Antecedents and consequences of brand loyalty an empirical study

Antecedents and consequences of brand loyalty: An empirical study Received (in revised form): 5th November, 2003 SPIROS GOUNARIS has a PhD from Athens University of Economics and Business, and is an assistant professor of marketing at the Department of Marketing and Communication at Athens University of Economics and Business His research interests pivot around consumer behaviour, satisfaction and loyalty, service quality, tourist marketing, business-to-business marketing and market orientation development His work has been published in many journals VLASIS STATHAKOPOULOS has a PhD from the University of Arizona, and is an associate professor of marketing at the Department of Marketing and Communication at Athens University of Economics and Business His work has been published in a number of journals and been included in various research proceedings His research interests include marketing management and strategy, sales management, services marketing, and consumer satisfaction and loyalty Abstract The authors consider the relationships among characteristics associated with the consumer (risk aversion and variety seeking), the brand (brand reputation and availability of substitute products), the social environment (social group influences and peers’ recommendations), four types of loyalty (premium loyalty, inertia loyalty, covetous loyalty and no loyalty), and four consumer-related behaviour types (word-of-mouth communication, buy alternative brand, go to different store and buy nothing) To test the hypothesised relationships a survey of Greek consumers was conducted The findings provide general support for the postulated linkages among the above variables Implications for marketing practice and directions for future research are discussed INTRODUCTION Spiros Gounaris Assistant Professor of Marketing, Department of Marketing and Communications, Athens University of Economics and Business, Patission 76, Athens 10434, Greece Tel: ϩ32 10 8203 445 Fax: ϩ32 10 8211 269 E-mail: sgounar@aueb.gr There is no doubt, among academics and practitioners alike, that the concept of brand loyalty is of strategic importance for companies in order to obtain a sustainable competitive advantage This is due to a number of reasons First, brand-loyal consumers are less expensive, since they reduce the marketing costs of doing business.1–3 Secondly, brand extensions are less risky for brands that exhibit high loyalty.4 Thirdly, brand loyalty has been shown to be associated with higher rates of return on investment through increases in market share.5 Fourthly, brand-loyal consumers have fewer reasons to engage in an extended information search among alternatives, thus reducing the probability of switching brands.6 Finally, brand loyalty has been identified as a major determinant of brand equity.7 The concept of brand loyalty has not, however, been uniquely defined and operationalised in the marketing literature For example, brand loyalty has been defined as a repeat purchase,8 preference9 and commitment,10 and as retention and allegiance.11 These diverse definitions of brand loyalty are in part due to the fact that loyalty is a very complex construct.12 Furthermore, there exist various aspects of brand loyalty (such as behavioural and attitudinal brand loyalty) If these aspects were to be integrated, however, then one could come up with a ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 283 GOUNARIS AND STATHAKOPOULOS more accurate definition and thus operationalisation of brand loyalty Hence the first objective of this paper is to conceive a better definition of brand loyalty and validate its operationalisation Furthermore, until now there have been few studies that have examined the antecedents of brand loyalty (for example, Dick and Basu,13 Ha14 and Hog et al.15) Hence the second objective of this study is to add to this stream of research by empirically examining the role of context in shaping the development of brand loyalty Finally, a third objective of this manuscript is to empirically examine the effects of brand loyalty on consumers’ behaviour For instance there is empirical evidence that demonstrates that loyalty is not necessarily reflected upon the systematic purchase of a single brand.16 In fact, researchers have long questioned whether the systematic purchase of a single brand is the result of increased levels of loyalty to this brand or whether it is the outcome of loyalty to a store which carries a limited number of brands for a given product category.17 Moreover, empirical research has demonstrated that brand loyalty does not result only in a specific purchase pattern For instance, it can also bring about positive wordof-mouth communication, which is not necessarily tied with the purchase of the brand to which the consumer feels loyal.18 The rest of the paper is organised as follows First, the different types of brand loyalty are discussed Next, the authors advance a conceptual model and associated research hypotheses Then a description is given of an empirical study designed to test the hypotheses and compare