Business Commons^™

Switching Costs And Loyalty: Understanding How Trust Moderates Online Consumers’ Ties To Merchants, Michelle Carter, Richard Klein, Jason B. Thatcher, Ryan Wright

Jason Bennett Thatcher

Information technology has transformed how travelers interact with travel service providers. Due to fierce competition in the online air travel industry, e-ticketing services have focused attention on fostering customer loyalty. This is an important strategy because, in general, initial transactions with new customers are less profitable than transactions with existing customers. Drawing on research on customer loyalty, switching costs, and trust, this study develops, and proposes an empirical test, for a model incorporating trust as a moderator of the relationship between switching costs and online customer loyalty. We propose that in the presence of high customer trust, e-businesses should have …