...ANALYSIS OF MARKET COMPETITION, SWITCHING COSTS AND ITS CONSEQUENCES IN TELECOMMUNICATIONS IN NEPAL NAME: SAROJ POUDEL DEGREE: MASTER OF INFORMATION SYSTEMS/MASTER OF INFORMATION TECHNOLOGY COURSE: 7112ICT RESEARCH METHODS IN INFORMATION TECHNOLOGY INTRODUCTION The economics of switching costs and network effects have achieved a significant amount of popular, as well as professional attention in the last few decades. It is presently defined as the core factor for new Information Technology economy. Switching costs originates, if a consumer demands a product, or its related accessories(hardware or software), of his own purchases to be compatible with each other this creates economies of scope among his purchases from a single supplier. Whereas network effects arise when a user wants his system to be compatible so that s/he can interact or trade with other users, or switch to the same compatible system, which leads to the creation of economies of scope between different incompatible products. Thus these economies of scope impacts the consumer’s buying and switching behavior between various products. The state of lock-in arises when the switching cost is sufficiently high so that the consumer proceeds using the same product rather than switching to the different product. Lock in is the state where the cost of switching exceeds the benefits of switching. Economics of switching costs is the summation of various types of switching costs including: compatibility...
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...625 Unethical Consumer Behavior Dr. McFaul January 20, 2013 Unethical Consumer Behavior Introduction Today’s consumer is looking for the best value and some consumers find ways to take advantage of a business through unethical consumer behaviors. Consumer ethics is defined as “moral rules that apply to consumers, such as the choice to return a used item for a refund, shoplift, and engage in software piracy, as well as the steps, the company takes to counter these actions, such as charging restocking fees and limiting returns” (Shiffman, 2010, p. G-2). Consumers have caused businesses additional costs through unethical consumer behavior. Anytime a consumer is unethical it costs the business money in lost profits. Unethical Behavior Many consumers find ways to cheat a company through unethical behavior. Piracy is an ongoing issue that many companies face through consumers illegally recording movies, music, software, and ringtones. Many consumers are stealing these products and do so because it saves the consumer from having to buy these products. Consumers also take the time to buy pirated material at a reduced cost than they can purchase these products at a retailer price. The downside to pirating is that this behavior costs every element of the supply chain money. Those affected are other consumers that have to pay inflated costs, Manufactures, retailers, and inventors or producers of the materials. Some consumers may be performing unethical behavior without knowing...
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...Estimating Switching Costs in the Mobile Telecommunications Industry in the UK∗ Lukasz Grzybowski Center for Information and Network Economics Munich Graduate School of Economics September 2004 Preliminary version, Comments are welcome Abstract In this paper I estimate the magnitude of switching costs in the UK mobile industry. Using a survey data with individual choices of network operators in two consecutive years I find a presence of very strong average switching costs, which make the majority of consumers reluctant to switch networks. The size of average switching costs differs significantly across networks and the observed switching may be due to heterogeneous switching costs across consumers. The willingness to switch networks depends to some extend on consumer’s characteristics. Keywords: mobile telephony, switching costs, discrete choice. JEL Classification: C25, D12, L96 ∗ I would like to thank Volkswagen Stiftung and Munich Graduate School of Economics for the generous financial support which made this research possible. All errors are mine. 1 1 Introduction The presence of switching costs has a critical impact on the consumers’ behavior and firms’ strategies in many industries. The anticompetitive effects of switching costs are of major concern for the regulators. Therefore, the identification and measurement of the magnitude of switching costs should provide important information for the regulators. In particular, the mobile telephony may be subject...
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...Factors behind the brand switching in telecom industry The Cellular telephone (mobile phone) is a long-range, portable electronic device used for mobile communication. In addition to the standard voice function of a telephone, current mobile phones can support many additional services such as SMS for text messaging, email, packet switching for access to the Internet, and MMS for sending and receiving photos and video. The problem of Customer’s switching to other service providers have been the cause of intensive research .Due to the increased competition in the telecommunication industry in Ghana it has become extremely important for the companies to pay attention towards retaining of their customers .This research study particularly investigated the causes of customer switching behaviour. CHAPTER ONE: INTRODUCTION This research is focus on finding out the underlying factors that make the customer to switchover to another service provider in telecom industry in Ghana . The telecommunication industry is one of the most important industries of the world. In order to gain competitive advantage as competition is getting more and more intense, companies are compelled to innovate and do their best for to enhance the customer satisfaction level. As in the telecom industry the customers have multiple choices to select among service providers and actively seek their rights of switching from one telecom service provider to another. In this ferocious competition customers requires better...
