factors behind the brand switching in telecom industry

8/11/2019 Factors Behind the Brand Switching in Telecom Industry

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Factors behind the brand switching in telecom industry

The issue of Customers switching to other service providers have been the cause of intensive research from many years now and have given rise to many theories.Due tothe increased competition in the telecommunication industry it has become extremely

important for the companies to pay attention towards retaining of the customers.Thisresearch study particularly investigated the causes of customer switching behavior.A prolific way to gain the knowledge about the switching behavior of customers is basically to examine the various factors that play imtegral role in switching behavior.This qualitative research study has offered new insights by defining and identifyingthe customers rationale to switch from one service provider to another. The model isestimated using the data set on the number of switching behavior. A total of 100

respondents were surveyed to identify the factors that have a greater effect on thecustomer satisfaction.The data were analyzed by the Optimal Scaling (CategoricalRegression)to test the hypothesis. The model identified that

CHAPTER ONE: INTRODUCTION

This research tried to find out the underlying factors that made the customer to

switchover to another service provider in telecom industry. The telecommunicationindustry is one of the most important industries of the world. In order to gaincompetitive advantage as competition is getting more and more intense, thecompanies are compelled to innovate and do their best for the customer satisfaction. As in the telecom industry the customers have multiple choices to select amongservice providers and actively seek their rights of switching from one telecom serviceprovider to another. In this ferocious competition customers requires better servicesat reasonable prices, while service providers concentrating on retention of the mostprofitable customers instead of acquisition..The technology in telecommunicationindustry is booming with fast pace thus bringing the changes in the sizes and types of network services. Multiple tariffs plans are usually offered by the network serviceproviders to compete in their menu plans and to provide the quality of service. In thetelecom industry the service providers try to attract the large number of customers toexploit the consumers preference heterogeneity. The need to understand that why customers switch to another service providers have usually become a key area of study. The switching behavior has to be analyzed to identify the possible drivers


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leading to customer switching behavior Its entirely apparent that when a customerdecides to switch over to another network they try to figure out that which serviceprovider offers them best. The switching costs also affect the customer switching behavior. The customers switch when they find that their potential savings relatively exceeds switching cost. The deep understanding of the customers switching behavior

in the telecom industry has an important proposition for the service providers.This study helps us to analyze the factors that cause the switching behavior. As thetelecom industry has been growing rapidly and the rate of penetration also increased,the number of new customers subscribing to thus cant be reduced. Where as in themature market with a base of shrinking potential subscribers, stealing the customersof competitors and retaining its own customers has become the most important

strategy for the service firms. Therefore the service firms have got more interested inknowing and understanding the underlying factors leading to switching behavior of customers, as customers are totally heterogeneous in nature and can repeat switchingfrom time to time. As stated in the relevant literature the service of high quality helpsto create customer satisfaction, loyalty and market share growth by petition for new customers and improved financial performance and productivity (Lewis, 1993); Andereson, Fornell & Lehmann, 1994) . According to Hackl, Scharitzer, and Zuba

(2000) had demonstrating it by adding that customer satisfaction is a prerequisite of customer retention, satisfaction and loyalty.

Those customers who are loyal plays vital role in building up businesses, by setting updistinct moves, by paying the premium prices and providing the companies with a setof potential new customers by positive word of mouth. (Ganesh et. al. referred in Aydin and Ozer, 2004)

In fact the telecom industry losses their customers more frequently so its usually challenging thing for the service providers to retain their existing customers andattract the new customers

In telecom industry it has been observed that the customers when remainedconnected with the particular network or the service provider then the long tenure of

their relationship is particularly very important for the success of a company in thiscompetitive era. (Gerpott et. al. 2001 referred in Aydin and Ozer 2004).


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Price has been considered as one of the major contributing factors in brand switchingin telecom industry as the customers were price-concious. Kay, (2006) argued that brand image has been built-in into the lives as well as the minds of customers because brands were considered to be not only the companys property but also as a culture ora social property by customers.

