Relational Switching Costs Research Articles

The Influence of Relationship Characters on Switching Cost: The Moderating Role of Customer Characters

With the competitive environment intense, the leader of the market gradually becomes buyers market. For the enterprise, to maintain and retain existing customers, which is to reduce the customer switch to the competition as low as possible, is particularly important. Therefore, how to effectively seize the minds of consumers and understand their behavior trends is the crux for enterprise to win. This study developed a model of the influence of relationship characteristics on switching costs, and we set customer characteristics as a regulated variable which was always set to a leading factor in the previous study. We used smart-phone users as our research object, through the method of questionnaire and established an equation model to analyze data. The results showed that: (1) in general, the relationship characteristics between consumers and businesses (including the length of time and the kind of purchase) respectively played a positive role on the switching costs (including procedural switching costs, relational switching costs and lost benefits costs), (2) the moderating effects of customer characteristics (including involvement and switching tendency) in the relationship between relationship characteristics and switching costs (including the procedural switching costs, relational switching costs and lost benefits costs) are respectively significant. This article verifies the regulated effect of customer characteristics and enriches the antecedent influencing factors of switching costs. So it is of great significance for enterprises to better manage switching costs and effectively retain customers.

How Do Online Game Communities Retain Gamers? Social Presence and Social Capital Perspectives

While online game communities have been found to be useful for retaining gamers, the mechanism underlying this phenomenon is not fully understood. Knowledge about such mechanism enables managers of online games to effectively retain their customers. This study thus investigates how network convergence and interdependence-2 characteristics of online game social networks-fuel gamers' continuance intention. Social presence and social capital theories were used for developing the study hypotheses, and responses from 1,467 online gamers were used in the analysis. The findings indicate that both network convergence and interdependence are positively related to sense of community and relational switching cost coefficients ranging from .20 to .50, which further contribute to gamer continuance intention coefficients ranging from .13 to .72.

The role of individualism vs. collectivism in the formation of repurchase intent: A cross-industry comparison of the effects of cultural and personal values

As repurchase intent drives profitability and firms are facing culturally diverse customers, managers should know how individualism (vs. collectivism) influences the formation of repurchase intent. This research models individualism as a dimension of both national culture and personal values. Based on HLM of data from six countries and ten industries, study 1 shows that cultural individualism is more influential than personal individualism. Individualism positively moderates the effect of customer satisfaction and negatively moderates the effects of public brand image and relational switching costs on repurchase intent. While the effects of customer satisfaction and relational switching costs are moderated more strongly for services, the effect of public brand image is moderated more strongly for products. Study 2 illuminates psychological processes operating behind these moderating effects: importance of relational switching costs – reliance on salespeople; importance of public brand image – meeting social preferences (impressing others, expressing group identify), but not trustworthiness; importance of customer satisfaction – customization, distinctiveness, but not functional benefits. This research also tests extant theories about the main effect of individualism on repurchase intent. The results provide valuable, novel suggestions for cross-cultural adaptation of marketing strategy.

The Moderator Effects of Switching Costs and Customer Expertise in the Satisfaction-Repurchase Intention Relationship for Mobile Telecommunication Services

This study discusses and tests the moderator role of monetary, time, effort, social ties and relational switching costs and their interactions with customer expertise in the satisfaction-repurchase intention relationship for mobile communication services. The authors use survey data of 516 customers from the three largest mobile communication providers in Vietnam. A moderated regression is used to test the hypotheses of both two- and three-way interaction effects on repurchase intention. The results show that monetary, time, effort and social ties switching costs have a negative moderating effect, but relational switching costs have a positive moderating effect on the satisfaction-repurchase intention relationship. Furthermore, this study contributes to the existing literature by providing empirical evidence supporting three-way interaction effects between satisfaction, switching costs and customer expertise on repurchase intention. Specifically, customer expertise reduces the moderating effects of social ties and relational switching costs on the satisfaction-repurchase intention relationship.

Customer Switching Costs and its Correlates in the Turkish Credit Card Market

In recent years, service quality, trust, corporate image and switching cost are mainly viewed as the primary determinants of repeat choice behavior. In the literature, according to many authors, switching costs have (1) financial switching cost, (2) procedural switching cost and (3) relational (psychological) switching cost. Each type also composed of multiple facets. The aim of this study is to determine customer switching costs the credit card market and to form a third-order measurement model and to examine the associations among switching cost., loyalty, service quality, trust and corporate image. Firstly we examined the concept of switching cost and determined all the facets. Secondly, the relationships among all the variables were analyzed by the confirmatory factor analysis (CFA). The findings from CFA show that the switching cost is explained by monetary loss, benefit loss, evaluation, learning, set-up, uncertainty and relationship loss cost. Also there is no significant association between customer loyalty and monetary loss and learning cost because of the competition in the Turkish credit card market. Uncertainty and relationship loss cost are associated with customer loyalty. On the other hand, the most important factors affecting customer loyalty are trust, perceived service quality and corporate image, respectively.

