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The double-edged sword: The positive and negative effects of switching costs on customer exit and revenge

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  • Haj-Salem, Narjes
  • Chebat, Jean-Charles

Abstract

What happens when customers have to deal with switching costs after a service failure and a poor recovery? This study seeks to address this question by proposing and testing an integrative model that incorporates customers' negative emotions as mediators between switching costs and behavioral outcomes (i.e., loyalty and revenge). The model distinguishes positive from negative switching costs, and inward from outward negative emotions. Analysis of survey data from 280 real customers who actually experienced a service failure and poor recovery with a major telecommunications firm reveals that customers react to switching costs strongly, emotionally, and sub-optimally. In contrast to most findings in the service literature, the results indicate that negative switching costs generate both exit and desire for revenge. Paradoxically, positive switching costs generate both loyalty and an even higher level of desire for revenge. These findings have important implications for the service industry.

Suggested Citation

  • Haj-Salem, Narjes & Chebat, Jean-Charles, 2014. "The double-edged sword: The positive and negative effects of switching costs on customer exit and revenge," Journal of Business Research, Elsevier, vol. 67(6), pages 1106-1113.
    • Handle: RePEc:eee:jbrese:v:67:y:2014:i:6:p:1106-1113
    DOI: 10.1016/j.jbusres.2013.05.050
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    References listed on IDEAS

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    4. Chuah, Stephanie Hui-Wen & Marimuthu, Malliga & Kandampully, Jay & Bilgihan, Anil, 2017. "What drives Gen Y loyalty? Understanding the mediated moderating roles of switching costs and alternative attractiveness in the value-satisfaction-loyalty chain," Journal of Retailing and Consumer Services, Elsevier, vol. 36(C), pages 124-136.
    5. Aidha Auliah & Gunawan Prayitno & Ismu Rini Dwi Ari & Rahmawati & Lusyana Eka Wardani & Christia Meidiana, 2022. "The Role of Social Capital Facing Pandemic COVID-19 in Tourism Village to Support Sustainable Agriculture (Empirical Evidence from Two Tourism Villages in Indonesia)," Economies, MDPI, vol. 10(12), pages 1-20, December.
    6. Heiner Evanschitzky & Valentina Stan & Liane Nagengast, 2022. "Strengthening the satisfaction loyalty link: the role of relational switching costs," Marketing Letters, Springer, vol. 33(2), pages 293-310, June.
    7. Harun, Ahasan & Rokonuzzaman, Md, 2021. "Pursuit of loyalty in service recovery: The roles of brand equity and cognitive reappraisal as moderators," Journal of Retailing and Consumer Services, Elsevier, vol. 62(C).

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