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Benefits of brand loyalty
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Brand loyalty is defined by Aaker (1991, p. 39) as a circumstance which shows the tendency of consumers switching to another brand, particularly when the brand makes a change, whether is a change in price or product features. Oliver (1997) characterizes brand loyalty as a sense of commitment to constantly repurchase or repatronise a favored product or service in the future, regardless of any marketing tactics or situational influences that may act upon switching behavior. Aaker (1992) and Keller (2003) noted that brand loyalty means that each consumer whose past and future purchase is the same, they recommend others to purchase or they have the intention to purchase more. Moreover, Brand loyalty is the attitude of brand preference towards a …show more content…
This argument is supported by Solomon (1992) with him discovering that purchase decision that is based on loyalty might become a habit which leads to brand equity. On the other hand, Aaker (1991) described brand loyalty as consumer’s mentality toward a brand that drives them to consistently purchase the same brand. As per Yoo (2000), brand loyalty has the ability to affect consumer choice to buy a same product or brand and cease to switch to other brands. Subsequently, Yoo (2000) reasoned out that brand loyalty is the root for brand’s value. Aaker (1991) additionally contended that brand loyalty is a fundamental component used to assess brand’s value due to the fact that brand loyalty can increase profitability. The consumers who are loyal to a brand will not assess the brand, instead they simply purchase it unquestionably based on their experiences with the brand (Sidek, Yee, and yahyah, 2008). The loyal customers bring advantages to a firm by cutting down costs, encouraging easier strategies implementation, providing time for responding to competitions, creating a barrier to entry, increasing sales volume, protecting firm against detrimental pricing and to retain rather than seek for customers (Aaker 1991; Rundle and Bennet, 2001). Loyal customers are also less incline to change to another brand simply because of pricing factor and they purchase more frequently compared to their non-loyal counterparts (Bowen and Shoemaker,
The phrase Brand loyalty refers to consumers sticking with a brand out of feeling of commitment for that brand. "Consumers attachments to certain brands are so powerful that this loyalty is often considered as a product attribute in and of its self”(Solomon). Solomon’s quote, is showing the attachment that people feel when they purchase a product for a long time, and are still very happy with it, is a huge plus in its self. People enjoy the luxury of not having to scavenge around the supermarket in search of a new product. Brand loyalty is also very attractive to the companies since they enjoy their work being easier, and less costly. It is less expensive and less time consuming to keep old customers, rather than spend money and time advertising towards new ones. "Furthermore, companies with faithful customers tend to be less susceptible to economic down turns or new competitors"(Harrell).
Brand equity is crucial as it implies that the brand itself is an important (financial) asset and can be calculated in financial terms (Barwise, 1993). This is particularly important in the luxury sector as from a behavioural viewpoint, brand equity can differentiate a company or product from other competitors, adding to their competitive advantages based on non-profit competition (Aaker, 2004). The model created by Aaker (1992) states that there are four categories of brand equity; Loyalty, Awareness, Perceived Quality and Associations. Luxury branding relies on a high level of perceived quality, loyalty and associations, although potentially less so for awareness, as it is thought that consumers choose luxury brands based on their exclusivity and as such the more the awareness that surrounds the brand, there is potential for it to become less valuable (Phau and Prendergast,
...of brand equity in an organizational-buying context. Journal of Product & Brand Management, Vol. 6(6), pp. 428-437.
1. Lau, Geok Theng, and Sook Han Lee. "Consumers' trust in a brand and the link to brand loyalty." Journal of Market-Focused Management 4.4 (1999): 341-370.
...dom), (2) behavioral response (i.e., purchase), (3) expressed over time, (4) by some decision-making unit, (5) with respect to one or more alternative brands out of a set of such brands, and (6) is a function of psychological (decision- making, evaluative) processes. This evidence is empirically supported by an experiment designed by (Jacob 1973). According to (Delgado and Aleman 2005) brand loyaltywhich is trust in brand ultimately results in the brand equity the study was conducted in the south eastern part of Spain and resulting from 271 surveys and the results indicated that brand trust evolves from the brand reliability (the feeling that brand would meet my expectations) and brand intentions (the feeling that brand is worth enough to solve all my problems) these two things leads to brand trust which leads to repurchase of the brand resulting in brand loyalty.
Sportswear including sports jacket, footwear, shorts, caps and many other types of apparel is very common nowadays because many people have been wearing them for quite some time. Any interna-tional sportswear brands could learn from the worldwide leading sportswear brands, such as Nike and Adidas, and build brand loyalty for the customers with the same quality as the best sportswear. The researcher believe if many sportswear brand could learn from the factors influencing brand loyalty towards sportswear, any sportswear brand could build the brand loyalty in big cities by separating the 7 main factors building the brand loyalty toward a sportswear brands, such as Product Quality (PQ), Style (ST), Brand Name (BN), Store Environment (SE), Service Quality (SQ), Sales Promotion (SP), Price (PR) with the Brand Loyalty (BL)
In order for a brand to fall under the category behavioral loyalty customers must not only be brand loyal, but also feel that it is the only brand out there that has the product they need (pg.96). For example, if the product
Brand value evaluations have also been studied in relation to purchase decisions. Positive perceptions of brand value may help the customers make purchase decisions through development of positive feelings regarding the brand (Kumar et al., 2006).
