This study are to find out the factors that influence the consumers in switching the service provider and finding out the likeliness of switching the service provider Pakistan has more then 100 million users of mobile phone network services.Mobile phone users switched over their networks increased an average 0.6 million each month during last year as per convenient of service quality and affordability of tariff,therefore customers loyalty leads to long-run profitability of an organization, which is a base for retaining the loyalcustomers.For this Ho and H1 is made to check whether there is association between the variables.The type of research used for this study is descriptive research design,a sample size of 60 is taken from different region of Karachi and found that call rates is most influence to change their network and various other charatcerstics has found of mobile network users that ultimately that will helps mobile usres Companies.
Contents
Introduction
All organizations have their hidden motive to increase the profitability. Successful organizations are attracting customers by raising their expectations and are delivering performances over and above the customer expectation levels. Successful organizations are investing heavily on promotion to increase the customer expectations and are devising their strategies to delight the customer. In customer satisfaction process, if the performance falls short of expectations, the customer is dissatisfied. If the performance matches the expectations, the customer is satisfied. If the performance exceeds expectations, the customer is highly satisfied or delighted. Long-run satisfaction leads to customer retention / loyalty.
Pakistan Telecommunication Authority confirms that the total number of cell phone users in Pakistan have crossed the mark of 99 million in fiscal year 2010
Switching behaviour is a consumer behaviour where the behaviour of the consumers differs based on the satisfactory level of the consumers with the providers or companies. Switching behaviour can be enunciated as the process of being loyal to one service and switching to another service, due to dissatisfaction or any other problems. Even if a consumer is loyal to a particular brand, if the brand does not satisfy his/her needs, the consumers switch to a competitor brand.
LITERATURE REVIEW
Trust is the major determinant In addition to trust, switching cost & corporate image are responsible forcustomer loyalty and satisfaction in mobile phone operator industry.Oyeniyi and Abiodun (2009) argues that customer satisfaction positively affects customer retention and that switching cost affects significantly the level of customer retention (Business Intelligence Journal (January). pp: 111-121).Consumer loyalty is defined as the degree to which a Consumer exhibits repeat purchasing behaviour from a service provider, possesses a positive attitudinal disposition toward the provider, and considers using only this provider when a need for this service arises (Gremler and Brown, 1996).
In a survey of South Korean customers found that call quality, value-added services and customer support were significant, but not price, and convenience in procedures.
The ads factor can be one of main reason to switching, telling the benefits and given better imager of there product to customer in a unique way and providing very simple methods to switch to their product. Juan Pablo Maicas Lopez, Yolanda Polo Redondo and Fco, Javier Sese Olivan ,University of Zaragoza, Zaragoza, Spain,(2006) their research shows how relationship marketing has recognized the importance of building long-term relationships in increasing firms profitability and guaranteeing their future viability. Trust is considered as the most important factor for building long-term relationships, for enhancing customer loyalty.
Richard Lee, Jamie Murphy, University of Western Australia (2005), their study investigates determinants that cause mobile phone Customers to transit from being loyal to switching. It concluded that there are different factors which affect the Customers to switch from loyalty to switching intentions such as price, technical service quality, Functional service quality, switching costs, etc. But, the rating was given that price is the most important factor which affects the Customers to switch loyalties to another provider.
Discussion on the Topic
Switching Your Service Provider
According to Pakistan Telecommunication Authority (PTA), an increased of 7.2 million subscribers who switched over their network from other with the facility of Mobile Number Portability (MNP).
These are the annual cellular subscribers in Pakistan according PTA,Insta phone has remains no longer after 2008 and was acquired later by the Arfeen Group and Pakistan Telecommunication Authority (PTA) terminated the license of Instaphone due to the company’s failure to pay outstanding dues.