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...Sales Promotion and Consumer Loyalty: A Study of Nigerian Tecommunication Industry Oyeniyi Omotayo Abstract In today’s competitive business world customers are considered to be kings. Customers have several choices to make among alternative products, and they exercise a high level of influence in the market with respect to product size, quality and price. Hence, it is important for producers to meet the needs of customers in order to stay competitive. One of the marketing communication tools that is used in attracting the attention of the customer and build their loyalty is sales promotion. The aim of this paper therefore is to determine the effect of sales promotion on customer loyalty in the telecommunication industry. In this study, the survey method was used in gathering information from the respondents. Simple random sampling was used to select a sample size of 310, while descriptive and inferential statistical analyses were conducted with the aid of SPSS software. Producers spend a large part of their total marketing communication expenses on sales promotion. Hence, this paper attempts to find the effect of sales promotion on customer loyalty using a sample of customers of mobile telecommunication services. The paper found that, there is positive relationship between sales promotion and customer loyalty. More importantly, it was discovered that non-loyal customers are more prone to switch to competing products as a result of sales promotion than loyal customers. Key...
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...BRAND SWITCHING INTRODUCTION Sometimes known as brand jumping, brand switching is the process of choosing to switch from routine use of one product or brand to steady usage of a different but similar product. Much of the advertising process is aimed at encouraging brand switching among consumers, thus helping to grow market share for a given brand or set of brands. Brand loyalty is when consumers become committed to your brand and make repeat purchases over time. It is a result of consumer behavior and is affected by a person's preferences. Loyal customers will consistently purchase products from their preferred brands, regardless of convenience or price. Companies will often use different marketing strategies to cultivate loyal customers, be it is through loyalty programs (i.e. rewards programs) or trials and incentives (ex. samples and free gifts). | | Convincing consumers to switch brands is sometimes a difficult task. It is not unusual for customers to build up a great deal of brand loyalty due to such factors as quality, price, and availability. To encourage switching brands, advertisers will often target these three areas as part of the strategy of encouraging brand switching.Price is often an important factor to consumers who are tight budgets. For this reason, advertisers will often use a price comparison model to entice long time users of one brand to try a new one. The idea is to convince the end user that it is possible to purchase the same amount of product...
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...36 Abstract: Even though the number of brands has strongly increased in recent years, only a few managed to endow themselves with significant brand loyalty. Besides the actual proprietary brand assets, such as patents and trademarks, other major elements like brand loyalty, perceived quality, brand associations, and others, underlie brand equity. A successful brand strategy must be based on creating brand loyalty. For achieving this goal consumers must be classified on a loyalty basis, while marketing strategies and mixes must be shaped accordingly. INTRODUCTION The success of a firm depends largely on its capability to attract consumers towards its brands. In particular, it is critical for the survival of a company to retain its current customers, and to make them loyal to the brand. Brand loyal consumers reduce the marketing costs of the firm as the costs of attracting a new customer have been found to be about six times higher than the costs of retaining an old one. Moreover, brand loyal consumers are willing to pay higher prices and are less price sensitive. Brand loyalty also provides the firm with trade leverage and valuable time to respond to competitive moves.[1] In sum, loyalty to the firm's brands represents a...
