With the increasing competition on the market, customer loyalty has become a decisive factor for long-term business profits. At its high, customer loyalty connotes the high entry barriers the competitor faces when entering the market, and it contributes significantly to a reduction of marketing costs. To attract new customers, companies are required to invest a lot of time and money which can result in uncertainties and risks over longer periods of time. The number of loyal customers as a sign of market share is more significant than the total number of customers. More loyal customers translate to high profits. Loyal customers will continue to purchase or receive the product or service from the same enterprises, and they will be willing to pay higher prices for the quality products and first-class services, thereby increasing sales revenue. Consequently, the focus of many enterprise managers at this point is on marketing management aspects to improve customer loyalty in order to gain the competitive advantage in the face of fierce competition. The importance of customer loyalty has been identified by many researchers and academics in the past years. This importance is also predominant in the telecommunication industry and, consequently, the Nigerian telecom industry. This book attempts to assess and analyze the variables that influence a mobile phone subscriber’s loyalty and how Nigerian service providers can enhance this loyalty. The study is based on a survey that uses the quantitative approach. A structured questionnaire was developed and personally administered to a sample of University of Ilorin students across four major GSM operators in the country. Four hundred (400) respondents were sampled through a stratified random sampling. Out of this, three hundred and forty-eight (348) copies of the questionnaire, constituting an 87% response rate, could be used for the analysis. Of the eleven (11) operational factors that were used to assess loyalty of customers in the Nigeria Mobile Telecoms industry, all variables except Brand Image and Service Centre Quality were found to be capable of influencing customer loyalty and also considered as the most important loyalty variables in the industry. The unavailability of Mobile Number Portability was found to be a prominent factor in tying consumers down to service providers, while the generally low satisfaction with the present state of service delivery in the industry also plays a role. Therefore, the retention which the service providers were able to enjoy can be described as circumstantial. The given recommendations include that the service providers embark upon drives that will reduce dropped calls to a bare minimum, that they improve call quality, and that they develop SMS delivery standards.

