Factors affecting customer loyalty in telecom sector in india

FACTORS AFFECTING CUSTOMER LOYALTY IN TELECOM
SECTOR IN INDIA

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Abstract
The researcher has conducted this research work to illustrate the factors that affect customer
loyalty by taking the Indian telecom company, BSNL. The aim of the paper is to find out and
assess those factors that make the customers look for other companies, rather than staying with
the present organisation. Therefore, the paper has tried to look at the problem closely to find out
the inherent reasons behind the factor. In the second chapter, the researcher has used
SERVQUAL model to understand the factors that affect desired service quality. On the other
hand, the service-profit-chain model prescribes how customer loyalty can be ascertained.
The research has been mainly done by incorporating the positivism and deductive approach to
use the present theories and models to look at the chosen topic from different angles. Therefore,
the third chapter has described the research design based on which, the entire research is going to
flourish. Therefore, it is obvious that a timeframe be presented to calculate the time that is
necessary to complete the research work judiciously. The researcher has taken 60 respondents in
the survey to understand their pulse. The survey has presented several important points of view
regarding the customer retention policy of BSNL. The respondents have replied positively
regarding the tariff prices of the services of BSNL. However, the customers have shown their
disapproval regarding the customer relation approaches taken by the employees of the
employees. Some of the customers have even suggested to offer specialised offers and rewards
packages to the loyal customers as a token of gratitude. The last chapter has dealt with linking
the objectives with the survey questionnaire and the literature review. In addition, the researcher
has tried to recommend some corrective measures to tackle the challenge of customer loyalty
bravely.

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Acknowledgement
It gives me utmost joy to make the final submission of the research work , ‘Factors Affecting
Customer Loyalty in Telecom Sector in India’. I am really thankful to many people for their
support during the research work.
I would like to thank my superior. Without his judicious guidance, my project would have been
incomplete. I would also like to thank my classmates for their unconditional support. I would
also like to show my gratitude towards the respondents of the surveys without whose co-
operation, the data collection would not have been possible.
Thank you
…………………….

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Table of Contents
Chapter 1: Introduction 7
1.0 Introduction 7
1.1 Background of the research 7
1.1.1 Background of the company 8
1.2 Rationale of the study 8
1.3 Problem statement 9
1.4 Research aim 9
1.5 Research objectives 10
1.6 Research questions 10
1.7 Structure of the dissertation 10
1.8 Summary 11
Chapter 2: Literature review 12
2.0 Introduction 12
2.1 Conceptual framework 12
2.2 A brief overview of the concept of service quality 12
2.2.1 SERVQUAL Model of service quality 13
2.3 Critical evaluation of Customer Perceived Value 14
2.4 A short overview of customer satisfaction in the Indian telecom sector 14
2.4.1 Service-profit-chain (SPC) model 15
2.5 Critical evaluation of customer loyalty and retention 16
2.6 Summary 16
Chapter 3: Research methodology 17
3.0 Introduction 17
3.1 Research onion 17

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3.2 Research philosophy 18
3.3 Research approach 18
3.4 Research design 18
3.5 Method of data collection 19
3.6 Data analysis 19
3.7 Sampling 19
3.8 Time schedule 19
3.9 Ethical considerations 20
3.10 Summary 21
Chapter 4: Data analysis and finding 22
4.0 Introduction 22
4.1 Quantitative data analysis 22
4.2 Summary 39
Chapter 5: Conclusion and Recommendations 40
5.0 Conclusion 40
5.1 Linking objectives 40
5.2 Recommendations 41
5.3 Research limitations 42
5.4 Future scope of research 42
Reference list: 43
Appendix: 46

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List of Figures
Figure 1.1: Dissertation structure 10
Figure 2.1: Conceptual Framework 12
Figure 2.2: SERVQUAL Model of service quality 14
Figure 2.3: Service-profit-chain (SPC) model 15
Figure 3.1: Research Onion 17
Figure 4.1: Percentage of male and female respondents 23
Figure 4.2: Age group of the customers 24
Figure 4.3: Duration of use of the customers 25
Figure 4.4: Types of mobile connection 26
Figure 4.5: Applicability of the promotional policies of BSNL 27
Figure 4.6: Employee behaviour of BSNL 29
Figure 4.7: Satisfaction of the customers regarding tariff plans 30
Figure 4.8: Applicability of tariff price of BSNL 31

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Figure 4.9: Customers’ perception of the brand image of BSNL 32
Figure 4.10: Ease of availing the services of BSNL 33
Figure 4.11: Understanding the needs of the customers 34
Figure 4.12: Response time for customer grievances 36
Figure 4.13: Pricing options of BSNL 37
Figure 4.14: Recommendations to improve overall service quality 38

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List of Tables
Table-3.1: Gantt chart 20
Table 4.1: Percentage of male and female respondents 22
Table 4.2: Age group of the customers 24
Table 4.3: Duration of use of the customers 25
Table 4.4: Types of mobile connection 26
Table 4.5: Applicability of the promotional policies of BSNL 27
Table 4.6: Employee behaviour of BSNL 28
Table 4.7: Satisfaction of the customers regarding tariff plans 30
Table 4.8: Applicability of tariff price of BSNL 31
Table 4.9: Customers’ perception of the brand image of BSNL 32
Table 4.10: Ease of availing the services of BSNL 33
Table 4.11: Understanding the needs of the customers 34
Table 4.12: Response time for customer grievances 35

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Table 4.13: Pricing options of BSNL 37
Table 4.14: Recommendations to improve overall service quality 38

