ZENITH International Journal of Business Economics & Management Research
Vol.2 Issue 7, July 2012, ISSN 2249 8826 Online available at http://zenithresearch.org.in/
CUSTOMER LOYALTY ON TELECOM MOBILE
M.THAIYALNAYAKI*; S.PREETHI VARSHNEY*
*Assistant Professor, Head of the Department - BBA, VELS University, Pallavaram, Chennai. Research Scholar, Department of Commerce Pachaiyappa’s College, Chennai. **Assistant Professor, VELS University Pallavaram, Chennai.
ABSTRACT The mobile telecom market persists to grow at a hectic pace, driven particularly by the rapid penetration of mobile services with an acute increase in churn rate and disloyalty especially on the youth market. To face this operational challenge it is highly essential to exploit customer behavioural data to identify unique and actionable factors influencing the purchasing decision and customer loyalty. Thus this research mainly targets customer loyalty in Telecom Industry constructive study on the behavior of the regular repeat customer’s .The purpose of this paper is to find out what kinds of specific and concrete operational factors have an important impact on Indian mobile telecom customer loyalty. KEYWORDS: customer loyalty; customer satisfaction; perceived quality; customer value; switching cost; corporate image, Indian Mobile Industry, Telecom analytics, Customer value, customer lifecycle analysis, Churn management, Market Basket analysis, Customer profiling. ______________________________________________________________________________ INTRODUCTION The Indian telecommunications Industry is one of the fastest proliferating sector in the World and India is projected to bench the second largest telecom market globally by 2011.Indicators are clearly representing the increased competition and that induced the customers to hop for low cost options1. This in turn entangled with disloyalty and as the industry saturates, it become imperative for the mobile operators to shift their focus from rapid acquisition strategies to strategies which helps to maintain and enhance margins from existing customer base. IMPACT OF THE PROBLEM
wikipedia. July 2012.in/
Though many service industries are affected by the churn phenomenon the problem is extremely acute in the telecom industry. is a process by which data from customer behavior is aggregated and analysed to gather the purpose and factors influencing them to be loyal in their purchasing pattern.5 percent to 6 percent per month. ISSN 2249 8826 Online available at http://zenithresearch.000. It enables the Telco to understand which customer is likely to leave and why.org/wiki/Youth_marketing
www. level of satisfaction with regard to Indian Mobile telecommunications.2 Issue 7. which in turn can help the company take the necessary measures to counter it.zenithresearch. one of the highest in the Asia-Pacific region. SUBJECT AREA Customer loyalty can be determined through the customer profile. with customers joining and quitting in short periods. RESEARCH METHODOLOGY RESEARCH PROBLEM Indian mobile telecommunication is facing very high churn and disloyalty 2 in the market inspite of its tremendous growth. India’s churn rate is anywhere between 3. they are marking tremendous development.in
. Customer loyalty enables an operator to gain a better understanding of the variables that influence customer churn. RESEARCH OBJECTIVE Recent trend line shows the growth and prospects of youth marketing 3 and especially in the field of Telecommunications. is mainly rooted by the Youth segment Hence this study of customer loyalty is mainly focusing on Youth segment to lead not only to better and more productive customer relations in terms of sales and service but also to improvement in supply chain management (lower inventory and speedier delivery) and thus lower costs and more competitive pricing. It is highly critical to analyze the factors influencing customer loyalty and their level of satisfaction on the cellular providers. CUSTOMER LOYALTY AND ITS SIGNIFICANCE Research is all about Customer loyalty on Indian cellular market. It facilitates to assess the Customer profitability index and Customer lifecycle.mobileyouth. RESEARCH PURPOSE The purpose of this research is to determine customer loyalty by identifying the operational factors that are influencing customer buying behavior. level of satisfaction. Considering that the cost of acquiring a new customer is as high as Rs 3. At the same time