the effects of 284 the different types of brand loyalty After discussing the findings and their managerial implications, this paper concludes with study limitations and directions for future research TYPES OF LOYALTY The authors’ review of past literature suggests that brand loyalty has been viewed from three different, albeit complementary, perspectives, namely: the behavioural, the attitudinal and the reasoned action perspectives More specifically, the behavioural perspective has conceptualised brand loyalty in terms of repeated purchases (for example, Cunningham19 and Kahn et al.20) In fact, several models have been proposed in the literature in order to study brand loyalty from the behavioural perspective, the Dirichlet model being one of the most prominent.21–23 These approaches model the consumers’ faithful enactment of a promise to consistently purchase only one brand, although they fail to model the reason(s) behind this behaviour One possible insight could be found in the attitudinal perspective in conceptualising loyalty According to this perspective, brand loyalty consists of a strong internal disposition towards a brand leading to repeated purchases.24–26 As such, the attitudinal approach conceives brand loyalty based on stated preferences, commitment, or purchase intentions One would expect attitudinal and behavioural brand loyalty to be positively correlated, although not perfectly, otherwise there would be little need for different concepts.27 Thus an increase in attitudinal brand loyalty should lead to an increase in behavioural brand loyalty ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY Another possible explanation can, however, be derived from the theory of reasoned action According to this perspective, the consumer’s behaviour may be influenced by social pressures, thus explaining how a consumer’s brand attitude may be unfavourable, while the consumer repeats the purchases of the particular brand In such a case, the consumer’s brand loyalty would be superficial.28 Recognising the above difficulties in defining and explaining brand loyalty, Ha29 proposed the theory of reasoned action to explain brand loyalty According to the reasoned action paradigm — based on the theory of reasoned action, introduced by Fishbein30 — brand loyalty is conceived as a notion that is dependent on normative influences (such as influences deriving from social peers) These influences, in turn, are reflected in the behavioural consequences of loyalty.31,32 According to this view, one may hold a favourable attitude towards a brand but still not purchase it because of not being able to afford it, a partner disliking the brand, or for many other reasons.33,34 Such an individual, although having never actually purchased the brand, promotes it in public, recommends it, and compels others to buy it This situation is similar to the theoretical discussion by Oliver35 of the loyalty phases, and particularly the cognitive phase, where loyalty is based merely on ‘brand belief’ and not on brand experience For the purposes of this research, a conceptualisation of loyalty is adopted that attempts to combine all three approaches to brand loyalty in explaining purchasing behaviour Thus, incorporating the behaviour paradigm suggests that repeat purchases are often the outcome of habitual behaviour This then implies that the attitudinal perspective is of limited value in grasping the notion of loyalty If, however, there are changes in the marketplace, as is often the case (for example, a new or improved product is introduced, and there is increased perceived risk), the consumer is likely to engage in a decision-making process, breaking the cycle of habitual purchases The cycle of purchases may or may not break, however, if the consumer holds strong positive sentiments and identifies with the brand Including the attitudinal perspective in conceptualising loyalty is useful, since it allows the decision-making process occurring in the consumer’s mind during the purchase to be more realistically described It is the cognitive activities that one describes with this perspective Similarly, the cycle of purchases may or may not break because of pressures exercised by the consumer’s social environment Thus embodying the reasoned action approach in the proposed conceptualisation recognises the fact that there are some situations where consumers’ behaviour is not fully under their control, but is influenced by the expectations of relevant others Therefore, one could conceive brand loyalty as comprising three dimensions Each of them determines the type of loyalty a consumer will exhibit towards a brand For instance, a consumer who is unfavourable to the purchase of a certain brand may still purchase the brand This loyalty behaviour is likely to be converted into a behaviour of switching the brand when the consumer is no longer forced to keep purchasing the brand Thus the following four generic types of brand loyalty can be identified: ‘no loyalty’, ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 285 GOUNARIS AND STATHAKOPOULOS Emotional attachment High COVETOUS PREMIUM High High Low s nce l