Can Customer Satisfaction and Dissatisfaction Coexist? An Issue of Telecommunication Service in China

Although the telecommunication industry in China is growing at a fast pace, and firms are making strong efforts to provide customers with various services, customer switching continues to be high. Satisfaction has been considered as one of the most important antecedent of customer loyalty. However, little attention has been paid to dissatisfaction, a qualitatively different construct from satisfaction, which also influences loyalty. Relying on the two-factor and three-factor theory, this research proposes a theoretical framework to demonstrate the coexistence of customer satisfaction and dissatisfaction, and investigates the different antecedents and influences of satisfaction and dissatisfaction on customer loyalty. Through an exploratory study, we derived 11 telecom service attributes and further classified them into three categories, namely, hygiene factors, bivalent factors, and motivating factors. Each of these categories has a distinct effect on shaping customers’ satisfaction and dissatisfaction. The PLS analysis of the survey data collected from 679 respondents provides insights into the complex interrelationships between 11 telecom service attributes, functional perception, motivating perception, customer satisfaction, customer dissatisfaction, and customer loyalty constructs. This study has a few interesting implications for researchers and telecom industry managers.