Fei Chuang ◽  
Yang-Fei Tai
Keyword(s):  
Interpersonal Relationships ◽  
Switching Costs ◽  
Service Industry ◽  
Meta Analysis ◽  
Current Understanding ◽  
Switching Behavior ◽  
Developmental Trend ◽  
Mobile Telecommunication ◽  
Content Type ◽  
Customer Switching

Purpose This study aims to analyze and explain the characteristics and findings in previous studies of switching behavior and identifies the developments within this topic in order to improve its current understanding. Design/methodology/approach The authors construct a literature database of studies published in prominent business and management journals from 1996 to 2013 and conduct an analysis using the variables in the data fields. Furthermore, we execute meta-analysis to combine the research goals of tracing the history of customer switching behavior studies. Findings Satisfaction switching costs and attractiveness of alternatives are the most commonly used predictor variables to explain switching intentions. Switching costs subjective norms and interpersonal relationships moderate the relationship between switching intentions and its antecedents. Customer switching behavior in mobile telecommunication services has received a lot of attention. Practical implications This study assists researchers by examining the type and topic of these studies and the research tools and findings reported in theory. The authors ultimately identify the developmental trend in the literature on switching behavior and propose a direction for future studies. Originality/value This study clarifies the characteristics and findings of previous studies on switching intention from a literature review and improves the current understanding.

Message-related effects on consumer switching when the preferred product is out of stock

2017 ◽  
Vol 51 (5/6) ◽  
pp. 1091-1109 ◽  
Author(s):  
Hsuan-Hsuan Ku ◽  
Chien-Chih Kuo ◽  
Wan-Ting Huang
Keyword(s):  
Design Methodology ◽  
Product Performance ◽  
Current Understanding ◽  
Switching Behavior ◽  
Short Supply ◽  
Content Type ◽  
Potential Gain ◽  
First Choice ◽  
Customer Switching ◽  
Consumer Switching

Purpose This paper aims to investigate the effect of retailers’ consumer communications in prompting the choice of an in-stock alternative to an out-of-stock first-choice product. Design/methodology/approach Four between-subjects experiments assessed the extent to which the likelihood of a retail customer switching to a similarly-priced alternative when a first choice was out-of-stock was affected by messages concerning stockout status (Studies 1a and 1b). They further examined the interaction effects on participants’ preference of messages comparing the available versus unavailable options and stating stockout status (Study 2) and those giving information on the reasons for the stockout and on its status (Study 3). Findings Participants maintained their original preference for an out-of-stock product unless an external restriction on choice prompted them to forsake it or they perceived a strong reason to opt for an in-stock alternative. There was a greater tendency to switch if the alternative offered a potential “gain” or the reasons given for a stockout were irrelevant to product performance, whether the participant was expecting imminent re-stocking. Switching was triggered when the available alternative was directly comparable to the original or the retailer’s explanation related to an attribute judged trivial, but only if short supply was expected to continue. Originality/value The studies add to current understanding of how shoppers respond to unavailability of a first-choice product by examining the effect on switching behavior of messages about the stockout situation that are communicated deliberately or inadvertently by retailers.

scholarly journals A diffusion model for service products

2014 ◽  
Vol 28 (4) ◽  
pp. 331-341 ◽  
Author(s):  
Xiaohui Shi ◽  
Pattarin Chumnumpan ◽  
Kiran Fernandes
Keyword(s):  
Diffusion Model ◽  
Durable Goods ◽  
Service Sector ◽  
Service Industry ◽  
Switching Behavior ◽  
Content Type ◽  
Market Growth ◽  
Proposed Model ◽  
Customer Switching ◽  
Service Diffusion

Purpose – This paper aims to develop a diffusion model that can be used to understand and forecast the market growth of service products in a competitive environment. Despite the fast growth of the service sector, the existing literature has dedicated little effort to modeling the market growth of service products. Design/methodology/approach – The authors propose a choice-type diffusion model that links the issues of service product utility, customers’ choice preference, customer switching behavior and the market growth of service products. The authors use the market data of one online product and assess the performance of the proposed model using this case. Findings – The results demonstrate the model’s good fitting and forecasting performance. Specifically, the proposed model has better performance than the benchmarks the authors choose from the existing literature. Originality/value – This study shows that market growth of service products can have different diffusion patterns with that of durable goods, which is evidence of the needs for specific models for service diffusion. Further, this study demonstrates the important role of customer switching in service diffusion. Also for marketing practitioners, this study provides an explanation and forecasting tool for the market growth of service products, which can be used for marketing planning in the service industry.

