Determinants of Customer Loyalty: Evidence from the Egyptian Mobile Market

Abstract

This study aims to explore the factors that determine customer loyalty in the telecom industry. The mobile market in Egypt is used as the particular context of study. A distinctive model is developed drawing on the results of previous empirical work on customer loyalty. The model proposes that customer loyalty in a service industry like the telecom industry is a combination of a number of factors namely; perceived service quality, corporate image, trust, switching cost and customer satisfaction with the service. A sample of 600 mobile subscribers was drawn from the cell phone users in Egypt.This research used a random systematic sampling technique to select the sample units by selecting nth number from the dials provided by Etisalat Misrto identify the customers of the three key telecom companies operating in Egypt namely; Etisalat, Mobinil and Vodafone. Data was collected via a large scale field study over a period of three months and covered various areas in Egypt being; Cairo, Alexandria, Delta and Upper Egypt. Data was analyzed via multiple regression technique. Findings indicate that perceived service quality, trust and satisfaction with the service are the significant determinants of customer loyalty. Corporate image and switching cost did not turn out to have a significant effect on customer loyalty. The study provides marketing insights and implications of these findings. For managers, the findings of this research can have important implications with regard to customer retention and customer relationship management. Telecom managers should emphasize service quality through the provider’s relationship with customers, professionalism of their employees, prompt and excellent service and differentiated core products.