cia So Low Figure ue infl NO LOYALTY INERTIA A conceptualisation of loyalty based on purchasing behaviour, emotional attachment and social influences ‘inertia loyalty’, ‘premium loyalty’ and ‘covetous loyalty’ (see Figure 1) The four types of brand loyalty are characterised as follows: — No loyalty: No purchase at all, and a complete lack of attachment to the brand Also no social influences to be even cognitively loyal to a brand — Covetous loyalty: No purchase but, unlike the case of ‘no loyalty’, the individual exhibits a very high level of relative attachment to the brand as well as a strong positive predisposition towards the brand, which is developed from the social environment This condition arises from perceived human characteristics which a consumer identifies in a specific brand.36 The individual comes to like the brand and thus emotional attachment with the brand increases The brand becomes an extension of the consumer’s own 286 Purchasing behaviour self-perception and personality The consumer trusts it and is willing to recommend it to peers, friends or relatives, although, for reasons beyond the consumer’s control, the purchase itself may never occur In such cases, the consumer is strongly discouraged to be loyal to a certain brand by social influences For instance, a young, newly appointed lecturer in a business school might covet a Mercedes, but not purchase it because he cannot afford it or because he might not wish to publicise his economic status The lecturer may, however, still recommend the brand — Inertia loyalty: An individual, although purchasing the brand, does so out of habit, convenience or for some other reason, but not as a consequence of emotional attachment to the brand or a real social motive Inertia loyalty is characterised by a habitual attach- ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY ment that is to a large extent unemotional and convenience driven The consumer may systematically choose the specific brand over other brands, but this choice involves little emotional involvement, little personal investment, and no brand commitment.37 Hence this is a very fragile relationship that may be easily terminated by a rival product capable of breaking the consumer’s habitual behavioural pattern Oliver38 terms this type of loyalty ‘phantom loyalty’, while Day39 and Dick and Basu40 call it ‘spurious loyalty’ — Premium loyalty: An individual exhibits a high degree of relative attachment to the brand, a high instance of repeat purchases, and appears to be highly influenced by social pressure Premium loyalty is characterised by the greatest degree of consumer attachment to the brand, and in this case the consumer purposefully seeks to purchase the particular brand, while attempting to overcome obstacles This is similar to the description by Oliver41 of ‘action loyalty’ — ‘commitment to the action of re-buying’ Premium loyalty propels individuals to suffer various sacrifices in order to acquire their favoured brand Football fans are a good, although extreme, example of people showing this type of loyalty They may see their team losing one game after the other, and yet be willing to travel with the team or watch its games on television Consumers who exhibit ‘premium loyalty’ have been won over by the brand alternative through the value it provides to them42 or are con- vinced that the selected brand is in some way the best brand to buy.43 This conviction arises from both personal and social motives Variations in the price of their favourite brand may affect the quantity of the brand they purchase, but not the brand they choose to buy, since these consumers are committed to the brand CONCEPTUAL MODEL AND RESEARCH HYPOTHESES Figure presents the conceptual model of brand loyalty that guides this research The model shows potential drivers of brand loyalty These drivers are classified in three basic categories: consumer drivers, brand drivers and social drivers By focusing on potential drivers, it may be possible to manage brand loyalty better In addition, the model used in this study focuses on consumers’ behavioural responses to brand loyalty — word-of-mouth communication, buying alternative brand, going to different point of sale (store) and buying nothing Consumer drivers Both normative and empirical studies have substantiated the importance of the individual’s characteristics in deciding to purchase a specific brand.44 Two such characteristics are examined in this study: risk aversion and variety seeking Although many characteristics of consumers may have an impact on the decision to purchase a specific brand, this study chooses to focus on these two specific attributes, which both relate to how consumers handle risks Loyalty has been described as a means of handling the risk associated ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 287 GOUNARIS AND STATHAKOPOULOS Buy nothing CONSUMER DRIVERS Risk aversion Variety seeking Buy alternative brand BRAND DRIVERS Brand reputation Availability of substitute brands Type of brand loyalty Word-of-mouth communication SOCIAL DRIVERS Social group influences Peers’ recommendation Figure Conceptual model