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...IMPACT OF BRAND SWITCHING, BRAND CREDIBILITY, CUSTOMER SATISFACTION AND SERVICE QUALITY ON BRAND LOYALTY Idrees Akbar, waheed Naseer, Shoaib Ahmed Amin , Abdul Muqtadir , Hafsa Zia, Urooj Shafique Department of Management Sciences, the Islamia University of Bahawalpur Pakistan, Abstract: To be a leading company, it is a massive task to build brand loyalty. Brand is the only word that differentiates the goods and services from the other ones. Therefore the dominated companies spend a lot on the brand to make it unique in order to develop the brand loyalty. Brand loyalty can be created by the numerous ways and strategies but most convenient ones are how much you fulfill your promises in the light of brand credibility, and so on service quality is how much strong if the customer is satisfied then it will show its loyalty towards brand and if not then it shift the intention towards other brand in term of brand switching. This study measures brand loyalty of banking clients of Bahawalpur in Pakistan. A field survey was conducted in Islamia University of Bahawalpur. the study was conducted by 200 respondents, analysis werecoducted by mean of exploratory and confirmatory factor, for checking the data and common method variance. For checking the relationship regression analysis were done. The results were quit significant. Findings indicate that bank has performed satisfactorily in presenting a desired image of the target market. Hence future researchers in the area should be...
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...1. TITLE: “Factors responsible for Brand switching from Samsung to Nokia in smartphones in Indore region ”. 2. BRIEF OVERVIEW: 15 years ago, having a mobile phone was considered a luxury, but now it is a very common commodity. Just look around and you will see someone talking on a mobile phone. This device has become an integral part of our life. It is very interesting to see how the mobile handset market has evolved from ten years before to what it is now. What is even more interesting is how competition plays a very important role in determining the market condition today and tomorrow. Initially when Motorola introduced the mobile handset it was said that this device had a huge potential and that prediction has come true. For 14 years Nokia has held the top position of the global mobile phone market, however according to a Reuters poll of analysts, Samsung Electronics is outselling the Finnish mobile giant, but now we can see that people are switching their brands from nokia to other brands so we here want to find and study the factors in our research report that are responsible for the sudden change in the preference of the customers who previously used to buy the Nokia Cellphones but now prefer Samsung over Nokia. 3. BRIEF LITERATURE REVIEW: Following Researches have been conducted on Brand switching: * Consumers Propensity to Switch: A STUDY ON Mobile phone Industry * SWITCHING TENDENCIES OF CONSUMERS OF MOBILE PHONE SERVICES IN PUNJAB DISTRICT ...
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...CHAPTER TWO: LITERATURE REVIEW Much attention has been given to the concept of brand (Kotler, 1991 p.442) defined “Brand as a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods of one seller or group of sellers and to differentiate them from those of competitors. To interpret the perception of the company people usually developed knowledge systems (i.e schemas) Corporate Image believed to have identical characteristics as self-schema (Markus,1977) with consideration to persuade the buyer’s purchasing decision i.e good image of corporate encourages purchase from one company by abridge decision rules. (Bateson 1995) stated that the service quality is generally conceptualized as an attitude, the evaluation of the service offered. Quality is basically made up from a series of evaluated experiences and are usually fluctuates less comparatively than attitudes built from the satisfaction emotions. Parasuraman et al. (1988) stated that the customers judge the service quality on the basis of overall firm’s superiority and excellence. According to (Gronroos, 2000) the evaluation of service quality by customers could be judge through the interaction process that exactly happens or perceived by customers leave a critical impacts on customers. (Parasuraman et al., 1988; Aydin and Özer, 2005; Ismail et al., 2006; etc.) If service is high in quality it is regarded as a key to succeed in most competitive service markets. Many researchers have...
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...industry was under monopoly which has now been converted into more competitive market in which more competitors have entered and offering various alternatives of different kinds of services. TeliaSonera has been one of biggest telecommunication service providers in Sweden which is amalgamation between two big companies; Telia, a major Swedish company and Sonera which is Finish counterpart of Telia. Currently, TeliaSonera is offering various communication services to its customers such as Broadband, TV, Fix telephone connections and Mobile phone services. TeliaSonera is offering these services to both kinds of customers; i.e. business and residential customers. The purpose of this research project is to understand the telecom customers’ switching behavior in detail by distinguishing between two different kinds of customer experiences which are active customers and passive customers, based on their specific characteristics and to learn to design a communication that is effective not only for one kind of customers’ e.g. active customers but also for passive customers that have been found challenging regarding communication reception generally. By analyzing the outcomes, researchers would be able to demonstrate different features which need to be taken under consideration while communicating to each of these customers. The research has been carried out with an explorative research approach and qualitative interviewing with 13 students of Karlstad University in two parts. Through this research...
