The Influence of Customer Complaint Behaviour, Firm Response and Service Quality on Customer Loyalty of Mobile Telephone Subscriber in Uganda

Abstract

This study evaluated the influence of customer complaint behaviour, firm responses and service quality on customer loyalty of Mobile Telephone subscribers in Uganda. The study objectives were to determine the statistically significant relationship between customer complaint behaviour and customer loyalty; and examine the influence of firm responses on customer loyalty; assess the statistically significant influence of customer complaint behaviour on service quality and to examine the influence of service quality on customer loyalty. The study sought to establish the moderating effect of firm responses on the relationship between customer complaint behaviour and customer loyalty and to establish the mediating effect of service quality on the relationship between customer complaint behaviour and customer loyalty. Finally, the study sought to establish the joint effect of customer complaint behaviour, firm responses and service quality on customer loyalty. Three variables (customer complaint behaviour, firm responses and service quality) were used to form an integrated model to broaden the scope of customer loyalty. The study used descriptive cross sectional survey method. Stratified random sampling was used and a sample of 384 was used in the study with a response of 336 (88%). The population comprised students and staff of Makerere University. Primary data were collected from a sample of 336 administrators, support and academic staff of Makerere University. In a pilot study, reliability, validity and tests for parametric assumptions were done. Data were analysed using descriptive statistics and inferential statistics (factor analysis, correlations and regression tests). Results showed that the influence of customer complaint behaviour on customer loyalty within mobile telephone companies was both directly and partially moderated by firm responses and mediated by service quality. Both influences were positive and statistically significant (β= 0.301, p<0.05 and β = 0.670, p< 0.05, respectively). Service quality had direct positive significant correlations with customer Loyalty (β= 0.239, p< 0.05). Customer complaint behaviour had a statistically positive significant effect on customer loyalty (β=0.263, p< 0.05). The joint effect of customer complaint behaviour, firm responses and service quality on customer loyalty was statistically significant. It was recommended for policy makers and management of mobile telephone companies in Uganda to improve on handling customer complaints by considering firm responses and service quality dimensions. The study has made contribution to theory, policy and practice in relation to marketing in general and customer complaint behaviour in particular. It has offered more explicit clarification into the relationship between customer complaint behaviour, firm responses, service quality and customer loyalty. However, since the study was done in an academic environment, there is a need to conduct the study in a different context. The study used cross sectional research design which may limit generalisability of the results. Since consumer behaviour practices are dynamic, future research effort should emphasize use of a longitudinal study design.