with the decision to purchase a specific brand.45 Risk aversion Individuals are often confronted with situations that differ in the degree of uncertainty or complexity they present to them.46 Typically, decisions linked to highly valued goals47 such as the purchase of a new car and/or decisions on high-involvement product categories48 encompass greater risk for the individual buyer Such decisions may evoke negative emotions that the buyer attempts to deal with.49 Emotions accentuate the risk associated with the purchase of a specific brand, leading to a greater search,50 which, in turn, may lead to lower levels of brand loyalty On the other hand, emotions may lead consumers to exhibit avoidance behaviour51 and/or greater dependence on previously held choices, which result in higher levels of brand loyalty Furthermore, Sheth and Parvatiyar52 argued that consumers become brand loyal — a manifestation 288 Visit other store of rational market behaviour — in order to reduce perceived risk The risk element may be either a functional risk or a social acceptance risk In fact the perceived risk can be so intense that individuals become reluctant to proceed with the action Instead, they procrastinate until they have reduced the perceived complexity or the uncertainty associated with the situation.53,54 Hence the consumer’s need to control the risk will be a significant positive factor in the formation of brand loyalty On these grounds, this paper investigates the following hypothesis: H1: Risk aversion will relate to the type of brand loyalty the individual develops towards a specific brand Variety seeking On the other hand, uncertainty of the outcome of a purchase and the risk associated with a certain decision provides stimulation to the consumer.55 If the stimulation obtained is within the bounds of the optimal stimulation ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY level, then it is desirable and the consumer actively seeks to attain it However, if the optimal stimulation level is exceeded, it becomes too intensive, leading consumers to try to reduce the complexities that are associated with such a condition and, as pointed out earlier, they attempt to routinise the decision-making process and its outcomes In fact, Sheth and Parvatiyar56 pointed out that routinisation and variety-seeking behaviour become cyclical over time, but the cycles are asymmetrical in favour of the longer duration of routinised behaviour Routinisation, although initially helpful, may, however, lead an individual to feelings of monotony and boredom, which may lead to experimentation with new brands.57 Moreover, it appears that the level of variety-seeking behaviour depends on the intrinsic need of consumers to seek variety (personal differences) and on the product category level of involvement.58 It is within this framework that studies report a break in the link between satisfaction and loyalty.59 Indeed, as Homburg and Giering60 have demonstrated, variety seeking is one of the key consumer characteristics which moderates the relationship between perceived quality and satisfaction with the loyalty to a specific brand Within this framework, this paper hypothesises that: H2: Variety-seeking behaviour will relate to the type of brand loyalty an individual develops towards a specific brand Brand drivers An individual’s intention to purchase a product reflects a search for value out of the transaction and the cost if he decides to acquire the product Hence to understand how product characteristics contribute to brand loyalty, it is necessary to comprehend what creates and determines the value individuals derive from a brand The following two brand characteristics are examined in this study: brand reputation and availability of substitute brands Brand reputation Although not part of the physical product itself, the reputation of a brand’s name has been described as an extrinsic cue, that is, an attribute related to the product.61 A reputable brand name conveys a strong indication of the product’s quality and equity that is not necessarily related to detailed knowledge of the intrinsic — technical — specification of the product.62 Therefore, the choice between alternative brands within a single product class is facilitated, since brands are differentiated easily by their consumers As Oliver63 suggests, loyalty is not merely about product superiority and satisfying customers Loyalty is about having customers who can become determined defenders of the brand If the firm cannot develop, support and maintain brand uniqueness and perceived brand equity, then it is not possible to expect loyalty to develop.64 Thus having a brand with a strong reputation will be a significant positive factor in the formation of brand loyalty, since the brand’s reputation strengthens its perceived equity.65,66 Moreover, the reputation of the brand strengthens the habitual behaviour of consumers by rewarding their choice and making the brand more desirable and alluring.67 As ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 289 GOUNARIS AND STATHAKOPOULOS a result, reputable brands enjoy higher loyalty due to their