Factors Influencing The Behavior of The Mobile Phone Users To Switch Their Service Providers in Andhra Pradesh
Factors Influencing The Behavior of The Mobile Phone Users To Switch Their Service Providers in Andhra Pradesh
Factors Influencing The Behavior of The Mobile Phone Users To Switch Their Service Providers in Andhra Pradesh
Marketing
Volume 16 Issue 5 Version 1.0 Year 2016
Type: Double Blind Peer Reviewed International Research Journal
Publisher: Global Journals Inc. (USA)
Online ISSN: 2249-4588 & Print ISSN: 0975-5853
FactorsInfluencingtheBehavioroftheMobilePhoneuserstoSwitchtheirServiceProvidersinAndhraPradesh
Strictly as per the compliance and regulations of:
© 2016. Mohana Prasad. M & Dr. D. Prasanna Kumar. This is a research/review paper, distributed under the terms of the Creative
Commons Attribution-Noncommercial 3.0 Unported License http://creativecommons.org/licenses/by-nc/3.0/), permitting all non-
commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.
Factors Influencing the Behavior of the Mobile
Phone users to Switch their Service Providers in
Andhra Pradesh
Mohana Prasad. M α & Dr. D. Prasanna Kumar σ
Abstract- Consumer Behavior is a study of how individuals behavior is there in between both, companies and
make decisions to spend their available resources like time, customers, because the consumer switching behavior
2016
money and effort on consumption related items what they buy, restricts both parties to make long term relationships
why they buy, when they buy , where they buy, how often they
Year
and even it breaks the pre-developed long term
buy and use a product or service for satisfying their needs.
relationships. Similarly the consumer switching behavior
From a marketing point of view, the consumer behavior is, “the
psychology of how consumers think, feel, reason and select is basically the behavior of consumers in shifting their 23
between different alternatives like brands, products”. The attitude from one brand (product) to another brand
(product).Due to this dramatic growth, the cellular
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
consumer switching behavior is there in between both,
companies and customers, because the consumer switching industry all over the world has been witnessing fall in the
behavior restricts both parties to make long term relationships costs of cellular services, very high growth rates in
and even it breaks the pre-developed long term relationships. subscriber base, and increasing competition and
Similarly the consumer switching behavior is basically the deregulation. For developing countries in particular,
behavior of consumers in shifting their attitude from one brand
cellular services are becoming a very significant
(product) to another brand (product). Due to this dramatic
growth, the cellular industry all over the world has been
proportion of the overall telecom infrastructure. The
witnessing fall in the costs of cellular services, very high increasing competition in cellular service industry may
growth rates in subscriber base, and increasing competition be for the purpose of attracting consumers towards the
and deregulation. For developing countries in particular, firms because consumers are the main source of
cellular services are becoming a very significant proportion of profitability of the firm.
the overall telecom infrastructure. The increasing competition The service providers are offering most
in cellular service industry may be for the purpose of attracting sophisticated mobile services with an expanding
consumers towards the firms because consumers are the number of value added services such as Short Message
main source of profitability of the firm. Due to intense
Service (SMS), Wireless Application Protocol (WAP),
competition in telecommunication industry customers
frequently switch from one service provider to another. It has
subscription services (SS), General Packet Radio
become very important for service providers to investigate the Services, and Third Generation services, which will help
switching behavior of customers. to attract consumers and the influence their buying
Keywords: consumer, buying behavior, tele- behavior. This value added services are increasing the
communication, cellular services etc. level of consumers’ expectations from service provider
and if the service provider is unable to meet these
I. Introduction expectations then, the consumers considers switching
T
to competitors services. The switching behavior of the
he consumer behavior study is basically the
consumers will significantly affect the revenues, service
psychology of consumers, like when, how, why
continuity, and market share of the firm (Oyeniyi and
and people buy and use the products for satisfying
Abiodun, 2013). Therefore, in order to prevent
their needs. From a marketing point of view, the
consumers from switching to competitors, the service
consumer behavior is, “the psychology of how
providers are forced to add new schemes, offers,
consumers think, feel, reason and select between
technological advancements, and benefits with the
different alternatives like brands, products”. The
services.
