Customer Switching Behavior in Iran Banking Services Industry

The costs of retaining an existing customer are one fifth of the costs of acquiring a new customer for a firm. This statement is considered as a predominant notion in marketing. According to this notion, existing customers switching of a firm leads to create lots of costs for that firm. Therefore, the present study has been conducted with the aim of finding the causes of the switching intentions and influential factors on the customers switching intentions in Iran Banking Industry.
This study is a descriptive-survey research carried out on Iran Banking Industry. 397 customers from five selected banks in Tehran were chosen for this research. In order to examine and analyze the [R1] data, Structural Equation Modeling (SEM), Confirmatory Factor Analysis (CFA) and one-way Analysis of Variance (ANOVA) have been used.
“Satisfaction”, “trust”, “loyalty” and “switching barriers” are considered as the main factors weakening “switching intention”. The findings confirmed that the variables of satisfaction, trust and loyalty have significant negative impacts on the switching intention, but the impact of the switching barriers on the switching intention in Iran banking was not significant. The present research has been conducted only on banking services industry and only in Tehran which reduces the generalizing effect of the study. Moreover, quantitative analysis methods were used in order to evaluate the subjective factors such as customer switching behavior.