Articale

African Journal of Business Management Vol. 4(12), pp. 2402-2408, 18 September, 2010 Available online at http://www.academicjournals.org/AJBM ISSN 1993-8233 ©2010 Academic Journals

Full Length Research Paper

Determinants of consumer retention in cellular industry of Pakistan
Jawaria Fatima Ali1, Imran Ali1,2*, Kashif ur Rehman2, Ayse Kucuk Yilmaz3, Nadeem Safwan4 and Hasan Afzal5
1

Department of Management Sciences, COMSATS Institute of Information Technology, Lahore Pakistan. 2 IQRA University Islamabad, Pakistan. 3 Department of Aviation Management, School of Civil Aviation, Anadolu University, Eskisehir, Turkey. 4 FUIEMS, Foundation University Islamabad, Pakistan. 5 Independent Researcher, Hong Kong.
Accepted 9 June, 2010

Cellular industry of Pakistan has grown many folds in recent years. Many new entrants have also joined the market to reap the potentials of this growing industry. This situation has originated a hyper competition among major cellular service providers in Pakistan. Companies are working hard to introduce more innovative and eye-catching products to attract customers. The companies with large consumer base are striving to reduce their switching costs. However the main concerns of the cellular service providers is to retain the existing customers. This research is designed to find out the determinants of consumer retention in cellular industry of Pakistan. This is an exploratory study based on primary data which was collected from University students of Pakistan. The study found user friendliness, price reasonability and call clarity as strongest determinants of consumer retention in cellular industry of Pakistan. Although the findings of this study are specific to cellular industry in Pakistan, these may be generalized to any other market passing through transitional phase of rapid growth and characterized by low paying capacity of customers. Key words: Customer satisfaction, consumer retention, switching cost, cellular industry,