STATEMENT OF THE PROBLEM

The fundamental problem in predicting the customer choices exist in the fact that brand switching decisions of the customers are solely made on the bases of severaldifferent criteria simultaneously which includes factors like brand image, features,network quality, prices, etc. Thus the frequent switching behavior of customers hascompelled to review such factors that affect the telecom industry. Thus the problemhas been more confounded in telecom industry where customers get attractedtowards the competitors offers & features and analyzes the expectations of thecustomers regarding the telecom industry services.

OBJECTIVES OF THE STUDY

The basic purpose of this study is to determine the factors that influence the

customers to switch from their particular service providers to others and to access theproblems generally faced by the service users and their satisfaction towards thedifferent cell phone service providers.

SCOPE OF THE STUDY

The scope of this study is limited to five major players of Telecom industry and those

are Mobilink , Ufone, Telenor, Warid, & Zong. The objective of this study is toexamine the underlying factors that led to the customer switching behavior. Thisstudy has been carried out in the Karachi city of Pakistan. The Purpose of this study isto know the customer satisfaction for these various telecom service providers. Theleading switching behavior of customers in telecom industry is a question of study toanalyze the factors influencing their switching behavior and how important they perceive these various factors.

METHOD:


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HYPOTHESES:

H1: Price has a significant impact on brand switching in the telecom industry.

H2: Network Quality has a significant impact on brand switching in the telecomindustry.

H3: Brand Image has a significant impact on brand switching in the telecom industry.

H4: Value Added Services have a significant impact on brand switching in the telecomindustry.

H5: Sales Promotions have a significant impact on brand switching in the telecomindustry.

H6: There are no differences w.r.t demographics for customer satisfaction in telecomindustry.

CHAPTER TWO: LITERATURE REVIEW

Much attention has been given to the concept of brand (Kotler, 1991 p.442) definedBrand as a name, term, sign, symbol, or design, or combination of them which isintended to identify the goods of one seller or group of sellers and to differentiatethem from those of competitors. To interpret the perception of the company peopleusually developed knowledge systems (i.e schemas) Corporate Image believed to haveidentical characteristics as self-schema (Markus,1977) with consideration to persuadethe buyers purchasing decision i.e good image of corporate encourages purchasefrom one company by abridge decision rules.

(Bateson 1995) stated that the service quality is generally conceptualized as anattitude, the evaluation of the service offered. Quality is basically made up from aseries of evaluated experiences and are usually fluctuates less comparatively thanattitudes built from the satisfaction emotions. Parasuraman et al. (1988) stated thatthe customers judge the service quality on the basis of overall firms superiority andexcellence. According to (Gronroos, 2000) the evaluation of service quality by

customers could be judge through the interaction process that exactly happens orperceived by customers leave a critical impacts on customers. (Parasuraman et al.,1988; Aydin and zer, 2005; Ismail et al., 2006; etc.) If service is high in quality it is


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regarded as a key to succeed in most competitive service markets. Many researchershave indicated that the customer satisfaction and the customers trust in that servicefirm is directly influence by the service quality being provided. The pre-purchaseexpectations if fulfilled with the kind of service quality being provided the customersmight be satisfied. The telecom industry which is basically the service industry, the

service quality is an important factor to develop the customers satisfaction andloyalty. (Gronroos 1984) analyzed the two distinct service quality dimensions whichare technical and functional quality. Technical quality is something that customersget as an conclusion of an dealings with the service provider. Where as the functionalquality is something that has to do with how the service has been delivered.(McDougall and Levesque 2000) also analyzes the theory of technical quality,although in the type of core service quality i.e. product or service related offerings. As

compare to technical quality, functional quality tends to be more important incustomer satisfaction. (Lim, Widdows, and Park 2006) has identified the fivedistinctive proportions of cell phone service quality, and the indirect and direct effectson economic value, and emotional value on faithfulness through customersatisfaction. These are usually network, billing, pricing, data and customer services. According to ( Johnson & Sirikit, 2002) the perceptions of the customers about theservice quality affects their behavior intentions. Even though if onetelecommunication company has been preferred by the customer to the over another based on the perceived quality of the service provided, that customer might engagedin a repurchasing cycle and that would most probably leads to recommending thespecific service providers to their peers.