Study of social ties as one kind of switching costs: a new typology

Purpose – The purpose of this paper is to study how customers’ social ties can be performed as one kind of switching costs, which can affect customer loyalty and have a moderate effect on the relationship between customer satisfaction and customer loyalty, and to improve the typology study of switching costs and give suggestions for companies about how to strengthen customer loyalty. Design/methodology/approach – An empirical research is implemented to prove the effectiveness of the study model, using factor analyses, regression analyses and structural equation model analyses as data analyses approaches. Findings – The research results prove the direct and moderate effect of social ties loss costs, and the effectiveness and reasoning of the new typology of switching costs. Practical implications – According to the research results, companies can take measures to enhance customers’ social ties loss costs properly so as to strengthen their loyalty. Originality/value – This research comes up with a new kind of relational switching costs, social ties loss costs and proves its effects, thus improving the typology of switching costs, and makes practical suggestions for companies.

Securing business-to-business relationships: The impact of switching costs

While the relationship marketing literature acknowledges the importance of switching costs for increasing customer retention, little is known about its relevance in industrial markets. In particular, it is unclear whether switching costs, and associated dimensions, impact on behavioral outcomes of buyer–seller relationships in business-to-business (B2B) markets. In order to contribute to theory development in this important area, our research first explores the dimensions of switching costs for the B2B domain and also tests the relative impact of these dimensions on business customers' actual purchase behavior. Results suggest that switching costs in B2B settings are a multi-faceted construct, including (i) procedural, (ii) financial, and (iii) relational switching costs. Moreover, we find relational switching costs to be most important for securing B2B buyer–seller relationships since they impact a customer's (a) share-of-wallet, (b) cross-buying behavior, and (c) actual switching behavior. While procedural switching costs only influence share-of-wallet, financial switching costs solely impact customer's cross-buying behavior. These findings contribute to a better understanding on how to secure B2B buyer–seller relationships.

Understanding continuance intention of mobile instant messaging

Purpose – The purpose of this paper is to examine the continued usage of mobile instant messaging (IM) from the perspectives of both motivators and inhibitors. Design/methodology/approach – To cast light on the motivators and inhibitors of continuance intention (CI) to use mobile IM, 268 responses from Chinese mobile IM users were collected via an online survey. Findings – The results suggest that perceived system quality, procedural switching cost and relational switching cost (RSC) positively affect resistance to change (RTC), while perceived user base, perceived quality of communication, RSC and RTC positively affect the CI. Among them, RTC has the greatest effect on the CI, and RSC has the largest effect on RTC. Originality/value – Extant research has mainly focussed on the motivators behind the continued usage of mobile services. However, the inhibitors, such as switching cost and RTC, have been less considered in the research on the continued usage of mobile services. Also, only a little research has examined the components of switching costs and how they affect the intention to continue using mobile services. The current study attempts to fill these research gaps.

Switching experience, customer satisfaction, and switching costs in the ICT industry

Purpose – Stabilizing business in highly competitive and volatile business-to-business (B2B) markets is a strategic imperative for many companies. In such a context, customer retention through the creation of switching barriers (i.e. by increasing switching costs) is a common strategy. The purpose of this paper is to develop a network of relationships among customer switching experience, customer satisfaction, perceived switching costs, and behavioral loyalty intentions. Design/methodology/approach – Survey data were collected from 327 business customers (very small enterprises with fewer than nine employees; customers included physicians, lawyers, tax advisors, consultants, civil engineers, etc.) of an information and communications technology (ICT) company. The research model was tested using partial least square structural equation modeling. Findings – The results show that switching experience negatively influences customer satisfaction and behavioral loyalty intention. Furthermore, the influence of customer satisfaction on behavioral loyalty intentions is partially mediated by financial and relational switching costs. Practical implications – In saturated markets, companies often try to grow by acquiring customers from competitors. This study reveals that this strategy can backfire. The customers that can be most easily acquired may be those that are the most difficult to retain because customers experienced in switching are difficult to satisfy – and low satisfaction means lower perceived financial and relational switching costs and, in turn, lower loyalty. Originality/value – This research contributes to theory and practice by shedding further light on the satisfaction-loyalty link by investigating the often widely neglected role of switching experience. Furthermore, the study seeks to add to the discussion of how to specify the role of switching costs: as a mediator or as a moderator.