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Chapter 1: Introduction
1.0 Introduction
The need to stay connected has become one of the most prominent features for human existence
in the present era and telecommunication thus plays an important part for the mankind to stay in
touch with the world. The subscriber base in India has seen a quadruple jump in the last decade.
The total number of subscribers presently stands approximately at 927 million, as stated by the
TRAI report of 2015. The telecom companies of India are thus trying to retain the customers as,
the mobile subscribers have a number of options before them. Therefore, the research paper aims
to present the factors that affect customer loyalty in Indian telecommunication sector, by taking
the example of the telecom giant, BSNL. As the Indian telecom providers are reeling under
immense pressure to retain the customers, the companies are striving hard to take every possible
step to make the customers happy. Only contented customers would stay with the present
company. Thus, various factors influencing the loyalty of the customers need methodical
elucidation in order to understand the loopholes. The paper would also like to present the way
the Indian customers’ choice regarding the selection of the telecom service providers vary.
1.1 Background of the research
Indian telecom sector has seen tremendous growth and the present strength of mobile users of
well above 900 million validate that fact. The teledensity of India also stands at a staggering rate
of 74% (Griffin & Herres, 2012). Therefore, the high rate of returns for the companies has also
attracted the foreign companies to invest here. The continuous positive growth in this sector has
therefore brought forth several foreign collaborations too. The competition has been increasing
and the telecom companies are trying their best to retain the loyal customers. However, Miller &
Washington (2013) have opined that customer loyalty depends on great many factors and the
competitive market warrants that the companies provide every possible benefit to the customers
in order to stay ahead of the rival companies.
The telecom sector of India is unevenly balanced due to the overwhelming number of mobile
phone users. The number of landline subscribers is getting low continuously and at the end of
2013, the number stood only at 28.78 million. As the number of service providers is increasing
significantly, the companies are facing increasing challenges to retain the customers, along with

10
attracting the new ones (Jacoby & Chestnut, 2009). The aspect of highly volatile telecom market
means that shifting customer loyalty becomes a strategic challenge for the companies. In
addition, the customers now have the provision of using a number of connections
simultaneously. This gives the chance to the customers to compare the service quality of the
companies first hand. Zeleke (2015) has opined that service quality and perceived customer
value are the two most important factors to enhance the satisfaction quotient of the customers.
Therefore, the paper aims to evaluate these factors along with other important ones to ascertain
whether the Indian telecom companies are fulfilling the norms or not.
1.1.1 Background of the company
BSNL is a state-owned organisation catering to the Indian customers from the year of 2000
(Bhote, 2009). The telecom company is headquartered in New Delhi and has more than 216,000
employees of 2015. The company is the largest player in the sector of fixed and broadband
service. Although, the company has been going through severe loss in the recent year, the
management has taken a number of positive steps to mitigate the problem. One of its
subsidiaries is MTNL, providing exclusive service to New Delhi and Mumbai. The organisation
is currently facing the problem of retaining the existing customers for various issues. First, the
lack of technological orientation towards the modern advancements has deterred the prospects of
BSNL. Apart from that, the organisation has not been able to increase its cell density in the
metropolitan cities due to the stiff competition from the private enterprises. Several other
companies have tried to manipulate the thinking process of the customers by offering cheaper
service with better coverage. This has resulted into the company losing its existing customers to
the rival companies. Back in 2011, BSNL was the largest telecom service provider in the country
and had the market share of approximately 26% (Atkinson, 2009). However, after the entrance of
the private players, the scenario changed. Those companies, with their huge expertise and
resources, have captured the imagination of the customers. The private entities have adopted the
latest technological advancements in order to reduce the service gaps and they have also been
able to reach the remotest corners of the country to appease the customers with their service
quality.
Therefore, the latest trend has seen the decreasing number of customers for BSNL and the
company is striving hard to hold on to its existing customers by providing specialised offers and
reward packages. Although, the move has not produced the desired result, the management is
optimistic that it would retain the existing customers, along with attracting newer ones. The stiff

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competition has also catapulted the growth prospect of the company as, the private operators
have to pay lesser amount of Access Deficit Charges (ADC), which relates to the charge payable
by the private companies to BSNL for operating in non-lucrative areas (Jacoby & Chestnut,
2009). This also has dented the prospect of revenue generation, which has in turn deteriorated the
service quality of BSNL. The existing customers have been fretting over the lack of quality
service from the operator as, the company rarely has the equipments to expand its grasp in the
yet to be reached areas. This may be prove to be fatal for the long term growth of the company
as, the loyalty of the customers cannot be taken for granted (Pezeshki, Mousavi & Grant, 2009).
The customers have a number of options before them and therefore, do not find it customary to
stick with BSNL. Therefore, the issue of loyalty of the customers arises now. Looking at the
prospect of competitive rivalry in the Indian telecom market, the researcher has observed that the
aspect of new entry for the private entities is not easy as, the Indian market is already teeming
with various operators (Punniyamoorthy & Raj, 2009). BSNL being the first mover has achieved
a considerable amount of advantage from the market. However, this may not be true for other
new entrants entirely.
The aspect of competitive rivalry hampering the aspect of retaining the existing customers is
huge as, the customers now have more number of options to chose from. In addition, Atkinson
(2009) has opined that the aspect of low switching costs make the customers habituated to
change their loyalty to other companies. The aspect of buyer power has been keeping the
companies on tenterhooks and thus, BSNL along with other telecom service providers tries to
appease the buyers by offering lucrative deals. Therefore, the aspect of buyer power is huge and
that is hampering the market prospect of the telecom provider such as, BSNL. In addition, Bansal
& Taylor (2012) have opined that the threat of substitution for the services offered by BSNL is
also keeping the company on high alert as, the loyalty of the customers would go for a toss if,
they get better service at a cheap rate from others. Therefore, the market analysis of the Indian
telecom sector has presented that although, the customers have a number of choices before them,
the companies have the chance to attract them by relaying out detailed plans. On that note,
Bansal & Taylor (2012) have remarked that if the companies can look after the prospect of
providing quality care to customers irrespective of the price, they can retain the customers.
The present market penetration of BSNL stands out to be the diminishing gradually for the
severe onslaught from the more powerful private entities. With their revamped business model
and client relationship, the companies have been able to dislodge BSNL from its numero uno
position (Jacoby & Chestnut, 2009). The market penetration of BSNL has been upped though

