Mediating Role of Customer Satisfaction on the Relationship Between Perceived Value and Customer Retention Among Mobile Phone Service Users in Western Kenya Region

The purpose of this study was to investigate the mediating role of customer satisfaction on the relationship between perceived value and customer retention among mobile phone users in public universities of western Kenya region. The study was guided by the social exchange theory which focused on the fundamental principle that humans in social situations choose behaviors that maximize their likelihood of meeting self-interests in those situations. Descriptive and explanatory research designs were utilized in this study. A questionnaire was used to collect data from sample size of 222 respondents who were sampled from the population. Data collected was analyzed by use of descriptive and inferential statistics. Multiple regressions were used to establish the effect of independent variables on the dependent variable. Mediation test was conducted by following Baron and Kenny (1986) four steps. Further, sobel test were used to test the level of significant of the mediation. The results revealed that Perceived value had significant effect on Customer retention. Also it was established that, Customer satisfaction was significant in predicting customer retention. Finally, Customer satisfaction had partial mediation effect on the relationship between perceived value and Customer retention. The study recommends that service providers should put more emphasis on perceived values since they influence customer satisfaction and hence customer retention. The study provides new theoretical insight into factors influencing customer retention by incorporating customer satisfaction as a mediator in the relationship between Perceived value and customer retention. Future researchers may use other models such structural equations model, Goodman test among others to test the relationship. Key Words : Mediation, Perceived Value, Satisfaction, Retention, Relationship DOI : 10.7176/EJBM/16-9-01 Publication date : November 30th 2024