How procedural, financial and relational switching costs affect customer satisfaction, repurchase intentions, and repurchase behavior: A meta-analysis

Switching costs and customer satisfaction may differently affect marketing strategy. Managers would benefit from knowing how different switching costs (financial, procedural, and relational) and satisfaction jointly affect repurchase in order to properly invest marketing resources. A meta-analysis of 233 effects from over 133,000 customers shows that: (1) relational switching costs have the strongest association with repurchase intentions and behavior; and (2) procedural and relational switching costs mitigate the association between satisfaction and repurchase intentions/behavior whereas financial switching costs enhance it.

SMEs’ switching behavior in the natural gas market

Purpose – The purpose of this paper is to explore loyalty and switching behavior among corporate energy customers in Italy. Thanks to the recent liberalization process, firms have now the opportunity to evaluate alternative energy providers and try to reduce their energy expenses. Nonetheless their switching rate in Italy is currently as low as 6.3 percent. Design/methodology/approach – The study is based on a cross-sectional analysis of the switching behavior of a sample of 110 Italian small and medium firms that purchase natural gas from a middle-sized natural gas supplier. Findings – The analysis emphasizes the role of price convenience (but not of dissatisfaction with the service provision) as a driver of the intention to switch to a new supplier. The negative impact of procedural and relational switching costs on the intention to switch emerges, as well. Research limitations/implications – The sample size was quite limited. Moreover participants were all customers of one natural gas supplier only. Practical implications – The findings highlight the need for gas service providers to focus on customer orientation and loyalty to stimulate customer loyalty and not just customer repurchases. Originality/value – Whilst a few studies have explored switching behavior and loyalty among private energy customers, this study investigates this issue among corporate energy customers.

Antecedents for user intention to adopt another auction site

Purpose – Multiple adoption (the adoption of another auction site in addition to the present one) enables startup or non-leading firms to survive and grow by eroding the customer bases of market leaders. Thus understanding multiple adoption is important. Hence, the purpose of this paper is to propose and examines antecedents of user intention to adopt another online auction site. Design/methodology/approach – This study utilized a cross-sectional design and an online survey, obtaining 495 valid responses. Findings – Analytical results indicate that self-efficacy and inherent novelty seeking contribute to the intention to adopt another auction site. Moreover, transaction opportunities enhance the intention. Perceived network externality also increases the intention. However, perceived relational switching costs reduce such intention. Originality/value – This study is new in investigating why users intend to use another auction site and identifying the antecedents.

Extension of switching costs antecedents based on customers' social ties

The effects of customers' social ties on switching costs have recently attracted researchers' attention. This study formally included customers' social ties as a new antecedent to supplement those elucidated by Burnham in 2003. Through empirical research, this study successfully verified the reliability and validity of items created to measure social ties, and it demonstrated the facilitating effects of social ties as an antecedent on customers' procedural and relational switching costs. Finally, the study lists managerial implications aimed at retaining customers through knowledge of this added antecedent.

Study on Effects of Regulation by Switching Costs in Mobile Communication Consumption of College Students

A theoretical hypothesis that switching costs have effects of regulation is proposed by analyzing relations among switching costs, customer satisfaction and customer loyalty in the field of mobile communication consumption of enrolled college students. Then relevant data are acquired from questionnaires, processed with SPSS 20.0 Statistical Program and subjected to hierarchical regression analysis to test the hypothesis. Finally, it is concluded that, among different dimensions of switching costs, procedural switching costs have a significant effect of regulation between customer satisfaction and customer loyalty, but the financial and relational switching costs have not significant moderating effect. Thus, to improve customer loyalty, operators are suggested to enhance customer satisfaction and procedural switching costs simultaneously.

Custos de mudança e seus efeitos no Comprometimento, na intenção de recompra e no boca-a-boca em serviços educacionais

The present study addresses the switching costs in the educational service sector, measuring their effects on the commitment, repurchase intentions and word-of-mouth (positive and negative). This article seeks to fill the gap regarding the analysis of the effects of different types of switching costs: relational, financial and procedural costs, taking into account their multidimensional nature. In order to do that, a literature review and a qualitative research were conducted, followed by a survey with undergraduate students from private institutions to examine the role of switching costs and their positive and negative effects in the context of educational services at undergraduate level. The results show an influence of relational, financial and procedural switching costs on affective, normative and calculative commitment, respectively. The affective commitment and the normative commitment are associated with positive effects, such as repurchase intentions, being affective commitment also associated with positive word-of-mouth. It should be noted that the calculative commitment leads to negative effects: greater negative word-of-mouth and lower repurchase intentions. Hence. the incremental cost of procedural changes, which precede the calculative commitment should not be encouraged. At the end of the article, the results are discussed, as well as the study’s limitations, suggestions for future research and managerial implications are presented.Key words: switching costs, commitment, repurchase intentions and word-of-mouth, educational services.

