Research Paper

on

Effect of Switching Cost, Service

Quality, Customer Satisfaction on
Consumer Loyalty of Cellular Service
Providers In Indian Market
Source :

ICFAI university Journal of Marketing Management ,

Vol. VIII ,Feb. 2009

Researchers, Made by,

S.K.Chadha Shreyas D Laste
Deepa Kapoor Roll No.-28
 Objective
- In telecom Sector India has highest growth rate

- Protecting Subscriber Base is to win customer Loyalty

- Study Shows that Switching Cost, Service Quality,

Customer Satisfaction have positive effect on
Customer Loyalty
Introduction

- Major work is to maintain the current customer

- Highest growth rate in the world 45% in 2007

- Total 66.34 million subscriber added in 2006-07

- Annual growth rate 83.17

Theoretical Background
-Switching Cost
- Cost involved in changing service from
one provider to another

-Service Quality
- customer retention depend upon service quality

-Customer Satisfaction
- it is customer experience while getting service

-Customer Loyalty
- it is favorable attitude towards particular brand
Hypothesis Of the Study

H1 : Higher is the switching cost ,higher is the

Customer Loyalty
H2 : Higher is the customer perceived service quality,
higher is the Customer Loyalty
H3 : Higher is the Customer Satisfaction ,
higher is the Customer Loyalty
Data Collection and Sample

-Data from GSM Pre-paid Subscribers in

Ludhiana and Chandigarh

-Convenient Sampling method is used

-Total 300 questionnaires were distributed in both cities

out of which 220 were completed(73.33%)
 Research Methodology

3.Measurement Variable

i. Switching Cost
- include initial set up cost, learning cost, time
and effort, monetary cost, uncertainty cost
- all measured on a five point Likert Scale

ii. Service Quality

- include network quality, pricing structure,
convenience, and value added services.
- all measured on a five point Likert Scale
 Contd………
iii. Customer Satisfaction
- include overall customer satisfaction and
conformity with pre-purchase expectation
- all measured on a five point Likert Scale

iv. Customer Loyalty

- include repurchase intention, switching to competitors
product or service and recommended to friends and
associates
- all measured on a five point Likert Scale
2. Data Analysis and Findings
- Collected Data analyzed by SPSS 11.5 statistical tool

- Reliability Analysis
- done by computing coefficient of Cronbach Alfa
- it measures internal consistency of items

Sr. No. Name of the Scale Cronbach Alfa

1 Switching Cost 0.76
2 Service Quality 0.82
3 Customer Satisfaction 0.85
4 Customer Loyalty 0.79
 Hypothesis Testing

Correlation analysis
Correlation Switching Service Customer
Cost Quality Satisfaction

Customer Loyalty 0.436 0.368 0.653

Regression Analysis
Variables Std. t-value
Coefficient
Customer 0.693 14.351
Satisfaction
Service Quality 0.310 4.98

Switching Cost 0.238 3.85

 Conclusion

- Customer Satisfaction is most significant to Customer Loyalty

- Maximize service quality and customer satisfaction

to enhance customer loyalty

- Improve network quality, price and value added services

- Also implement some reward programs

Thank you