THE RELATIONSHIP BETWEEN CUSTOMER LOYALTY AND
PRODUCT BRANDS
Hussein vazife dust1 Gholam reza askarzade2
ABSTRACT
Nowadays, brand management is regarded as a competitive advantage in marketing which results in customer
loyalty in the short term.in fact; product brands relate companies to customers producing a strong and significant
relationship among them. In this article, the effective factors of loyalty, the relationship among them and also a
new model of loyalty to brands have been presented. The variables of this model are satisfaction, trust,
perceived quality, commitment and several other factors. The results demonstrate that product brands result in
an increase in satisfaction level, profitability and company share in the competition market.
Keywords: brand, loyalty, satisfaction, Trust, Perceived quality, Continuous commitment.
Introduction
According to theory of America Marketing Association (AMA) the brand is a name, phrase, symbol, design or
combination them. This factors which are express the essential nature of a company, is a product or service. At
First aspect, commercial brand is a commitment and says that you know the name and trust in its commitment.
Trust is the main and critical objective of brand. David Aker says the brand is a symbol that is associated with
many assets and intellectual commitment (Matzler, 2008). Commercial brand recognition has a positive effect
on perceived value, brand trust and customer satisfaction. Perceived value is a subjective evaluation of the trade
or loss the exchange relations (Zeithaml, 1988). Emotional relationship with the main objective can be put under
the influence of cognitive assessment (Murphy and Zajonc, 1993). As the brand recognition represents a deep
and meaningful relationship, the company's reputation is linked strongly with the brand identity (Bhattacharya
and Sen, 2003). Brand recognition can increase customer satisfaction in two ways:
1. By increasing the perceived performance
2. Overall favorable assessment leads to emotional attachment to commercial brand
Chaudhuri and Holbrook, (2001) states that companies and institutions need or don’t need to invest to loyal
customers based on build relationships and create intimacy is an issue that has been hotly debated. Creating such
relationships lead to peak out the loyalty. Ndubisi, (2004), explained the brand loyalty as customers tendency to
choose a product or business among other products for a specific need . Novo (2004) stated that create and keep
1Corresponding
2
author; Associate professor of Islamic azad university science and research branch of tehran
Faculty member of sama college of azad university of yazd
1
customers loyal to the brand is an important strategy for maintaining competitive advantage of organizations
that eventually has a positive effect on brand performance, by considering the dimensions and factors affecting
brand loyalty (Windbergs and Olbrich,2006)
The expression R
Brand is an important relational means in management of corporate-consumer relationship. As study of Erdem
and Souit (1998) shows, that research flow that is made based on information of economic pattern, is used for
product and suggests that brand is valuable for two reasons for consumers :1. They decrease risk perceived by
consumer, 2. They save costs of decision-making (Erdem and Swait, 1998). The basis of these statements is that
brand is an effective symbol of market that corporate develops it to consider asymmetry of market information.
In other words, consumers have less knowledge on product or services of a corporate that corporate itself.
Therefore, they are positioned in adverse conditions that finally leads to doubt of consumer about product
(Sweeney and Swait, 2008) is called brand loyalty as a deep commitment from the customer that leads to repeat
purchases and his repeating purchases from the company. Brand loyalty is defined as referring tothe product or
service constantly in future by considering marketing specialist efforts and contingency affects that have
required potential to change the behavior. Nevertheless, position impacts and marketing proposals are
potentially influence the changing customer behavior in marketing (Oliver ,1999).In Olsen(2002) point of view
there is difference between Mental and behavioral loyalty and measurement of loyalty is something more than
attitude measurement alone (Olsen ,2002).As studies have shown, increasing customer loyalty lead to the
increased company sales and exchanges, which is eventually followed by profitability. In fact, brand loyalty
have positive effects on company performance, the number of transactions, increase liquidity and reduce errors
(Windbergs and Olbrich,2006).To create loyalty we should achieve customer satisfaction, in fact customer
satisfaction is equivalent to achieve assure about performance or provided service by the organization with
customer expectations. Customer satisfaction is the product of achieve to goods or service with minimal
deviation of customer expectations. there is customer dissatisfaction in opposite. Dissatisfaction of customer is a
condition in which one of the factors of dissatisfaction has affected him/her enough about the quality of products
or services he /she purchased(Biggs and Swailes ,2006).In fact, Customer satisfaction is one of the most
structural evaluation concepts that followed in many businesses to create loyalty. As the customer loyalty is seen
as the key to business success, loyal customers are more profitable and make higher re-purchases, so increase
the market share and caused to introduce the company to others. Brand is one of the key issues in creating
loyalty in customers.