companies are always trying to build mutual
Cellular services have become the main source
relationships with their customers through delivering
of growth in telecommunication sector in India. The
better value and fulfilling their commitments, but due to
flexibility offered in communications and falling tariffs are
competitive business environment, it’s becoming difficult
playing a significant role in popularizing mobile
for marketers to do so. The consumer switching
communications. In the last decade, the mobile
revolution has played a significant role in the growth and
Author α: Research Scholar, K L U Business School, Guntur, Andhra
Pradesh, India. e-mail: [email protected]
development of Indian economy. As the number of
Author σ: Associate Professor, K L U Business School, Guntur, Andhra cellular service providers are continuously increasing, it
Pradesh, India. is expected that the Indian telecom industry will grow at
© 2016 Global Journals Inc. (US)
Factors Influencing the Behavior of the Mobile Phone users to Switch their Service Providers in Andhra
Pradesh
a compound annual growth rate (CAGR) of 15.8 percent Muddie and Pirrie (2006), identified four basic
between 2010 and 2014 and will touch revenues of $92 characteristics of services i.e. intangibility, inseparability
billion (377,683 crore INR) (telecomleads.com). The (simultaneous production and consumption), variability
Indian cellular consumer market is expected to double (heterogeneity) and perishability. He also argued that
its subscription base by 2017 when compared to marketing activity is normally structured around the ‘4Ps’
present subscriptions. i.e. product, price, promotion and place; but the
The earnings and profitability of the company distinctive characteristics of services requires 3 more Ps
will be highly affected, if it loses even a single consumer, in addition i.e. people, physical evidence and process.
as it can cost five times more to acquire new customer Schiffman, et al. (2008) stated that, consumer
than to retain an old customer. Therefore, in order to behaviour is a root of marketing concept. Therefore, the
retain the old consumers and reduce the rate of concept of consumer behaviour in terms of switching in
consumers from switching to competing service cellular service industry has been discussed below
providers, it is very important to study the factors that because it may be significantly important for the cellular
2016
influence consumer behaviour in terms of switching service providers to understand the grounds in which
Year
between the cellular service providers. consumers’ exhibit switching behaviour in order to gain
Telecommunication industry is characterized by understanding on consumers’ needs and expectations,
24 high growth. Due to intense competition in and the ways for satisfying them. It can enable cellular
telecommunication industry customers frequently switch service providers to reduce the risk of customers
switching from one cellular service provider to another,
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
they fail to satisfy its consumers, then consumer loyalty III. Objectives of the Study
may be lost and they may consider switching their
service provider which in turn may bear loses for the The research is designed to address the
firm. The impact of consumer switching or defection on following aims and objectives. The broad aim of the
the firm is discussed below. research is to explore and examine the factors that
determine the consumers switching behavior of young
iii. Switching determinants
adults (aged 18-35 years) in cellular service providers.
According to Lee and Murphy (2005), there are
The objectives of the research are as follows.
several factors that determine consumers to stay with
their current service providers or to switch. Some of the • To investigate the factors that influence consumers
important factors which determine switching are: to switch the cellular service providers.
• To critically evaluate the most and the least
• Price is rated as the most important reason for
significant factors that influence consumers
switching.
2016
switching behavior in cellular services?
• Brand trust leads to commitment towards brand,
• To investigate the likeliness of consumers to switch
which then reduces the consumers’ behaviour to
Year
from current cellular service provider to another.
switch the service provider.
• Switching costs are also important switching IV. Hypothses of the Study 25
determinant because switching costs such as
monetary loss and uncertainties with new service For the convienience of the study the following
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
provider deter switching regardless of hypothesis are developed which are to be test.
dissatisfaction. H1: Tariff package has significant effect on consumers’
• Reference Groups which plays a significant role in switching behavior in terms of switching cellular service
influencing consumer to switch the service provider provider.
in order to conform to others, norms, broad values
H2: Network coverage has significant influence on
and behaviour. According to a classification given
consumers’ switching behavior in terms of switching
by Bruhn and Georgi (2006), reasons for switching
cellular service provider.
can be divided into three groups:
H3: Price has a direct and significant influence on
1. Customer-related switching reasons are concerned
consumers’ switching behavior in terms of switching
with customer characteristics with a more or less
cellular service provider.
direct connection with the service provider.
Characteristics concerns customers age, sex, H4: Promotional activity has significant influence on
preferences, lifestyles, etc and are directly consumers’ switching behavior in terms of switching
connected to customers’ needs (Bhrun and Georgi, cellular service provider.