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with the introduction of 3G services. The company is also vying for 4G services in the
metropolitan areas to cope up with the demand of the present tech savvy generation. On the other
hand, the product development sector of BSNL has seen the firm existence of high speed
broadband along with the introduction of mobile tv. This aspects have attracted the existing and
potential new customers to try out the offers of BSNL. Babakus & Boller (2011) have however
argued that unlike other private players, BSNL does not have the technological strength to roll
out latest modules of technology in its services. On the other hand, the aspect of market
development from the side of BSNL has taken place by the inception of foreign tie ups. The
company has recently tied up with two South African technological farms to revamp its
technological expertise and attain global standard. Atkinson (2009) has opined that this move
may prove to be quite fruitful to retain the existing customers as, refurbished service quality
would automatically imply that the customers would ahun the lucrative offers of other telecom
companies to stay with BSNL.
1.2 Rationale of the study
What is the issue?
It has often been observed that the telecom companies are trying hard to retain the customers in
this cut-throat competition. The aspect may raise doubts regarding the strategies of the telecom
companies as, they can always try to attract the new customers to endorse the companies
(Atkinson, 2009). However, retaining the customers is more than that. It is a sign of healthy
organisation. If the companies can retain their customers, the brand image automatically acquires
new height. Attracting new customers does not become an issue then. Therefore, the issue of
retaining the customers has gained enough prominence in this highly competitive world.
Why is it an issue?
The Indian telecom companies have a very large ground to play in as, the number of citizens sans
any mobile connection is a significant one. Therefore, the companies have the chance to attract
new customers too. However, retaining the existing customers is an important aspect to prove
that the companies are in a healthy state. If the companies cannot retain their customers,
attracting neer ones would also face severe challenges. Aaker & Jacobson (2010) opined that
satisfying the customers with the service is the only criterion that can retain the customers.
Therefore, the researcher has taken the issue as, the Indian telecom companies are suffering

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hugely for stiff competition. Switching cost is too low and therefore, the customers can always
take the option of other service providers. This is severely challenging for the companies.
Why is it an issue now?
Recently, a report published by TRAI has revealed that the number of customers, who are using
a connection for more than two years is coming down drastically (Babakus & Boller, 2011). This
report therefore throws out an important question before the concerned people regarding the
actual reason of it. One of the positive factors may be that the number of options before the
customers is increasing (Pezeshki, Mousavi & Grant, 2009). However, this also shows that the
customers are not sticking to any one company. Therefore, retaining the customers has become
one of the main problems for the Indian telecom companies.
What would this research shed light on?
The research would try to assess those factors that affect the aspect of retaining the customers in
the Indian telecom sector. In addition, the paper aims to present different points of view of
eminent scholars to understand the chosen topic lucidly. Therefore, the researcher would try to
provide the suitable corrective measures that may be applied by the service providers to mitigate
any crisis.
1.3 Problem statement
The issue of retaining the customers in the Indian telecom sector has arisen due to the continuous
shifting of customer loyalty. Therefore, satisfying the service users is the only criterion to negate
those factors affecting the aspect of customer loyalty.
1.4 Research aim
The aim of the research is to assess those factors that affect customer loyalty in the telecom
company, BSNL.
1.5 Research objectives
● To identify the factors that affect customer loyalty in BSNL
● To critically analyse the key determinants that help BSNL to retain the customers
● To examine the various challenges faced by BSNL to retain the customers
● To provide effective recommendations to BSNL to eliminate the problems

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1.6 Research questions
● What are the factors that affect customer loyalty in BSNL?
● What are the key determinants that help BSNL to retain the customers?
● What are the various challenges faced by BSNL to retain the customers?
● What strategies can be recommended to BSNL to eliminate the problems?
1.7 Structure of the dissertation
Figure 1.1: Dissertation structure
(Source: Created by author)
1.8 Summary
The chapter has thus provided the basic understanding of the chosen topic by presenting the
aims, objectives and the research background. In addition, the research questions would go a
long way to help the researcher to frame the research work in an appropriate manner.

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Chapter 2: Literature review
2.0 Introduction
The literature review deals with the points of view of the eminent scholars, who have assessed
the chosen topic from different angles. Therefore, the chapter would assess the chosen topic from
different angles to understand in a better way. The chosen topic would be assessed by using
different models and theories such as, SERVQUAL model of service quality and SPC model
related to the factor of customer loyalty. The aspect of customer satisfaction would also be
depicted.
2.1 Conceptual framework
Figure 2.1: Conceptual Framework
(Source: created by author)
2.2 A brief overview of the concept of service quality
The term service quality refers to the assimilation of two factors that is service and quality.
Therefore, maintaining a perfect equilibrium, between the two factors would enhance the overall
scenario. As opined by Bansal & Taylor (2012), service quality can be measured according to the

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judgment given by the customers after using the products or services. On the other hand, Barnes
(2009) has stated that the service quality can be said to be positive when, the features of the
products or the services can meet the implied needs. Therefore, service differentiation is
prerequisite to take the companies to the path of growth.
The service sector is highly heterogenous. However, four basic aspects are there, which
differentiate the service sector from the product selling sector. These are such as, intangibility,
heterogeneity, inseparability and perishability. Intangibility means that services cannot be
attributed to a thing. Therefore, Bowen & Chen (2011) has stated that services are consumed but
the services cannot be possessed. On the other hand, heterogeneity refers to the factor of keeping
the service quality equal on all the parameters. Products have their own standards, as opined by
Caruana (2012). However, services have the factor of heterogeneity. According to Chada &
Kapoor (2009), inseparability refers to the factor that services are produced and distributed
among the users at the same time. Therefore, services cannot be stored for an indefinite time.
Lastly, the factor of perishability does not persists in the case of services as, these have no shelf
life.
2.2.1 SERVQUAL Model of service quality
SERVQUAL model of service quality refers to measuring the service quality by using the gap
between the delivered services and the expected level of service. The model speaks of five
aspects such as, reliability, responsiveness, empathy, assurances and tangibles. The model is a
type of analytical tool. This model can help the management of a company to assess the gap
between the provided service quality and what the customers desire from the company. Chen
(2011) has stated that the model is an exploratory one and does not describe the actual gaps in
the offered service.