| Annual Cellular Subscribers | |||||||
| | Mobilink | Ufone | Zong | Instaphone | Telenor | Warid | Total |
| 2003-04 | 3,215,989 | 801,160 | 470,021 | 535,738 | | | 5,022,908 |
| 2004-05 | 7,469,085 | 2,579,103 | 924,486 | 454,147 | 835,727 | 508,655 | 12,771,203 |
| 2005-06 | 17,205,555 | 7,487,005 | 1,040,503 | 336,696 | 3,573,660 | 4,863,138 | 34,506,557 |
| 2006-07 | 26,466,451 | 14,014,044 | 1,024,563 | 333,081 | 10,701,332 | 10,620,386 | 63,159,857 |
| 2007-08 | 32,032,363 | 18,100,440 | 3,950,758 | 351,135 | 18,125,189 | 15,489,858 | 88,019,812 |
| 2008-09 | 29,136,839 | 20,004,707 | 6,386,571 | 34,048 | 20,893,129 | 17,886,736 | 94,342,030 |
| 2009-10 | 32,202,548 | 19,549,100 | 6,704,288 | 0 | 23,798,221 | 16,931,687 | 99,185,844 |
| Jul-10 | 32,264,625 | 20,087,449 | 7,018,055 | 0 | 23,786,402 | 17,039,238 | 100,195,769 |
| Aug-10 | 31,777,445 | 20,182,449 | 7,249,813 | 0 | 23,743,680 | 17,085,379 | 100,038,766 |
| Sep-10 | 31,444,099 | 20,236,451 | 7,453,034 | 0 | 23,836,209 | 17,164,955 | 100,134,748 |
| Oct-10 | 31,453,954 | 20,187,309 | 7,785,713 | 0 | 24,121,009 | 17,167,065 | 100,715,049 |
| Nov-10 | 31,544,480 | 20,192,949 | 8,028,087 | 0 | 24,401,083 | 17,474,523 | 101,641,122 |
| Dec-10 | 31,794,292 | 20,275,002 | 8,497,799 | 0 | 24,692,818 | 17,517,476 | 102,777,387 |
| Source PTA.com.pk | |||||||
MNP is a system that facilitates mobile phone users to switch over their mobile phone network without changing personal number and code. The mobile phone users carried out change of network because of service quality, affordability of tariffs, choice of bundle packages and value-added services offered by different service provider. The average number of subscribers, who shifted to new network have been recorded at 600,000 in the last 12 months. The subscribers can migrate from their existing network to another more than one time with a gap of three months. The migration is completed within a couple of days by the operator against minimal charges
1st Country to Implement MNP in South Asia
Pakistan is the first country in South Asia to implement the Mobile Number Portability (MNP) in March 2007 within a record time of two years. MNP is regulated under provisions of “Number Portability Regulations” and “Porting Process Guidelines”. Normal porting time for both Pre-Paid and Post-Paid subscribers is 4-days after the subscriber settles his contractual obligations with concerned donor operator. Pakistan Mobile Number Portability Database (Guarantee) Limited (PMD) was established by the six cellular mobile operators to act as a centralised clearinghouse for MNP.
MNP Creates Competition Among Players
MNP created competition among the cellular mobile operators and forced them to introduce new packages for the subscribers.Mobile phone operators’ full-fledge advertisements and marketing campaigns have become fruitful for them for broadening of subscribers’ base. Also, the operators are now more cautious for improving their services and offering new packages in order to retain their subscribers. The subscribers can migrate from their existing network to another with the same code and number more than one time with a gap of three months. The migration is completed within a couple of days by the operator against minimal charges.
Research Methodology
The purpose of study is that to explore the factor of consumer switching and loyality to specific mobile network.This research is Descriptive which wil examine and respondent answer and test them through statistical manner.
Data Collection
In this survey, the primary data was obtained by structured questionnaires. The secondary data was collected through various websites.
Sample Size
The sample size of each region consist of 12 and total is 60 respondents.
Sample size & sampling methods
To calculate minimum smaple size I have used the following formula proposed by Saunders M, Lewis P and Thornhill
n = p% x q% x (Z/e%)2
Where:
n = minimum sample size required.
p% = proportion belonging to specific category.
q% = proportion not belonging to the specific category.
Z = z-value 95 % confidence interval.
e% = margin of error required .
For this study, Karachi is geographically divided into four broad regions: North Karachi, Central Karachi, South Karachi, West Karachi and East Karachi. The respondents are randomly drawn from each region.
So, cluster sampling method is used for data collection. The sample size was 60, in which 57 were validated and remaining 3 were not included due to incompleteness.
Respondents
| North Karachi | 12 |
| Central Karachi | 12 |
| South Karachi | 12 |
| West Karachi | 12 |
| East Karachi | 12 |
| N | 60 |
Objectives
To identify the factors that affects the consumers into switching the service provider.
Scope
§ The present study can be extended to other geographical areas.
§ It can be extended to study the usage of mobile services of different age groups and accordingly new plans can be formulated.
§ This study can be extended to understand the switching behaviour of a particular cellular service provider.
DATA ANALYSIS
Multiple regression methods were used in view of hypothesis and research objectives. Figures obtained from SPSS-19.0. Statistical part were interpreted to come at conclusion and implications and for charts excel 2007 is used.