http://www. According to research firm Gartner. Recent statistics depicts very high churn in this Industry. and their buying behavior with regard to Indian mobile telecom providers. the losses are immense.org/post/mobileyouth-tv-4/ http://en.ZENITH International Journal of Business Economics & Management Research
articles etc. the targeted customer base of 200. scholarly reports. Questionnaire was designed in the structured objective pattern focusing on the Research objectives. SECONDARY DATA The secondary data had been collected from the previous Research findings.org.zenithresearch. RESEARCH DESIGN Research design adopted for this study is “Exploratory” type of research.. SAMPLE SIZE For academic and effective result. telecommunication reports.2 Issue 7.ZENITH International Journal of Business Economics & Management Research
Vol. services and values. DATA COLLECTION The research work is in need of first hand information and also secondary information so as to assess the changes happening in customer satisfaction.org.in/
indicators are highlighting very high churn rate in this segment. July 2012. 1. youth segment4 falling under the age group of 18 to 34 are selected as the respondents for the research.org/
. PRIMARY DATA Survey method was adopted for collecting the primary data. PILOT STUDY The questionnaires were distributed randomly to 30 of the samples. As mentioned above in the research objective. SAMPLING PLAN www. To determine the level of customer satisfaction with regard to their perceived product quality. falling under the age group of 18 to 34 is selected for sampling.mobileyouth. respective marketing departments and through the different sources of literature such as journals.in Simple Random sampling has been adopted by the researcher. PROCESS OF DATA ANALYSIS
http://www. To identify the factors influencing the customer loyalty with respect to Indian mobile telecommunications. 2. ISSN 2249 8826 Online available at http://zenithresearch. Hence this Research focuses on Youth segment and Research objectives are listed below. So Primary and Secondary data are collected for this survey.
Satisfactory level over performance-tariff rates 5. Service quality-quality of phone calls 3. Satisfactory level over www. Mobile operators 2.org. Service quality-quality of coverage 4. Satisfactory level over performance-network coverage 7. discounts10. LIST OF VARIABLES TAKEN FOR THE DATA ANALYSIS Totally 10 Dependent variables and 13 Independent variables are taken for the analysis and they are DEPENDENT VARIABLES 1. MMS.in/
In order to analyze all the data collected.0 and Excel were used for statistical analysis to find out the relationship between the customer loyalty and our data. Service quality-quality of SMS 5. Service quality-Advertisement INDEPENDENT VARIABLES 1. Satisfactory level over performance-offers.2 Issue 7.zenithresearch. Service quality-quality of convenience & reliability 7.ZENITH International Journal of Business Economics & Management Research
Vol. SPSS 18. Satisfactory level over performance-in general 2.in
. Service quality-quality of service center and hotline 8. Satisfactory level over performance-call connectivity 6. VAS 9.org. Service quality-rate of pricing for given quality 9. Satisfactory level over performance-SMS. bonus 10. ISSN 2249 8826 Online available at http://zenithresearch. July 2012. Service quality-quality of network 6. Service quality-score accumulation plan. Satisfactory level over performance-customer services 3. Satisfactory level over performance-subscription easiness 8. Satisfactory level over performance-billing system /RCV 4.
.2 Issue 7.org. Satisfactory level over performance-social responsibility 13.in/
Performance-internet services 11.org.ZENITH International Journal of Business Economics & Management Research
Vol. Service QualityQuality Of Network Independent Variables Satisfactory level over offers .Mobile operators 2.249
www. Service quality of Network coverage 3.538* Beta coefficients . Service QualityQuality Of convenience & Reliability
a)Satisfactory Level Over PerformanceInternet Services
5. ISSN 2249 8826 Online available at http://zenithresearch.MMS a)Satisfactory Level Over PerformanceTariff Rates F value 4.Discounts Satisfactory Level Over PerformanceNetwork Coverage Satisfactory Level Over PerformanceSMS. Satisfactory level over performance-ad and other promotional activities TABLE 1 MULTIPLE REGRESSION ANALYSIS `Dependent variables 1.321**