2006) H5: Customer service quality has a direct and significant
2. Provider-related switching reasons are closely influence on consumers’ switching behavior in terms of
connected to cause customer retention and it is switching cellular service provider.
concerned with perceived service quality and
customer satisfaction. Service prodders can easily V. Research Methodology
manage this category of reasons. It is the most
The present study is based on descriptive
important source for avoiding customer defection
research design as we wish to know the reasons why
(Bhrun and Georgi, 2006).
consumers are switching in the telecommunication
3. Competition-related switching reasons lead to
industry. Survey research method is adopted to gather
customer defection because consumer behaviour
data on the variables determined. The target population
not often depends on the current service provider
was 100 consumers using different mobile networks. A
and its service but also on its competitors. For
random sample of 93 consumers were selected by
example, when a mobile phone customer’s basic
stratified random sampling technique keeping in the
criterion of buying is price, and then they compare
view the probability proportion.
the price system of their current service provider
and other provider (Bhrun and Georgi, 2006). The study
Some of the important factors that determine The study will be exploratory in nature with
consumer switching behaviour in cellular service survey method being used to complete the study.
industry have been discussed below to gain the Sampling unit
knowledge about underlying facts of those factors for Customer on the basis of age, gender, income,
the purpose of achieving the objectives of this research. occupation, education in Vijayawada.
Sampling size
100 Respondents in Vijayawada.
scale was used to measure the items. Of the 100 First we shall start with description of the
questionnaires administered 93 valid filled sample which is given below:
Year
© 2016
1 Global Journals Inc. (US)
Factors Influencing the Behavior of the Mobile Phone users to Switch their Service Providers in Andhra
Pradesh
2016
SA A NEUTRAL DA SDA
Year
Are you likely to switch from current cellular service provider to another? 8 43 25 14 3
Consumer Satisfaction Level on the Basis of Performance of current
Service Provider is good 1 4 23 57 8 27
Network coverage of the current cellular service provider is good 1 5 19 56 12
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
Call quality provided by current cellular service provider is good 0 5 18 56 14
Current service provider offers suitable tariffs for different age groups 2 9 27 37 18
Gender *Switching
93 100.0% 0 0.0% 93 100.0%
Behaviour
2016
Switching Behaviour
Gender VERY VERY Total
LIKELY Neutral
28 LIKELY UNLIKELY UNLIKELY
Male 6(4.7) 23 (25.4) 15 (14.8) 8 (8.3) 3 (1.8) 55
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
Chi-Square Tests
Asymptotic
Exact Sig. (2- Exact Sig. (1- Point
Value Df Significance
sided) sided) Probability
(2-sided)
Pearson Chi-Square 3.505a 4 .477 .505
Likelihood Ratio 4.630 4 .327 .408
Fisher's Exact Test 3.049 .573
Linear-by-Linear
.206b 1 .650 .663 .367 .079
Association
N of Valid Cases 93
a. 4 cells (40.0%) have expected count less than 5. The minimum expected count is 1.23.
b. The standardized statistic is -.454.
Null Hypothesis: The relationship between gender of the significance for 4 degrees of freedom, the null
respondents and their switching behaviour of their hypothesis is accepted and it could be concluded that
mobile connection is not significant. the relationship between the gender and switching
As the calculated Chi-Square value (3.505) is behaviour of the mobile phone users is not significant.
less than the table value (9.488) at 5% level of
2. Is there a relationship age of the respondents and switching behaviour of the mobile phone users
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
© 2016
1 Global Journals Inc. (US)
Factors Influencing the Behavior of the Mobile Phone users to Switch their Service Providers in Andhra
Pradesh
Total 8 43 25 14 3 93
Chi-Square Tests
2016
Asymptotic Exact Sig.
Year
Exact Sig. (1- Point
Value df Significance (2- (2-sided) sided) Probability
sided)
29
Pearson Chi-Square 10.725a 8 .218 .212
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
Likelihood Ratio 9.886 8 .273 .365
Fisher's Exact Test 8.686 .319
Linear-by-Linear
.130b 1 .718 .738 .388 .050
Association
N of Valid Cases 93
a. 8 cells (53.3%) have expected count less than 5. The minimum expected count is .61.
b. The standardized statistic is -.361.