Main objective:
- Studying the effective factors in flouncing customer loyalty to brands.
Sub objective:
- Identifying the effective factors in flouncing customer loyalty to brands.
-Measuring any of the effective factors in flouncing customer loyalty to brands.
2
- Rating any of the effective factors in flouncing customer loyalty to brands.
- Extracting the conceptual model of the effective factors in flouncing customer loyalty to brands.
- Developing and drawing a conclusion from the extracted conceptual model the effective factors in flouncing
customer loyalty to brands.
Research Hypotheses
- There's a positive and significant correlation between satisfaction and customer loyalty to product brands.
- There's a positive and significant correlation between brand value and customer loyalty to product brands.
- There's a positive and significant correlation between oral advertising and customer loyalty to product brands.
- There's a positive and significant correlation between commitment and customer loyalty to product brands.
- There's a positive and significant correlation between Trust and customer loyalty to product brands.
- There's a positive and significant correlation between perceived value and customer loyalty to product brands.
Research Background
Row
Scholar
Year
Subject
1
Hallowell, roger
1996
The relationship between
The results
Customer satisfaction have affected the
customer satisfaction,
customer loyalty that this loyalty will lead
customer loyalty and
to increased profitability of company.
profitability of practical
study
2
3
Yoo, B., Donthu, N
Berry, L.
2000
2000
Study the Effect of
Costs of advertising and pop stores have
selecting marketing mix
an impact on brand value and brand
elements and brand value
loyalty
Cultivating Service
Brand Equity
Brand share value, external relations.
Consumer experience from organization,
concept of brand, knowledge of brand,
brand were shown.
4
Greece O'cass
2003
An Exploratory of
Associations
framework of brand evidence and brand
relationships were studied
The importance of brand
Satisfaction, value, feel, and trust are the
Celuch, Kevin &
equity on customer
relevant factors which affected the brand
Goodwin, Stephen
loyalty
loyalty of customers in industrial markets
Service Brand
5
Dimensions of service brand in the
Taylor, steven&
2004
3
6
7
Bridy & Bordo
Kuusik, Andres
2005
2007
The Importance of Brand
Cues in
Intangible Service
Dimensions of service brand in the
framework of brand evidence and brand
relationships were studied
Product or brand?
Satisfaction, confidence value, the image
Relationship between
and commitment influence the customer
customer satisfaction and
loyalty
customer loyalty
8
LaisonSondohJr,
2009
Stephen
Brand image, customer
loyalty and satisfaction of
women customers in
Malaysia
Customer satisfaction have positive
affection on loyalty by 4 aspects of the
brand (brand value, product
components, the practical benefits,
experiential benefits)
9
Touzani, Mourad
, Temessek, Azza
2009
Brand loyalty: the
Attitudinal aspects of brand loyalty,
influence of cognitive
which expresses the commitment of
and emotional variables
loyalty leads to loyalty behavioral brand
and has a positive effect upon that
Some researches and studies conducted in the Customer loyalty and brand Impact In order to be successful in
today's complex and competitive markets. It can help companies to retain their loyal customers and attract
potential customers. Also, these results suggest that the customer satisfaction has a positive effect on their
attitude and ultimately will create loyalty. Loyalty to the Commercial brand has positive effect on commercial
performance. some customer satisfaction are includes : 1 - certainly the satisfaction is related to customer
loyalty and committing to relations. 2 –More satisfied customers are doing widely spoken advertising for
companies(N d b s I,2005) Although the customer satisfaction is an important factor to customer loyalty, but
researches show that is not the only factor (Thomas et al,2007).The commercial brand particularly has affection
on customer satisfaction. Since the brand is a promise that gives to customers, if we can implement this promise
and act as the customer expectation, the customer satisfaction will be achieved. Loyalty in the psychological
sense belonging and a desire to continuing the relationship with the company. Brand also creates a continuous
commitment to the customer (Keller,1993)Therefore, if we can design a good brand and committed to the
commitments that the brand claims to be committed, We can get customer satisfaction by good performance,
ensure their loyalty to our products ,This means the long-term relationship of the company with customers
which make long-term profitability for the company.
