Acquisition and retention · Empirical implementation of a random-utility approach to measure switching costs and brand loyalty, followed by analysis of how usage, service design, and firm and individual characteristics relate to switching and retention.
Measuring Switching Costs and the Determinants of Customer Retention in Internet-Enabled Businesses: A Study of the Online Brokerage Industry
Pei-Yu (Sharon) Chen, Lorin M. Hitt (2002). Measuring Switching Costs and the Determinants of Customer Retention in Internet-Enabled Businesses: A Study of the Online Brokerage Industry. Information Systems Research. https://doi.org/10.1287/isre.13.3.255.78.
Plain-English take
Measured switching costs varied substantially (up to a factor of two). Demographics had little effect, while systems usage and quality were associated with reduced switching; product-line breadth and quality could reduce switching and attrition. For your marketing: Use it to frame a lifecycle hypothesis and define customer-level outcomes; compare its market and retention horizon with yours.
How much weight to give this
2.5/5 Evidence needs cautious interpretation
The 1–5 evidence-check score is a practical reading aid, not a formal peer review or a probability that a conclusion is true. It combines design strength (2 points), sample reporting (1), comparison/control clarity (1), and how much of the paper could be checked (1). Access affects how confidently this directory can assess a study, not the study's underlying quality. Blinding is reported separately because it is not relevant to every design.
Empirical implementation of a random-utility approach to measure switching costs and brand loyalty, followed by analysis of how usage, service design, and firm and individual characteristics relate to switching and retention.
The online brokerage industry; the publisher page reports data from that industry and evaluates systems usage, systems quality, product-line breadth and quality, and customer demographics.
Based on the publisher-described design and comparison; see the article for complete analysis.
Publisher record was fetched directly; full text was not assumed open.
Double-blind? Blinding was not established from the retrieved publisher record.
Research question
What the authors investigated
How large are switching costs and brand loyalty for online service providers, and which usage, service-design, firm, and individual factors determine switching and retention?
Design
Empirical implementation of a random-utility approach to measure switching costs and brand loyalty, followed by analysis of how usage, service design, and firm and individual characteristics relate to switching and retention.
Sample and setting
The online brokerage industry; the publisher page reports data from that industry and evaluates systems usage, systems quality, product-line breadth and quality, and customer demographics.
Reported result
What the study found
Measured switching costs varied substantially (up to a factor of two). Demographics had little effect, while systems usage and quality were associated with reduced switching; product-line breadth and quality could reduce switching and attrition.
This is a paraphrase of the source. Check the original paper for definitions, estimates, statistical uncertainty and analysis details.
Scope and transfer
Limitations to keep in view
Not stated on the publisher article page's abstract; the page identifies online brokerage as the empirical context, so transferability to other Internet-enabled businesses is not established there (scope caveat).
Possible founder application
Use it to frame a lifecycle hypothesis and define customer-level outcomes; compare its market and retention horizon with yours.
Evidence access
Publisher abstract/metadata retrieved; consult the linked paper for full methods and tables.
The publisher abstract says the authors implement a random-utility approach using online-brokerage data and find up to twofold variation in switching costs, little demographic effect, and reduced switching associated with usage, systems quality, and firm product breadth/quality. Direct publisher-page retrieval was recorded on 2026-10-09; profile summarizes the accessible record and does not claim independent review of inaccessible full text.
If only an abstract or metadata was available, the profile is limited to claims supported there. A paper's paywall does not change its evidentiary status, but it limits what we can substantiate from accessible text.