We study the non-linear interaction of a cold sample of strontium-88 atoms coupled to a single mode of a low finesse optical cavity in the so-called bad cavity limit and investigate the implications for applications to laser stabilization. The atoms are probed on the weak inter-combination line $lvert 5s^{2} , ^1 textrm{S}_0 rangle ,-, lvert 5s5p , ^3 textrm{P}_1 rangle$ at 689 nm in a strongly saturated regime. Our measured observables include the atomic induced phase shift and absorption of the light field transmitted through the cavity represented by the complex cavity transmission coefficient. We demonstrate high signal-to-noise-ratio measurements of both quadratures - the cavity transmitted phase and absorption - by employing FM spectroscopy (NICE-OHMS). We also show that when FM spectroscopy is employed in connection with a cavity locked to the probe light, observables are substantially modified compared to the free space situation where no cavity is present. Furthermore, the non-linear dynamics of the phase dispersion slope is experimentally investigated and the optimal conditions for laser stabilization are established. Our experimental results are compared to state-of-the-art cavity QED theoretical calculations.
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