Conceptual model of the research:
According to studies on the described model, we have achieved a functional model, which examines the brand
effect on customer loyalty. In the following table show expressed variables in six previous models along with
proposed model.
4
Model 1
Model 2
Model3
Model4
Model5
Model6
Hongwei He
Donio
et al
Rios
&Rijueme
Youl Ha et al.
Suhartanto
Souini & souit
model
(2011)
(2011)
---
(2006)
---
(2008)
---
---
(2008)
---
---
---
---
---
---
---
---
Brand
Brand
recognition
Brand value
-----
-----
The cost of
advertising
Appearance
of the store
-----
-----
-----
-----
Brand value
---
---
Brand value
Brand value
---
Brand
value
---
---
---
---
---
Perceived
quality
---
Satisfaction
Trust
Loyalty
---
----Loyalty
---
Satisfaction
Trust
Loyalty
---
Satisfaction
--Loyalty
---
Satisfaction
Trust
-----
Satisfaction
Trust
Loyalty
---
---
---
---
---
---
---
---
---
---
---
---
---
-----
-----
-----
-----
-----
-----
-----
-----
-----
-----
Perceived
quality
Quality of
Service
Satisfaction
--Loyalty
Attitudinal
loyalty
Cognitive
loyalty
Emotional
loyalty
Effortloyalty
Behavioral
loyalty
Brand image
---
---
---
Perceived
quality
---
-----
-----
-----
-----
-----
--Linguistic
advertisement
Against change
Continuous
commitment
--Linguistic
advertisement
--Continuous
commitment
(2011)
The proposed
model
Table 2 - Variables used in the model R
As shown in the above table, used variables in the proposed model, according to the variables used in the six
studied models are presented. Brand value variable from the 1,2,3,6st model and Perceived quality jointly from
models of 4,5 and satisfaction variable jointly from models1,3,4,5,6and trust variable from models 1,3,6 and
loyalty variable from models 1,2,3,4,5 and Linguistic advertisement variable and Continuous commitment
variable From models 6.According to the results of the six studied models in this research, we have finally
reached a proposed model. The conceptual framework of proposed model is presented below.
Brand Value: Value or asset of the brand is a concept beyond the familiar of customers with the brand and in
fact there isn’t a special factor to identify the brand value exactly and is just a perception concept from
customers. In recent years the most important measurements which used to assess and evaluate the brand value
or asset of a organization include: the physical quality of the company product (or service), employee behavior
5
of the company, the ideal self-adaptive of product with changes, brand recognition by customers and product
compatibility with customers' lifestyles (Nam, 2011).
Loyalty: According to him studies, although initial cost must be expended to attract and preserve loyal
consumers, but in general, loyalty to brand decrease costs, because cost of preserving consumer is less than cost
of obtaining consumer and loyalty to trademark creates resistance among loyal consumers against competitive
strategies of competitors(Sanzo,2007)
Satisfaction: Satisfaction is an effective reply and is obtained following expected experience that includes
observational process. After evaluation of performance, consumers compare the results before purchase or
consumption to their expectations and any difference leads to insistence. Positive insistence means. That if
performance is higher than what is expected, it increases satisfaction. Negative insistence means that if
performance is lower what is expected, it decreases satisfaction and causes dissatisfaction (Broner et al, 2008).
