Role of Customer Trust and Perceived Risk on Customer Intention to use Digitized Services in the Sri Lankan Telecommunication Industry

Abstract

Digital transformation is developing as a key driver of changing customer services in many industries including the telecommunication industry of Sri Lanka. Over the past decade, most customer services have been increasingly digitalized by improving profitability and the overall efficiency of business in several industries, including telecommunication. Hence, the study was mainly motivated to explain the effect of customer trust and perceived risk on intention to use digitalized services in the telecommunication industry in Sri Lanka. The conceptual model was developed based on three main variables, namely customer trust, perceived risk and intention to use digitalized services. For analyzing purposes, data was collected from a representative sample of 250 customers who were using traditional offline telecommunication services in the Colombo district. A printed structured questionnaire was used for data collection. SPSS and SMART PLS based Structural Equation Modeling (SEM) techniques were used for data analysis. The findings of the survey showed that customer trust had a positive impact on intention to use digitalized customer services. However, it has proven that there is no significant moderating effect of perceived risk on the relationship between customer trust and intention to use digitalized services in the telecommunication industry in Sri Lanka. Therefore, increased customer trust in digitalized services can be used as a tool to enhance the intention to use digitalized customer services. The findings further describe management implications and opportunities for future research in the same field.