Morgan Bianco

BUS 414- Consumer Behavior

Final Paper
Chapter 10: Loyalty and Satisfaction
December 1, 2016

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Brand Loyalty
One of the major components of consumer behavior is brand loyalty. The
textbook defines brand loyalty as the degree to which a customer holds a positive
attitude toward a brand, has commitment to it, and intends to continue purchasing
it in the future (Donavan, T., & Mowen, J. pg 289). Why is brand loyalty important to
marketers? For starters, it can cost up to six times more to attract a new customer
than to retain existing customers (Kuusik, A. 2007, pg 4). This is why customer
retention strategies are one of the most important aspects in the succession of a
company. The impact of brand loyalty on marketers is very strong; brand loyalty
focuses on current customer and company relationships. This is crucial because
having a strong loyal customer base creates a high entry barrier for competitors
(Kocoglu, C., & Guzel, A. 2015. Pg 319). It is extremely difficult to change a
consumers mind and attitude towards a particular brand once they have become
loyal. When a customer is highly satisfied with a brand, they will often times keep
repurchasing it. This is how brand loyalty is formed (Zhang, Y. 2015, January 16, pg
60). Customer satisfaction refers to the customers general evaluation of the
overall shopping experience of some specific product or service (Zhang, Y. 2015,
January 16. Pg 60). When a products performance exceeds the customers
expectations, the customer satisfaction level increases, but when the performance
level falls short of the expectancy level, the customer becomes dissatisfied. How a
product ranks compared to the expectancy rate, set by the consumers, can
influence the brands overall image.
Brand Image

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Brand image is a key factor in brand equity and the major determinant of
purchasing decisions. Brand equity is defined as the consumers general
perception and feeling about a brand and has an influence on consumer behavior
(Zhang, Y. 2015, January 16. Pg 58). Marketers focus on establishing a brand image
in hopes of stimulating consumer behavior. They strive to get the consumers to
purchase their brand. Customer-based brand equity was a concept introduced in
1993. Marketers analyze the consumers reactions to their companys branding
campaign (Zhang, Y. 2015, January 16. Pg 59). This concept is centered around the
idea that brand image and brand awareness are the core to brand equity. Positive
brand image can be created by associating the particular brand to a positive
memory using branding campaign techniques (Zhang, Y. 2015, January 16. Pg 59).
In 1995, another consumer equity concept was introduced by Lassar. This concept
had the belief that consumers confidence in a brand determined the brands equity
(Zhang, Y. 2015, January 16, pg 60). There are five important elements in
determining a customers confidence in a brand: the brand performs the functions
as intended to, there is an increase in social image of this particular brand is
purchased or owned, the customer can recognize and has some sort of emotional
connection with the brand, the brand possesses positive values, and consumers feel
they can trust the brand (Zhang, Y. 2015, January 16. Pg 60).
Brand awareness, brand associations, perceived quality and brand loyalty are
considered the four elements of brand image (Kocoglu, C., & Guzel, A. 2015, pg
318). Brand association focuses on the differentiation and positioning of a brand
and the efforts of creating a positive attitude and opionions from consumers. There
are eleven brand association types: brand qualities, moral values, benefits to the
consumers, related price, usage, user, famous people, lifestyles, product class,

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competitive environment, and geographical environment (Kocoglu, C., & Guzel, A.
2015, pg 319). Brand personality is a subsection of brand association. When a
brand is linked to a human personality trait it is considered to have a brand
personality (Romaniuk, J. & Nenyez-Thiel, M. pg 4). Brand personalities help
consumers associate the brand name with positive traits. For example, Coca-Cola is
known for bringing fun and happiness to their consumers. How is this true? CocaColas advertising campaigns focus on connecting the emotions of happiness and
fun with the Coca-Cola beverages to give their brand that particular personality
image. Brand association leads to consumers recognizing the brand by name. This
is known as brand awareness. Brand awareness is defined as the ability of a
potential buyer to recognize or remember that the brand is a member of a certain
product category (Kocoglu, C., & Guzel, A. 2015, pg 319). As the level of brand
awareness increases, there is a greater chance of the company gaining more
market share due to the increased number of purchases and repurchases. Brand
association and brand awareness are important because consumers prefer to
purchase a known brand rather than a brand they are unaware of. This theory
becomes more prominent in high-cost, long term purchases because a known brand
is often a brand in which a consumer trusts and offers benefits (Kocoglu, C., &
Guzel, A. 2015, pg 319). This leads us to the factors that affect brand loyalty.
Factors Affecting Brand Loyalty
There are various factors that affect brand loyalty; all the factors intertwine
and make a loop of cause and effect scenarios. One factor of brand loyalty is
trustworthiness. It was already stated that consumers are more likely to trust a
brand that they recognize than a brand that they havent heard of before. This is
true because often times when people recognize a brand, they have heard