higher market share.68 This higher market share is attributed to the fact that higher-share brands are not only bought by more consumers, but they are also bought more frequently In other words, highshare brands benefit both from greater market penetration and higher purchase frequency This is the wellknown double-jeopardy phenomenon, an ‘empirical law’ that researchers have observed and modelled for nearly 30 years.69 On these grounds, the following hypothesis is investigated: H3: Brand reputation will relate to the brand loyalty type an individual develops towards a specific brand Availability of substitute brands Brand reputation is subjected to the shopper’s perception of both the range of competing products and brands as well as the class of substitute products When a product class comprises several brands which are perceived by consumers to be similar to each other, discriminating among them is hard Consequently, individuals have no reason to show loyalty towards one or another In fact, the more alike the brands are perceived to be, the less likely loyalty is to emerge.70 Rather, consumers are prone to make their purchases from a predetermined set of alternative products without showing a particular preference to any specific brand from this set.71,72 Thus the availability of substitute products is expected to affect brand loyalty significantly Moreover, when customers stay in a relationship because they are forced to 290 so in the absence of any attractive alternative — as is the case when no substitute brands are available73 — the relationship tends to last only for as long as there is no alternative.74 Research suggests that customers in such constrained situations attempt to restore their freedom to choose.75 According to resourcedependence theory,76 consumers may attempt to break free from constrained relationships by identifying acceptable substitutes Hence the perception of similar substitutes may be expected to influence negatively the creation of relational ties to the brand within the specific category, and it might therefore be considered as a deterrent to the formation of brand loyalty On these grounds the following hypothesis is investigated: H4: The availability of substitute products will influence the type of brand loyalty an individual develops towards a specific brand Social drivers Finally, when studying the antecedents of loyalty, one should not neglect the social norms which may influence consumers’ behaviour patterns Consumers not take decisions isolated from social influences Rather, they are subjected to heavy social control over the attitudes they have and the behaviour they develop.77 Social group influences One strong type of such social influence is that derived from reference groups — the social groups that have a direct or indirect influence on the person’s attitude or behaviour.78 In the ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY context of the present work, two types of social influence are considered: social group influences and peers’ recommendations A group becomes a reference one when an individual identifies with it so much that he takes on many of the values, attitudes and/or behaviour of its members.79 The power of the influence of a reference group is dependent on the individual’s susceptibility to this influence, the strength of his involvement with the group and the degree of product conspicuousness.80 Powerful reference groups may easily change the behaviour of their members, or their aspirant members, and align it more with the norms and standards that the group considers to be acceptable.81 Hence the individual’s loyalty towards a product is also dependent on the acceptance of his preference for a certain product by the social group the individual refers to, particularly when the conditions under which individuals feel coerced to give in to the group’s norms are met By adapting their attitudes and behaviour, consumers fulfil their aspirations and at the same time reduce the perceived risk of making a decision.82 Besides, recent empirical studies have attested to the impact of social stimuli (or normative information) on loyalty.83,84 For instance, Mascarenhas and Higby,85 in their study of how youngsters choose a brand, indicated that parents’ consistent choice of a particular brand influences children to perceive the brand as ‘good’, and thus become loyal to it Furthermore, Hog et al.86 found that families and peer groups led young consumers to form a more positive image of a brand Hence group social influences are expected to have a strong positive impact on brand loyalty, since the desire for the brand may be affected by group preference.87 On these grounds, this paper investigates the following hypothesis: H5: Social group influences will relate to the type of brand loyalty an individual develops towards a specific brand Peers’ recommendation Another strong source of social influence is the recommendations and suggestions made by the individual’s peers Hite and Hite88 found that a party’s reputation could lead to positive expectations about the party which, in turn, leads other parties to develop reciprocity