Using More Rewarding Switching Barriers to Build Loyalty on Dissatisfied Customers

Abstract

Several studies have focused on the influence of switching barriers on customer loyalty, but there has been no consensus on their findings. This study proposes that the mix of conclusions lie down in the fact that there are two different types of switching barriers - rewarding and punitive ones - and two different dimensions of loyalty - attitudinal and behavioral - and that the direction and strength of the impact on loyalty depends on the type of switching barriers used by organizations and also on the dimension of loyalty consider in the study. Using a sample of dissatisfied customer in an emerging economy, Chile, this paper studies the relationship between switching barriers and customer loyalty. The study confirmed five dimensions to measure switching barriers and showed a very reliable construct to measure customer attitudinal and behavioral loyalty. The investigation also showed that the more rewarding switching barrier dimensions (e.g. organizational credibility, value congruency and relational values) are positively related to the loyalty of dissatisfied retail banking customers. The punitive switching barriers were shown to be negatively related to loyalty. When considering the dimension of loyalty, the results showed that the impact of switching barriers is greater on behavioral than on attitudinal loyalty, in particular when dealing with punitive switching barriers.