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information or have done some sort of research on the brand itself; this is how the
trust is built. A consumer has to have trust in their brand in order to keep buying
their products and services; again, the commitment to purchase and repurchase a
product is considered brand loyalty.
Another factor that influences customer loyalty is brand image. There are
three ways in which consumers develop brand assoicaitons; these are exposure to
marketing campaigns, being exposed to word-of-mouth advertising, and of course
personal experiences (Romanuik, J. & Nenyez-Thiel, M. pg 5). Customers use their
preferences to present their own image of themselves; this occurs at both the
conscious and subconscious levels. People define themselves materialistically,
meaning they use their possessions to determine who they are. That being said,
consumers choose the brand that has the image and values that they want to be
associated with (Kuusik, A. 2007, pg 9). Consumers also use brands to enhance their
social standings. If a brand is highly accepted by society and perceived as prestige,
consumers may purchase the product for the simple fact that they will become
accepted or to be seen as of a higher social class than actuality. In other words,
consumers sometimes purchase a particular product to gain the brands image on a
personal level. The buying behavior of a customer is strongly affected by their past
experiences with the brand and that is the key factor in whether they buy that same
brand again; meaning brand loyalty is highly affected by the experiences and
memories created by that particular brands products or services (Bonerjee, S. P.,
Novemeber-December 2014. Pg 25). This goes to show how brand association is
applied to whether the consumer is going to be loyal to the brand on a personal
level rather than a corporate level.

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How is a products quality determined? The answer is quite simple;
consumers determine the quality of a product or service. Consumers base their
perception of quality on how the product or service functions compared to its
competitors (Kocoglu, C., & Guzel, A. 2015, pg 319). It is often said that the
purchasing decision of a consumer is determined by the consumers perceived
quality. Perceived quality is divided into two elements: hard ware and human ware.
Hard ware is defined as the quality of the product or service attributes, whereas
human ware consists of the interactive elements in a service situation such as the
atmosphere or the customer service efforts (Kuusik, A. 2007. Pg 9). The perception
of quality is determined by customer satisfaction, which decides if a customer
becomes loyal to the brand, and is an important factor of brand association. As we
know, brand association affects brand loyalty and is a component of brand image;
making the cause and effect an endless circular flow.
Types of Brand Loyalty
There are two different approaches to brand loyalty: behavioral and
attitudinal. In the behavioral approach, a consumer actively chooses one brand over
a competitor and a repurchase behavior is present (Kocoglu, C., & Guzel, A. 2015.
Pg 319). The attitudinal approach, on the other hand, involves analyzing the
psychological process of the consumer. These psychological functions include
prejudge, behavioral reactions, a specific time frame, certain decision making
elements, and having a preference of one or two competing brands (Kocoglu, C., &
Guzel, A. 2015. Pg319).
There are two specific elements in determining if a consumer is behaviorally
loyal to a brand. These elements are buying frequency and share of wallet. The

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buying frequency is defined by how often a consumer purchases a particular brand
compared to other consumers (Romaniuk, J. & Nenyez-Thiel, M. pg 4). How much
money a consumer spends on this particular brand compared to other consumers is
referred to as the share of the wallet (Romaniuk, J. & Nenyez-Thiel, M. pg 4). There
are five different types of behavioral brand loyalty: undivided, occasional switch,
switch loyalty, divided loyalty, and brand indifference (Donavan, T. & Mowen, J. pg
290). Undivided brand loyalty is when the consumer only purchases one brand
every time. Occasional switch brand loyalty occurs when the consumer purchases
the same brand over and over again but every once in a while they decide to try a
different brand. When a consumer is loyal to one brand and decides to try another
and becomes loyal to that brand instead, switch loyalty occurs. Divided loyalty is
when a consumer is divided between two different brands; they buy both brands
frequently. Brand indifference occurs when a consumer doesnt have any preference
as to which brand to choose; there is no brand buying pattern. While these
consumers are loyal in the sense of repurchasing behavior, they have no emotional
connection to the brand. Attitudinal loyal consumers have an emotional connection
with the brand itself.
Undivided Loyalty
Occasional Switch Loyalty
Switch Loyalty
Divided Loyalty
Brand Indifference

