Mediating Factors in the Satisfaction-Loyalty Relationship

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Mediating Factors in the Satisfaction-Loyalty Relationship
Anneke Zwart, Moderator
Of course there exists a relationship between Satisfaction and Loyalty. Satisfaction can be seen as consistency between prior expectations of a certain product and the perceived performance.
Correspondingly, the probability that a SATISFIED consumer will continue to use the product or service and will maintain a relationship with the company (LOYALTY) is high.
However, Picón, Castro and Roldán (2014) mention 2 important factors that mediate such strong satisfaction-loyalty relationship:
1. Perceived switching costs (PSC): Switching costs are incurred by the company in order to dissuade customers to switch to a competitor’s product or service and to raise the difficulty of the switching procedure. PSC does not only have a direct effect on loyalty, it also influences loyalty through satisfaction. In what way?
1.1. First of all, satisfaction is an important contributor to loyalty creation, but this variable becomes less important when other factors -such as personal and social relationship and contractual requirements- are present. All these other mechanisms generate switching costs which increases the likelihood of customer retention.
1.2. Furthermore, switching costs discourages customers’ attempt to abandon the relationship and switch to a competitor even if the level of satisfaction with the current company is low.

2.Attractiveness of Alternatives (AA): How does AA mediates the satisfaction-loyalty relationship?
2.1. a high level of AA will increase the likelihood for customers to switch to the products or services of competitors, even if customers are satisfied about the current provider. A low level of AA occurs when alternative offers are outside the range of a consumer’s options, or if alternatives are not perceived as attractive by customers. In this case, customers will maintain the relationship with the current provider even if they are not satisfied.
2.2. Besides, satisfaction also affects AA, because a satisfied person will perceive a lower amount of the alternatives as being attractive. In other words, consumers with knowledge about the alternatives are more likely to abandon the relationship with the current provider if they are dissatisfied about its product or service.

Source: Picón, A., Castro, I. and J.L. Roldán (2014) “The relationship between satisfaction and loyalty: A mediator analysis” Journal of Business Research Vol. 67 Iss. 5 pp. 746-751.


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