Development of an empirical framework of customer loyalty in the mobile telecommunications sector

Abstract

India has the world’s second largest telecom network, surpassed only by China. In the year 2015–16, India crossed the milestone of one billion telecom subscribers. India’s total telecom subscription stands at 1209.96 million as on August 2017. The telecom sector in India is expected to witness a huge growth in the coming future. The Indian telecom sector is characterized by intense competition as a consequence of low switching costs and price sensitivity among customers. This is what makes the study of ‘Customer Loyalty’ very important as it guides the various stakeholders and help formulate effective customer retention strategies. The present study is based on developing a holistic model of ‘Customer Loyalty’ using the data collected from 770 prepaid telecom subscribers from Delhi and Haryana telecom circles in India. The Structural Equation Modelling technique with the aid of Analysis of Moment Structures (AMOS) statistical package is used for the purpose. The comparative impact of each of the drivers of customer loyalty is computed utilizing the standardized regression weights taken from the path model. Net Promoter Scores (NPS) of all the concerned telecom operators are calculated in order to compare customer loyalty amongst them. The study produces various findings and crucial insights that hold vital implication to the various stakeholders concerned.

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