Weathering consumer pricing sensitivity: The importance of customer contact and personalized services in the financial services industry

Wonjoo Yun and Nicole Hanson

Journal of Retailing and Consumer Services, 2020, vol. 55, issue C

Abstract: In a low-cost switching environment, certain firm actions undertaken by service employees can improve consumer loyalty, satisfaction and reduce price sensitivity. Interestingly, consumers' satisfaction levels can actually increase when experiencing a price increase. Counterintuitively, when consumers experience a price decrease, their loyalty decreases, suggesting that it might be in the firm's best interest to not offer such pricing discounts as these customers may be hypersensitive to price. Overall, it appears much easier for service employees to positively influence customer satisfaction than customer loyalty; satisfied consumers do not necessarily become loyal consumers.

Keywords: Price sensitivity; Service employees; Personalized services; Customer satisfaction; Loyalty (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joreco:v:55:y:2020:i:c:s0969698919312032

DOI: 10.1016/j.jretconser.2020.102085

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