Status quo biasas a determinant of customers retention

Despite the fact that people are subjects to bounded rationality and cognitive misperceptions while making decision if to stay with the current provider or to switch, status quo bias has received little to no attention in marketing literature. The aim of this thesis is to examine status quo bias as a determinant of customers’ retention and thus to reduce the gap between theoretical findings and the way people behave in reality. This is done by examining two hypotheses: 1) “pure” (stemming from cognitive misperceptions solely) status quo bias positively affects customers’ retention; 2) “pure” status quo bias positively affects attitudinal loyalty, which is a crucial factor of retention. Results of the carried out experiment among 200 university students have shown that respondents are indeed more likely to choose a particular provider when it is marked as the status quo, confirming the first hypothesis. They also tend to have higher attitude towards this provider and be more eager to recommend it to their friends; however, no significant difference in (affective) commitment towards the provider between treatment and control groups is found, meaning that the second hypothesis is partly confirmed.