Null Hypothesis: The relationship between the age group are related, correlation analysis has been carried out
of the respondents and their switching behaviour of the using SPSS 19. The independent variables are service
mobile phone users is not significant. quality, price, switching costs, change in technology,
As the calculated Chi-Square value (10.725) is advertising, social influence, and involuntary switching,
less than the table value (15.507) at 5% level of and the dependent variable is switching behavior. In
significance for 8 degrees of freedom, the null correlation analysis, if the value falls in between 0.1 and
hypothesis is accepted and it could be concluded that 0.5, it means that there is a weak correlation between
the relationship between the age and switching the variables and if the value falls in between 0.5 to 1,
behaviour of the mobile phone users is not significant. then it indicates that there is strong relationship between
Correlation Analysis the variables. The correlations between the switching
In order to test whether and how strongly the determinants and the switching behavior have been
pair of variables (dependent and independent variables) shown in the following table.
H1: Hence the above table represents the summary of VII. Findings
correlation between variables, which illustrates the
association between the tariff packages and switching After collecting information from the data i.e.
behavior was significant at 0.05 level with the correlation primary and the secondary data, the next step is to
coefficient ‘r= 0.223’. The analysis indicates that the analyse the data. In this chapter, firstly the findings from
tariff packages have a positive relationship with the the collected will be drawn and explained in terms of
switching behavior of consumers. So, according to the tables and graphs representing frequency and
hypothesis 1, tariff package has significant influence on percentage of respondents by using SPSS for the
consumers’ switching behavior in terms of switching purpose of bringing the ease in representation
cellular service provider. The hypothesis was accepted. 1. Customers especially in the age group (18-24) are
It means that the consumers are prefer low call charge, likely to switch from the current cellular service
SMS charge, etc.., they were intended to switch another provider to another.
2016
cellular service provider. 2. Consumers are disagree that the customer service
H2: The result of the relationship between network provided by the current cellular service provider is
Year
consumers. So,. So, according to the hypothesis 2, by the current cellular service provider is good.
network coverage has significant influence on 5. Consumers disagree that the call rates offered by
consumers’ switching behavior in terms of switching the current cellular service provider are high.
cellular service provider. The hypothesis was accepted. 6. Consumers disagree that the advertisements of the
It means that the consumers are prefer to good network competitors are encouraging them to switch the
coverage. cellular service provider.
H3: The third hypothesis tested the relationship between 7. Consumers are agree that the customer care
price and switching behavior was not significant at 0.01 service of previous operator was poor.
level. Hence the correlation coefficient was ‘r= 0.174’, VIII. Suggestions
which shows that the price has no significant influence
on significant influence on consumers’ switching • This research was carried out only on consumers
behavior in terms of switching cellular service provider. with specific age group between 18-39 years. It can
The result did not support the null hypothesis. be suggested, similar study can be conducted on
H4: The correlation represents the association between consumers with other age groups as well.
advertisements and switching behavior of consumers, • This study empirically examined seven factors that
which was not significant at 0.01 level with the may influence consumers’ switching behaviour in
correlation coefficient ‘r=0.177’, the analysis indicates cellular services. However, there may be some other
the advertisements has no significant influence on factors that can have an impact on consumers’
switching behavior in terms of switching cellular service switching behaviour but were not examined in this
provider. The result did not support the null hypothesis. study. Further empirical research is required to
examine the other factors that can impact or
H5: The correlation represents the association between
influence consumers’ switching decisions.
service quality and switching behavior of consumers,
• Service providers should create trustworthy and
which was not significant at 0.01 level with the
rational appeal in their advertisements. They should
correlation coefficient ‘r=0.184’, the analysis indicates
introduce innovative promotional strategies and
the service quality has no significant influence on
connect consumers with the promotional activities.
switching behavior in terms of switching cellular service
• Improving the performance of customer services by
provider. The result did not support the null hypothesis.
establishing more customer care centers, and to
All the above statistical tests and hypotheses
educate the customers regarding the essential
tests have satisfied the objective one of this study i.e. to
features of mobile phones and its services.
investigate the factors that influences the consumers to
• Finally providing the services that are expected by
switch their cellular service providers and it was found
the consumers as early as possible.