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Figure 2.2: SERVQUAL Model of service quality
(Source: Chow & Komaran, 2012, p.82)
2.3 Critical evaluation of Customer Perceived Value
Dick & Basu (2010) have opined that perceived value for the customers refer to the overall
assessment of how the presented service provides the intended benefit to the users. Therefore, the
value for money products or the services would obviously satisfy the customers. Five dimensions
are there according to Howat, Crilley & McGrath (2009), such as, quality, price, behavioural
price, emotional response and reputation. Therefore, customer satisfaction is the ultimate
criterion to decide whether the services meet the perceived quality standard or not (Hafeez &
Muhammad, 2012). The researcher has thus observed that customer value and customer loyalty
are the two important factors of customer perceived value.
2.4 A short overview of customer satisfaction in the Indian telecom sector
Customer satisfaction refers to fulfilling the demands and wishes of the customers through
providing effective service. Different customers have different level of expectation from the
companies. Therefore, the telecom companies would find it quite difficult to understand the
general notion of perceived service quality. As opined by Huang & Yu (2012), the Indian
telecom sector has a varied customer response as, the gap between the provided service and the
desired quality varies considerably.

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2.4.1 Service-profit-chain (SPC) model
The model specifies that there is a relation between the aspect of customer loyalty and employee
productivity. Therefore, if the companies are trying to appease the customers to retain them, the
best way would be to make the employees happy. One of the most important derivatives from
this model is that customer satisfaction can result into customer loyalty (Eshghi, Roy & Ganguli,
2009). Therefore, the telecom companies have the option of encouraging the customers to work
positively to make the customers loyal. The model also reveals that if the employees are happy
and contented, the quality of service provided would automatically improve. Therefore,
ultimately the companies would secure a positive image and credibility in the market.
Figure 2.3: Service-profit-chain (SPC) model
(Source: Akbar & Parvez, 2010, p.52)
2.5 Critical evaluation of customer loyalty and retention
The researcher has thus evaluated the process of securing the criterion of retaining the existing
customers by assessing different models and theories. Therefore, the Indian telecom sector has
seen many ups and downs regarding customer loyalty. On that note, John (2011) has noted that
the telecom companies has tried to lure the customers by providing enough rewards and offers at
first. However, gradually the companies have understood that retaining the customers is a tedious
job as, the plethora of options before them make the customers look for better options. However,

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Paulrajan & Rajkumar (2011) have argued that the telecom companies can retain the customers
without providing any additional bonus by simply developing the quality of service. If the
customers are loyal, retaining them would not be a problem. The problem of low frequency band
is plaguing the Indian telecom companies to offer better service to the customers
(Punniyamoorthy & Raj, 2009).
2.6 Summary
This chapter has thus described the relevant models and theories that are helpful to assess the
applicability of customer retention policies. Various problems faced by the telecom companies
have found a proper mention here. As the paper has described, the service profit chain is
quintessential to understand the criterions that are quite helpful to make the customers loyal. On
the other hand, SERVQUAL model has helped the researcher to evaluate the factors that
influence the service quality meted out to the customers.

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Chapter 3: Research methodology
3.0 Introduction
The researcher needs to assess the appropriate methods to conduct the research work judiciously.
Therefore, in this chapter, the researcher would finalise the appropriate approaches, designs, data
collection procedure and sampling methods among others to conduct the paper effectively.
3.1 Research onion
The research onion has different layers to help the researchers to conduct their research work
accordingly. The first layer states the philosophies, whether the second layer gives an idea
regarding the decision making process. The effectiveness of the time frame has been described in
the next stage to complete the research work within the prescribed time. The final layer of the
onion prescribes the data collection and analysis processes to formulate the outcome effectively.
Figure 3.1: Research Onion
(Source: Saunders et al. 2009, p.52)

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3.2 Research philosophy
Three types of research paradigms are there to help the researchers such as, positivism,
interpretivism and realism. Interpretivism deals with the material aspects of the world by stating
that scientific means are insufficient to describe the worldly affairs. On the other hand, realism
assumes that the universal parameters do not depend on human acuity as, the human beings can
only feel the objects with the senses. The researcher has chosen positivism philosophy because it
states that the scientific approach is the only way to conduct the research work effectively. The
researcher is going to take the deductive approach and the positivism philosophy goes well with
that approach.
3.3 Research approach
The researcher has observed that two types of approaches are prevalent such as, inductive and
deductive. The inductive approach specifies that every research work be based on new theories
or models. Therefore, the researchers have to think of some innovative means to come up with
specific models that will be suitable for the respective research work. However, this is not
always possible as, the development of new knowledge base needs wide scope. Therefore, the
researcher has chosen the deductive approach to use the available data and theories to
corroborate the chosen topic.
3.4 Research design
Three types of research designs are there such as, exploratory, explanatory and descriptive.
Explanatory design refers to dealing with complex subjects by bringing in tangential information
regarding the topic. On the other hand, the exploratory design deals with establishing connection
among the variables. However, both the designs are not suitable for the research work and
therefore, the researcher has chosen descriptive design to conduct the research work. In this
design, the researchers work with providing definition of the chosen research topic. In order to
conduct the research work fruitfully, the researcher has used mixed method. Exploratory design
works with the background information and the researcher has not considered this design for that
reason only.