and loyalty for the reputable party When it comes to brand names, their reputation reflects the opinion of others that a specific brand possesses or does not possess certain characteristics.89 While advertising and/or public relations help brands to demonstrate their qualities, peers are among the most influential sources of information used by consumers in shaping their opinion concerning a brand’s qualities.90 Peers exercise both normative (conformist) and identificational influences on consumers Informative influences help to guide consumers in product, brand and store searches,91 whereas normative influences direct and control evaluations, choices and loyalties.92 Thus peers’ recommendations are expected to significantly affect brand loyalty.93 Following the reasoned-action paradigm, Bearden and Etzel94 suggest, however, that the recommendations of peers may not necessarily convert into actions (ie purchase) Under certain circumstances, they could merely ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 291 GOUNARIS AND STATHAKOPOULOS influence the consumer’s emotional attachment to the brand Consider, for instance, a young teenager who develops a high attachment to Sony’s Playstation II after it was recommended by a friend, but still feels reluctant to purchase it because he perceives that his parents would disapprove Nonetheless, following the conceptualisation of loyalty outlined, the teenager in question is (covetously) loyal to the brand On these grounds, this paper investigates the following hypothesis: H6: Peers’ recommendation will relate to the type of brand loyalty an individual develops towards a specific brand Consequences of loyalty Scholars studying the notion of brand loyalty have discussed a number of behavioural consequences In the context of the present work, four alternative consequences of loyalty are examined, namely: word-of-mouth communication, buy alternative brand, go to different point of sale (store) and buy nothing Word-of-mouth communication Perhaps the single most expected behavioural outcome of loyalty is brand recommendation Consumers become loyal as a result of the satisfaction they experience with their purchase.95 Satisfied consumers who share their experiences with other individuals are the best advocators of any company or its products.96 In fact, as Oliver97 suggests, in certain cases it is the sharing of the experience regarding the brand that ultimately provides the satisfaction and not the brand itself 292 On these grounds this paper investigates the following hypothesis: H7: The type of brand loyalty will depend on the occurrence or not of word-ofmouth communication between consumers Buy alternative brand An interesting situation arises when a consumer is loyal to a specific brand, but the brand is unavailable when required at a particular store.98 How likely is it that the individual will betray the brand and purchase another? Oliver99 has shown that consumers, when faced with uncertainty about how to handle a decision and about its outcomes (concerning, for example, specifying relative uncertainties, what information to seek, or how to assess consequences), tend to delay the actual decision This is in line with the empirical findings of Greenleaf and Lehmann,100 demonstrating that such procedural uncertainty causes consumers to delay a decision Hence, for instance, when consumers are deprived of the brand towards which they have developed a feeling of loyalty, they may delay their purchase until either ‘their’ brand is available again or they have managed to handle the new situation On the other hand, some consumers might find delaying the purchase too ‘costly’ and thus decide to switch brands Many consumers adapt their brand preferences according to the time when they prefer to shop.101 Therefore they would rather stay in one store and switch brands Such behaviour is in line with the consequences of developing the ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY ‘spurious’ gested by grounds, following type of loyalty as sugDick and Basu.102 On these this paper investigates the hypothesis: H8: The type of brand loyalty will relate to the purchase or not of alternative brands Go to a different store In the absence of the desired brand, loyal consumers may choose to go to a different point of sale to seek the brand Once more, this behaviour depends on the perceived risk associated with the decision of purchasing an alternative brand, but perhaps also with the emotional disappointment of not finding the brand with which the consumer has an emotional attachment.103 It can be expected that the decision of whether to go to a different store to find the desired brand will be determined by the type of brand loyalty Based on the above discussion, this paper investigates the following hypothesis: H9: The type of brand loyalty will affect the decision to go to a different store Buy nothing The decision to buy nothing if the preferred brand is unavailable is by definition a strong indicator of premium loyalty To make this decision, the individual has to go through the same cognitive/conative process to decide on an alternative