. caller tones 12.934**
2.zenithresearch. Satisfactory level over performance-ringtones.913**
. Service QualityQuality Of SMS 4.150 t value 2.403
b) Satisfactory Level Over PerformanceInternet Services
2. July 2012.
278 3. Service Quality-Score Accumulation Plan.org. affects 0 .674*
. as these extracted Independent variables are subjected to Multiple Regression analysis.162
2.15 unit of change in the mobile operators .958** Over PerformanceRingtones.in/
Over PerformanceBilling System /Rcv . Service QualityQuality Of Service Center And Hotline 7.092*
Satisfactory Level 3.5 with statistical significance. This is mainly due to avoid multicollinearity among the predictor variables. For every unit of change in discounts and offers or promotions. the list of Independent variables are selected as per the significance.01 significance level www.238*
6.Callertones Satisfactory Level Over PerformanceAd And Other Promotional Activities 3.098*
.Hence Mobile operators can increase their customer
.in Step 1:-Performed correlation. ISSN 2249 8826 Online available at http://zenithresearch.249**
2.05significance level ** at 0. Service Quality-Rate Of Pricing For Given Quality 8.166**
Satisfactory Level Over PerformanceInternet Services
3. Bonus 9.2 Issue 7. by taking each one of the dependent variables with all the Independent variables and list of Independent variables extracted from the correlation matrix whose value fell below 0.org. INTERPRETATION 1.zenithresearch. July 2012.ZENITH International Journal of Business Economics & Management Research
Vol. Step 2:-By performing Multiple Regression for each Dependent variable. Service Quality-Ad
Satisfactory Level Over PerformanceCustomer Services
27 unit change in the Service quality of convenience . be very responsive to their queries and needs. For every unit change in the satisfactory level on Customer services and Ringtones influencing 0.zenithresearch. From the table it is clear that for every unit change in billing service will pose the impact of 0. and engage them in quick-win SMSwww.249 unit change in the service quality of VAS . Telecom companies should concentrate on Value added services by giving offers and promotional Recharge coupons with good quality. Discounts and with other promotional tools.2 Issue 7. July 2012. Therefore Operators should take necessary steps to focus mainly on quality of the network to increase customer loyalty.This indicates that customer services and product utilities should get strengthened for attaining customer loyalty 7. especially teens. value added services and adding promotional offers for SMS.Since the market taken for the Research is youth.16 unit of change on service quality implies Teleco should concentrate on Advertisements to create high loyalty. Every single unit change of Satisfactory level over the performance of value added services influences 0.org.2 unit change in their service quality . Marketers should give importance to enrich Customer services. ISSN 2249 8826 Online available at http://zenithresearch. Successful marketing to youth should entertain and empower. are the biggest users of SMS and MMS services in markets is drawing increasing attention from marketers. Service quality of Network is highly influenced by satisfactory level on Internet services and with their tariff rates. Telecom marketers should prioritize and concentrate on Quality of network coverage and internet services.org. MMS etc.469 units of change in the service quality of Network.4 unit and 0. inducing 0. marketers have to equip themselves to bridge up the customer mind gap.in
. RECOMMENDATIONS Based on the above analysis. 2. 3. 5. Each unit of satisfactory level on advertisements influences 0.Hence for post-paid segment marketers should facilitate billing system for customer accessibility and precision.in/
loyalty rate and implement Retention strategy based on Offers. 4.ZENITH International Journal of Business Economics & Management Research
Vol. give them free reign in designing Web content. Web oriented loyalty programs and promotional schemes to be introduced to increase customer loyalty. The fact that youth. Since for every unit of change in the satisfactory level of internet services and with their tariff rates. 6. Satisfactory level on Quality of Network coverage influences for its every one unit with 0. Mobile marketing campaigns for youth audiences are to be devised for everything ranging from new product launches and mobile coupons to wireless community and mobile auctions Joint promotional campaigns can be engaged to ascertain customer loyalty.2 unit of change in the service quality of network respectively.
D. C. 1996.in
. July 2012.org. Han... M. P. 60. Johnson.org. REFERENCES ACSI: Fornell. Marketers can add benefits with RCVs and in Advertisements to capture and sustain customer loyalty.. 552-569. Ahn. 7-19. Customer churn analysis: Churn determinants and mediation effects of partial defection in the Korean mobile telecommunications service industry.in/
based competitions. ISSN 2249 8826 Online available at http://zenithresearch. Journal of Marketing.ZENITH International Journal of Business Economics & Management Research
Vol. Telecommunications Policy. The American customer satisfaction index: Nature.2 Issue 7. 2006.
www. S. Lee Y.. CONCLUSION The mobile industry of India is undergoing a vibrant change and the mobile number portability is paving the pathway for the subjective Research. purpose. H. S. 30. This study is one such attempt to enhance the exposure on customer loyalty and it is also expected to facilitate the marketers to design the essential operational parameters for designing the retention strategies and to enhance Customer Experience management.zenithresearch. and findings. J.