Skip to main content

Predicting customer retention in discrete and continuous services

  • Chapter
  • First Online:
Markt- und Absatzprognosen

Part of the book series: FOM-Edition ((FOMEDITION))

  • 11k Accesses

Abstract

Optimising customer loyalty is critical for any organisation. However, achieving customer loyalty is challenging, especially in service industries. This chapter discusses customer loyalty, the challenges of achieving customer loyalty in service industries, and the different challenges to achieving loyalty in continuous (membership-based) service providers compared to discrete service providers. Finally, a step-by-step risk profiling approach is presented, based on a mixed-method research approach, to help service organisations predict the likelihood of loyalty and implement targeted interventions to customer segments most at risk of defection.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 49.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Hardcover Book
USD 64.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Bibliography

References

  • Akinci, S., Kaynak, E., Atilgan, E., & Aksoy, S. (2007). Where does the Logistic Regression Analysis stand in Marketing Literature? A Comparison of the Market Positioning of Prominent Marketing Journals. European Journal of Marketing, 41(5/6), 537–567.

    Article  Google Scholar 

  • Anderson, E., & Weitz, B. (1989). Determinants of Continuity in Conventional Industrial Channel Dyads. Marketing Science, 8(4), 310.

    Article  Google Scholar 

  • Bansal, H. S., Taylor, S. F., & James, S. T. (2005). Migrating to new service providers: toward a unifying framework of consumers switching behaviours. Journal of the Academy of Marketing Science, 3(1), 96–115.

    Article  Google Scholar 

  • Bhattacharya, C. B. (1998). When customers are members: Customer retention in paid membership contexts. Journal of the Academy of Marketing Science, 26(1), 31–44.

    Article  Google Scholar 

  • Bhattacharya, C. B., Rao, H., & Glynn, M. A. (1995). Understanding the bond of identification: An investigation of its correlates among art museum members. Journal of Marketing, 59(4), 46–57.

    Article  Google Scholar 

  • Bolton, R. N. (1998). A Dynamic Model of the Duration of the Customers Relationship with a Continuous Service Provider: The Role of Satisfaction. Marketing Science, 17(1), 45–65.

    Article  Google Scholar 

  • Bolton, R. N., Lemon, K. N., & Verhoef, P. C. (2004). The Theoretical Underpinnings of Customer Asset Management: A Framework and Propositions for Future Research. Journal of the Academy of Marketing Science, 32(3), 271–292.

    Article  Google Scholar 

  • Bove, L. L., & Johnson, L. W. (2009). Does true personal or service loyalty last? A longitudinal study. Journal of Services Marketing, 23(3), 187–194.

    Article  Google Scholar 

  • Brown, T. J., Barry, T. E., Dacin, P. A., & Gunst, R. F. (2005). Spreading the Word: Investigating Antecedents of Consumers’ Positive Word-of-Mouth Intentions and Behaviors in a Retailing Context. Journal of the Academy of Marketing Science, 33(2), 123–138.

    Article  Google Scholar 

  • Bryman, A. (2006). Integrating quantitative and qualitative research: how is it done? Qualitative Research, 6, 97–113.

    Article  Google Scholar 

  • Bryman, A. (2008). Social Research Methods (3rd edn.). United Kingdom: Oxford University Press.

    Google Scholar 

  • Bult, J. R., & Wansbeek, T. (1995). Optimal selection for direct mail. Marketing Science, 14(4), 378–394.

    Article  Google Scholar 

  • Büttgen, M., Schumann, J. H., & Ates, Z. (2012). Service Locus of Control and Customer Coproduction: The Role of Prior Service Experience and Organizational Socialization. Journal of Service Research, 15(2), 166–181.

    Article  Google Scholar 

  • Cachon, G., & Feldman, P. (2011). Pricing services subject to congestion: Charge per-use fees or sell subscriptions? Manufacturing and Service Operations Management, 13(2), 244–260.

    Article  Google Scholar 

  • Coelho, P. S., & Henseler, J. (2012). Creating customer loyalty through service customization. European Journal of Marketing, 46(3/4), 331–333.

    Article  Google Scholar 

  • De Matos, C. A., & Rossi, C. A. V. (2008). Word-of-Mouth Communications in Marketing: A Meta-Analytic Review of the Antecedents and Moderators. Journal of the Academy of Marketing Science, 36(4), 578–596.