Modern research has tried to set up the bases for improving the understanding of customers switching behavior and can be expressed in two main areas:

(1) The factors and the processes underlying customer switching decisions.

(2) The exact factors that encourage switching.

(The effort of Roos 1999) He discriminates among the three determinants of switching decisions using the Switching Path Analysis Technique (SPAT): (a) Pushing

determinants (the basis to switch to another supplier). (b) Pulling determinants(factors that stimulate the customers to come reverse to the original supplier) and (c)Swayers (they do not cause switching by themselves; they can only lessen or reinforce


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the switching decision).

Though the most of the concentration is given to the specific factors that lead toswitching behavior literature.(Bansal et al.2005), Portraying from repositioningliterature, thus create a model of customers switching behavior that recognizes themethod by which customers make a decision to switch service providers. (Roos 1999),He has also identified the determinants that play an integral role in customersswitching behavior. He has also emphasized on push, pull and mooring variables thatare fundamental to the switching process. (Keaveney 1995), Among his mostsignificant revolutionary works, classify eight factors coming behind customersswitching decisions in most of the service industries, which includes core service breakdown, employee reaction to service failures, attraction by competitors, pricing

or inconvenience. Collectively with the variables point out above. It has also identifiedthe subsequent as determinants of customers decisions to switch suppliers: CustomerDissatisfaction (Swinyard and Whitlark, 1994), perceived quality (Rust and Zahoric,1993), awarenessof alternatives (Capraro et al., 2003), location (Jones et al., 2003)and switching costs(Klemperer, 1995; Burnham et al., 2003).

(Keaveney 1995) has also identified several other leading factors that associate with

the customer switching decision and those differences are the persons attitude, behavior, and of course the socio-demographic characteristics .

Switching cost plays an integral role extensively in literature. Well switching costappears in different terms to every researcher to (Benkenstein and Stuhlreier,2004)switching cost is related to poor service quality and to (Gerrard and Cunnininggham,2004) its related to the customers reaction to high prices where as to (Bowen and

Chen 2001) switching cost is thus the action taken by the customer when thecustomer get dissatisfy. ( Burnham, Frelsand & Mahajan 2003),

He has classified switching cost as the following: (a) procedural switching costs, (b)financial switching costs, (c) relational switching costs.

However these cost were negatively correlated with the customers switching behaviorpattern.

Klemperer (1995) defined the three types of switching cost (a) artificial cost (b)learning cost


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(c) transaction cost..

Where as the most important is the transaction cost which shows that the customershould be aware of the cost incurs while switching to another service providers.(Jones, Mothersbaugh and Beatty 2000) and (Sharma and Patterson 2000) they recommended that switching costs are basically the factors themselves in influentialswitching. (Bumham, Frels and Mahajam 2003) survey in cross- industry specify thatswitching cost such as financial loss and suspicions with the new service providerdiscourage consumers from switching to other service providers regardless of dissatisfaction. References of family and friends and pressure for consistency couldalso dispirit customers from switching through peers, expectation, customs andtraditional values.

Customer satisfaction among theoretical literatures has been given muchconsideration. (Fornell 1992) defined that satisfaction derives from the overallassessment depending upon the total consumption and purchase experience of theservice compared with repurchasing expectations over time.

The evaluation that a customer makes of any definite transaction is known asSatisfaction. While ( Oliver 1980) stated that Satisfaction is a summary psychological state resulting when the emotions surrounding disconfirmedexpectations are coupled with the consumers prior feelings about consumptionexperience.

In marketing literatures, customer satisfaction has been an indicator in evaluating therelationship between customers and service providers.

According to Li (2008), five emotions perceived by customers as below aresatisfactory:

(1) Satisfaction: the products can be accepted or tolerated;

(2) Content: the products bring people with a positive and happy experience;

(3) Relieved: the products remove peoples negative state.