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3.5 Method of data collection
The data is collected using two strategies such as, qualitative and quantitative methods. In the
quantitative data collection procedure, the researchers try to collect data from primary sources to
have authentic data at hand. This data then can be assessed according to various models to
conclude concretely. Survey questionnaire is certainly a big part of the quantitative data
collection method. This is one of the most cost and time saving procedure to get access to the
thought process of the concerned stakeholders. A set of questionnaire is formulated to seek the
opinion of the respondents. In this research work, the researcher is going to take the sample size
of 50 customers of BSNL to understand their pulse.
3.6 Data analysis
The data analysis process can be done through two stages such as, qualitative and quantitative
process. The quantitative analysis is done through using statistical analysis. The collected data
from the survey is converted to understandable figures and tables. Therefore, the researcher and
the readers would be able to understand the data easily. The literature review presents the
secondary data through data to sum up the chosen topic effectively.
3.7 Sampling
The researcher has applied probability sampling methods to collect the quantitative data. Simple
random sampling technique has also been used to complete the survey with 50 customers. The
non-probability sampling is another important part of the sampling process. As the research
paper would not include any qualitative data, the researcher would not use convenience
sampling.
3.8 Time schedule
Main activities 1st week 2nd week 3rd week 4th + 5th
week
6th week 7th week
Selection of the
topic
●
Composition of
the literature
● ●

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review
Research
methodology
●
Collection of
primary data
●
Analysis and
interpretation of
data
●
Findings ● ●
Conclusion and
Recommendation
●
Final submission ●
Table-3.1: Gantt chart
(Source: Created by author)
3.9 Ethical considerations
The researcher has tried to conduct the research work according to the provisions of Data
Collection Act, 1998. Therefore, the researcher has vowed to use the collected data from the
survey in a safe manner. The collected data would not be used for any commercial purpose. In
addition, the privacy and opinions of the respondents would also be maintained by respecting
their decisions whether to give answer to the questions or not. They are free to withdraw from
the survey at any time.
3.10 Summary
The researcher has thus assessed the appropriate research methodologies required to conduct the
research work in the most suitable manner. The researcher has finalized all the required
strategies such as, research philosophy, design and approach in this chapter. The data collection
method has revealed that the researcher is aiming to conduct a survey by creating a questionnaire

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for near about 50 customers of the Indian telecom companies. The time chart would also help the
researcher to conduct the work within the prescribed period. The researcher has vowed to uphold
the legal provisions of protecting the privacy of the respondents and of the collected data.
Therefore, this chapter is immensely important for the entire research work as, the framework
based on which the entire project would be made, has been chosen here.

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Chapter 4: Data analysis and finding
4.0 Introduction
In this chapter, the researcher aims to find out the points of view of the customers of the hosen
Indian telecom company, BSNL by organising a survey. The collected data would be presented
in appropriate manner in tables and figures to analyse the data thoroughly.
4.1 Quantitative data analysis
1. What is your gender?
Response Response (%) Frequency Total respondents
Female 45 34 50
Male 55 26 50
Table 4.1: Percentage of male and female respondents

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Figure 4.1: Percentage of male and female respondents
Finding and analysis
The above depicted figure shows that the number of male respondents is more compared to the
female members. The reason may be that, the Indian society still sees more participation of the
male members to earn for their families than the female members. Therefore, the mobile
operators across India try to promote their services keeping this factor in mind.
2. What age group do you belong?
Response Response (%) Frequency Total Respondents
18-25 32 16 50
26-35 28 14 50
36-45 22 11 50
46 and above 18 09 50
Table 4.2: Age group of the customers

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Figure 4.2: Age group of the customers
The aforementioned figure shows that the number of respondents maximum in this survey
belongs to the age group of 18 to 25. Therefore, it can be inferred that the maximum number of
mobile service users belong to the age group, which is highly volatile. Retaining this group is
going to be very critical and at the same time rewarding. The reason being this age group
splurges a large amount of money to use various kinds of mobile services. The next sizeable
share of respondents are from the second age group belonging to several professions. Therefore,
this two age group has catapulted the growth of the Indian telecom sector.
4. How long are you using mobile service?
6 months 28 14 50
7 months to 1 year 30 15 50
2-3 years 24 12 50
4-5 years 18 09 50

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Table 4.3: Duration of use of the customers
Figure 4.3: Duration of use of the customers
The above presented pie chart shows that the respondents are using their mobile connection for
the last 7 months to 1 year for the maximum time. Therefore, the factor of switching their loyalty
may be there as, the customers cannot be cited as long time customers. On the other hand, the
customers using their mobile services for more than 2 years is a significant one. This section of
customers are truly loyal to the company.
5. What type of mobile connection do you have?
Prepaid 48 24 50
Postpaid 34 17 50
Both 18 09 50

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Table 4.4: Types of mobile connection
Figure 4.4: Types of mobile connection
Pre-paid customers are mostly prevalent in Indian telecom sector and BSNL has the task to look
at this choice seriously. The number of pre-paid customers outnumber the postpaid customers
significantly. The reason may be that prepaid connections come with a great deal of benefits,
which help the customers in case of any financial crisis. They can recharge their mobile number
when they have the means to do that. The mismatch between the actual use and the bill sent by
the company is not there in the case of prepaid service too.
7. How far do you agree that the promotional policies of BSNL are favourable for you?
Strongly agree 18 09 50
Agree 28 14 50
Neutral 14 07 50

30
Disagree 22 11 50
Strongly disagree 18 09 50
Table 4.5: Applicability of the promotional policies of BSNL
Figure 4.5: Applicability of the promotional policies of BSNL
Most of the respondents have answered positively for this question. Therefore, it can be assumed
that the customers are happy with the promotional policies of BSNL. However, the next most
chosen option is a negative one. Therefore, the promotional policies are not able to satisfy the
customers of all classes. Therefore, the promotional policies of BSNL are not certainly going
with the aim of the management to make the company India’s one of the best mobile service
providers.
9. How far do you agree that BSNL’s employees are friendly and approachable?

