Investigating the relationship between perceived switching costs and alternative attractiveness to customer loyalty in Vietnamese grocery retailing

The Vietnamese grocery retailing market promises to bring huge potential to both Vietnamese and foreign investors as it is considered one of the most dynamic markets in South-east Asian countries. For that reason, understanding how to keep customers loyal is essential because loyalty can result in firms’
sustainable development. This paper investigates the linkage between perceived switching costs and alternative attractiveness to customer loyalty in Vietnamese grocery retailing in Vietnamese food retailing. In other words, whether the presence of switching costs and alternative attractiveness change customers’
loyal behavior. The research was conducted for three months and sent surveys both online and offline to nearly 3,000 supermarket customers. By using confirmatory factor analysis (CFA) and structural equation modelling, the
research tested links between constructs presented in a research model. The analysis demonstrated that switching costs (SWCT) have a positive effect on customer satisfaction (CST) and customer loyalty (CLT) and high-perceived alternative attractiveness (ALAT) has a negative influence on CLT; especially, there is no relationship between ALAT and CST found. Additionally, the research confirms that CST has a strong positive impact on CLT. These findings have a crucial role in presenting the importance of ALAL and SWCT, helping firms to be aware of their current strategic positions and their competitors if they want to
keep their current customers loyal.