    Article  Google Scholar 

  • DeWitt, T., Nguyen, D. T., & Marshall, R. (2008). Exploring customer loyalty following service recovery. Journal of Service Research, 10, 269–281.

    Article  Google Scholar 

  • Dorsch, M. J., Grove, S. J., & Darden, W. R. (2000). Consumer intensions to use a service category. Journal of the Services Marketing, 14(2), 92–117.

    Google Scholar 

  • Evanschitzky, H., & Wunderlich, M. (2006). An examination of moderator effects: the four stage loyalty model. Journal of Service Research, 8(4), 330–345.

    Article  Google Scholar 

  • Flanagan, J. C. (1954). The Critical Incident Technique. Psychological Bulletin, 51(4), 327–358.

    Article  Google Scholar 

  • Gonçalves, H. M., & Sampaio, P. (2012). The customer satisfaction-customer loyalty relationship: Reassessing customer and relational characteristics moderating effects. Management Decision, 50(9), 1509–1526.

    Article  Google Scholar 

  • Gruen, T. W., Summers, J. O., & Acito, F. (2000). Relationship marketing activities commitment and membership behaviours in professional associations. Journal of Marketing, 64(3), 34–49.

    Article  Google Scholar 

  • Guest, G., Bunce, A., & Johnson, L. (2006). How Many Interviews Are Enough? An Experiment with Data Saturation and Variability. Field Methods, 18(1), 59–82.

    Article  Google Scholar 

  • Hajipour, B., Bavarsad, B., & Asadi, Z. (2013). Investigating the Service Friendship Communicational Skills and Personality Traits in High-Contact Service. Journal of Management Research, 5(1), 233–249.

    Article  Google Scholar 

  • Han, X., Kwortnik, R., & Wang, C. (2008). Service Loyalty: An integrated model and examination across service contexts. Journal of Service Research, 11(1), 22–42.

    Google Scholar 

  • Jones, T. O., & Sasser, E. W. (1995). Why Satisfied Customers Defect. Harvard Business Review, 73, 88–99.

    Google Scholar 

  • Jones, T., & Taylor, S. F. (2007). The Conceptual Domain of Service Loyalty: How Many Dimensions? Journal of Services Marketing, 26(1), 36–51.

    Article  Google Scholar 

  • Kinard, B. R., & Capella, M. L. (2006). Relationship marketing: the influence of consumer involvement on perceived service benefits. Journal of Service Marketing, 20(6), 359–368.

    Article  Google Scholar 

  • Kvale, S. (1996). InterViews: An Introduction to Qualitative Research Interviews. California: Sage Publications.

    Google Scholar 

  • La, S., & Choi, B. (2012). The role of customer affection and trust in loyalty restoration after service failure and recovery. The Service Industries Journal, 32(1), 105–125.

    Article  Google Scholar 

  • Lee, M., & Cunningham, L. F. (2001). A cost/benefit approach to understanding service loyalty. Journal of Services Marketing, 15(2), 113–130.

    Article  Google Scholar 

  • Lengnick-Hall, C. A., Claycomb, C., & Inks, L. W. (2000). From recipient to contributor: examining customer roles and experienced outcomes. European Journal of Marketing, 34, 359–383.

    Article  Google Scholar 

  • Liljander, V., & Strandvik, T. (1995). The Nature of Customer Relationships in Services. In T. A. Swartz, D. E. Bowen, & S. W. Brown (Eds.), Advances in Services Marketing and Management. London.: JAI Press Inc.

    Google Scholar 

  • Lovelock, C., & Gummesson, E. (2004). Whither Services Marketing? In Search of a New Paradigm and Fresh Perspectives. Journal of Service Research, 7, 20–41.

    Article  Google Scholar 

  • Mechinda, P., & Patterson, G. P. (2011). The impact of service climate and service provider personality on employees customer-oriented behavior in a high-contact setting. Journal of Services Marketing, 25(2), 101–113.

    Article  Google Scholar 

  • Mittal, V., & Kamakura, W. A. (2001). Satisfaction repurchase intent and repurchase behavior: Investigating the moderating effect of customer characteristics. Journal of Marketing Research, 38(1), 131–142.

    Article  Google Scholar 

  • Oliver, R. L. (1980). A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions. Journal of Marketing Research, 17, 460–469.

    Article  Google Scholar 

  • Peduzzi, P., Concato, J., Kemper, E., Holford, T. R., & Feinstein, A. (1996). A simulation of the number of events per variable in logistic regression analysis. Journal of Clinical Epidemiology, 49(12), 1373–1379.