31
Agree 18 09 50
Neutral 06 03 50
Disagree 26 13 50
Table 4.6: Employee behaviour of BSNL
Figure 4.6: Employee behaviour of BSNL
The above mentioned figure reveals that the customers are not at all happy with the employee
behaviour of BSNL. In fact, the last two options have attracted most number of responses and
that speaks about the loopholes of the telecom company. If the employee behaviour does not
change for good, the customers would not hesitate to leave the company. Therefore, this survey
has brought forth some important questions before BSNL regarding having properly trained and
qualified employees at place.
11. Are you satisfied with the tariff plans of BSNL?

32
Highly satisfied 16 08 50
Satisfied 26 13 50
Neutral 08 04 50
Dissatisfied 26 13 50
Highly dissatisfied 24 12 50
Table 4.7: Satisfaction of the customers regarding tariff plans
Figure 4.7: Satisfaction of the customers regarding tariff plans
The survey has revealed that equal number of customers have voted for both positive and
negative options. Therefore, it can be inferred that the tariff plans are not according to the
demands of the greater number of customers. In fact, the tariff plans have not evoked any
considerable amount of positive response from the survey.

33
12. Do you think that BSNL is demanding additional tariff price in the name of premium
quality service?
I think so 28 14 50
No, I do not think so 54 27 50
I have no idea 18 09 50
Table 4.8: Applicability of tariff price of BSNL
Figure 4.8: Applicability of tariff price of BSNL
The figure has revealed that the customers do not think that the telecom company has been
charging extra rates in the name of providing tariff price. Therefore, the tariff rates are
reasonable and the customers are willing to pay that. BSNL has to therefore maintain this price
equilibrium to keep the customers happy.
13. Are you satisfied with the brand image of BSNL in the market?

34
Satisfied 28 14 50
Neutral 08 04 50
Table 4.9: Customers’ perception of the brand image of BSNL
Figure 4.9: Customers’ perception of the brand image of BSNL
The customers of the telecom service provider, BSNL are contented with the brand image of the
company. Therefore, The positive image would help the company to retain the existing
customers, along with attracting new ones. However, the rate of negative responses is also not
low and that may be looked at seriously to make the brand image even more positive.

35
14. How far do you agree that it is very easy to take up new mobile connection along with
getting recharges done from BSNL?
Agree 20 10 50
Neutral 10 05 50
Disagree 28 14 50
Table 4.10: Ease of availing the services of BSNL
Figure 4.10: Ease of availing the services of BSNL

36
The customers think that taking new connections from the company and recharging their mobile
numbers is not an easy task. The reason may be the lack of sufficient franchises and shops,
where all the necessary amenities are available of BSNL. The number of respondents going for
the positive answers are few but significant one. Therefore, the customers would be more
inclined to use the services of the company if, they can avail the services with ease.
17. Do you agree that BSNL makes efforts to understand the needs of the customers?
Agree 24 12 50
Neutral 06 03 50
Disagree 28 14 50

37
Table 4.11: Understanding the needs of the customers
Figure 4.11: Understanding the needs of the customers
The customers think that the company does not have a good record in understanding the need of
the customers. This may be because the customer relation team of the company does not care to
listen to the customers’ needs. As the customers are the primary stakeholders for any business,
the telecom company has the task to look for the actual reasons for which the customers have
perceived that they are not being listened by the company.
19. How far are you satisfied with the response time of BSNL in terms of customer
grievances?
Satisfied 24 12 50
Neutral 10 05 50

38
Table 4.12: Response time for customer grievances
Figure 4.12: Response time for customer grievances
The above presented figure reveals that the customers are not actually happy with the response
time for the lodged grievance. The reason may be the lack of efficient personnel to handle the
customer grievances effectively. The lethargy of the employees to respond to the call of the
customers in time may be another reason for that. However, the number of respondents choosing
the positive option presents the role of the employees in a positive light too. Therefore, the
employees have the role of providing the best in class service to strengthen its portfolio.
21. Do you agree that BSNL offers a great range of pricing options for you to chose from?

39
Agree 24 12 50
Neutral 10 05 50
Disagree 26 13 50
Table 4.13: Pricing options of BSNL
Figure 4.13: Pricing options of BSNL
The respondents have mostly answered negatively as they think that the pricing option from the
company is not flexible for them. The company has kept the tariff prices high to reduce the
losses incurred in the lt fiscal. This may be the reason that the customers think that the tariff
prices are high. The second option has been chosen for the second most time and that shows that
all is not wrong regarding the tariff prices.
30. What would you recommend to BSNL for the betterment of the overall services quality
to retain the customers?

40
Improve the
promotional tools
16 08 50
Take customer
feedback seriously
18 09 50
Reduce tariff rates to
suit the customers
20 10 50
Provide personalized
offers for the loyal
customers
24 12 50
Incorporate latest
technological
advancements
22 11 50
Table 4.14: Recommendations to improve overall service quality

41
Figure 4.14: Recommendations to improve overall service quality
Providing personalized offers to the customers is the most suitable option in this question. That
shows that the customers think that the company needs to provide special attention to the loyal
customers. The second most ticked option is incorporating latest technological equipments to
enhance the service quality. Therefore, the customers think that the technological parameters of
the company is not up to the mark.
4.2 Summary
The chapter has thus assessed the responses provided by the chosen 50 customers of the telecom
company, BSNL. The survey has revealed many interesting facts such as, the customers perceive
that the aspect of customer relation is not upto the mark. On the other hand, the tariff prices are
within the budget of the customers, as presented by the survey. Thus, the survey has helped the
researcher to understand the pulse of the customers to conclude concretely.

