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What is Switching Cost

Encyclopedia of Organizational Knowledge, Administration, and Technology
Monetary and non-monetary factors that compel a customer to shift his website preference.
Published in Chapter:
Examining the Value, Satisfaction, and Loyalty Relationship Under Online Framework Using PLS-ANN
Himanshu Sharma (University of Delhi, India), Anu G. Aggarwal (University of Delhi, India), and Abhishek Tandon (University of Delhi, India)
DOI: 10.4018/978-1-7998-3473-1.ch154
Electronic commerce has gained popularity over the years and forced the businesses to go online in order to achieve competitive advantages. Digitalization has led to the dynamicity of markets and this poses a question on the loyalty of customers towards these e-commerce websites.This chapter attempts to examine the relationship between website service quality (WSQ), social media reviews (SMR), customer value (CV), customer satisfaction (CS), and website loyalty (LOY); with the moderating effect of switching cost. Also, the most influential predictor in each cause-effect relationship is determined. The hypothesized conceptual framework is validated using a two-stage approach. In the first stage, the hypotheses are tested and path loadings are generated using PLS-SEM approach. Also, the moderating effect is studied using PLS. Second stage utilizes the advantages of artificial neural network (ANN) to obtain the best explanatory variable in each independent-dependent association.
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More Results
Electronic Loyalty Programs Comparative Survey
The broad term used for the cost of inconvenience imposed on a customer due to switching from a product, service, brand, or a firm to another. Since switching costs are more psychological and less financial, it is difficult to quantify them. There is a strong relationship between switching costs and customer loyalty. If the level of the switching cost of a customer for a specific brand is higher than a threshold, then the customer does not have an incentive to switch to another brand, and hence remains loyal.
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The Importance of Customer Satisfaction and Customer Loyalty in the Service Sector
The fixed cost obtained by a buyer when changing suppliers, because the buyer's product specifications, production equipment, and purchasing cycle is closely tied to the current supplier's products and operations.
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