(4) Novelty: the products bring people with freshness and exciting;


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(5) Surprise: the products make customer unexpectedly pleased

(Yi and Jeon, 2003) His study is based on the subscription market . Customers basically subscribe to mobile phone services with no purpose of switching, they tendto remain loyal with the present service until and unless some factors prompt them toswitch to another network for improved features or services. The research shows thatcustomer satisfaction is basically could not be fully explained through customerretention that if customer is retained he is satisfied. There are other underlyingfactors to determine the switching. (Inger 2008) He analyzed that the fineunderstanding of the emotion that plays an important role in customer switching behavior and identifies the occurrence of negative distinct emotions in terms of distinct triggers. The findings was that the emotions identified were located in the

relationship trigger part and was immensely expressed by the respondents duringtheir switching behavior in forms of anxiety, annoyance, disappointment anddissatisfaction, stress tension etc. (Seth et al 2008) describes in his study that tomanage the customer perceived service quality for a cellular mobile phone, it analyzesthat the service quality attributes is very important whereas responsiveness is its mostimportant dimension, followed by other dimensions such as reliability, customernetwork quality, assurance ,empathy and tangibles. (Kalpana and Chinnadurai 2006)

analyzes in their study named Promotional Schemes for Cellular Services. statedthat the increased in competition and customers changed taste and preferences in allover the world prompting the companies to change their strategies as well. The study revealed that the advertisement plays vital role in influencing the customers to switchover.

BRAND IMAGE:

Brand image was defined by Keller (1993, p3) as the perceptions about a brand asreflected by the brand associations held in consumers memory.

According to (Dobni and Zinkhan, 1990) brand image is a perception or a picture of a brand created in the minds of customers through different responses of customersthat could be emotional or rational. ( Gronroos 2007, p.287) A brand is not first built

and then perceived by the customers.Instead, every step in the branding process,every brand massages, is separately perceived by customers and together add up to a brand image, which is formed in customers minds.(Gronroos 2000) stated that the


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relationship of brand being develop with the customers is usually based on a series of contacts with brands experienced by the customers.

The customers build brand image in their mind through different sources such as word of mouth, public reputation, and marketing communication. The positive brandimage prevents the customers from switching to another brand. The more value the brand hole the more profitable would it be for the company (Ibid).

.

CORE SERVICE FAILURES:

Core service failure has been seen as the major cause of customers switching

behavior in (Susan Keaveney 1995) study. Core service failures might be itself themajor cause or it could be accompanied by other reasons that makes the customer toswitch. Basically the Core Service Failures includes all the that are due to errors or thetechnical problems caused by the service providers themselves.( Keaveney 1995)stated that the core service failures includes the errors of billing, service mistakes andservice disasters. If the customer sees the billing errors or if accompanied by the delay in correcting those errors he or she is likely to switch to another service provider.

In the cell phone industry as the new features, packages plans etc are introduced they need to change or update their billing systems which may ultimately could result in billing problems. As mentioned above another factor of core service failure is servicedisaster or service catastrophes which is the breakdown of the companies core servicefunction which makes the customers to switch because of the loss of their time andmoney.

Example: Mr. Rob Simpson asked his service provider to make his call forwarded toanother cell phone number after 3 rings. But due to some service problems, the callscould not be forwarded. And as Mr. Simpson was an incensed customer delay inaddressing such problems might lead to the switching behavior.

PRICING:

(Keaveneys 1995) study indicated that the third most important factor in switching behavior is pricing. Pricing basically includes call charges, rates, penalty, surcharges


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or fees. Customers switch at times when they perceived that the price is high andthats totally unfair because they have the reference prices on their mind which they tend to compare it with past experience or the acceptable charges for the values or theservices that are being rendered to them. Customers compare the prices of thecompetitors that what other service providers are offering them for the same service.

