Customers' Perception of Expensiveness and Its Impact on Loyalty Behaviors

ABSTRACT In the domestic and global marketing of services, customer satisfaction and loyalty are of paramount importance. Managers and researchers alike have spent the past thirty years trying to understand the antecedents and consequences of customer loyalty. This paper suggests a new construct, perceived expensiveness, and tests its effects on four customer loyalty behaviors: word-of-mouth, repurchase intent, complaining behavior, and price sensitivity. Significant results across two industries are compared; an equipment-based industry (telephone service) and a personal interaction-based industry (hair styling service). Managerial implications and future research directions are also discussed.