A firm is likely to be most vulnerable to customers' switching behavior when:
A) its customers are dissatisfied, the switching costs are low, and the firm operates in a business environment with high competitive intensity.
B) its customers are satisfied, the switching costs are high, and the firm operates in a business environment with high competitive intensity.
C) its customers are dissatisfied, the switching costs are high, and the firm operates in a business environment with low competitive intensity.
D) its customers are satisfied, the switching costs are low, and the firm operates in a business environment with low competitive intensity.
E) its customers are satisfied, the switching costs are high, and the firm operates in a business environment with low competitive intensity.

Question

Quizplus · Accepted Answer

When customers are dissatisfied and the switching costs are low, they are more likely to switch to a competitor. Additionally, in highly competitive environments, there are more options for customers to switch to. Therefore, a firm is most vulnerable to customers' switching behavior when its customers are dissatisfied, the switching costs are low, and the firm operates in a business environment with high competitive intensity.

A Firm Is Likely to Be Most Vulnerable to Customers