Purpose The purpose of this study is to develop an understanding of the factors influencing Indian consumers’ loyalty toward mobile phone service providers by exploring the mediating roles of commitment, corporate image and switching costs on causal relationships between customer satisfaction, trust and loyalty. Design/methodology/approach A survey of 855 Indian mobile phone users was carried out to test the hypothesized relationships using structural equation modeling. The results support most of the proposed hypotheses. Findings The direct linkages in the model are found to be statistically significant. Of these relationships, corporate image emerged as the strongest determinant of attitudinal loyalty. Calculative commitment and corporate image are found to be partial mediators between satisfaction and attitudinal loyalty. Calculative commitment and switching costs are each proven to be partial mediators between trust and attitudinal loyalty, while corporate image is proved to be a complete mediator. Research limitations/implications The study is limited to examining the impact of relationship variables on Indian consumers’ loyalty toward mobile phone companies. Future research can examine the impact of variables such as rate plans, value-added services, billing experience and voice quality on customer loyalty. Practical implications The results have implications for retaining customers in highly competitive and maturing Indian mobile telecommunications. The research provides some initial insights into corporate brand building as an important area for mobile phone companies. Originality/value This is one of the first studies to test the mediating role of commitment, switching costs and corporate image in the relationship between satisfaction, trust and loyalty in the Indian context.
Purpose -Identifying the loyalty drivers to cell phone operators is extremely important in today's competitive environment. Consensus is absent in the marketing literature on how loyalty should be conceptualized and measured in the service industry. The purpose of this study is to test an integrative model to examine the relations among customer satisfaction, trust, commitment, corporate image, attitudinal loyalty and behavioural loyalty. It also aims to examine the mediating roles of commitment and corporate image on causal relationships between trust and loyalty. Design/methodology/approach -Data collection was done in two stages: in the first stage in which the primary purpose of analysis was pre-testing, the authors collected data from 250 respondents. In the second stage, data were obtained from 855 mobile phone users in India via questionnaire. The data were analysed by structural equation modelling (SEM) in order to test all the relationships between variables in the model. Findings -The findings supported the proposed hypotheses, which are consistent with the theoretical framework. Analysis showed that corporate image is an important determinant of attitudinal loyalty. Research limitations/implications -In order to generalize the findings, the proposed model should be studied in different service industries. This research does not examine the interaction effects between customer satisfaction and trust. Future researchers can test these interaction effects and study its impact on development of behavioural and attitudinal loyalty. The proposed model should be tested using a longitudinal research design. Practical implications -Firms should focus both on attitudinal and behavioural loyalty to create truly loyal customers. A defensive marketing strategy is important for the highly competitive and maturing mobile telecommunications service market. Mobile phone companies should develop and reinforce marketing strategies focusing on factors (satisfaction, commitment, trust and corporate image) which have the greatest influence on retention. Originality/value -This paper examines the mediating roles of commitment and corporate image in the formation of customer loyalty.
The Indian telecom industry is one of the fastest growing in the world and second largest mobile market globally. The Indian cell phone market is characterized by a large subscriber base (545 million connections as on May, 2010, expected to reach 876.6 million in 2013), low average revenue per user (INR 209 as on March 2009) and high churn rates (53.2% in 2009, and is expected to increase to 59.6% in 2013). The Indian consumers are enjoying a wide range of services along with the world�s lowest local call rates. The mobile phone operators in India are faced with the challenge of reducing customer churn in the ever-increasing prepaid subscriber market. Under such circumstances, the success of mobile phone service providers in India mainly depends on developing innovative schemes to increase customer loyalty. In service organizations, customer loyalty is considered as prime determinant of long-term financial performance of firms. One of the crucial issues of today is to understand how or why a sense of loyalty develops in customers. Loyalty definitions and metrics are mostly in behavioural and attitudinal terms. Consensus is absent in the marketing literature on how loyalty should be conceptualized and measured in the service industry. The present study addresses both the conceptual and measurement issues related to customer loyalty amongst the cell phone users. Building on existing literature, the antecedents of customer loyalty are reassessed in a service setting namely, customer satisfaction, trust, commitment, corporate image, and switching costs. This paper reports the development and validation of scales for measuring customer loyalty and its antecedents. The scale development and validation process was divided into three phases. Phase 1 consisted of the item generation process, assessment of content validity, and initial purification of measures. Item analysis and exploratory factor analysis were used on data collected from 250 postgraduate business students of a major university in India for initial purification of the instrument. In Phase 2, additional data were collected from 855 cell phone users in northern India to assess the latent factor structure through confirmatory factor analysis. In Phase 3, the discriminant validity and convergent validity of the measures were established. The managerial implications of the major findings of this study are as follows: It contributes to the existing literature by developing a theory-based framework for understanding the direct effects of satisfaction, trust and commitment, switching costs and corporate image on behavioural and attitudinal loyalty. By measuring loyalty as composite measure consisting of both behavioural loyalty and attitudinal loyalty, it provides evidence of the multidimensional nature of loyalty construct. Using data collected from mobile phone users, the reliability and validity of the scale are established. The newly refined and validated measures can be used by future researchers to study customer loyalty and its antecedent factors. The loyalty measures developed in this study provides managers with an easy tool to identify attitudinal and behavioural differences among customers. Marketing managers can draw meaningful distinctions between customers who buy out of habit and those who buy because of emotional attachment to the company.
The focus of this study is to find out the impact of Customer Relationship Management (CRM) on the financial performance of firms in India. The study identifies four CRM constructs – customer need sensing, communication, intermediaries, and the internal environment of firms. A CRM scale is developed, refined and validated and confirmatory factor analysis is used to examine the model fit. Firm data on profitability and growth is used as performance indicators for estimating the regression model. Using a large sample of 171 firms from eight different industry types, results suggest that there is a positive influence of CRM on firm performance but that this impact is insignificant.
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