New Insights in the Moderating Effect of Switching Costs on the Satisfaction–Repurchase Behavior Link

• The way in which switching costs (SC) moderate the satisfaction–repurchase behavior link is unclear.
• We synthesize both an amplifying and a lock-in effect to theorize the moderating effect of SC.
• We find evidence for an inverted u-shaped moderating effect of SC.
• The inverted u-shaped moderating effect varies for different SC-types.
• The inverted u-shaped moderating effect is stronger for positive than for negative SC.

Existing studies on the role of switching costs (SC) as moderator of the relationship between satisfaction and repurchase behavior are inconclusive. We attempt to explain these inconclusive findings by synthesizing an amplifying and a lock-in effect, and hypothesize a nonlinear moderating effect. In Study 1 (a main study and three replications), we find strong evidence for an inverted u-shaped moderating effect of overall SC. Our results suggest that satisfaction is a particularly important predictor of repurchase behavior in situations characterized by medium-levels of SC. Based on Prospect Theory, Study 2 (a main study and one replication) reveals that this inverted u-shaped moderating effect of SC is stronger for positive (relational and financial) SC than for negative (procedural) SC. We conclude with recommendations for satisfaction management of different customer segments, and describe possibilities to influence customer switching costs in various industries.

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