Application of the theory of planned behavior to customer switching intentions in the context of bank consolidations

2017 ◽  
Vol 35 (1) ◽  
pp. 147-172 ◽  
Author(s):  
Maya F. Farah
Keyword(s):  
Theory Of Planned Behavior ◽  
Planned Behavior ◽  
Structural Equation ◽  
Real Life ◽  
Switching Behavior ◽  
Control Beliefs ◽  
Equation Modeling ◽  
Perceived Behavioral Control ◽  
Content Type ◽  
Customer Switching

Purpose The purpose of this paper is to examine the factors that affect customers’ switching intentions among banks in the context of mergers and acquisitions, using particularly the case of the merger between Lloyds TSB and Halifax Bank of Scotland, which took place in 2009. Design/methodology/approach On the basis of the theory of planned behavior, a quantitative survey was developed and administered to 515 account holders from both banks in branches located in Spain. Structural equation modeling was then utilized to evaluate the significance of direct and indirect relationships between the various factors under study. Findings Empirical findings indicate a significant direct relationship between switching intentions and each of: behavioral beliefs, normative beliefs, attitudes, and subjective norms. Results also reveal an inverse significant relationship between switching intentions and both control beliefs and perceived behavioral control. Research limitations/implications The absence of a longitudinal study measuring the actual impact of the merger on customer switching behavior is the main limitation of this study. Moreover, despite being insightful, the results of this study should be generalized with caution since the sample was based on a list purposely chosen by the banks’ management. Originality/value This paper discusses customer switching behavior in the context of a real-life case of banks’ consolidation.

scholarly journals Examining Customer Switching Behavior in Cellular Industry

2014 ◽  
Vol 4 (2) ◽  
pp. 114 ◽  
Author(s):  
Sana Malik ◽  
Shanayyara Mahmood ◽  
Muhammad Rizwan
Keyword(s):  
Customer Loyalty ◽  
Research Method ◽  
Switching Costs ◽  
New Technology ◽  
Cellular Phone ◽  
Perceived Usefulness ◽  
Smart Phones ◽  
Switching Behavior ◽  
Customer Switching ◽  
Customer Defection

Although technology evolves over the year, people take it longer to accept it. The invention of touch screen mobiles or smart phones has now become a need of the hour, simultaneously lowering the demand for keypad mobiles. Our research investigates these switching intentions among people due to the adoption of the new technology. Customer defection is happens when people give up one service provider for another in order to get equipped with the latest gadgets. Survey research method was employed. Questionnaires were distributed among cellular phone users in Bahawalpur. Valid questionnaires (n=170) were filled and returned. Regression analysis was used to analyze the data. PEOU and PU are directly related which has a positive relationship with switching intentions. Also, switching costs and customer loyalty are positively associated. Overall, this research explains that perceived usefulness play a major role in determining customer’s switching intentions and that the companies should increase their switching costs to enhance customer loyalty.

Factors influencing customer switching behavior in Islamic banks: evidence from Kuwait

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sherif Ghamry ◽  
Hamed M. Shamma
Keyword(s):  
Cost Effective ◽  
Switching Behavior ◽  
Service Reliability ◽  
Islamic Banks ◽  
Content Type ◽  
Islamic Bank ◽  
Factors Influencing ◽  
Customer Switching ◽  
Bank Managers ◽  
Significant Factors

Purpose With increasing competition, Islamic banks in Kuwait are currently facing difficulties in retaining their customers as customers now have the option to switch from one bank to another. As the banking industry offers almost identical products and services, customers are more likely to change their bank when they get a better offer from another bank, especially if the customer is dissatisfied with the current bank. Thus, this study aims at identifying the most significant factors that make Islamic bank customers switch their bank. Design/methodology/approach The data for this study was collected through a survey with a response rate of 25.5%. Logistic regression was used to analyze the collected data and examine the effect of each factor on the customer switching behavior. Findings The results of empirical analysis reveal that the service convenience, service reliability, level of technology and Sharia compliance are the most significant factors influencing the customer switching behavior in Kuwaiti Islamic banks. Thus, Islamic bank managers should focus on these factors when building their strategies to increase their customer’s satisfaction and loyalty. Loyal customers are more profitable than new customers as they are more likely to use more services, spread a positive word of mouth and, more importantly, they are more likely to resist competitors’ offers. Practical implications Identifying and understanding these factors will enable Islamic bank managers to direct their efforts and resources to the most cost-effective ways that help them to retain their customers, and accordingly, increase bank profits. Originality/value To the best of the authors’ knowledge, this is the first study to examine the customer switching behavior in Kuwait, and one of the few to present a model that explains the stages through which customers pass until they reach the switching decision.