as he did originally to choose the preferred product, and this creates both cognitive and emotional discomfort The result is that the decision to buy is postponed (for when the product is available), and in doing this there is less risk associated with the decision The individual has developed the highest level of loyalty — ‘action loyalty’ Betraying the brand will be like betraying himself.104 Based on the above discussion, this paper investigates the following hypothesis: H10: The type of brand loyalty will relate to whether the consumer decides to buy nothing if the brand is unavailable METHODOLOGY Data collection and sample The sample for the study was drawn from the area of Athens, Greece Trained personnel conducted interviews, based on a questionnaire, in order to increase the validity and reliability of the responses The sample consisted of 850 consumers of whisky who were randomly approached in the street and shopping malls Although the sample was clearly chosen for convenience, the interviews were conducted at different locations and on different days, as well as at uniform intervals, in order to reduce location-, date- and time-related response bias The decision to focus the study on whisky buyers was based on three factors First, there is a remarkable variety of alternative whisky brands in the Greek market, a fact which gives many options to the shopper Moreover, whisky is bought quite often by the majority of the adult Greek population Consequently, it could reasonably be expected that signals of loyalty, where identified in terms of behaviour, emotional attach- ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 293 GOUNARIS AND STATHAKOPOULOS ment or social stimuli, would be authentic and not the consequence of a constrained choice Finally, the large number of alternative whisky brands that can be found in the Greek market differ markedly in terms of their positioning strategy (product, price, promotion and distribution) in Greece The same is also true for the purchasing occasion Whisky is bought in Greece for private or public (in-home or on-premises) consumption, as well as for offering as a gift In addition, whisky can be bought legally from off-licences, supermarkets and convenience stores Therefore, the authors expected that there would be enough scope for all types of loyalty to develop Tải FULL (24 trang): https://bit.ly/3u7fzrO Dự phòng: fb.com/TaiHo123doc.net Measures Although attempts were made to use existing measures, they were not available for several constructs or were otherwise limited in their applicability to the context of this study It was therefore necessary to adapt the current measures or develop new ones (as discussed subsequently) Development of the loyalty scale The review of the current literature did not reveal any empirically validated scales with respect to the different types of loyalty Thus new scales were developed to measure the loyalty construct In doing so, the scale-development instructions suggested by Churchill105 were followed More specifically, once the domain of the construct (brand loyalty) was specified, the preliminary set of items was developed through discussion with consumers and group brand managers 294 This process resulted in a battery of 21 items worded to capture the different types of loyalty Next, a mini pilot survey was conducted among a randomly selected sample of 250 students Exploratory factor analysis was employed to refine their answers on loyalty by deleting items with high loadings on multiple factors This process resulted in a four-factor solution, namely premium loyalty (comprised of three items), covetous loyalty (three items), inertia loyalty (four items) and no loyalty (five items) These 15 items were employed in the analysis of the results, which is reported in this manuscript Dimensionality and psychometric attributes of the loyalty scale In the main study the psychometric attributes of the scales employed to measure loyalty were assessed using confirmatory factor analysis (CFA) This was preferred to exploratory factor analysis (EFA), a method about which various concerns have been raised For instance, according to Mulaik,106 EFA may ‘find optimal knowledge’ (p 265) Mulaik107 made it clear that ‘there is no rationally optimal way to extract knowledge from experience without making certain prior assumptions’ (p 265) In addition, the factor structures yielded by an exploratory factor analysis are determined by the mechanics of the method and are dependent on specific theories and the mechanics of extraction and rotation procedures This, too, can result in inaccurate results Mulaik108 also made it clear that exploratory techniques not provide any way of indicating when something is wrong with one’s assumptions, ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY e1 e2 e3 e5 e4 0.87 0.83 0.88 C2 C3 P1 P2 0.89 0.94 P3 0.83 0.93 0.89 0.60 COVETOUS 0.62 0.79 0.83 0.80 C1 e6 PREMIUM 0.61 0.69 0.69 INERTIA 0.79 NO LOYALTY 0.62 0.93 0.78 0.82 I1 0.84 e7 Figure 0.84 0.88 I2 I3 e8 0.85 e9 N2 N1 I4 0.88 0.79 0.79 0.85 e10 e11 0.81 e12 0.75 N3 0.85 e13 0.69 N4 0.68 N5 0.82 0.81 e14 e15 The loyalty