Trust: Trust means that belief of a partner to the fact that other partner to the fact acts so that positive results are
obtained. In view of Josanzo et al (2007); there are two types of trust:
1. trust to honesty of partner or belief to the fact that partner has necessary skills effectively and fulfills his/her
obligations.
2. Belief to the fact that a partner interests to welfare of other partner. Ability of a partner for obtaining positive
results for other partner determines commitment to relationship. Therefore, trust is an important determinant in
commitment to relationship and when occurs that a partner be honest and trustworthy (Sanzo, 2007).
Commitment: It has been proven that commitment to creating a relationship with customers to creating a
relationship with customer's results in a reduction in customer's attitude changes and an increase in their
purchases and their future satisfactory intentions like customer loyalty .commitment has been identified as a
sophisticated phenomenon having very many dimensions. There are many factors among we will continue
discuss two aspects apply: commitment to loyalty (LC), continuous commitment that this aspects of
commitment, most contact with the subject. These two dimensions demonstrate tendency to keeping
relationships in the course of time.an effective commitment results in commitment to loyalty which transfers a
positive feeling to our partners in a relationship (Sweeney&Swait,2009).
Perceived quality: The perceived quality of products and services is of two types: subjective and objective.
Olsen quotes oliver as saying “The product and service quality focus on realizing consumers "expectations and
perceptions and is an emotional and cognitive answer which precedes their general satisfaction (Olsen,2002).
Oral advertising: Oral words are any activities which consumers create in order to transfer in formation to other
consumers. Oral advertising is an informal relationship among customers with each other or with producers
about ownership, use, virtues of a particular type of service or product (Gremler.2001).
6
Brand value
Linguistic
advertisement
Satisfaction
Perceived
quality
Loyalty
Trust
Continuous
commitment
Figure 1 - The proposed model
Model Analysis
The main part of customer loyalty model is composed of service quality and commitment to the offered services
and also trust is an important part of the model which is attained through Brand Value, Oral advertising and
also through supporting customers which results in continuous visits of customers to the brand ;Then factor of
satisfaction one of the model factor which covers pevceived value and commitment ,finally brand loyalty is
given.
The research universe
As for performing this research, a primary sample of 30 people was chosen and for observing its reliability,
cronbachs Alpha was used. As it is obvious from the table below, α =0.971, which proves that the questionnaire
is reliable.
Reliability Statistics
Cronbach's
N of Items
Alpha
.971
30
7
In this research, the effects of variables like trust, brand value, perceived quality, commitment, oral advertising
and satisfaction on customer loyalty will be examined.
N
Normal Parametersa
Mean
Most Extreme Differences
Std.
Absolute
Positive
Kolmogorov-
Asymp.
Smirnov Z
Sig. (2-
Negative
tailed)
Deviation
Brand value
384
.4035
.08840
.079
.079
-.072
1.418
.058
384
.3443
.06452
.079
.079
-.074
1.539
.087
384
.3404
.06131
.085
.085
-.083
1.665
.068
384
.3720
.06891
.092
.092
-.089
2.118
.060
384
.3308
.07031
.081
.080
-.081
1.583
.053
Satisfaction
384
.3429
.06805
.070
.068
-.070
1.891
.082
Loyalty
384
.3451
.06930
.088
.085
-.088
1.724
.063
Linguistic
advertisement
Continuous
commitment
Trust
Perceived
quality
The table above studies the normality of variables which use the criteria of Kolmogorov-Smirnov test's its
obvious, the p-value of all variables are bigger than Sig of 0.05,which shows that all variables follow normal
distribution.