42
Chapter 5: Conclusion and Recommendations
5.0 Conclusion
The present study thus concludes by emphasising on the various factors that hamper the factor of
customer loyalty. The aspect of service quality and sustaining the quality service for long time to
retain the existing customers have found a prominent place here. The researcher is going to
assess the collected data from chapter 4 and 2 to evaluate those important factors. In order to do
this, the researcher is going to link the objectives with the survey and literature review chapter to
provide some suitable recommendations.
5.1 Linking objectives
5.1.1 To identify the factors that affect customer loyalty in BSNL
The researcher has tried to link this objective with the first six questions in the quantitative
analysis and also with the literature review to understand the the factors. The survey, along with
the various opinions of the scholars has revealed that improper and untimely response to the
customer grievances and keeping the tariff prices high are some of those factors. In addition, not
respecting the demands of the customers is another reason that may affect customer loyalty.
5.1.2 To critically analyse the key determinants that help BSNL to retain the customers
The researcher has linked next four questions with this objective by explaining the factors that
help the telecom company to retain the customers. Providing quality service and maintaining the
employees happy are some of those factors. In addition, incorporating latest technological
advancements in the service would enhance the quality of the service.
5.1.3 To examine the various challenges faced by BSNL to retain the customers
The researcher has observed that the challenges are quite a few that are plaguing not only BSNL
but also other telecom companies in India. Therefore, BSNL had to face severe losses in the last
decade for the changing taste of the customers, along with a number of competitors entering the
country. The increased competition has downplayed the prospects of the telecom companies,
along with BSNL.
5.1.4 To provide effective recommendations to BSNL to eliminate the problems

43
Some changes are bound to be implied by the telecom company to mitigate the problem
regarding customer loyalty. In the context of the found gaps, the following recommendations are
going to follow to retain the customers.
5.2 Recommendations
Forging long term relationship with the customers
The telecom sector is highly volatile. Therefore, BSNL needs to forge a long term relationship
by taking firm steps to improve the service quality further. Marketing automation technology
would therefore guide the telecom companies, including BSNL to understand the need of the
customers.
Keeping the tariff rates affordable and competitive
The telecom giant needs to maintain competitive pricing policies to negate any similar moves of
the rival companies. In order to do so, proper market research would be really helpful to
understand whether, the tariff rates are really high or not.
Incorporating latest technologies to keep the service quality supreme
BSNL needs to incorporate the latest technological advancements to make the service up to date
with the rival farms. Specialist employees can help the company to understand the possible steps
that would necessitate the desired steps.
Providing specialized services to the loyal customers
If BSNL can provide specialised services to the loyal customers by providing them with
concessional tariff rates, the loyal customers would be overjoyed. This step would enable the
company to retain the customers. The loyal customers want that the company should provide
them with some preferential treatments for associating with them for so long. Looking after the
loyal customers would improve the brand image of the company also and that would surely
attract new potential customers.
5.3 Research limitations
The researcher tried to incorporate all the factors that affect the aspect of customer loyalty.
However, for the lack of time and resources, some of the factors may be overlooked. In addition,
the small sample size of only 60 people cannot present enough insights into the present market

44
condition and the mood of the customers. The researcher therefore had to go for cross section
studies. The responses of the respondents also created barrier for the researcher as, some of the
respondents did not answer correctly. Some of the respondents even rejected to answer the
questions.
5.4 Future scope of research
If the research paper would incorporate a larger number of respondents in the survey, the
research topic can be analysed with added efficiency. Moreover, the research paper would
become more authentic if, more companies can be incorporated in the paper. Therefore, the
comparative analysis would provide immense insights into the chosen topic. Other variables such
as, product differentiation and customer loyalty can be linked to get proper understanding of the
relation of those two factors.

45
Reference list:
Books:
Bhote, K, R. (2009) Beyond customer satisfaction to customer loyalty. 3rd ed. New York:
Appleton-Century-Crofts.
Griffin, J., & Herres, R. T. (2012). Customer loyalty: how to earn it, how to keep it. San
Francisco: Jossey-Bass.
Jacoby, J. & Chestnut, R. (2009). Brand loyalty: Measurement and management. New York:
John Wiley & Sons.
Miller, R. & Washington, K. (2013). Consumer loyalty, Loganville: Richard K. Miller &
Associates.
Zeleke, M. (2015). Influence of quality service on customer satisfaction and loyalty.
Saarbrücken: LAP LAMBERT Academic Publishing.
Journals:
Aaker, D. A., & Jacobson, R. (2010). “The financial information content of perceived quality”.
Journal of marketing research, 12(4), pp.191-201.
Akbar, M.M. & Parvez, N., (2010). “Impact of service quality, trust, and customer satisfaction
on customers loyalty”. ABAC Journal, 29(1), pp.34-56
Atkinson, A. (2009). “Answering the eternal question: What does the Customer Want?” The
Cornell Hotel and Restaurant Administration Quarterly, 29(2), pp.12-14.
Babakus, E. & Boller, G.W. (2011). “An empirical assessment of the SERVQUAL scale”.
Journal of Business Research, 24(3), pp. 253-68.
Bansal, H. S., & Taylor, S. F. (2012).” The service provider switching model (spsm) a model of
consumer switching behavior in the services industry”. Journal of Service Research, 2(2),
pp.200-218.
Barnes, S. J. (2009). ”Enterprise mobility: concept and examples”. International Journal of
Mobile Communications, 1(4), 9(4), pp.341-359.