According to (Peng and Wang, 2006) high pricing negatively influenced the purchaseprobabilities of customers. (Lichtenstein et al., 1993) stated that the perception of price usually thought to be related to price searching. (Oliver 1997) stated that thecustomers relate the prices to the service quality and then generate dissatisfaction orsatisfaction. And if a customer thinks that the price is comparatively fair then only thecustomer would go for transaction with service provider. According to previous

studies (Cheng et al.2008) suggested the two dimensions of price perception. Thefirst one is rationality of prices which shows the way that how the price is beingperceived by the customers as compared to its competitors. And the other is basically the value for money. According to (chitty et al., 2007) High quality services ascompare to low quality equivalents cost more. (Oliver, 1997; Peng and Wang, 2006;Cheng et al., 2008; Kim et al., 2008). These researchers have described the price as being the most influential factor on customer satisfaction and trust. ( Peng and Wang,

2006) stated that the customers mainly switch due to pricing issues i.e high, unfairpricing.

Another category of pricing which leads to switching behavior relates to deceptivepricing. In which the customer has not been given all the subsidiary charges and thefinal price when charged is more then the customers expectations and the pricequoted to customer.

Example: The customer subscribed for the free minutes for a particular time durationi.e certain minutes free till that particular time and if the customer exceeds theminutes in either time period there are an additional charges

Such kind of hidden pricing causes high churns that prompts the customers to switchto another service providers. (Ericsson Consumer lab survey 2004) studies showed

that the 86% of the customers select their service providers on the basis of the pricingof the plans and the features thus makes it a critical factors in choosing the serviceprovider.


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INCONVENIENCE:

Keaveneys study indicates that the inconvenience by the service providers leads thecustomers to switch to another service operator. The inconvenience includes thefactors such as time elapse, long hours of operations, waiting for the service or thelocation of the operator. As in customer services the clients have to wait for so long onthe telephone for the customer representative. One solution that has been suggested by (Taylor 1994) to stay away from infuriating the waiting clients is to Filling timecan reduce the anger and the uncertainty felt by the waiting client

( Taylor,1994,p.60).

VALUE OFFERS:

(Zeithami 1988) stated that the customers judge the consumption value aftercomparing its benefits that could be gain from other services as well along with theircost.(Ravald and Grnroos, 1996). Proposed that the service providers throughenhanced offers provide the superior value to improve the customer satisfaction by increasing the benefits and decreasing the benefits so that the customer is retained.

COMPETITIVE OFFERS:Competition makes the service providers in telecommunication industry to attract thenew customers to its network by persuading them, offering them the large amount of discounts, promotional time bound free-calling etc. These offers has led thecustomers with number of choices specially those who are price- conscious. (Weisser,2004 p.33) Truth is probably you dont need to switch carriers to get bargainscore

a deal just by calling your current carrier and threatening to switch. A price war inany kind of industry is not good because it makes the industry less profitable by constant discounting, which makes the customer price-sensitive and more likely toswitch.

ETHICAL PROBLEMS:

A frequent complain by the customers is that while the service providers announce alow call rates/price for the package, there are mostly hidden charges not specified.Such hidden pricing can be harmful in the long run as the massive customers can


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switch as they get much better offer.

While the callings patterns of customers frequently changes, optimisation of the rateplans needs to be done to make sure that it best suits the customers needs to preventthe customers from switching.

(Steward, 1993) Network Services is one of the most important pillars in a telecomindustry. Network services include call quality, network connectivity, and network coverage. From customers point of view the dropped calls, stagnant or brokeconversations can make the customers frustrated and annoyed. (Shah, 1996) Theenhanced landline communication quality of today with the good voice clarity and callquality has raised the customers level of expectation similarly in cell phone industry.(Boney 1997) stated that the mostly people just used the phone but what exactly andtruly the customer wants was a clear call, a good connection, and a good network coverage so that the phone can be easily taken where they want to. (Steward, 1996)stated that the advancement of network technologies and air boundary standards were swiftly becoming more complex. Therefore any drop calls, static, weak signals or broken connections could simply lead to customers dissatisfaction and churn. (Shah1996) stated that background noise could also be another factor leading to customers

switching. The echo canceller was at the centre of very intricate digital network thatcan help service providers to deliver rge good quality of service to the customers.

