The impact of service quality on loyalty intention and customer satisfaction : the moderating effect of price fairness and switching cost of prepaid mobile phone users in Thailand
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Date
2010-04
Authors
Srikanjanarak, Saowanee
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Abstract
Increasing global competition has led to an intensively competitive market among
service providers. Several organizations have created and developed a variety of products
or services; in particular the telecommunications industry has developed mobile phone
services. Various value-added services linked to mobile phone services, ihe complexity of
price strategies in mass service context is increasingly competitive, offering variety of
service options among service providers and various promotions have been increasingly
llSed as major tools to retain their existing customers. However, service quality models
have placed little focus on value-added services and no research has yet operationalized
the conrept of value-added services in a service quality model from the customer's
perspective of the service industry. In addition, the lack of operational measurement to
capture the price fairness perception and the impact of various strategies in customer's
view in terms of switching cost has received little attention in the service marketing
literature. Moreover, there have been limited studies investigating their impact on
customer behaviour. Hence, this study aims to further conceptualize a service quality
model, develop an extension of conceptualization and a multiscale measurement of price
fairness perception and examine the effects of various dimensions of service quality on
loyalty intention through customer satisfaction. Moderating effects of price fairness and
switching costs (positive and negative) on customer satisfaction and loyalty intention are
also investigated. Data is collected from individual users by using self-administrated
questionnaires and 998 usable responses were analyzed. Four dimensions of service
quality are created; core service, non-voice service, entertainment service and customer
care service. They affect both staying intention and word of mouth intention, except
entertainment services which have impact only on word of mouth intention. The results
support the mediation effect of customer satisfaction on three dimensions of service quality
and loyalty intention, except entertainment service. The moderating effect of price fairness
perception and positive switching cost has been demonstrated. These fmdings indicated
that to maintain the loyalty intention between customer and service provider, the creating
and developing the quality of core service, other services related to the core service seems
to be an increasingly hllportant weapon. However, entertainment <;ervice is also effecting
an increasing impact on word of mouth intention. Moreover, price strategy should be
focused on the fair deal and positive switching cost should be pursued from the point of
view of the customer. The general discussion, limitations, theoretical and practical
implications and recommendations from the current findings are provided.
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Keywords
Increasing global competition has led to , an intensively competitive market among service providers.