46
Bowen, J. T., & Chen, S. L. (2011). “The relationship between customer loyalty and customer
satisfaction”. International journal of contemporary hospitality management, 13(5), pp.213-217.
Caruana, A. (2012). “Service loyalty: The effects of service quality and the mediating role of
customer satisfaction”. European Journal of Marketing, 36(7), pp. 811-29.
Chada, S.K & Kapoor,D. (2009). “Effect of switching cost, service quality and customer
satisfaction on customer loyalty of cellular service providers in Indian market”. The ICFAI
University Journal of Marketing Management, 8(1), pp. 23-37
Chen, L., Nath, R., (2011). ”A framework for mobile business applications”. International
Journal of Mobile Communications, 2(4), pp.368-381.
Chow-Chua,C.& Komaran,R. (2012). “Managing service quality by combining voice of the
service provider and voice of their customers”. Managing Service Quality, 12(2), pp.77-86.
Dick, A.S. & Basu, K. (2010). “Customer loyalty: Toward an integrated conceptual framework”.
Journal of the Academy of Marketing Science, 22(2), pp.99-113.
Eshghi, A., Roy, S.K. & Ganguli, S., (2009). “Service quality and customer satisfaction: an
empirical investigation in Indian mobile telecommunications services”. Marketing Management
Journal, 18(2), pp.23-63
Hafeez, S. & Muhammad, B., 2012. The Impact of Service Quality, Customer Satisfaction and
Loyalty Programs on Customer's Loyalty: Evidence from Banking Sector of Pakistan.
International Journal of Business and Social Science, 3(16).
Howat, G., Crilley, G. & McGrath, R. (2009), “A focused service quality, benefits, overall
satisfaction and loyalty model for public aquatic centres”. Managing Leisure, 13(4), pp. 139-161.
Huang, M. H., & Yu, S. (2012). “Are consumers inherently or situationally brand loyal? A set
intercorrelation account for conscious brand loyalty and nonconscious inertia”. Psychology &
Marketing, 16(6), pp.523-544.
John, J., (2011). “An analysis on the customer loyalty in telecom sector: Special reference to
Bharat Sanchar Nigam limited, India”. African Journal of Marketing Management, 3(1), pp.1-5.
Paulrajan, R. & Rajkumar, H., (2011). “Service quality and customers preference of cellular
mobile service providers”. Journal of technology management & innovation, 6(1), pp.38-45.

47
Pezeshki, V., Mousavi, A. & Grant, S., (2009). “Importance-performance analysis of service
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Measuring Business Excellence, 13(1), pp.82-92.
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233.

48
Appendix:
1. Quantitative analysis
1. What is your gender?
● Male
● Female
2. What age group do you belong?
● 18-25
● 26-35
● 36-45
● 46 and above
3. What is your educational qualification?
● Below Hr. Secondary
● Hr. Secondary
● Graduation
● Post Graduation
● Doctor/Engineer/CA/ Ph.D
4. How long are you using mobile service?
● 6 months
● 7 months to 1 year
● 2-3 years
● 4-5 years
5. What type of mobile connection do you have?
● Pre-paid
● Postpaid
● Both
6. Are you considering switching to other service providers?
● Yes
● No
7. How far do you agree that the promotional policies of BSNL are favourable for you?

49
● Strongly agree
● Agree
● Neutral
● Disagree
● Strongly disagree
8. How far do you agree that BSNL has kept the promises in terms of service quality?
● Strongly agree
● Agree
● Neutral
● Disagree
9. How far do you agree that BSNL’s employees are friendly and approachable?
● Strongly agree
● Agree
● Neutral
● Disagree
10. How many mobile connection are you using presently?
● Only 1
● 2 connections
● More than 2
11. Are you satisfied with the tariff plans of BSNL?
● Highly satisfied
● Satisfied
● Neutral
● Dissatisfied
● Highly dissatisfied
12. Do you think that BSNL is demanding additional tariff price in the name of premium
quality service?
● I think so
● No, I do not think so
● I have no idea

50
13. Are you satisfied with the brand image of BSNL in the market?
● Satisfied
● Neutral
● Dissatisfied
14. How far do you agree that it is very easy to take up new mobile connection along with
getting recharges done from BSNL?
● Strongly agree
● Agree
● Neutral
● Disagree
15. How far are you satisfied with the call quality in terms of voice clarity and low call drop
problem of BSNL?
● Satisfied
● Neutral
● Dissatisfied
16. How far are you satisfied with the coverage area of BSNL?
● Satisfied
● Neutral
● Dissatisfied
17. Do you agree that BSNL makes efforts to understand the needs of the customers?
● Strongly agree
● Agree
● Neutral
● Disagree

51
18. Do you agree that BSNL maintains all the records accurately?
● Strongly agree
● Agree
● Neutral
● Disagree
19. How far are you satisfied with the response time of BSNL in terms of customer
grievances?
● Satisfied
● Neutral
● Dissatisfied
20. How far do you agree that the service provided by BSNL are competitive?
● Strongly agree
● Agree
● Neutral
● Disagree
21. Do you agree that BSNL offers a great range of pricing options for you to chose from?
● Strongly agree
● Agree
● Neutral
● Disagree
22. Do you agree that the Value Added Services provided by BSNL are updated and
competitive?
● Strongly agree
● Agree
● Neutral
● Disagree

52
23. Do you agree that BSNL has followed the moral values of the customers?
● Strongly agree
● Agree
● Neutral
● Disagree
24. How far are you satisfied with the customer relation policies of BSNL?
● Satisfied
● Neutral
● Dissatisfied
25. How far do you agree that BSNL alters the tariff rates and offers according to the taste
of the customers?
● Strongly agree
● Agree
● Neutral
● Disagree
26. Do the rules and regulations of BSNL affect your ethical standards?
● Yes
● No
27. How far do you agree that BSNL is transparent to you?
● Strongly agree
● Agree
● Neutral
● Disagree
28. Is customer relationship of BSNL suitable for you?
● Yes
● No

53
29. How far do you agree that BSNL is there to help you whenever there is a problem?
● Strongly agree
● Agree
● Neutral
● Disagree
30. What would you recommend to BSNL for the betterment of the overall services quality
to retain the customers?
● Improve the promotional tools
● Take customer feedback seriously
● Reduce tariff rates to suit the customers
● Provide personalised offers for the loyal customers
● Incorporate latest technological advancements to make the service quality better

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