Three Competing Models on Customer Loyalty in the Context of Mobile Subscribers

Abstract

Three competing models based on same six constructs have been examined to find out which model explains mobile subscribers’ loyalty most meaningfully. Data were collected from 195 subscribers of the state-owned (or public) mobile operator in Bangladesh. In all three models, the constructs were measured with same indicators and most of the causal paths were common too in all three models. Confirmatory Factor Analysis was employed to assess the validity and reliability of each construct and the results were satisfactory. Structural Equation Modeling was used to assess the data-model fit. All three models displayed satisfactory goodness-of-fit indices. Path analysis was used to assess the hypotheses. In first two models all hypotheses were empirically supported. However, eight out of nine hypotheses were supported in the third model. To evaluate the competing models, chi-square (χ2) difference statistics and change in degrees of freedom (df) have been used. Later on, PNFI, ratio of explained paths, and explained variance (R²) in endogenous variables were considered to identify the best customer (subscriber) loyalty model. By far the second model showed superior results. This study might encourage the mobile operators to take necessary measures to create a loyal customer base.