Boney (1997) studies indicated that the most important aspects of service is thecustomer service value. As a result a variety of choices should be offered whichincludes contract options, handsets features and pricing etc. Among all these Pricingis the most importantly related to the customers value. According to (Meyers 1997)

building up the brand image includes lots of responsibilities like paying continuousattention to the needs and the requirements of the customers in markets. Ensuringthe satisfaction among employees, creating brand equity and brand association.Emerging up with new technology stages and concentrating on expansion by developing new services for their customers. According to (Ryan 1995) The serviceproviders needed to improve their billing systems in line to continue eccentric outaccurate bills. Billing system was basically the lifeblood of any business. If the service

providers could not have the billing systems accuracy or in capable to bill in a timely pattern, they could be into a huge cash flow problems that could destroy the business.


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( Burdiek 1993) studies showed that the customer quality model for a cell phoneservices yet not exist, despite the reality that a incredible quantity of industry capitalhad been owed to model another network performance characteristics.. Garelis (1996)revealed that by executing a technology that offered our employees with the accuratetools, we facilitated them to take possession of their jobs, and that enhanced the

overall value of service provided. Inventive software applications were used for theimprovement of the quality of services to the customers. ( Lonergan 1999) revealedthat the churn remained a main

Challenge for the cell phone providers. The most common reason of churn amongcustomers was switching over to another network service provider. Even though 25%of customers had left their previous service providers to avail the promotional offers

by other service providers.Customers switch over to different service providers for several reasons. The reasonscould be that the service provider fails to meet the needs of its customers because of the changing demand patterns and circumstances. Or a customer might get betteroffers from its competitors. However if the motive of any business is to get theknowledge of the customer behavior, and how and why in the customer base the

fluctuations can take place is critical for the effective management of customerrelationships.

Relationship with the customers is a dynamic process that involves the interaction between a service providers and the customers. According to (Bolton 1998; LaBarberaand Mazursky 1983; Rust et al.1999). The process of consumption that the customersgo through leads them to the decision of whether to switch or to stay with the

company.The main reasons or the sources of the fluctuation in customers relationships in thesituation of the switching course is known as trigger.( Gustafsson, Johnson, and

Roos 2005; Roos 1999; Roos, Edvardsson, and Gustafsson 2004; Roos, Gustafsson,and Edvardsson 2006). Previously carried out studies have shown that triggers can becategorized in terms of the own lives of the customers known as situational triggersthe impact of market known as influential trigger and the conventional criticalincidents known as reactional triggers. This study described that the two facets


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considered being very important for the inclusive understanding of the customers who switches very frequently. (Roos 1999) stated that the customer relationships aretriggered by the driving forces that usually have long lasting effects on customers.Customers if experiences a trigger, they may own some sort of sensitivity to switchingdeliberately or nondeliberately. (Roos, Gustafsson, and Edvardsson 2006) If

sensitivity persists in customer relationships it influences customers valuation andsteadily causes switchover to competitors. The literature offers theoretical support forthis assumption that when customers are attracted by other alternatives they demonstrate quiescent attitude towards their existing service providers that persuadetheir switching behavior. According to (Dambrun and Guimond 2004) referred toimplied attitudes as an insensible mode of definite behavior.(Hastie and Park 1986;Meyer 1987). Park and Mittal (1985) stated that the stimulated capacity of a switching

condition is not always the same from the perspective of an aggregate customer. Itdiffers by depending on the variety of offers presented to the customers by thecompetitors. In the framework of this study the outcome of this condition is switching because the competitor contact plays an influencing role.

(Gopinath 2005) stated that the trigger is referred to time-related changes and thedefinite factors that included in them. Customers who willing to switch are definitely

sensitive to change.(Ahluwalia, Burnkrant, and Unnava 2000; Garbarino andJohnson 1999; Gustafsson, Johnson, and Roos 2005; Roos, Gustafsson, andEdvardsson 2006).

