SATISFACTION, LOYALTY, OR INERTIA: WHAT BRINGS BACK CUSTOMERS BEFORE AND AFTER A COVID-19 SHUTDOWN?

Session Title

Casino Industry: Operations & Tourism

Presentation Type

Paper Presentation

Start Date

27-5-2026 12:00 AM

Abstract

There is a growing body of evidence that customer satisfaction leads to favorable future purchase behaviors, and these behaviors drive firm performance. This study reexamines the link between customer satisfaction and future purchase behavior as mediated by loyalty (as measured by repurchase intention). Using individual customer-level data from the casino industry, I establish the causal mechanisms among satisfaction, loyalty, and future purchase behavior (i.e., customer retention). However, observed loyalty may be confounded with inertia. Therefore, I examine the relationship between customer satisfaction, loyalty, and future purchase behavior before and after a shutdown due to the COVID-19 pandemic. The change in the business environment and the long lag time between the measure of loyalty and future purchase behavior should reduce the impact of inertia. I find in the data that after the post-COVID-19 outbreak, satisfaction positively influences retention, but loyalty does not. This is very different from the pre-COVID period, wherein loyalty (not CS) was the key driver of retention. I propose to expand this analysis to other behaviors, including future spending and time to repeat purchase. In addition, I will examine the performance of the Net Promoter Score as an alternative metric for measuring loyalty.

Author Bios

Dr. Sanghee Kim is an Assistant Professor of Marketing at CSULB. She holds master’s degrees in Statistics and Biostatistics and a Ph.D. in Marketing from the University of Iowa. She previously worked at DuPont. Her research examines customer purchase behavior, focusing on satisfaction, loyalty, and spending using causal inference, machine learning, and advanced statistical models.

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May 27th, 12:00 AM

SATISFACTION, LOYALTY, OR INERTIA: WHAT BRINGS BACK CUSTOMERS BEFORE AND AFTER A COVID-19 SHUTDOWN?

There is a growing body of evidence that customer satisfaction leads to favorable future purchase behaviors, and these behaviors drive firm performance. This study reexamines the link between customer satisfaction and future purchase behavior as mediated by loyalty (as measured by repurchase intention). Using individual customer-level data from the casino industry, I establish the causal mechanisms among satisfaction, loyalty, and future purchase behavior (i.e., customer retention). However, observed loyalty may be confounded with inertia. Therefore, I examine the relationship between customer satisfaction, loyalty, and future purchase behavior before and after a shutdown due to the COVID-19 pandemic. The change in the business environment and the long lag time between the measure of loyalty and future purchase behavior should reduce the impact of inertia. I find in the data that after the post-COVID-19 outbreak, satisfaction positively influences retention, but loyalty does not. This is very different from the pre-COVID period, wherein loyalty (not CS) was the key driver of retention. I propose to expand this analysis to other behaviors, including future spending and time to repeat purchase. In addition, I will examine the performance of the Net Promoter Score as an alternative metric for measuring loyalty.