scholarly journals Long-Term Relationship Building and Customer Switching Behaviour in the Mobile Telecommunication Industry in Nigeria

2021 ◽  
Author(s):  
Ebhote Oseremen
Keyword(s):  
Service Providers ◽  
Mobile Network ◽  
Relationship Building ◽  
Switching Behavior ◽  
Telecommunication Industry ◽  
Mobile Telecommunication ◽  
Network Service ◽  
Customer Switching ◽  
Telecommunication Operators

This paper examined long-term relationship building and customer switching behavior among mobile telecommunication operators in Nigeria. The population of this study includes all mobile telecommunication company and their subscribers in Edo State, Nigeria. The samples for this study were drawn from Mobile Network Service Providers and their subscribers. For service providers, three (3) out of the nine (9) mobile network operators were selected (Nigeria Communication Commission NCC, 2020). Morgan and Krejcie's (1970) sampling methods were implemented to choose a sample of 322 mobile telecom subscribers Godden (2004). The paper employed regression analysis to analyze and test the hypothesis formulated. The result showed that long-term relationship building (Two-way Communication, Customer retention Strategy, Customer Loyalty, and Relational Bond) had a positive statistically significant relationship with customer switching behavior among mobile telecommunication operators (Network service providers) at p>0.05. The research recommends among others that players of the mobile telecommunication Industry (mobile network service providers) should embrace the application of long-term relationship-building to achieve, sustain and retain customers' usage of their products, this will enable them to compete better with other players in the industry. Also, they should engage in relational bonding aimed at creating attachment with the customer leading to customer retention and subsequently profitability.

Inertia in services: causes and consequences for switching

2017 ◽  
Vol 31 (6) ◽  
pp. 485-498 ◽  
Author(s):  
David M. Gray ◽  
Steven D’Alessandro ◽  
Lester W. Johnson ◽  
Leanne Carter
Keyword(s):  
Service Provider ◽  
Online Survey ◽  
Structural Model ◽  
Switching Costs ◽  
Service Providers ◽  
Switching Behavior ◽  
Service Firms ◽  
Actual Behavior ◽  
Path Modeling ◽  
Content Type

Purpose This paper aims to examine the antecedents of customer inertia (i.e. knowledge, confusion, perceptions of competitor similarity and switching costs) and their relationship to customer satisfaction, service providers’ switching intentions and actual switching behavior. Customer inertia is said to reduce the incidence of service provider switching; however, little is known about the antecedent drivers of inertia. Design/methodology/approach The conceptual model was tested by a longitudinal/discontinuous panel design using an online survey research of 1055 adult (i.e. +18 years old) subscribers to cell phone services. Partial least squares (PLS) path modeling was used to simultaneously estimate both the measurement and structural components of the model to determine the nature of the relationships between the variables. Findings Findings of the PLS structural model provide support for the direct relationship between customer inertia and its antecedents (i.e. knowledge, confusion, perceptions of competitor similarity and switching costs). The results show that customer inertia has a moderate negative effect on the intention to change service providers but had no measurable effect on the actual behavior of changing service providers, other than indirectly, by influencing the perception of difficulty in switching some 11 months later. Further results from an analysis of indirect pathways of the antecedents to inertia show that switching costs are the only variable which indirectly reduce intentions to change service providers. The results also show that the effect of satisfaction on switching service providers is partially moderated by inertia. Importantly, these relationships are reasonably robust given past switching behavior and contract status of consumers. Research limitations/implications The authors find evidence which explains some of the causes of inertia, and show that it has both direct and moderating effects on service provider switching intentions, though not necessarily the behavior of changing service providers. However, support was found for its indirect role through intent as an influence on switching behavior. Importantly, the authors find that inertia has lingering effects, in that it influences the perception of switching difficulties and, hence, behavior up to 11 months in the future. Practical implications Managerial implications are that service firms can profit from customer inertia through a reduction in churn. However, high levels of customer inertia over the longer term may increase the level of customer vulnerability to competitor offers and marketing activities, as satisfaction with the provider does not in itself explain switching intentions or behavior. Originality/value This study is the first study to contribute to an understanding of the antecedent drivers of customer inertia with respect to service provider switching and to empirically evaluate a variety of antecedent factors that potentially affect switching intentions. Importantly, the long lasting latent effect of inertia in indirectly influencing service switching behavior was found to persist some 11 months later.

