The influence of relationship intention on satisfaction, loyalty and retention following service recovery in the cellular industry

PhD (Marketing Management), North-West University, Potchefstroom Campus, 2014.It is common practice for service providers, such as cell phone network providers, to utilise relationship marketing strategies in an effort to retain their customers and thereby to increase profitability. Customers with relationship intentions are willing to respond to such efforts while other customers will refrain. Service failures negatively impact relationship marketing efforts and thus complicate service providers’ relationship-building efforts. Therefore, service providers endeavour to restore customers’ post-recovery satisfaction and loyalty through service recovery efforts to retain their customers. However, the influence that customers’ relationship intentions have on this process has not been considered. Previous research on relationship intention in South Africa focussed only on developing a valid and reliable relationship intention measurement scale. For this reason, the primary objective of this study was to determine the influence of relationship intention on customer satisfaction, loyalty and retention following service recovery within the cellular industry. Supporting the primary objective, a model depicting the influence of respondents’ relationships intentions on satisfaction, loyalty and retention following service recovery was developed. Furthermore, a model depicting the interrelationships of the relationship constructive dimensions of the service recovery process uncovered during this study was also developed. Through non-probability convenience sampling of adults 18 years and older (residing in Johannesburg and the surrounding residential suburbs) who have used a cell phone network provider for three years or longer, 605 respondents completed interviewer-administered questionnaires. Demographic and patronage information, together with respondents’ relationship intentions, attitudes towards complaining, customers’ complaint behaviour, expectations of service recovery, perceived service recovery as well as satisfaction, loyalty and retention following service recovery, were obtained. Results indicated that no associations exist between respondents’ levels of relationship intention and their relationship lengths, as well as whether they had contractual agreements with their cell phone network providers. It is therefore recommended that instead of using relationship length or contractual agreements, cell phone network providers should use customers’ relationship intentions to identify customers for relationship marketing purposes. Findings from this study furthermore include that respondents’ relationship intentions influence their propensities to complain, as well as the likelihood that they will voice a complaint regarding disatisfactory service delivery. It is therefore recommended that cell phone network providers use the opportunity to identify customers with relationship intentions through customers’ complaint behaviour. This study found that respondents’ relationship intentions influence both their expectations of cell phone network providers to take service recovery action, as well as their perceptions of service recovery. Respondents’ relationship intentions also positively influence their satisfaction, loyalty and retention following service recovery. Based on these findings, it is recommended that cell phone network providers should always take corrective action following service failures (such as billing errors in this study), preferably by including at least an acknowledgement, apology, explanation and rectification of the problem as part of the service recovery efforts. Such a combination of service recovery efforts will increase the satisfaction, loyalty and retention of customers with higher relationship intentions. From the results it can be concluded that customers’ relationship intentions influence their behaviour with regard to propensity to complain, voicing, expectations of service recovery action, perceptions of service recovery, as well as satisfaction, loyalty and retention following service recovery, when service failures occur. The proposed model developed from these findings results in the recommendation that cell phone network providers should view the service recovery process as an interrelated process influenced by customers’ relationship intentions. Cell phone network providers should note that customers with higher relationship intentions will attempt to salvage the relationship when service failures occur, which contributes to their satisfaction, loyalty and retention following service recovery. This study contributes to establishing relationship intention theory by confirming the positive influence of customers’ relationship intentions on constructive behaviour when service failures occur. Moreover, practical recommendations concerning cell phone network providers’ response to billing errors are proposed. Future research should address the methodological limitations of this study by using probability sampling, and data should be collected from all South African provinces. Real-time service failures should be considered as opposed to the scenario-based approach used in this study. Important influences on customer behaviour when service failures occur, such as the perceived severity of service failure, service failure type, perceived justice and attributions, should also be considered with regard to their influence on the constructs of this study. Lastly, the antecedents of or differences with regard to customers’ relationship intentions based on personality, generational cohort or population group deserve further attention to establish relationship intention as study field within the domain of relationship marketing.Doctora