How do the success factors driving repurchase intent differ between male and female customers?

As customers’ repurchase behavior leads to long-term corporate profitability, managers should know the success factors influencing repurchase intent. Knowledge of gender differences in these success factors would enable managers to separately optimize repurchase intent for men and women. This research thus develops original hypotheses on gender differences in the formation of repurchase intent. Based on hierarchical linear modeling of data from five countries and ten industries, this research finds that public brand image more strongly influences customer satisfaction and repurchase intent for women than for men. Perceived value has a weaker effect on repurchase intent for women than for men. The analyses do not detect any gender difference in the influence of customer satisfaction on repurchase intent. Contrary to conventional wisdom, relational switching costs more strongly influence repurchase intent for men than for women. Further analyses illustrate moderating effects of country differences in gender egalitarianism and of contextual differences between products and services.

The role of employee job satisfaction in strengthening customer repurchase intentions

Purpose– The purpose of this paper is to examine the role of front line employee job satisfaction in customers ' behavioral intentions.Design/methodology/approach– Research design is nested with data collected from both first line employees and customers. Data are collected from multiple branches of a single bank to eliminate the possibility of other parameters such as design of operations and physical evidence from masking the true effects of the variables under investigation.Findings– Employee job satisfaction influences a customer ' s perception of quality, customer satisfaction and the development of high relational switching cost. Hence the effect on repurchase intention is indirect but significant and strong while moderated by branch size and age of the employee.Research limitations/implications– The degree of employee job satisfaction is a resource of strategic nature for these companies aiming to improve customer retention rates. Such companies should protect their ability to build employee job satisfaction and restrain themselves from policies that threaten to slim down the satisfaction their employees derive from their job.Originality/value– Using a hierarchical research design, this is the first study that manages to establish the relationship between employee job satisfaction and customers ' behavioral intentions while eliminating the effect of complementary marketing mix parameters such as operations design effectiveness and aesthetics.

Testing the Model of Hotel Chain Frequency Program Members' Loyalty Intentions

The present study proposed and tested the role of service performances (core and service encounter performances), satisfaction, switching barriers (relational investment, switching costs, and lack of alternatives' attractiveness), and commitments (continuance and affective commitments) in forming hotel chains' rewards/frequency program members' loyalty intentions. The results from the structural equation modeling revealed that these variables well accounted for the variance of member loyalty intentions, directly/indirectly contributing to determining loyalty intentions. In addition, findings from a series of modeling tests for metric invariance verified the moderating impact of affective commitment on the links from relational investment and continuance commitment to member loyalty intentions. Implications are discussed with study limitations and recommendations for future research.

A Study of Online Auction Sellers’ Intention to Switch Platform: The Case of Yahoo!Kimo Versus Ruten_eBay*

ABSTRACTThe study of consumers’ switching from one service provider to another has a long tradition in economics, information systems, and marketing. The emergence of electronic commerce presents new challenges in understanding consumers’ switching intentions in the context of e‐commerce in general and online auctions in particular. With the abundance of literature on online auctions, there is a surprising lack of research on auction sellers’ intentions to switch from one online auction platform to another. Using the competition between Yahoo!Kimo and Ruten_eBay, two leading auction platforms in Taiwan, as the backdrop, we developed a research model and collected empirical data based on this real case to study what factors influence auction sellers to switch to a competing service provider. We find that the higher the procedural switching costs, financial switching costs, relational switching costs, site design quality, or interaction quality, the lower the intention of an auction seller to switch to a competing auction service provider. A higher perceived transaction fee, however, leads to a higher switching intention.

Consumer electronics acceptance based on innovation attributes and switching costs: The case of e-book readers

The predictors of innovative consumer electronics product acceptance range from technology to economic factors. Prior studies assume direct effects from these predictors on acceptance behavior. We study e-book readers as an illustrative technology. We contend that consumers’ perceived innovative attributes (relative advantage, compatibility, and complexity) directly affect their acceptance behavior, and also influence their behavior via their perception of the costs (procedural, financial, and relational switching costs). Our findings reveal that complexity is a key antecedent to switching costs. The empirical results also suggest the full or partial mediating role of procedural and relational switching costs between the innovative attributes and the use of e-book readers. Financial switching costs, however, are not influential for the use of e-book readers.