When customers are confronted by such situations they become familiar with thereasons that the service providers they had chosen is no longer good enough and valid. Thus such kind of difficulty causes sensitivity and those customers actively try

to switch over to another service provider to get a better subscription, whereas(situational trigger) reflects those customers who get easily attracted toadvertisements and company promotions make them to switch over and to belief onthe advertisements promises known as (influential trigger) and lastly those customers who have been treated harshly or badly move to new alternatives known as reactionaltriggers. According to (Roos 1999; Roos, Edvardsson, and Gustafsson 2004).Onething to consider most in the context of the influential trigger is that some of thecustomers tend to switch because of the petite financial benefits. It seems that its not just the matter of economic rewards but some kinds of incentives are being offered on


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switching.

(Liljander 1994; Parasuraman, Zeithaml, and Berry 1994; Park and Jiho 1998.)However in marketing literature and in psychology field the objectivity of customerevaluations has very often been questioned, that what makes the customers tocompare among when they argue on something being more expensive or lessexpensive. Or the decision for switching over depends on what they compare.

According to (Gronroos 2000) the companies need to develop such new strategies which should be based on customer-driven value creation so that the companies canimprove their profitability as well as productivity in this competition era of services. According to (Edvardsson 1998) the best way to gain knowledge about the customers value perceptions as a basis for the service development and quality improvement isto judge and to learn their switching behavior and through their complaints. Another best way to maintain customer relationships is to focus on communication.

Hart et al. (1991) argued that the closing the communication loop with customers is very important. The customer information could be identified through customercomplaints which are particularly important. Besides all this how service providersrespond to the customers complains in extremely important. Study indicates thatmost of the customers switch because of the service providers response to thecustomers complaints. The tendency to switch over to another service provider ishigh among customers in monopolistic companies comparatively to lose monopolies(Sindh 1990). Numerous studies have focused on complaining behavior,dissatisfaction and satisfaction (Andreasen and Best 1977; Day and Ash 1978; Gilly and Gelb 1982; Edvardsson 1997;Liljander 1999). Customers tend to modify their

complaining behavior and the perceptions they hold about the service quality duringtheir long term relationship with the service providers. Dynamic behavior could beprovoked by the perception influenced by many factors. Blodgett and Granbois 1992;Rust et al. 1997; Bolton et al. 2000). So its really very important to understand thedynamic customer relationships. Day (2000) stated that a many-sided considerationand understanding of the firms customer base is obligatory for all types of communication between a company and its customers. The literature emphasized

upon the value of customer relationship dynamics.( Roos 1999 a, Edvardsson andStrandvik 2000; Roos and Grnroos 2000). In literature of the customer relationship


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the understanding and analysis of customer relationships has been derived fromdecisive incidents. (Edvardsson 1988; Bitner et al. 1990; Olsen 1992; Stauss 1993;Strandvik and Liljander 1994; Stauss and Weinlich 1995; Decker and Meissner 1997). With the passage of time the focus of this study has been changed to strengthen and weaken the effects on customers relationships of the decisive incidents. (Edvardsson

and Strandvik 2000). The more the customer stays in a relationship with the serviceprovider the more value they could generate (Reichheld, 1996b),so the period of timethe customer maintained the relationship is one of the essential factors inunderstanding the value provided by the customer to the service provider(Berger andNasr, 1998 Rosset et al., 2002). Customer switching behavior is therefore a seriousintimidation in achieving the long-term relationships. (Ganesh et al., 2000).Therefore the service providers need to study the processes that help in determining

the customers switching behavior, as they have to make their customer base strong.Bansal et al., 2005).

Marketing Research has contributed a lot in identifying the long term relationshipsand those factors that determine them(Ganesan, 1994; Dick and Basu, 1994), but lessefforts to the factors that motivate the customers to switch over to another serviceproviders. (Keaveney, 1995). In the meantime the literature on customer switching

behavior was mainly focused on the background of such processes (Roos, 1999),rather then on exemplifying customer differences in terms of the lesser or greatertendency to switch to other service providers (Keaveney and Parthasarathy, 2001).

