ETAPAS DE LAS OBSERVACIONES PLANEADAS

This chapter offers an overview of the extant literature and reveals several research gaps for further research. As mentioned previously, substantial research into the role of switching barriers in marketing has been undertaken in the offline context. Studies in this area are mainly limited to service industries which are either contractual or high-touch in nature, such as banking and hair salons (Jones et al. 2002), credit card and long distance phone call providers (Burnham et al. 2003) and financial services (Bansal and Taylor 2002; Colgate and Lang 2001). Only in recent times has the role of switching barriers received attention in e-retailing research (e.g. Balabanis et al. 2006; Chen and Hitt 2002; Goode and Harris 2007; Yang and Peterson 2004), generating mixed results. This may be due to the assumption that switching barriers are not as important online as they are offline mainly because consumers have numerous alternatives to which they can switch very easily (e.g., Bakos 1997; Friedman 1999; Holloway 2003).

However, as already mentioned, recent research has found that a wide range of choice may not necessary be good for consumer mental health (Murray and Haübl 2008). On the contrary, this may have adverse consequences, such as diminished self-control, reduced satisfaction levels, increased ‘cognitive dissonance’ and regret (Baumeister and Vohs 2003;

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Carmon, Wertenbroch and Zeelenberg 2003). As a consequence, internet shoppers are generally hesitant to switch (Murray and Haübl 2008), rendering e-retailers ‘stickier’ (Brynjolfsson and Smith 2000; Johnson et al. 2003) than originally anticipated.

While many studies have employed switching costs as their main construct, there has been very little effort to develop robust measures of online switching costs. The multifaceted typologies and dimensions of switching costs denote the complex nature of the construct. However, empirical research in this area has treated switching costs as unidimensional (e.g. Fuentes-Blasco et al. 2010; Goode and Harris 2007; Kim and Toh 2006; Wang 2004), measuring such costs as a global construct. This approach ignores the conceptual richness of the switching costs construct, which is too complex to be operationalised as unidimensional (Burnham et al. 2003). Aydin

et al. (2005) specifically highlight the need for future research to investigate the sub-dimensions of switching costs.

Although there have been some attempts to assess switching costs online, no research to date focuses specifically on the issues of pure-play internet retailers. It is important to distinguish the effect of pure online companies and bricks-and-click companies. A study carried out by Shanker et al. (2003), for example, has found differences in the magnitude of loyalty and

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satisfaction towards an online retailer versus offline retailer selling the same product. Another study by Holloway (2003) has found that consumer relationships with bricks-and-click retailers are stronger than online only retailers. To a certain extent, being a multichannel retailer may affect consumer loyalty and retention. This is because the brand name, physical presence and tangibility of the retailer’s physical store are likely to enhance customers’ familiarity with its online counterparts (Pan et al. 2002). This may leverage customer loyalty and lead to over-estimation of the relationship in a research model [see, for example, Danaher et al. (2003)]. Hence, another goal of this research is to achieve a clearer understanding of the role of switching barriers in the pure online retailing environment, answering the call for solid empirical work in this area. This research represents the first attempt not only to study switching barriers explicitly with respect to pure ‘dot com’ retailers, but also to incorporate multidimensional switching costs in this context. As noted by Chen and Hitt (2002, p. 256):

"Despite the critical role of switching costs in e-commerce strategy, there is surprisingly little empirical evidence about the presence, magnitude, or impact of switching costs on customer behaviour."

As discussed, most empirical evidence of switching costs (online and offline) has resulted from examination of the direct association between the

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construct and customer retention (e.g. Jones et al. 2002; Ping 1993). Recently, scholars have begun to explore the moderating role of switching costs on the satisfaction and retention link although with mixed results (Bell et al. 2005; Patterson and Smith 2003). This suggests that more empirical work is needed to explore the interaction effect of switching costs to confirm past findings.

Habit or inertia is one of the constructs that is considered important in consumer behaviour, and is closely associated with consumer loyalty and retention. However, as described earlier, while habit is a key determinant of customer retention, as theorised in past research stemming mainly from the social psychology and information system arenas, there is a dearth of research on this subject in the consumer behaviour arena. In the online retailing context, where visiting and purchasing from particular websites can be a habitual behaviour, the inclusion of this construct is very necessary. Furthermore, the mix of opinion among scholars with regards to the habit concept indicates the need for more research into habit to be conducted. Therefore, this study aims to extend the existing research into the social exchange framework application to retailing by including habit as an additional construct.

In light of the gaps identified, the objective of this research is to investigate the role and importance of perceived switching costs and

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alternative attractiveness in increasing customer retention for online retailers. It is important to note that the research does not specifically examine the development of customer loyalty as this has been widely studied in past studies; rather it explores the role and importance of perceived switching costs and competitors’ switching inducements (attractiveness of available alternatives) in relation to customer retention.

2.10SUMMARY

This chapter presents a discussion of literature associated with customer loyalty, satisfaction, switching costs, alternative attractiveness and habit loyalty from two relevant perspectives. First, a brief discussion of the above concepts was conducted from the social psychology perspective. This was followed by a more detailed discussion from the marketing and consumer behaviour perspectives. This is in line with the objective of the research, which seeks to investigate the role of perceived online switching barriers as one of the key factors explaining and predicting customer retention in online retailing. The literature based on social psychology theories associated with prediction of personal relationship commitment and relationship persistence provide the initial reference base for the development of the conceptual model and hypotheses, which are presented in the next chapter. In addition, the conceptualisation and hypotheses chapter presents the facets of the

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switching costs construct that are relevant to the online retail industry, particularly the pure-players. This necessitates discussion of the individual dimensions that have been identified as relevant to this study and justifications for their inclusion.

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