measurement: Confirmatory factor analysis Tải FULL (24 trang): https://bit.ly/3u7fzrO Dự phòng: fb.com/TaiHo123doc.net because the technique is designed to fit the data regardless of other considerations Rather than justifying the ‘knowledge’ produced, exploratory factor analysis suggests hypotheses, but does not justify knowledge Finally, another problem lies in the interpretation of the results The interpretation of factors measured by a few variables is frequently complicated.109,110 Stevens111 suggested that the difficulty in interpretation often comes about because the researcher lacks prior knowledge and therefore has no basis on which to make an interpretation CFA on the other hand is a theorytesting model as opposed to a theorygenerating method like EFA In CFA, the researcher begins with a hypothesis prior to the analysis This model specifies which variables will be correlated with which factors and which factors are correlated The hypothesis is based on a strong theoretical and/or empiri- cal foundation.112 In addition, CFA offers the researcher a more viable method for evaluating the validity of a construct The researcher is able to explicitly test hypotheses concerning the factor structure of the data due to having the predetermined model specifying the number and composition of the factors Confirmatory methods, after specifying the a priori factors, seek to optimally match the observed and theoretical factor structures for a given data set in order to determine the ‘goodness of fit’ of the predetermined factor model Figure depicts the results of CFA while Table summarises the fit indices using the chi-square test, the goodness of fit index (GFI), Bentler’s comparative fit index (CFI) and the root mean square error of approximation (RMSEA) for the four scales employed in this study to measure the different types of loyalty The RMSEA ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 295 GOUNARIS AND STATHAKOPOULOS Table Fit statistics Loyalty measurement Four factors 122 83 0.980 0.983 0.024 Chi square (␹2) Degrees of freedom (df) GFI* CFI* RMSEA** One factor 970 89 0.795 0.638 0.108 * CFI and GFI values close to indicate a good fit ** The lower the RMSEA values, the better the model; values below 0.1 suggest adequate fit Table Reliability and validity assessment Rel PREM AVE (Corr)2 Rel Dimensions of loyalty CVTS INRT AVE (Corr)2 Rel AVE (Corr)2 Rel N-LTY AVE (Corr)2 Conv Disc 0.82 0.72 0.85 0.69 0.71 0.94 0.78 0.88 0.60 0.59 0.91 0.59 YES YES PREM, premium loyalty; CNTS, covetous loyalty; INRT, inertia loyalty; N-LTY, no loyalty; Rel, Cronbach’s alpha coefficient; AVE, average variance extracted ϭ ͚ (standard loadings)2/͚(standard loadings)2 ϩ ͚␧ij; Conv, convergent validity (AVE > 0.50); Disc, discriminant validity ϭ AVE/(Corr2) > 1; (Corr)2, highest (Corr)2 between factor of interest and remaining factors measures the lack of fit and takes parsimony into account by assessing the discrepancy per degree of freedom between the population covariance matrix and the fitted matrix That is, it penalises for overfitting The adjusted goodness-of-fit index (AGFI) is not reported as its usefulness is questionable.113 The measurement model was first tested for the adequacy of a four-factor solution As can be seen in Table 1, although the overall chi-square test was statistically significant (␹2 ϭ 122, df 83) the GFI of 0.98 and a low value (below 0.10) of the root mean square residual (RMSEA ϭ 0.024) suggested a good model fit.114 Besides, the ␹2 statistic is known to be strongly dependent on sample size, and thus its appropriateness has been strongly questioned.115,116 A single-factor model was also tested, but, as can be seen in 296 Table 1, the four-factor solution was superior to that of the single factor Convergent and discriminant validity for the loyalty scale were evaluated by calculating the average variance extracted (AVE) for each factor Convergent validity is established if the shared variance accounts for 0.50 or more of total variance Discriminant validity is evident when the AVE for each construct is greater than the squared correlation between that construct and any other construct in the model.117 The results presented in Table confirm both the convergent and discriminant validity of the four scales Internal consistency was assessed by means of the Cronbach’s alpha coefficient.118 An alpha value of 0.60 or above for new scales, and 0.70 or above for established scales, is considered to be ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 3849518 ... an increase in behavioural brand loyalty ᭧ HENRY STEWART PUBLICATIONS 1479-1803 BRAND MANAGEMENT VOL 11, NO 4, 283–306 APRIL 2004 ANTECEDENTS AND CONSEQUENCES OF BRAND LOYALTY: AN EMPIRICAL STUDY. .. Risk aversion Variety seeking Buy alternative brand BRAND DRIVERS Brand reputation Availability of substitute brands Type of brand loyalty Word -of- mouth communication SOCIAL DRIVERS Social group... this study: brand reputation and availability of substitute brands Brand reputation Although not part of the physical product itself, the reputation of a brand? ??s name has been described as an extrinsic