Correlations
value
Trust
advertiseme commitmen
nt
t
8
quality
Satisfaction Loyalty
Pearson Correlation
1
.519
.523
.451
-.040
-.061
.642
.000
.000
.000
.429
.235
.014
Brand value
Sig. (2-tailed)
Linguistic
advertisement
N
384
380
384
384
384
384
384
Pearson Correlation
.519
1
.387
.236
-.008
-.040
.733
Sig. (2-tailed)
.000
.000
.000
.882
.433
.021
N
384
384
384
384
384
384
384
.523
.387
1
.165
-.064
.017
.717
.000
.000
.001
.210
.740
.007
N
384
380
384
384
384
384
384
Pearson Correlation
.451
.236
.165
1
.086
.052
.677
Sig. (2-tailed)
.000
.000
.001
.094
.307
.001
N
384
380
384
384
384
384
384
Pearson Correlation
-.040
-.008
-.064
.086
1
.327
.913
Sig. (2-tailed)
.429
.882
.210
.094
.000
.000
N
384
380
384
384
384
384
384
Pearson Correlation
-.061
-.040
.017
.052
.327
1
.822
Sig. (2-tailed)
.235
.433
.740
.307
.000
N
384
438
384
384
384
384
384
Pearson Correlation
.000
.733
.717
.677
.913
.822
1
Sig. (2-tailed)
.014
.021
.007
.001
.000
.000
N
384
384
384
384
384
384
Pearson Correlation
Continuous
commitment Sig. (2-tailed)
Trust
Perceived
quality
Satisfaction
.000
Loyalty
Because these variables have normal distribution, so Pearson correlation coefficient has been used to study the
impact of these factors on loyalty variable; in the table above, the correlations among these variables have been
shown and according to this table, these hypotheses will be studied.
First hypotheses:
According to the table above, the correlation coefficient between value and customer loyalty is 0.642 and also
by considering p-value = 0.014 that is smaller than 0.05, therefore the hypothesis stating that the variable of
value influences customer loyalty is accepted.
Second hypotheses:
9
384
According to the table above, the correlation coefficient between oral advertising and customer loyalty is 0.733
and considering p-value= 0.021 which is smaller than 0.05, therefore the hypothesis stating that the variable of
oral advertising influences customer loyalty is accepted.
Third hypotheses:
According to the table above, the correlation coefficient between commitment and customer loyalty is 0.717 and
considering p-value= 0.007 which is smaller than 0.05, therefore the hypothesis stating that the variable of
commitment influences customer loyalty is accepted.
Fourth hypotheses:
According to the table above, the correlation coefficient between Trust and customer loyalty is 0.677 and also
by considering p-value= 0.007 which is smaller than 0.05, therefore the hypothesis stating that the variable of
commitment influences customer loyalty is accepted.
Fifth hypotheses:
According to the table above, the correlation coefficient between perceived quality and customer loyalty is
0.913 and also by considering p-value= 0 which is smaller than 0.05, therefore the hypothesis stating that the
variable of perceived quality influences customer loyalty is accepted.
Sixth hypotheses:
According to the table above, the correlation coefficient between customer satisfaction and customer loyalty is
0.822 and also by considering p-value = 0 which is smaller than 0.05, therefore the hypothesis stating that the
variable of customer satisfaction influences customer loyalty is accepted.
Conclusion and Suggestion
In this research, several hypotheses were prepared based on the research literature in order to determine factors
which influence customer loyalty to product brands. Finally after testing the statistical hypotheses and
correlation coefficient, all of six hypotheses were accepted. Now according to this research, it can be concluded
that all of variables influencing customer loyalty have a strong influence on loyalty, but the perceived quality
has got more influence on customer loyalty in competitive markets. In nowadays competitive conditions,
keeping customers and also attracting competitor's customers are considered as the most important strategies of
companies. In such conditions, one of the ways for strengthening the competitiveness ability is creating loyalty
in customers.
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