Brand equity, in general terms, simply refers to how much a product is worth and how consumers behave and associates themselves with that product (Slotegraaf, Rebecca & Pauwel, 2008; Page 93-306). Consumer attitudes and the value of the product is linked to brand equity as it will determine how big of the market share the brand will occupy and how much the brand will earn in the long run. As the aviation industry is extremely competitive, many airlines have customer loyalty schemes and frequent flyer programmes to maintain or expand their brand equity, making the switching costs substantially high between airlines (Chen & Chang, 2008; Page 40-42). Chen and Chang (2008) also found out that brand equity is also linked to brand preference, purchase intentions and have an influence on consumers when they are thinking about switching brand products. Tigerair Australia’s brand equity was low in the Australian aviation market due to low brand awareness from consumers, the breaches of safety regulations by the Australian Civil Aviation Safety Authority (CASA), and strong competition from competitors like Jetstar.
With the market gradually enriched, competitive brands are steadily increasing, consumers can choose from different brand. Many companies use brand to create and cultivate their own competitive advantage. This has become one of the main strategies used by companies in the international marketing competition. Brand loyalty is when consumers make purchasing decisions, they too many times to express the preference for a brand. It decides the value and influence of the brand, and affects the establishment of market position. It is very important for each company. Therefore it is necessary to research the brand loyalty. This essay will research the value of brand loyalty, methods of improving and keeping brand loyalty, and factors that influence
From the study it is clear that people often purchase branded products since they are aware of the brand performance or perhaps they have a good past experience about the brands. This makes customer’s become loyal with the specific brand.
People in the field have used both attitudinal and behavioral measures to define and assess customer loyalty (Zeithaml, 2000). Loyalty, from an attitudinal stand point, implies a specific desire to continue a relationship with supplier and provider (Reza and Rehman, 2012). This means that a customer is loyal to a brand or firm if they have a positive and preferential attitude towards it. Whereas behavioral loyalty is when a customer repeatedly buys from the same company, (Reza and Rehman, 2012) thus the customer is faithful to the company. Oliver (1997) defined customer loyalty as “a deeply held commitment to re-buy or re-patronize a preferred product/service consistently in the future, thereby causing repetitive same-brand purchasing, despite situational influences and marketing efforts having the potential to cause switching behavior. According to Ahmed and Moosavi (2013) “brand loyalty is the customer’s willingness to stay with a brand when competitors come knocking with offers that would be considered equally attractive had not the consumer and brand shared a history.”Rahman, et al., (2010) and Deng, Lu, Wei, Zhang (2010), expressed that same notion. Furthermore, Reza and Rehman (2012) note that customer loyalty represents the repeat purchase and referring the company to other customers. They also stated that customer loyalty is a figure that may be measured directly by measuring the actual repeated sales to customers. Additionally, due to intense competition in the market place, businesses have increased efforts to implement the customer retention strategy in order to maximize the lifetime value of customers (Boshoff and du Plessis, 2009).It is important to note that Cheng et al. (2011) proposed that it is cost-effective to maintain existing customers than obtaining new ones. To this the authors proceeded to state that the cost of
To measure customer-based brand equity, most marketing researchers employ Keller’s (1993) and Aaker’s (1996) brand equity dimensions. Keller (1993) defined customer-based brand equity as “the differential effect of brand knowledge on consumer response to the marketing of the brand”. He introduced a conceptual framework of brand equity with two broad components: brand awareness and brand image. Brand awareness is the familiarity of the brand under different conditions. Brand image is defined as “perceptions about a brand as reflected by the brand associations held in consumer memory” (Keller, 1993). It is important for firms to understand the brand equity from a customer perspective. According to Keller (1993), positive customer-based brand equity is created when consumers have the ability to identify the brand and have some favorable, strong and unique associations with the brand in their
Conclusion – customers do not compromise with brand loyalty also decision making factor plays a great role in buying behavior.
The brand equity is intangible, but represents the perception of a brand from customers, sales can represent the effect of a certain marketing strategy over a short period, but the brand equity is not about short-term revenue (Ha, 2011). Companies seek to maintain at all time a high level of brand equity when expending, marketers in the sportswear industry monitor the level off the factors to understand where their brand stands and where they should focus according to the results for a long term performing brand (Sriram, Balachander, & Kalwani, 2007). These metrics have created new data for the marketers such as the Customer Lifetime Value (CLV) which is the current value of future cash flows of a customer during his relationship with the company (Stahl, Heitmann, Lehmann, & Neslin, 2012). The CLV is highly related with the customer loyalty, when expanding their marketing strategies, brands need to retain their base of customer, the physical evidence of it are the loyalty programs (Steinhoff & Palmatier, 2016). Customers are more likely to be loyal to a brand if they own a loyalty card, particularly in the retailing industry, it develops a sense of belonging from customers (Beck, Chapman, & Palmatier,