Brand Switching in the United Kingdom Telecom Industry - Literature review Example

Literature Review

Customers are crucial in any industry. Thus, organisations have the obligation to channel their efforts to ensure customer satisfaction is always guaranteed. According to Naveen and Jeevanantham (2011), brand switching is a phenomenon whereby clients terminate their customer relationship with a particular company and start consuming goods or services of another firm. Ideally, brand switching behaviour is influenced by numerous factors some that are consumer specific. Alternatively, Aydin and Özer (2005) define customer brand switching phenomenon as a defection from a particular brand either on a permanent or temporary basis as a result of various factors. On the other hand, Deng et al. (2010) assert that brand switching behaviour is a situation whereby clients shift their allegiance to a certain brand in preference to the next either temporarily or on a permanent basis.

According to Saeed et al. (2013), switching cost is a primary element that either facilitates or hinders brand switching behaviour. It is prudent that switching cost does not take effect immediately a customer shifts allegiance from a particular brand, but it is implemented procedurally. Ideally, switching cost is classified into contractual, learning and transactional cost. Contractual cost is the amount of money incurred as a result of a customer creating a new consumer relationship with a new company, for instance, a new mobile service provider. It can take the form of subscription charges or any other kind of cost that has to be incurred before one can commence enjoying the new product or service. Transactional cost is the actual amount of money paid to enjoy a service of product provided by a particular company. In the telecommunication industry, transactional charges can take the form of tariff charges or rather the amount paid out when one makes a call for a particular period. Relatively, learning cost is the amount incurred in the process of one familiarising with a new product or service. It is prudent that switching cost can either hinder or facilitate brand switching behaviour depending on how expensive it is to switch to alternative brands.

Kumar and Chaarlas (2011) assert that when the anticipated benefits of the new product or service fall below the switching cost, clients are more likely to stick with their current service provider since it will not be imperative to switch. However, according to Hanif, Hafeez, and Riaz (2010), the market price is a primary factor that influences brand switching in the telecommunication industry. He argues that call charges are a determinant in the pricing structure for firms in the telecom industry. In that regard, changes in the price structure will likely influence brand switching among customers in the industry. Contrary to Afzal et al. (2013) and Aydin and Özer (2005), Deng et al. (2010) argue that price is not always an influential factor in the brand switching phenomenon. According to this scholar, some customers tend to be quality conscious and thus they often don’t mind paying premium prices as long as they receive quality services. In that perspective, they tend to have the belief that premium prices are a precursor to quality products and services. Thus, they are unlikely to shift to alternative brands with changes in prices since they expect such changes to be accompanied by improvements in service quality. Often customers tend to forego low prices for quality services since cheap products will not satisfy their needs to their satisfactory. Naveen and Jeevanantham (2011) argue that quality services and products are a source of consumer loyalty and go on to hinder brand switching behaviour. Ideally, once clients are impressed with the level of services offered by a particular firm they will tend to make repeat purchases despite price hikes as long as the quality is not jeopardised.

Findings by Liu (2008), suggests that service quality is determined by value added services, communication guaranteed network as well as innovative communication technology. It is evident that these factors play a crucial role in influencing client brand switching behaviour. Saeed et al. (2013) argue that for telecommunication companies to build customer loyalty trust is a fundamental element in that relationship. Ideally, trust assists clients in making purchase decisions at the same time it instils a sense of confidence in the service provider. Once customer develops trust on a particular company they are likely to make repeat purchases and thus enhance customer loyalty thus boosting the value proportion of that brand. Aydin and Özer (2006), assert that in the telecommunication industry, trust is like a relationship-preserving force since without it customer loyalty cannot be maintained. It is prudent that the moment customer develops loyalty to a particular brand; short-term alternatives are not likely to affect allegiance to that brand. Kumar and Chaarlas (2011) reiterate that trust has a positive impact on customer loyalty since it reflects the credibility of the firm as well as minimises any perceived risk concerning that service provider.

According to Aydin and Özer (2005), loyal consumers are a pillar to the success of business organisations since they are likely to make repeat purchases, pay premium prices as well as refer the company to other people. It is thus fundamental for firms to maintain a long-term relationship with loyal clients to ensure the long-term success of the business as well as enable the company to obtain a competitive edge in the market. Đỗ, Huỳnh, and Đặng (2016) argue that advertisement plays a crucial role in influencing customer brand switching phenomenon by inducing clients attached to rival brands to shift over. However, the advertisement can also be utilised as defines mechanisms to safeguard the loyalty of customers to a particular brand. Ideally, the messages relayed in advertisement and promotional campaigns influence preferences, purchase intentions of clients, attitudes as well as decision-making process on the part of the customers. However, Afzal et al. (2013) state that the primary intention of advertisement is to enhance a positive feeling among loyal customers by portraying the brand in a manner that generates emotions and a sense of attachment to the brand. In that regard, loyal customers are set to remain ingrained in the brand despite the ramifications in the market that might trigger brand shift.