CHAPTER THREE: RESEARCH METHODLOGY

Data Collection & Methodology

Essentially there are two types of data available for the researchers, Primary andSecondary. In this research primary data has been used collected throughquestionnaires based on qualitative and quantitative data. . A questionnaire survey consisting of three pages was used to collect the data (Primary) from respondentsfrom Iqra University; as well as from the Foundation public school. And from some of the private employees, businessman, government employees, etc. The questionnaire

was mailed and e-mailed to the executives, employees of the companies. Some werestudents of engineering college, Management College and undergraduate college. Thesample size consists of 100 respondents. Out of the sample that collected the division


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of the sample size was on the subsequent parameters.. Each participant was given outa questionnaire that consisted of a range of questions questioning them about theattributes which in their judgment plays a very critical role in brand switching behavior.

QUESTIONNAIRE SURVEY:

For the purpose of data collection a questionnaire was devised based on two partsthat consisted questions pertaining to factors which lead to brand switching of customer and the demographics of the respondent. The respondents have been askedthe reasons for switching over to another network service and the relative importanceof those factors in their belief.

RESEARCH TECHNIQUE USED IN ANALYSIS:

The tool that was being used was SPSS. In this study the research technique used forresults interpretation is Optimal Scaling. .

RESEARCH DESIGN:

The methodology is based on Descriptive Research.

Pretest

A questionnaire testing was conducted to identify flaw in design and instruments.Pre-testing refers to the testing of the questionnaire on a small sample of respondentsin order to identify and eliminate potential problem. Here, the researcher intended toconduct a testing to evaluate the questionnaire for clarity, bias, ambiguous questions,

and relevance to the study. Burns and Bush (1998) suggested that a pre-test of 5-10representative respondents is usually sufficient to identify problems with aquestionnaire.

A set of questions was developed to pretest the questionnaire. The pretest and pretestresults questionnaire is presented in Appendix. The Questionnaire was pretested witha total of 6 business executives. Four were given and responded to the pretest

questionnaire. Two were interviewed.

From the results of the pretest, the final version of the questionnaire was developed.


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CHAPTER 4: RESULTS AND ANALYSIS

The method of analysis was Optimal Scaling (CategoricalRegression).Categorical regression quantifies categorical data by assigning numerical values to the categories, resulting in anoptimal linear regression equation for the transformed variables.Categorical variables serve to separate groups of cases, and thetechnique estimates separate sets of parameters for each group.The estimated coefficients reflect how changes in the predictorsaffect the response. Prediction of the response is possible for any combination of predictor values.

The capital R in this table is multiple of correlation which is .679 which shows thatthere is high correlation between dependent and independent variables the secondcolumn which shows R Square which shows that 46% Of variation in network switching is caused by predictors third column is Adjusted R square 34.9% variationis caused by predictors considering number of observations and the number of predicted variables.

The ANOVA table tests the model acceptability and how model fits the first row whichshows regression .Displays information about the variation accounted for by yourmodel and the second row of Residual shows information about the variation is notaccounted by your model the significant value of P is .000. Which is less than 0.05 soit means than model is acceptable and the variation explained by the model is not dueto chance.

In the coefficients table, the first row dont shows constant which means that thatconstant is not significant thats why removed from the model whereas the secondrow second column is the first slope of the regression equation which is .280 showsthat for every bad change in network quality .280 the ratio of network switching will be caused hence its also significant variable since P value in 0.000 which is less than0.05. Second is voice clarity which is not significant variable P>0.05 which meansthat no effect of voice clarity on network switching third is service provider the value

of Beta is -.155 and the variable is significant the beta or slope value is showing thatgood change in service provider service will cause negative impact on network switching . Third is call charges which is insignificant means that is no impact of call


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charges on network switching. Fourth is SMS service which is significant beta showsthat positive change in SMS services can cause -.401 negative impact on network switching means if SMS services are bad there is a chance for network switching.Billing system is also significant P


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The hypothesis 4 tested that the Value Added Services have a significant impact on brand switching in telecom industry. The results indicated that this hypothesis has been rejected as the value is determine to be insignificant and bears no impact on brand switching behavior of the customers.

The hypothesis 5 tested that the promotion schemes have a significant impact on brand switching in telecom industry. The results showed that the promotion schemesfor the current network were significant. Hence the hypothesis has been accepted.

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factors behind the brand switching in telecom industry

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