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Emotional loyalty is defined as the desire to maintain a valued relationship

with a brand (Kuusik, A. 2007. Pg6). These types of loyalties are stronger and longer
lasting than behavioral loyalty because it is based off on an emotional attachment.
Consumers that are highly connected will repeatedly buy from that particular brand,

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recommend the brand to others, and defend their purchase choice as being the
best (Kuusik, A. 2007, pg 6). This brand commitment, or emotional attachment,
occurs more often in high-involvement products, i.e. products that are higher-priced
and have a greater perceived risk, that represent their own self-concepts, values,
and needs (Donavan, T. & Mowen, J. pg 291).
Why Are Consumers Behaviorally Loyal Rather Than Emotionally Loyal?
Under some circumstances, a consumer is behaviorally loyal because they
are forced to. Forced loyalty occurs when a consumer has no choice but to be loyal
to a particular company. This kind of situation occurs when there is a monopoly in
the industry (Kuusik, A. 2007, pg 6). For example a lot of electric, water, and gas
companies are monopolies, meaning there is only one choice of provider. Another
reason of forced loyalty is financial restrictions (Kuusik, A. 2007, pg 6). When a
consumer is under financial restrictions they are limited to the cheapest option
making it a forced brand loyalty. When another brand becomes the cheaper option,
the loyalty of the consumer then shifts to the respective brand. This is obviously
behavioral loyalty because there is no emotional attachment involved between the
brand and the consumer.
Another reason for behavioral loyalty is loyalty due to inertia. Loyalty due to
inertia occurs when a consumer does not want to switch brands because they are
comfortable with their current brand or the choice is of low importance (Kuusik, A.
2007, pg 7). If the product or service is of low importance, the consumer will not
want to waste their time searching for alternatives; therefore they will continue to
stay behaviorally loyal to that brand to save time and effort.

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The last reason for a lack of emotional connection in loyalty is loyalty due to
function. Functionally loyal customers are those who are loyal to a brand because of
an objective reason (Kuusik, A. 2007. Pg 7). Functional values such as price, quality,
distribution, and usage convenience through loyalty rewards programs are used to
gain functionally loyal customers (Kuusik, A. 2007. Pg 7). These functional values
are short-term because competitors can easily copy these strategies eliminating the
function loyalty. Once another brand offers similar or better functional values,
consumers will switch their loyalty from one brand to the other, again without an
emotional connection stopping them.

Sources

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Bonerjee, S.P. (Nov-Dec 2014). Brand Loyalty-Influencing Consumer Buying
Behaviour. Eduved Global Management Research.01(01), 22-26.
Donavan, T., & Mowen, J. (n.d). Loyalty and Satisfaction. Consumer Behavior (pp.
289-292). Chicago Business Press.
Kocoglu, C., Tengilimoglu, D., Ekiyor, A., & Guzel, A. (2015). The Effects of Brand
Loyalty on the Consumer Buying Behaviors: the Example of Perfume in the
Province of Ankara. International Journal of Humanities and Management
Sciences, 03(05), 318-323.
Kuusik, A. (2007). Affecting Customer Loyalty: Do Different Factors Have Various
Influences in Different Loyalty Levels? University of Tartu. 3-29.
Romaniuk, J. & Nenyez-Rhiel, M. (n.d.) Behavioral Brand Loyalty Measures and
Consumer Responses to Brand Attributes. 1-11.
Zhang, Y (2015, January 16). The Impact of Brand Image on Consumer Behavior; A
Literature Review. OJBM Open Journal of Business and Management, 03(01),
58-62. Doi: 10.4236/ojbm.2015.31006