Customers' Continuance Intention Regarding Mobile Service Providers: A Status Quo Bias Perspective

Customers' Continuance Intention Regarding Mobile Service Providers: A Status Quo Bias Perspective

Anis Khedhaouria (Montpellier Business School and Montpellier Research in Management, Montpellier, France), Roy Thurik (Erasmus School of Economics, Erasmus University of Rotterdam, Rotterdam, the Netherlands & Montpellier Business School, Montpellier, France), Calin Gurau (Montpellier Business School and Montpellier Research in Management, Montpellier, France) and Eric van Heck (Rotterdam School of Management, Erasmus University of Rotterdam, Rotterdam, the Netherlands)
Copyright: © 2016 |Pages: 21
DOI: 10.4018/JGIM.2016100101

Abstract

Using a status quo bias perspective, this paper examines the relation between customers' inertia and continuance intention, identifying the moderating role of contractual subscription on this relationship. The authors' model is validated using data collected from 457 mobile phone service customers and partial least squares. Results show that customers continue with mobile service providers due to their inertia resulting from habit and switching costs. The effect of customers' inertia on their continuance intention is stronger when they have a contractual subscription with the mobile service provider. The authors' results show the importance of including inertia when studying customers' continuance intention and taking into account the specific moderating effect of contractual subscription.
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Introduction

The mobile phone service market shows considerable and continued growth in terms of market size, variety of services and intense competition (Fuentelsaz et al., 2012; GSMA, 2015). Although a dynamic market, mobile phone services are ranked below the average in customer satisfaction compared with other information technologies (IT) services (Malhotra & Malhotra, 2013). With such a low ranking, it is not surprising to see high switching behaviors (Shin & Kim, 2008). In Europe, switching behaviors concerning mobile services have significantly increased recently, with rates exceeding 41% in Spain, 37% in the Netherlands, 35% in Germany, 33% in France and 32% in the U.K. (Khedhaouria & Beldi, 2014; Rusby & Sale, 2015). Hence, to discourage switching behavior in mobile service customers, providers must understand what motivates their customers to continue their services (Kim et al., 2013).

The Expectation Confirmation Model, or ECM (Bhattacherjee, 2001), has mostly been used to predict IT continuance intention (Nabavi et al., 2016). The ECM posits that continuance intention is fundamentally a purposeful behavior based on conscious decisions related to expectations of benefits from future usage and satisfaction about prior usage (Bhattacherjee, 2001). Other research indicates that continuance intention might be habitual based on subconscious decisions related to repeated behavioral sequences (Limayem et al., 2007; Limayem & Cheung, 2011).

The ECM is appropriate for predicting continuance intention concerning a mobile technology in which customers interact with the technology without consuming any service but is not appropriate to predict the intention to continue using mobile services provided by an operator (Kim et al., 2013). Users of mobile services are not only mobile technology users but also service consumers (Ng & Kwahk, 2010; Boakye et al., 2014). Therefore, to understand customer continuance intention better it is important to seek alternative theoretical perspectives (Bhattacherjee & Lin, 2015) that consider the service aspect.

Continuance intention refers to a customer’s tendency to continue an existing behavior (Bhattacherjee, 2001) and to maintain the so-called status quo (Kim & Gupta, 2012; Zhou, 2014a). Understanding why customers maintain the status quo can be useful for mobile service providers to retain their customers (Ng & Kwahk, 2010). The status quo bias theoretical perspective (Samuelson & Zeckhauser, 1988) offers a useful framework to explain customers’ tendency to remain with their current service providers (Kim & Gupta, 2012). The framework highlights the role of inertia in explaining the bias resulting from rational decision making whereby customers consider the costs of switching from the status quo to new service providers (Chen & Hitt, 2002; Bawa, 1990). Indeed, inertia reflects a bias toward the status quo because a customer systematically favors continuing using the same service provider even when there are better alternatives (Polites & Karahanna, 2012). Inertia is conceptualized as resulting from conscious (i.e., switching costs and satisfaction) and subconscious (i.e., habit) choices leading to continuance intention (i.e., maintaining the status quo) (Ng & Kwahk, 2010; Kim & Gupta, 2012; Polites & Karahanna, 2012).

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