Page 109 - FREN-C2021 PROCEEDINGS

DETERMINANTS OF CUSTOMER LOYALTY IN THE MALAYSIAN
MOBILE SERVICE PROVIDER INDUSTRY: A CONCEPTUAL
PERSPECTIVE

1*
2
Vidyamala Mohamad , Shaiful Azlan Abdul , Lennora Putit 1

1 Faculty of Business Management
2 Arshad Ayub Graduate Business School
Universiti Teknologi MARA (UiTM), 40450 Shah Alam, Selangor Darul Ehsan, Malaysia

* Corresponding author: mvidyamala@gmail.com

Abstract
There seems to be an increase in mobile usage since the total lockdown (Movement Control Order)
was established due to the COVID-19 pandemic. This phenomenon matched and is noticeable with a
lowering rate of 4G download speed. Ever since the Malaysian Government introduced the Movement
Control Order, there has been an increase in the citizens’ dependence on internet access to facilitate
work, education, and social interactions. The Malaysian mobile service provider industry has reached
its saturation point, as indicated by the penetration rate of around 131.9 subscriptions per 100
inhabitants. The average penetration rate for Asia & the Pacific regions was at 105.3 subscriptions per
100 inhabitants in 2018, with Malaysia in fourth place after Thailand, Singapore, and Indonesia.
Noticeably, there was an increasing trend of subscriptions of mobile service providers from the years
2017 to 2019. However, this trend had triggered a rise in customer complaints received by the
Malaysian Communication and Multimedia Commission (MCMC). The negative impact of the
complaints may harm the consistency of loyalty among subscribers. Thus, to establish and maintain
the consistency of customer loyalty, firms should rely on the determinants of customer loyalty to
attain customer retention. This study suggests a conceptual model of customer loyalty that aims to
determine whether trust mediates the relationship between brand credibility on customer loyalty. To
better understand customer retention decisions, new research is needed because the true role of trust in
customer loyalty is still not cleared despite decades of research.

Keywords: COVID-19, Brand Credibility, Trust, Customer Retention, Customer Loyalty, Mobile Service Provider

Introduction
There is a broad and massive expansion traced during the past few decades in the mobile service
provider industry. Moreover, the worldwide COVID-19 pandemic spread has changed the business
landscape. Before, businesses were most likely to map their digital strategy in one to three years, but
now they have to accelerate the pace of their digital transformation in a matter of days or weeks. The
COVID-19 situation has become the focal point of all interactions, compelling businesses and
individuals to adopt digitalization more quickly than before (Blackburn et al., 2020). The mobile
service provider industry in Malaysia has no escape from this. ‘Stay connected’ was the best to
describe this new norm and the new normal environment. Therefore, the mobile service provider
industry in Malaysia, as well as the global level, has become competitive and challenging due to stiff
competition, changes in regulations, and changes in customer behaviours. Moreover, improving
customer service is an important challenge for these mobile service providers to tackle more new
customers and to retain the existing clients.

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