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...based on customer socialization and previous findings, they make four hypotheses: 1) Teenagers' athlete role model influence is positively related to product switching and complaint behavior; 2) Teenagers' athlete role model influence is positively related to favorable or positive word-of-mouth behavior; 3) Teenagers' athlete role model influence is positively related to brand loyalty and 4) Female teenagers' athlete role model influence is more positively related to (a) product switching and complaint behavior, (b) favorable word-of-mouth behavior, and (c) brand loyalty than male teenagers. After test the hypotheses, they found that 1) teens' athlete role model influence is not significantly related to product switching or complaining behavior; 2) athlete role model influence is positively related to teenagers' favorable word-of-mouth communications; 3) the results show that athlete role model is positively related to teenagers' brand loyalty; and 4) there are no significant differences between male and female members of Generation Y when it comes to athlete role model influence on product switching and complaint behavior. For marketers, they should realize that celebrity sports athletes are important to adolescents when they make brand choices and talk about these brands positively. Moreover, regardless of their public behavior, teenagers do consider athletes as important role models. In addition, females in our sample may spread more positive word-of-mouth about a product or brand...
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...switch to other service providers. Thus, the following are hypothesized: H1: A high level of switching cost is less likely to make mobile phone users switch to other service providers; and H2: A high level of switching cost moderates the relationship between service satisfaction and service switching. This paper will discuss the results of these two hypotheses tested using linear and moderated regression analysis. Data was obtained using a sample of about 500 employees and students of five public universities and two private universities in Malaysia. Findings from this study will develop insights to better strategize and effectively implement loyalty programs and so, prevent their customers from switching. Keywords: switching behavior, service quality, consumer satisfaction, mobile phone service usage Field of research: consumer behavioral aspects of marketing, mobile phone service SERVICE SWITCHING AND SWITCHING TELECOMMUNICATIONS INDUSTRY COST IN THE MOBILE Although switching is a common scenario in most service industries (Griffin & Lowenstein, 2001), it is more prevalent in telecommunication services (Lee & Murphy 2005). For example, the annual switching rate ranges from 20% to 40% in most of the global telecommunication service companies (Berson et al., 1999; Madden et al., 1999). Until two years ago, mobile service users in Malaysia faced significant costs in switching from one service provider (SP) to another because it could cause the loss of phone number...
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...nd swFactors behind the brand switching in telecom industry The issue of Customer’s switching to other service providers have been the cause of intensive research from many years now and have given rise to many theories.Due to the increased competition in the telecommunication industry it has become extremely important for the companies to pay attention towards retaining of the customers.This research study particularly investigated the causes of customer switching behavior.A prolific way to gain the knowledge about the switching behavior of customers is basically to examine the various factors that play imtegral role in switching behavior. This qualitative research study has offered new insights by defining and identifying the customer’s rationale to switch from one service provider to another. The model is estimated using the data set on the number of switching behavior. A total of 100 respondents were surveyed to identify the factors that have a greater effect on the customer satisfaction.The data were analyzed by the Optimal Scaling (Categorical Regression)to test the hypothesis. The model identified that… CHAPTER ONE: INTRODUCTION This research tried to find out the underlying factors that made the customer to switchover to another service provider in telecom industry. The telecommunication industry is one of the most important industries of the world. In order to gain competitive advantage as competition is getting more and more intense, the companies are compelled to...
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...Target is a company that competes in the department store industry. So, the first step to increase primary demand size in the department store industry would be to form some kind of mutual agreement with its competitors. This would enable them to function together as a team with the intention of developing a marketing strategy to increase demand size for the entire industry. For instance, Target Corporation and the rest of the department store companies would develop a marketing campaign where they would communicate to consumers the advantages of buying and choosing department stores over online stores, discounted department stores, along with other competitors of the department store industry. Also, marketers would generate informative advertisements...
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