In marketing and microeconomics, customer switching or consumer switching describes "customers/consumers abandoning a product or service in favor of a competitor". Assuming constant price, product or service quality, counteracting this behaviour in order to achieve maximal customer retention is the business of marketing, public relations and advertising. Brand switching--as opposed to brand loyalty is the outcome of customer switching behaviour.
Variability in quality or market price fluctuations--especially a rise in prices--may lead customers to consult price comparison services where alternative suppliers may be offered. Declining customer satisfaction may be due to poor service quality but also--to a lesser degree--be a symptom of boredom with the brand of choice. Brand loyalty can be very strong, however, and the longer a commitment to a brand lasts, the stronger the ties will usually be.
Because of the dominant role of pricing, market tactics like penetration pricing have evolved to offer a convincing incentive for switching. Another approach is the advertisement of vaporware that seemingly will offer newer or better features than established products without actually possessing any innovation.
Switching is a significant business factor affecting revenues for companies providing continuously delivered services, as is the case for the energy market as opposed to sectors providing products that stimulate non- or sparsely recurring purchase because of the durability of the product or a general orientation towards casual customers.Energy customer switching is a significant risk or success factor for energy suppliers.
|This marketing-related article is a stub. You can help Wikipedia by .|