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What drives Gen Y loyalty? Understanding the mediated moderating roles of switching costs and alternative attractiveness in the value-satisfaction-loyalty chain

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  • Chuah, Stephanie Hui-Wen
  • Marimuthu, Malliga
  • Kandampully, Jay
  • Bilgihan, Anil

Abstract

Generational theory presumes that generational cohorts develop similar attitudes and beliefs with regard to their market behaviors. This study examined the attitudes and beliefs of the Gen Y members towards mobile Internet service providers (MISPs). Gen Yers have the highest adoption of mobile Internet. They are also the most value-conscious, least satisfied and loyal customers compared with all other generations. This study therefore proposed a research model to elucidate the relationship between perceived value, satisfaction, switching costs (SC), alternative attractiveness (AA) and loyalty, and tested it using empirical data collected from 417 Gen Y mobile Internet subscribers. The results indicated that perceived value significantly influenced the satisfaction of Gen Y customers and, in turn, their loyalty towards MISPs. The results also confirmed the existence of mediators and moderators in the relationship between customer satisfaction and loyalty. Both SC and AA proved to be partial mediators, whereas AA was a moderator. Further, it was found that the moderating effect of AA on the association between customer satisfaction and loyalty was contingent upon the mediating effect of SC. Finally, the implications of these findings are delineated.

Suggested Citation

  • 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.
    • Handle: RePEc:eee:joreco:v:36:y:2017:i:c:p:124-136
    DOI: 10.1016/j.jretconser.2017.01.010
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