References: Ali I, Yilmaz AK, Rehman KU, Ali JF, Nazir S (2010). Linkage between Corporate Social Responsibility and Consumer Retention. Afr. J. Bus. Manage., 4(4): 475-485 Anderson E, Sullivan MW (1993). The antecedents and consequences 2408 Afr. J. Bus. Manage. of customer satisfaction for firms. Mark. Sci., 12(2): 125-143. Anderson EW (1996). Customer Satisfaction and Price Tolerance. Mark. Lett., 7(3): 265-274. Anderson EW, Fornell C, Lehmann DR (1994). Customer satisfaction, market share, and profitability: Findings from Sweden. J. Mark., 58: 53-66. Andreasen AR (1988). Consumer complaints and redress: What we know and what we don 't know. In E. S. Maynes (Ed.), the frontier of research in the consumer interest (675-721). Columbia, MO: University of Columbia and American Council of Consumer Interest. Antreas DA, Opoulos AI (2003). Modeling customer satisfaction in telecommunication: Assessing the multiple transaction points on perceived over all performance of the provider. Prod. Oper. Manage., 12(2): 224-245. Barnes JG (1997). Closeness, Strength, and Satisfaction: Examining the Nature of Relationships Between Providers of Financial Services and Their Retail Customers. Psych. Mark., 14(8): 765–790. Bendapudi N, Berry LL (1997). Customers’ motivations for maintaining relationships with service providers. J. Retail., 73(1): 15–37. Bolton RN, Drew JH (1991). A multistage model of customers’ assessments of service quality and value. J. Cons. Res., 17: 375384. Bosch VG, Enriquez FT (2005). TQM and QFD: Exploiting a customer complaint management system. Int. J. Quality Reliability Manage. 22(1): 30-37. Bowen E, Lawler E (1992). The Empowerment of Service Workers: What Why, How and When. Sloan Manage. Rev., 33(3): 31-39. Brown SA, Gulycz M (2001). Customer relationship management: A strategic imperative in the world of e-business: New York: Wiley. Brown TJ, Churchill GA, Peter JP (1992). Improving the Measurement of Service Quality. J. Retail. 69: 127-139. Butt M, Run E (2008). Measuring Pakistani Mobile Cellular Customer Satisfaction. Icfai J. Serv. Mark., 6(1): 40-50. Carol S (1982). An Investigation into the Determinants of Customer Satisfaction. J. Mark. Res. 19: 491-504. Chang TZ, Albert RW (1994). Price, Product Information, and Purchase Intention: An Empirical Study. J. Acad. Mark. Sci., 22(1): 16-27. Churchill GA, Surprenant C (1982). An investigation into the determinants of customer satisfaction. J. Mark. Res., 19: 491-504. Churchill GA Jr. (1979). A Paradigm for Developing Better Measures of Marketing Constructs. J. Mark. Res., 16: 64-73. Cöner A, Güngör MO (2002). Factors affecting customer loyalty in the competitive Turkish metropolitan retail markets, J. Am. Acad. Bus., 2(1): 189-195. Cronin J, Taylor A (1992). Measuring service quality: A re-examination and extension. J. Mark., 56: 55-68. Dawkins PM, Reichheld FF (1990). Customer retention as a competitive weapon. Direct and Board, 14: 42-47. DeSouza G (1992). Designing a customer retention plan, J. Bus. Strat., 13(2): 24-28. Ferguson R, Brohaugh B (2008). Telecom’s search for the ultimate customer loyalty platform. J. Cons. Mark., 25(5): 314-318. Fornell C (1992). A national customer satisfaction barometer: the Swedish experience. J. Mark. 56: 6-21. Fornell C, Wernerfelt B (1987). Defensive marketing strategy by customer complaint management: a theoretical analysis. J. Mark. Res., 24: 337-346. Gerpott T, Rams W, Schindler A (2001). Customer retention, loyalty, and satisfaction in the German mobile cellular telecommunications market. Telecom. Policy. 25(4): 249–269. Gremler DD (1995). The effect of satisfaction, switching costs, and interpersonal bonds on service loyalty. Unpublished dissertation, Arizona State University. Hansemark OC, Marie A (2004). Customer Satisfaction and Retention: The Experiences of Individual Employees. Manage. Serv. Quality, 14 (1): 40-57. Heejin L, Richard W, Jungkun P (2006). M-loyalty: Winning strategies for mobile carriers. J. Cons. Mark., 23(4): 208-218. Jones TO, Sasser WE (1995). Why satisfied customer defects. Harv. Bus. Rev., pp. 88-99. Jones, M.A., and Sue, J. (2000). Transaction-specific satisfaction and overall satisfaction: an empirical analysis. J. Serv. Mark. 14: 147-159. Kang GD (2006). The hierarchical structure of service quality: integration of technical and functional quality. Manage. Serv. Quality, 16(1): 37-50. Kim H (2000). The churn analysis and determinants of customer loyalty in Korean mobile phone. Korean Information Society Rev. Kim MK, Park MC, Jeong DH (2004). The effects of customer satisfaction and switching barrier on customer loyalty in Korean mobile telecommunication services. Telecom. Policy. 28: 145-159. Kim MK, Park MC, Jeong DH (2004). The effects of customer satisfaction and switching barrier on customer loyalty in Korean mobile telecommunication services. Telecom. Policy, 28(2): 145-159. Lee J, Lee J, Freick L (2001). The impact of switching costs on the customer satisfaction-loyalty link: Mobile phone service in France. J. Serv. Mark., 15(1): 35-48. McDougall G, Levesque T (1994). A revised review of service quality dimension: An empirical investigation. J. Prof Serv. Mark., 11(1): 189210. Min D, Wan L (2009). Switching factors of mobile customers in Korea. J. Serv. Sci., 1: 105-120. Negi R (2009). User perceived service quality of mobile communications: experience from Ethiopia. Int. J. Quality Reliability Manage., 26(7): 699-711. Parasuraman A, Zeithaml VA, Berry LL (1988). SERVQUAL: A MultipleItem Scale for Measuring Consumer Perceptions of Service Quality. J. Retail., 64(1): 12-40. Peters T (1988). Thriving on Chaos, Alfred A. Knopf, New York, NY. Pollack BL (2009). Linking the hierarchal service quality model to customer satisfaction and loyalty. J. Serv. Market., 23(1): 42-50. Reichheld FF (1996). The loyalty effect: The hidden force behind growth, profits, and lasting value. Boston, MA: Harvard Business School Press. Reichheld FF, Sasser WE (1990). Zero defections: quality comes to services. Harvard Bus. Rev. September-October, pp. 105-111. Rust RT, Zahorik AJ (1993). Customer satisfaction, customer retention, and market share. J. Retail., 69(2): 193215.http://www.finance.gov.pk/finance_blog/?p=238. Shankar V, Lakshman K (1996). Relating Price Sensitivity to Retailer Promotional Variables and Pricing Policy: Empir. Anal. J. Retail., 72(3): 249-272. Spreng RA, MacKoy RD (1996). An empirical examination of a model of perceived service quality and satisfaction. J. Retail., 72(2): 201-214. Steenkamp JBEM (1989). Product Quality, Van Gorcum, Assen/Maastrichts. Stephens N, Gwinner K (1998). Why don’t some people complain? A cognitive-emotive process model of consumer complaint behavior, J. Acad. Mark. Sci., 26(3): 172-189. Valdecantos C (2009). Pricing optimization in Africa: the challenge. Africa Telecommunications Network. Cited on November 03, 2009.http://africatelecommunications.ning.com/profiles/blogs/pricingoptimization-in-africa. Westbrook RA, Fornell C (1979). Durable goods buyer purchase information. J. Mark. Res., 16: 303-312. Woo KS, Fock KY (1999). Customer satisfaction in the Hong Kong mobile phone industry. Serv. Ind. J., 19(3): 162-175. www.pta.gov.pk. Yankee group (2001). 'Churn management in the mobile market: A Brazilian case study ', Pub ID: YANL696399. Yu CJ, Wu L, Chiao Y, Tai H (2005). Perceived quality, customer satisfaction, and customer loyalty: the case of lexus in Taiwan, Total Quality Manage. Bus. Excellence, 16(6): 707-719. Zeithamal A, Bitner MJ (1996). Customer contribution and roles in service delivery. Int. J. Serv. Ind. Manage., 8(3): 193-205. Zeithamal A, Pasuraman A, Berry L (1990). Delivering Quality Service: Balancing Customer Perceptions and Expectations. New York: The Free Press Division of Macmillan, Inc.