Text Sample: Chapter 1.2, The Characteristics of Nigerian Mobile Telecom Market: A large, evolving and profitable market: Nigerian Mobile Telecom market is indeed the fastest growing market in Africa, maintaining its lead with active subscribers of about 78 million (NCC, March 2010) and relegating South Africa to second place with about 45 million subscribers. Nigerian telecoms came into mainstream in 2001 when the deregulation of the subsector of the economy gave way to private involvement. The telecommunication system was opened up with the issuance of Global System for Mobile communication (GSM) unified license in 2001. GSM license in Nigeria cost about US5million. Nigerian Telecommunication (NITEL) was the only operator in the market before 2001 with subscribers of about 500,000 from a population of about 140 million. The deregulation ushered in telecom players like MTN, Glo Mobile, Zain formerly Celtel, Etisalat, Visafone, Multilinks, Starcomm and Zoom formerly Reltel. The telecom regulator in Nigeria is Nigerian Telecommunication Commission (NCC), with reference to NCC Act 2003 3-(1) ,There is established of a commission to be known as Nigerian Telecommunications Commission with responsibility for the regulation of the telecommunication sector in Nigeria’. The market is divided into urban and semi-urban, and rural market. Tele density in the urban is about 65% while semi urban is about 45% and rural is less than 15%. Product Segmentation is GSM and Code Division Multiple Access (CDMA). (www.ncc.gov.ng, March 2009) Major Players: MTN, Zain, Glo and Etisalat control the GSM market. While Visafone, Multilinks, Starcomm and Zoom formerly Reltel are in the CDMA product segment. The market shares of these major mobile telecoms are MTN-40.54%, Zain- 30.20%, Glo Mobile-28.11 and Etisalat- 0.7%, M-Tel Mobile phone business of NITEL-0.45%. While Visafone leads the CDMA market, follow by Multilinks, Starcomms, and Zoom. (www.ncc.gov.ng, March 2009) The Growth Progression: From a bit above 500,000 NITEL fixed wire line and mobile subscribers in 2001. The industry grew to over 7million subscribers in 2004 in December 2008 the subscribers in the market grew to 62.99million. An addition of 22.59 million subscribers in 2008 alone represented 56% annual growth rate. Recent figure as at January 2009 put the subscribers’ base at 64.16. While GSM subscribers are in the range of 57million, CDMA subscription in Nigeria grew from just 380,000 in 2007 to more than 6million at the end of 2008. The country intelligent report on Nigeria by Pyramid research (2009) stated that the market grew by 23% with total industry revenue of US.42billion. With mobile penetration of 42% revenue will increase to US.14billion by 2013 with forecasted annual increase of 5.7%. The telecom market has been named the largest mobile market in Africa. Tele density of 0.73% in 2001 has steadily increase over the year to 33.72% as at December 2006 and about 45% aggregate in December 2008. The current market installed capacity is 117.892 million as at December 2008. The mobile industry ARPU (Average Revenue per User) in 2003 was around US per month but as at 2008 December was US. (www.ncc.gov.ng, March 2009). It is however expected that ARPU will continue to fall with competition, and also as the service providers dig deeper into the lower strata of the society in villages to explore the ever ready market available naturally by the country’s population strength: - Mobile number portability (MNP) does not exist in the Nigerian mobile telecoms market. Mobile number portability (MNP) is the ability that enables mobile telephone users to retain their mobile telephone numbers when changing operators. Many countries are MNP countries for example, USA, Sweden, Denmark, Germany, Korea, UK, Turkey etc. But till now, Nigeria does not have MNP, so if a subscriber wants to change from one operator to another, he or she has to worry about a plenty of trouble after using a new cell phone number, like to inform every contact, miss a lot of phone calls and so on. - Majority consumers buy handsets by themselves. Before Third Generation (3G), Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA) are the two main network technologies. The CDMA operators require proprietary handsets that are linked to one carrier only. But for GSM, Subscriber Identity Module (SIM) card itself is tied to the network of an operator, rather than an actual phone. So operators, who use CDMA, always sell mobile service together with a handset while business model of operators who use GSM is to sell SIM card to their customers. The majority of subscribers in Nigeria are using GSM, that is to say, operators only sell SIM card to their customers and their customers buy cell phone separately. So the willingness to switch cell phones would not be an issue that makes customers change operators as long as they are in GSM network. 1.2.1, The Current situation of Nigerian Mobile Telecom Industry: There are about fourteen mobile operators in the Nigerian mobile telecom industry, they are: MTN, Globacom, Zain, Etisalat, Visafone, EMTS, M-Tel, Multi-Links, Starcomms, Reliance, M-Tel, Zoom, Intercellular and Onet. These operators not only supply the basic mobile voice services but also value-added services such as data, IP telephone and multimedia, though the bulk of their service is around voice and text. All the operators are privately owned with the exception of M-tel that has government stake and it is also been touted for privatization. However, regulation of the sector rests on a government agency in the name of National Communication Commission (NCC). Though controlled by the same department of the government, competition between the operators is serious and very fierce. 1.3 Statement of the Problem: Research into what factors impact on customer loyalty has been carried out in other countries such as South Korea, Germany, and France and so on. Gerpott (2001) considers the network quality, which is reflected in excellent indoor and outdoor coverage and in the clarity of voice reproduction without any connection break-downs the price paid for obtaining access to and using the network the quality of the exchange of information between customer and supplier (1) in response to customer (telephone) enquiries and (2) in the course of interactive activities initiated by the network operator (e.g., presentation of an invoice) have an important impact on customer loyalty in Germany market. Lee (2001) thinks pricing, area coverage, clarity of sound, access to provider, precision of billing service and perceived difficulty to switch are the main factors which have important impact on customer loyalty in France. Ahn (2006) considers that call drop rate (percentage of abnormally terminated calls), the number of complaints, monthly billed amounts and customers with a non-use or suspended status are positively associated with the probability of customer churn in South Korea mobile telecom industry. From the review of literature above, we find that different countries have different factors that affect their customer loyalty in the mobile telecom market. Comparing with the other mobile telecom market situation, the Nigerian market is a different one (in terms of structure, status and market saturation) and thus the need to understand the peculiarities of factors on which the loyalty of mobile telecom users hinge on. As earlier stated that different countries have different factors that affect their country’s customer loyalty in the mobile telecom market, thus, Nigeria as the most populous African country and indeed a force to be reckoned with in the World League of Nations when it comes to population is not unlikely to have different factors that affect mobile telecom customer loyalty. Hence addressing questions like what factors affect the loyalty of customers in Nigeria’s Mobile Telecoms industry and how has operators fared on these factors will be of importance in this thesis.

• Customer Loyalty

• Mobile Telecommunication

• Nigeria

• Customer Retention

Olayiwola Bello holds a Master’s Degree in Information Science and Business administration. He presently lectures at the University of Ilorin in the Department of Information and Communication Science. His areas of interest include mobile telecommunication, electronic/mobile services and information system management. He is happily married and currently pursuing his doctoral degree at the University of Ibadan, Nigeria.