Evaluating the effect of switching barriers in the Ghanian mobile telecommunication industry

Master's Thesis from the year 2014 in the subject Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media, Ghana Telecom University College, language: English, abstract: Issues of retention have become a very complex and multi-faced challenge for mobile operators. On one hand, intensifying competition and growing customer expectations have made it increasingly difficult in recent years for mobile operators to keep their subscribers and do it profitably. On the other hand, the availability and multiplicity of operators in the market, coupled with the multiplicity and variety of products and services, drive subscribers to shopping around looking for the best deals. In order to survive and even thrive in today s challenging environment, mobile operators have taken a fresh look at their strategies and methods for retaining their subscribers.§This research contributes towards a better understanding of the nature, dimensions and effects of switching barriers on subscriber retention by focusing on the Ghanaian mobile telecommunication industry. Switching barriers refers to any factors that make it costly or difficult for a subscriber to change his/her service provider. Two switching barriers were studied namely: switching costs, and attractiveness of alternatives. Regarding the perceived switching costs, three factors were identified. These were: Learning cost, search and evaluation costs, and uncertainty cost.§Data was collected through self-administered questionnaires from over 385 subscribers. A 5-point Likert scale was used for each question. Descriptive statistics and relative importance index were used to analyse the collected data. The findings of the research reveal that switching from one mobile network to another in the Ghanaian mobile telecommunication industry is relatively easy. First, switching costs have little to no influence on subscriber retention. Second, subscribers perceive competitors as attractive. In other words, the estimate of the likely satisfaction with an alternative mobile network is high. Third, subscriber churn is influenced by social interaction specifically the word-of-mouth of friends, family members and relative.