Drivers of customer loyalty in the South African mobile phone telecommunications industry .

Abstract

The research focuses on the drivers of customer loyalty in the mobile phone telecommunications industry in South Africa. It investigates how the subscribers’ behaviour and attitude influence the subscriber propensity to switch mobile phone operators. The report attempts to establish a sustainable service strategy by interrogating the key factors that influence customer loyalty. The industry faces challenges presented by a competitive marketplace, shorter product life cycles, instability, an uncertain future and threats of new entrants. Of these challenges, customer retention is within the control of the individual mobile phone operator and addresses the threat of competitors, as well as new entrants. Mobile phone operators may achieve customer retention through developing customer loyalty. The research makes use of an online survey to collect the data from a sample of mobile phone subscribers and the data is processed using CFA (Confirmatory factor analysis). The findings confirm that customer satisfaction, perceived value, trust and habit are the key drivers of customer loyalty. As the industry matures, and in the absence of population explosion, the only sustainable strategy for mobile phone operators lies in customer retention or customer loyalty, while increasing their product lines.