that these factors are statistically significant. This shows
that all the research questions have been answered and IX. Conclusion
the objectives of this research have been satisfied and
in turn the main aim of this research has been Conclusively, the study has explored some of
successfully achieved the major factors that are influencing the consumers’
behaviour to switch their cellular services providers,
© 2016
1 Global Journals Inc. (US)
Factors Influencing the Behavior of the Mobile Phone users to Switch their Service Providers in Andhra
Pradesh
through an exploratory investigation. However there 6. Lopez, J.P.M., Redondo, Y.P. and Olivan, F.J.S.
may be some other factors that have impact on (2006), ‘The impact of customer relationship
consumers’ switching behaviour but only the factors characteristics on customer switching behaviour:
which are most important and relevant to cellular Differences between switchers and stayers’.
services were examined. The results of this study have Managing Service Quality, Vol. 16(6), 556-574.
proved that all the seven factors are significantly 7. Lovelock, C. and Wirtz, J. (2007), Services
influencing the switching behaviour of consumers. An Marketing: People, Technology, Strategy (6th edn.),
understanding of these influencing factors allows p15. Singapore, Prentice Hall.
managers to direct efforts and resources in the most 8. Madden, G. (1993), Emerging Telecommunications
effective and efficient way to prevent consumers’ Networks: The International Handbook of
switching behaviour, and reduce business losses in the Telecommunications Economics (vol. ii), p106,
long run that results from consumers’ switching United Kingdom, Edward Elgar.
behaviour.
2016
9. Mallikarjuna, V., Mohan, G.K., and Kumar, D.P.
The results have disclosed that amongst all (2011), ‘Customer switching of mobile industry: An
Year
factors, price was the most influential factor that analysis of prepaid mobile customers in AP circle of
influences the behaviour of young adults in Vijayawada India’. International Journal of Research in
to switch from their current cellular service provider to Computer Application and Management, Vol. 1(3), 31
another. The cellular service providers should pay 63-66.
attention to all factors and especially towards the price
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
10. Md. Abdullah Al jamil. Md. Shahadat Hossian Sunny
of the services, because the consumers’ switching and Md. Rakibul Hasan, “Factors influencing the
intentions were found to be most significantly influenced Behavior of the mobile phone users to switch their
by the price, followed by service quality, change in mobile telecommunication operators in
technology, social influence, switching costs, Bangladesh”, International Journal of Trade &
advertising, and involuntary switching which is least Commerce- IJARTC, vol.4, No.1, January-June
important. The unfavorable price perceptions are the 2015, pp.16-26.
principally affecting consumers to switch loyalties to 11. Sidhu, A. (2005), Canadian Cellular Industry:
competing service provider. Favorable price for the Consumer Switching Behaviour. MBA thesis, Simon
cellular services is very important in order to gain loyalty, Fraser University.
market share, and corporate image of the firm. As it has 12. Paulrajan, R. and Rajkumar, H. (2011) ‘Service
been acknowledged that majority of respondents are quality and customers preference of cellular mobile
likely to switch from their current cellular service provider service providers’. Journal of technology
i.e. around 53 percent. Hence, the cellular service management and innovation, Vol. 6(1), 38-45.
provider can make use of the information provided in
this research to gain loyalty by meeting their
expectations and satisfying needs and desires because,
if the service providers are unable to meet the
expectations then consumers will take their business to
somewhere else.
References Références Referencias
1. Schiffman, L.G., Kanuk, L.L. and Hansen, H. (2008),
Consumer Behaviour: A European Outlook, p4.
England, Prentice Hall.
2. Philip Kotler (2008) “Marketing Management”
(Eleventh Edition), Pearson Education Inc,
Singapore.
3. C.R.Kothari (2014) “Research Methodology:
Methods & Techniques” (Third Edition), New Age
International Publishers \, New Delhi.
4. Kasande, S.P. (2008), ‘An investigation of switching
costs and customer loyalty in the Indian cellular
telephony industry’, Proceeds of 2nd IIMA
conference on Research in Marketing, pp7-13.
India, Labdhi R. Bhandari Memorial Fund.
5. Keaveney, S.M. (1995), ‘Customer behaviour in
services industries: An exploratory study’. Journal of
Marketing, Vol. 59(2), 71-82.
© 2016 Global Journals Inc. (US)
Factors Influencing the Behavior of the Mobile Phone users to Switch their Service Providers in Andhra
3 Pradesh
2016
Year
32
Global Journal of Management and Business Research ( E ) Volume XVI Issue V Version I
© 2016
1 Global Journals Inc. (US)