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Determinants of Customer Churn: An Empirical Study Of Cellular Subscribers From Saudi Arabia

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  • Soomro, Yasir
  • Al-Sehli, Ahmed Nafe

Abstract

This research main objective finds the determinants of churn that affect the telecom industry of the Kingdom of Saudi Arabia (KSA). To analyze the churn predictions to retain the customers in the telecom industry, the paper takes factors of churns that create obstacles in the retention of the customers. The variables of the study included switching cost, price, value-added services, and service quality relevant to the telecom industry. The questionnaire was created using adopted items from various studies and was used to collect the data from 315 respondents through non-restricted random sampling. Data reliability and analysis were performed on IBM SPSS®20 software and multiple regressions were applied. The key findings that lower switching costs of cellular network providers significantly lead to customer churn (MNP). This study found that switching costs are not considered a factor if a customer is dissatisfied or innovator in nature to try other companies’ services. Whereas, low service quality, high price structure, and less value-added encourage customers to switch service. The telecom industry should improve its service quality since it is considered one of the most important factors in churning in any industry. This paper would be highly beneficial for the managers of the telecom industry in KSA and other Middle Eastern telecommunication companies.

Suggested Citation

  • Soomro, Yasir & Al-Sehli, Ahmed Nafe, 2020. "Determinants of Customer Churn: An Empirical Study Of Cellular Subscribers From Saudi Arabia," MPRA Paper 101398, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:101398
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    References listed on IDEAS

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    More about this item

    Keywords

    Switching behavior; Service quality; Switching cost; Value-Added services; Client churn rate; Customer churn; Mobile Number Portability (MNP); Pricing structure; Mobile service provider.;
    All these keywords.

    JEL classification:

    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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