    Article  Google Scholar 

  • Reichheld, F. (1996). The Loyalty Effect. Boston: Harvard Business School Press.

    Google Scholar 

  • Reichheld, F. (2003). The one number you need to grow. Harvard Business Review, 81, 46–54.

    Google Scholar 

  • Reichheld, F., & Kenny, D. (1990). The Hidden Advantages of Customer retention. Journal of Retail Banking, XII(4), 19–23.

    Google Scholar 

  • Reichheld, F., & Sasser, W. (1990). Zero Defections: Quality Comes to Service. Harvard Business Review, 68, 105–111.

    Google Scholar 

  • Reinartz, W. J., & Kumar, V. (2000). On the profitability of long-life customers in a noncrontactual setting: An empirical investigation and implications for marketing. Journal of Marketing, 64(4), 17–35.

    Article  Google Scholar 

  • Ritchie, J., Spencer, L., & O’Connor, W. (2003). Carrying out qualitative analysis. In J. Ritchie, & J. Lewis (Eds.), Qualitative research practice: A guide for social science students and researchers. London.: Sage.

    Google Scholar 

  • Roos, I. (1999). Switching processes in customer relationships. Journal of Service Research, 2(1), 68–85.

    Article  Google Scholar 

  • Schmitt, P., Skiera, B., & Van den Bulte, C. (2011). Referral Programs and Customer Value. Journal of Marketing, 75, 46–59.

    Article  Google Scholar 

  • Tabachnick, B. G., & Fidell, L. S. (2007). Using multivariate statistics. Boston.: Allyn Bacon.

    Google Scholar 

  • Vargo, S. L., & Lusch, R. F. (2004). The Four services marketing myths: remnants from a manufacturing model. Journal of Service Research, 6, 324–335.

    Article  Google Scholar 

  • Verhoef, P. C. (2003). Understanding the Effect of Customer Relationship Management Efforts on Customer Retention and Customer Share Development. Journal of Marketing, 67(4), 30–45.

    Article  Google Scholar 

  • Verhoef, P. C., & Donkers, B. (2005). The Effect of Acquisition Channels on Customer Loyalty and Cross-Buying. Journal of Interactive Marketing, 19(2), 31–43.

    Article  Google Scholar 

  • Villanueva, J., Yoo, S., & Hanssens, D. M. (2008). The Impact of Marketing-Induced Versus Word-of-Mouth Customer Acquisition on Customer Equity Growth. Journal of Marketing Research, 45, 48–59.

    Article  Google Scholar 

  • Vittinghoff, E., & McCulloch, C. E. (2007). Relaxing the rule of ten events per variable in logistic and cox regression. American Journal of Epidemiology, 165, 710–718.

    Article  Google Scholar 

  • Wang, C. Y. (2010). Service quality perceived value corporate image and customer loyalty in the context of varying levels of switching costs. Psychology and Marketing, 27(3), 252–262.

    Article  Google Scholar 

  • Ward, T., & Dagger, T. S. (2007). The complexity of relationship marketing for service Customers. Journal of Services Marketing, 21(4), 281–290.

    Article  Google Scholar 

  • Zeithaml, V. A., Parasuraman, A., & Berry, L. L. (1985). Problems and Strategies in Services Marketing. Journal of Marketing, 49(2), 33–46.

    Article  Google Scholar 

Further Reading

  • Berry, L. L., Zeithaml, V. A., & Parasuraman, A. (1985). Quality counts in services too. Business Horizons, 28(3), 44–52.

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Corresponding author

Correspondence to Helen Watts Dr. .

Editor information

Editors and Affiliations

Rights and permissions

Reprints and permissions

Copyright information

© 2015 Springer Fachmedien Wiesbaden

About this chapter

Cite this chapter

Watts, H. (2015). Predicting customer retention in discrete and continuous services. In: Gansser, O., Krol, B. (eds) Markt- und Absatzprognosen. FOM-Edition. Springer Gabler, Wiesbaden. https://doi.org/10.1007/978-3-658-04492-3_5

Download citation

  • DOI: https://doi.org/10.1007/978-3-658-04492-3_5

  • Published:

  • Publisher Name: Springer Gabler, Wiesbaden

  • Print ISBN: 978-3-658-04491-6

  • Online ISBN: 978-3-658-04492-3

  • eBook Packages: Business and Economics (German Language)

Publish with us

Policies and ethics