Demographic:
| Measures | Items | Percentage |
| | 20 or below | 26% |
| | 21-25 | 45% |
| Age | 26-30 31-35 | 16% 6% |
| | 36-40 | 5% |
| | 41 or Above | 2% |
| Gender | Male | 54% |
| Female | 46% | |
| | Inter Bachelors | 27% 53% |
| Highest Level of Education | Masters MS | 18% 2% |
| | | |
| | Student | 72% |
| Occupation | Self-Employed Employed | 10% 16% |
| | Others... | 2% |
| | Below 10,000 | 23% |
| | 11,000-20,000 | 26% |
| Income Level | 21,000-30,000 31,000-40,000 | 21% 12% |
| | 41,000-50,000 | 10% |
| | Above 50,000 | 8% |
| | Mobilink | 14% |
| | Ufone | 28% |
| Network | Telenor | 28% |
| Warid | 18% | |
| | Zong | 12% |
| | | |
The questionnaire was helped to explain the demography of respondents with the
help of six items. Majority of youngsters were male which is about 54% while 46% were females.Pakistan is male dominated society therefore this was an encouraging aspect. Most of the respondents had completed education up to bachelor’s level (53%).I also come to know that 28% youngsters were using Ufone and Telenor respectively whereas subscribers of the other networks were lower than this figure. The outcome of survey further showed that 72% of youngsters were students and only 16% were employed.
Hypothesis:
H0: There is no association between switching Preference and independent variables
H1: There is an association between switching Perference and independent variables
H1: There is an association between switching Perference and independent variables
H0: β1 = β2 = β3 = β4 = 0
H1: β1 ≠ β2 ≠ β3 ≠ β4 ≠ 0
^
Y= β0 + X1 β1 + X2β2 + X3β3 + X4 β4 + e
| Model | R | R Square | Adjusted R Square | Std. Error of the Estimate |
| 1 | .912 | 0.832 | 0.783 | 0.34181 |
| Anova |
| Model | | Sum of Squares | df | Mean Square | F | Sig. |
| 1 | Regression | 31.947 | 4 | 7.971 | 68.276 | .000 |
| | Residual | 6.426 | 55 | 0.117 | | |
| | Total | 38.733 | 59 | | | |
| Coefficients |
| Model | | Unstandardized Coefficients | | Standardized Coefficients | t | Sig. |
| | | Std. Error | Beta | | | |
| 1 | (Constant) | -1.267 | 0.254 | | -4.988 | 0 |
| | Valueaddedservices | 0.372 | 0.113 | 0.289 | 3.3 | 0.001 |
| | Networkcoverage | 0.39 | 0.153 | 0.276 | 2.55 | 0.012 |
| | Callrates | 0.46 | 0.119 | 0.345 | 3.876 | 0 |
| | Sms | 0.066 | 0.126 | 0.046 | 0.525 | 0.6 |
R2 = .832
Since it is closer to 1, independent variable and dependent variable are highly correlated.
Here, dependent variable is switching preference and the independent variables are
Here, dependent variable is switching preference and the independent variables are
Call Rates, Network Coverage, Value Added Services, Sms.
Regression equation for this study, Switching preference = -1.267 + .372(Value Added Services) +.390(Network Coverage) + .460(Call Rates) + .066(Sms)
Since, significance value is 0.00<0.05, we accept the alternative hypothesis. There is an
association between switching behaviour and independent variables.
association between switching behaviour and independent variables.
From the regression equation, it is clear that if we increase Network Coverage 1unit of, which the independent variable in this study is, there will be a .390-unit increase in switching preference. Simultaneously, all independent variables are positively correlated.
Most preferred service provider in Karachi
It is clear that in Karachi most of people used telenor and ufone and it is found that it is mos preferred service provider in Karachi 28% people used and most less users in Karachi is of Zong 12%.
Kind of Service
Interpretation: Above data shows that most of the respondents in the area have pre-paid connections. And I got only 19% questionnaire filled by post-paid users.
Best Service Rater
| Brands | Excellent | Good | Avg | Poor | Terrible | Not Sure |
| Ufone | 5 | 7 | 3 | 1 | | |
| Telenor | 4 | 5 | 5 | 2 | | |
| Mobilink | 2 | 2 | 1 | 4 | | |
| Zong | 2 | 2 | 1 | 2 | | |
| Warid | 3 | 2 | 4 | 2 | | |
Interpretation: From the graphic that Ufone is the most excellent and good service provider as the believes that the service of the company in Karachi. Then Telenor has also good rate of a good service provider in Karachi. Third number is Mobilik and the Zong and Warid.
Consumer Loyalty to Brands
| Brands | >1 Month | 1-6 Month | 6 M– 1 Year | < 1 Year | < 3 Year |
| Ufone | 1 | 3 | 3 | 7 | 3 |
| Telenor | 1 | 5 | 3 | 2 | 2 |
| Mobilink | 1 | | 1 | 2 | 7 |
| Zong | 1 | 1 | 1 | 5 | |
| Warid | | 1 | 2 | 5 | 3 |
Interpretation:
Most longest used is mobilink since mobilink is also older in these company and and then it is ufone about 15% peole using more then one year,since zong is newest has low users in years.
