Sustainable service quality and customer loyalty: The role of customer satisfaction and switching costs in the Pakistan cellphone industry

Abstract

Generally, the current scenario in the hyperactive corporate world, and specifically in the telecom sector, renders companies to compete concurrently on two fronts: Expansion of their customer base and the retention of their current customers. In order to explore and examine the latter concept, the current study hypothesizes the effects of sustainable service quality on customer loyalty with a mediating role of customer satisfaction conceptualized through the reciprocity theory. The study also considers the suggested moderating role of switching cost by theorizing the Apostle model. Pertinently, the satisfied customer may not be loyal if the switching cost is low, since the dynamics of the switching cost provide a useful insight into the phenomenon of retaining the customers through customer satisfaction. The research opts for explanatory study where data were conveniently collected. The study has used the PROCESS macro model 4 and 14 to analyze the data. Findings reveal that the role of customer satisfaction is significant but the effect of the switching cost was considered to be insignificant, elucidating that a satisfied customer will remain loyal even if the switching cost is low. It means that sustaining service quality longitudinally did not affect customer loyalty in the presence of a low switching cost. With a view to complement the study, managerial implications of a switching cost have also been discussed.