Exploring the impacts of service innovation on customer satisfaction in the telecom industry: A perspective from interactive and supportive service innovations

The impact of service innovation on customer perception has been investigated in many studies. This paper provides a unique view of service innovation by categorizing service innovation into two forms, interactive and supportive service innovations, and exploring their effects on customer satisfaction and retention in the context of telecommunication services. A dataset of 402 telecom service users from Vietnam is collected for empirical hypotheses testing of the relationships among supportive/interactive service innovation, customer satisfaction, and customer retention. The findings show that the two components of service innovation, interaction and support, are the key determinants of customer satisfaction and customer retention, which provides important information for telecom managers in service strategy planning. The study suggests that service firms should differentiate themselves by investing in supportive service innovations since interactive services are characterized by ease of copying, especially in the telecom sector, which is a highly technology-mediated environment.