How pre-engagement factors and service product attribute complexity impact customer tenure with a retailer

Abstract

The purpose of this research is to look at how various cultural dimensions - power distance, uncertainty avoidance, and individualism/collectivism - are related to the actual tenure of a customer with a retail service provider. In addition, how these same culture dimensions impact the selection of a service product based on the complexity of the service product attributes was examined. Additionally, how the complexity of the service product attributes relate directly to customer tenure with the retail service provider was studied. Finally, how the customer's anticipated service quality expectations, another pre-engagement factor, was explored with regard to its impact on the subsequent tenure of the customer with the retail service provider.

This study was done using both primary survey data regarding culture and anticipated service quality expectations and secondary data from a bank's retail checking account base to calculate customer tenure. One unique feature of this research is that it develops the customer tenure relationship using actual customer tenure, not intention to remain. In addition, expert raters were used to develop the relative service product attribute complexity rankings for the various types of retail checking accounts offered. The results demonstrated that the cultural dimension of collectivism and the tangible construct of anticipated service quality expectations did have significant effects, positive and negative respectfully, on customer tenure. Also, service product attribute complexity did have a significant positive effect on customer tenure.