Abstract

Although there is an increasing recognition among marketing scholars and business practitioners of the impact of switching costs on customer satisfaction and loyalty relationship, there is still lack of research about the process through which this variable strengthens the relationship between satisfaction and loyalty among Computer Business Centers. This paper therefore aims to evaluate how customer loyalty can be enhanced through customer satisfaction and financial switching cost among computer business centers operating in some selected tertiary institutions in Jos metropolis. The study covered three tertiary institutions in Jos, plateau state Nigeria namely; University of Jos, College of Forestry and Plateau State polytechnic. The total population was 48, 848 students of the three tertiary institutions in Jos metropolis. The use of questionnaire was adopted as the primary method of data collection, administered to the sample size of 245 customers out of which 200 was duly completed and retrieved. Structural modeling and multiple regressions was used in analyzing the data. From the result, hypothesis one was tested and it was discovered that there is a significant relationship between customer satisfaction and customer loyalty. Hypothesis two also showed that there is a significant relationship between customer satisfaction and financial switching cost with an estimate (â) of 0.33. This means that financial switching cost constitutes 33% of satisfaction among customers patronizing the business centers in these institutions. Hypothesis three also showed a significant relationship between financial switching cost and customer loyalty, and finally it was confirmed that financial switching cost mediate the relationship between customer satisfaction and customer loyalty. The study concluded that enhancing customer satisfaction alone does not predict long term loyalty of customers but the use of financial switching cost can further increase satisfaction among customers in ensuring loyalty. This is because quality and relationship alone cannot guarantee effective loyalty among customers without giving discounts, bonuses, and credit when necessary. Based on the findings in this paper, it was recommended that every small scale business owner operating within Nigerian tertiary institutions should take into cognizance the use of financial switching cost as most students are interested in the financial aspect of switching cost to determine the extent of their loyalty to a service provider. This is because it is an important factor which ensures the sustainability of competitive advantage over rivals.