Academic journal article E+M Ekonomie a Management

An Integrated Model of Customer Loyalty in the Macedonian Mobile Service Market

Academic journal article E+M Ekonomie a Management

An Integrated Model of Customer Loyalty in the Macedonian Mobile Service Market

Article excerpt

Introduction

In today's competitive environment, creating and maintaining customer satisfaction and consequently customer loyalty is of vital importance to the companies. At the same time, it is a challenging task because little is known about how customers differ in their relational preferences (Palmatier et al., 2006) and because there are a lot of variables that influence customer loyalty. Although customers tend to be more demanding and less loyal (Reichheld, 1996), service marketers are convinced that building enduring relationships with the customers is incredibly important because loyal customers are less costly to serve, buy more, pay premium prices and spread positive word-of-mouth (Zeithaml, 2000; O'Brian & Jones, 1995).

Among the various factors that directly or indirectly influence customer loyalty, perceived service quality and customer satisfaction are frequently viewed as key determinants of customer loyalty (Vildova et al., 2015; Seto-Pamies, 2012; Cronin et al., 2000) with a confirmed mediating effect of customer satisfaction in the service quality-customer loyalty relationship (Srivastava & Rai, 2013; Caruana, 2002). Additionally, switching costs and switching barriers are also viewed as key determinants of customer loyalty (de Matos et al., 2009; Lee et al., 2001). Namely, when switching costs are high, customers may stay loyal even if they are not highly satisfied (Santouridis & Trivellas, 2010). Although the research interest on perceived service quality, customer satisfaction, switching costs, switching barriers and customer loyalty has been increasing regularly, the number of research studies integrating all these variables in exploring customer loyalty is rather scarce.

Recently, there has been an exponential increase in research on service quality, customer satisfaction and customer loyalty in the mobile service industry. Specifically, a number of researchers have attempted to reveal the relationship among various independent variables and customer loyalty as a dependent variable in the mobile service industry (Santouridis & Trivellas, 2010; Gerpott et al., 2001). Even though all these research efforts have advanced marketers' understanding of mobile service consumer behaviour and particularly of the relationships among perceived service quality, customer satisfaction, and customer loyalty (Lee, 2013), yet an integrated model of loyalty in the mobile service context with switching barriers and switching costs as supplementary variables is still rare. This study strives to All this research gap by proposing and testing an integrated model of customer loyalty. Moreover, the different effects of switching costs and switching barriers on the satisfaction-loyalty relationship are examined, since there is a lack of empirical studies testing these approaches simultaneously (de Matos et al., 2009).

The research context of our study is the mobile service industry in Macedonia. At present, three mobile service providers and one mobile virtual network operator operate in Macedonia, giving users a choice when considering their mobile communications needs. With a number of active mobile service users higher than the population, and a low mobile service users growth rate of only 1.05% in the third quarter of 2014 compared to the third quarter of 2013 (Agency for Electronic Communication of the Republic of Macedonia, 2014), the Macedonian mobile service market is reaching its maturity. In such conditions, the mobile operators are focusing their marketing efforts on retaining the current customers through creating customer loyalty. It is generally accepted that a high level of customer satisfaction will result in high level of customer loyalty, but sometimes, customers can manifest high level of repeat purchases as a result of some switching barriers they are facing.

Considering that, to the best of our knowledge, no article examining the customer loyalty of the mobile service industry in Macedonia has been published so far, this article is the first attempt to analyse the effects of perceived service quality, customer satisfaction, switching costs and switching barriers on customer loyalty. …

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