FINDINGS:
· Call rates is most important role in switching the service provider followed by Network coverage, value added service and last is Sms, which plays the least important role.
· Majority of youngster use mobile network with 57 % users in Karachi.
· It is found that telenor and ufone users are most in Karachi and finds that both are best service provider in Karachi.
· It is found that moblink is oldest and has most loyalty level follow by ufone.
Recommendations
· Call rates lead the consumers to switch the service provider. Therefore, mobile service providers need to satisfy the Consumer with minimum call rates.
· Mobile service providers should invest more on improving their network coverage in order to retain their consumers, Zong should paid more concentration on that.
· Mobile network should spend more spend on advertisment and should focus more on youngster so that the capture bigger market.
Conclusion
I suggest that cellular service providers concentrate more on tariff rates increasing network stability and setting competitively.Customer satisfaction has positive effects on the customer retention so Mobile operators should shift focus on building corporate image and analyse more carefully the reason for consumers to switch brands in this industry in order to increase loyalty among these consumers.
References
Far East Journal of Psychology and Business, Vol. 2 No 2, February 2011,From http://www.fareastjournals.com/journal_detail.aspx?jid=18 [Viewed 2/5/11]
Bansal H. S. (1997), Service Switching Model SSM: A Model of Customer Switching Behavior
in the Service Industry. Queen’s University Kingston, Ontario Canada,From
http://www.jstor.org/pss/1252074 [Viewed 3/5/11]
Gerrard,P. and Cunninham,J.B. (2004),Consumer Switching Behaviour in the Asian Market, ‟Journal of Services Marketing, From
http://www.deepdyve.com/lp/emerald-publishing/consumer-switching-behavior-in-the-asian-banking-market-gHlZoz0P2B [Viewed 3/5/11]
Mittal, B., and Lassar, W. M., 1998. Why do customers switch? The dynamics of satisfaction versus loyalty. The Journal of Services Marketing,From
http://www.deepdyve.com/lp/emerald-publishing/why-do-customers-switch-the-dynamics-of-satisfaction-versus-loyalty-aTM2RH0CEP [Viewed 4/5/11]
Telecom Indicators Annual Cellular Subscribers Last Updated (Friday, 18 March 2011),From
http://www.pta.gov.pk/index.php?option=com_content&view=article&id=269:telecom-indicators&catid=124:industry-report&Itemid=599 [Viewed 4/5/11]
Mobile Number Portability Switch Their Network March 2011,From
http://www.telecomrecorder.com/2011/04/24/over-0-6-million-cellular-phone-users-switch-their-networks [Viewed 4/5/11]
Attachment
Questionnaire
Please tick one of the option in given box
Demographic Portion
a) Gender
Male c Female c
b) Age
| 20 or below | c |
| 21-25 | c |
| 26-30 31-35 | c c |
| 36-40 | c |
| 41 or Above | c |
c) Education
| Inter Bachelors | c c |
| Masters MS | c c |
d) Occupation
| Student Self-Employed | c c |
| Employed Others | c c |
e) Income Level
| Below 10,000 | c |
| 11,000-20,000 | c |
| 21,000-30,000 31,000-40,000 | c c |
| 41,000-50,000 | c |
| Above 50,000 | c |
Mobile Phone Preference
Q1:- Which mobile connection do you have? (can tick more then one option)
a) Ufone b) Mobilink c) Zong d) Telenor
Q2:- What kind of service you have (can tick more then one option)
a) Pre-paid b) Post-paid
Q3:- Overall, how would you rate your service provider?
a) Excellent b) Good c) Average d) Poor e) Terrible f) Not Sure
Q4:- How long have you used the service of that company?
a) Less than one month b) 1 to 6 months c) 6 months to a year
RATING QUESTIONNAIR
5 = AGREE STRONGL
4 = AGREE
3 = MAYBE
2 = DISAGREE
1 = DISAGREE STRONGLY
Q5:- I change my network service company by my preference (Likeness)
5 4 3 2 1
Q6:- Sms Packages is a factors that’s influence me to change my network service company?
5 4 3 2 1
Q7:-I see value added service to change my service network company?
5 4 3 2 1
Q8:-Networks singals problem causes me to change my service network company?
5 4 3 2 1
Q9:-Call rates influence me to change my current service network?
5 4 3 2 1
Thank you for spending your precious time on filling the questionnaire !
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