Aydin and Özer (2005), state that the telecommunication industry is composed of two categories of consumer that is passive and active customers. Passive customers are those that possess little or rather limited knowledge about pricing information and other vital facts of the industry ramification. Ideally, their limited knowledge will likely make them less likely to switch to alternative brands since they do not perceive the benefits associated with such move. On the other hand, active customers are knowledgeable as far as the market is concerned up to date with the latest unfolding sin the industry. They are price sensitive and thus, respond accordingly to changes in the market. Ideally, this category of customers is likely to switch from one brand to the next when they perceive benefits in other products than what they are currently enjoying. However, Hanif, Hafeez, and Riaz (2010) argue that client retention can only be influenced by the ability of service providers in the telecommunication industry to give value to their consumers. It is prudent that once the customers are content with the kind of services they are receiving it is less likely for them to switch to alternative brands that they have not previously tested.

Importance of Literature Review and Existing Research to the Research Process

A literature review is a fundamental aspect of any study since it enables the researcher to reflect on with other scholars has done in the past with the aim of advancing that knowledge. Ideally, literature review underscores the purpose and expectations of the problem under investigation to enable the researcher to put appropriate emphasis on analysis and summarisation. It is prudent to note that literature review and other past research works serve as the foundation for the study since it is from that perspective that the researcher will evaluate recent trends and thus come up with a mechanism on how to improve on existing knowledge (Saunders, 2011). Ideally, a majority of the problems under research are not isolated in the sense that some researcher may have tackled the same topic in the past. Thus, a literature review in essential since it will act as a foundation for the research by anchoring the study on the findings of recent research works. That notwithstanding, studying literature and past research works enables the continuation of integration and coherence in the discipline since studies will be designed in a manner that is integrative and non-conflicting to each other. However, it is evident that numerous researchers’ works on similar topics yield different or rather conflicting findings. It is from that point that literature review is essential since it will appreciate that diversity with the intention of affirming findings by capitalising on the research gaps of previous studies (Kumar and Phrommathed, 2005).

Conversely, reviewing previous research works and literature is essential as it enables researchers to avoid the duplication of work by leveraging on the available findings. Ideally, scientific studies are both time consuming and expensive undertakings. In that light, the researcher will have to conduct an extensive review of the available literature as well as previous studies to ensure that the problem that is going to be investigating is unique from those that have been reviewed in the past. Similarly, literature review and past research works are a prime technique for collecting secondary data that will serve to affirm the findings obtained from primary data. The research process is prone to numerous risks and challenges during its implementation. Thus, past research works will assist the researcher to understand the kind of problems that will be anticipated during the process and as such come up with mitigations that will ensure that he/she does not bear the misfortunes that the previous scholar underwent. In that light, past research works allow the researcher to learn from history with the aim of making current studies better than their predecessors (Saunders, 2011).

Describe and evaluate the primary sources of information for a literature review and justify your conclusions

A significant portion of the information that will be used for the literature review will come from past studies that dealt with the factors that affect consumer brands switching in the telecommunication industry. Ideally, the topic has been investigated by numerous researchers thus making it easy to access loads of information for the purpose of developing a literature review for this particular study. Similarly, some information has also been gathered from books and scholarly sources that have knowledge aligned to the problem under investigation. It is prudent that some theories that have been advanced will play a critical role in affirming the issue under investigation and thus it is essential to integrate some books and scholarly material that have content about the matter of interest.

The use of past research work as the primary source of information for literature review was informed by the fact that the researcher will likely study and analyse past studies with the aim of making the current work more objective. Similarly, information from past research works will act as a foundation for the study since it will isolate the pertinent issues that the researcher is likely to encounter thus ensuring the current study is more focused and objective to a particular issue that has not be tackled in the past. Additionally, recent research work is ideal for literature review since most of the studies were first-hand work of the researcher thus the findings contained in those studies provide valid and reliable data that can be employed for decision-making. Relatively, the use of books and other scholarly materials as a source of information was ideal since for any research work to be credible it has to integrate theory with practice to investigate problems exhaustively. Thus, some methods were necessary to frame the research for it to be objective and tenable for investigation. In a nutshell, to develop a thorough and credible literature review the study had to incorporate both previous research work and scholarly material to gather credible and reliable information.