scholarly journals Cross-cultural validation of switching costs: a four-country assessment

2014 ◽  
Vol 31 (4) ◽  
pp. 413-437 ◽  
Author(s):  
Dahlia A. El-Manstrly
Keyword(s):  
Switching Costs ◽  
Short Form ◽  
Measurement Instrument ◽  
Cross Cultural ◽  
Test Theory ◽  
Switching Behavior ◽  
Measurement Tool ◽  
Content Type ◽  
Marketing Tool ◽  
The Uk

Purpose – The purpose of this paper is to develop a cross-cultural scale of customers’ perceived switching costs (PSCs). Customers’ PSCs function as a powerful defensive marketing tool that restrains customers from switching. Design/methodology/approach – Four sets of survey data were collected in the UK, Egypt, Germany, and China. An overall response rate of 86 percent was achieved across the four countries. Cross-cultural equivalence of the PSCs scale was assessed using multi-group confirmatory factor analysis. Findings – Tests of configural, metric, and factor variance invariance confirmed that the PSCs scale is appropriate for meaningful cross-cultural comparisons. Research limitations/implications – Data were collected in four countries from the financial service context. Future researchers should test the short-form PSCs (PSCs-S) scale across different cultural and industrial contexts to enhance its generalizability. Practical implications – The cross-cultural PSCs-S scale presented here will enhance international marketing researchers’ ability to test theory containing customers’ PSCs as central variables, and provide managers with a measurement tool that they can use to better segment and manage their customers. Originality/value – This study is one of the first to develop a cross-cultural PSCs scale. Despite the growth of research into customers’ PSCs, research on the topic has been limited by the lack of a cross-cultural measurement instrument. The latter now furnishes the research community with the opportunity to gain a fuller understanding of switching behavior, to establish the scale's generalizability, and to make meaningful comparisons of PSCs across cultures.

Mining the dominant patterns of customer shifts between segments by using top-k and distinguishing sequential rules

2015 ◽  
Vol 53 (9) ◽  
pp. 1976-2003 ◽  
Author(s):  
Elham Akhondzadeh-Noughabi ◽  
Amir Albadvi
Keyword(s):  
Marketing Strategies ◽  
Switching Behavior ◽  
Content Type ◽  
Markov Chain Models ◽  
Customer Switching ◽  
It Department ◽  
Event Detail ◽  
Practical Implications ◽  
Different Levels ◽  
Hybrid Methodology

Purpose – The purpose of this paper is to detect different behavioral groups and the dominant patterns of customer shifts between segments of different values over time. Design/methodology/approach – A new hybrid methodology is presented based on clustering techniques and mining top-k and distinguishing sequential rules. This methodology is implemented on the data of 14,772 subscribers of a mobile phone operator in Tehran, the capital of Iran. The main data include the call detail records and event detail records data that was acquired from the IT department of this operator. Findings – Seven different behavioral groups of customer shifts were identified. These groups and the corresponding top-k rules represent the dominant patterns of customer behavior. The results also explain the relation of customer switching behavior and segment instability, which is an open problem. Practical implications – The findings can be helpful to improve marketing strategies and decision making and for prediction purposes. The obtained rules are relatively easy to interpret and use; this can strengthen the practicality of results. Originality/value – A new hybrid methodology is proposed that systematically extracts the dominant patterns of customer shifts. This paper also offers a new definition and framework for discovering distinguishing sequential rules. Comparing with Markov chain models, this study captures the customer switching behavior in different levels of value through interpretable sequential rules. This is the first study that uses sequential and distinguishing rules in this domain.

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