Brand Loyalty

Brand loyalty

Various other studies have used these and other measures of brand loyalty and have generally concluded that brand loyalty exists and is a relatively widespread phenomenon. Most studies however, suffer from a lack of comparability because of differing conceptions of brand loyalty. Until consumer behavior researchers agree on a common definition, there will continue to be difficulty synthesizing results. Some researchers have suggested a useful definition of brand loyalty that recognizes that true brand loyal consumers should exhibit not only a high degree of repeat purchasing but also a favorable attitude towards the purchased brand. Perhaps the most complete definition recognizing this position describes brand loyalty as (1) the biased (nonrandom) (2) behavioral response (purchase) (3) expressed over time (4) by a decision making unit (5) with respect to one or more alternative brands out of a set of such brands, and is (6) a function of psychological (decision making evaluative ) processes.

Factors explaining Brand loyalty

Although numerous studies attempting to explain brand loyalty have been largely inconclusive to this point, the following results appear to be indicated.

1) Some socioeconomic demographic and psychological variables are related to brand loyalty (when extended definitions are used) but tend to be product specific rather than general across products.
2) Loyalty behavior of an informal group leader influences the behavior of other group members.
3) Some consumer characteristics are related to store loyalty, which in turn is related to bad loyalty.
4) Brand loyalty is positively related to perceived risk and market structure variables such as the extensiveness of distribution and market share of the dominant brand but it is inversely related to the number of stores shopped.

The effect out of Stock condition:

A potentially important influence on brand loyalty is the possibility of brand substitution. An important reason for brand substitution is an out of stock (OOS) condition. Consumers often have doubts that their preferred brand will be available in their favorite store (either not carried or OOS) . And if it is not available they are then confronted with shopping elsewhere for the desired brand or accepting a substitute. For example, a survey of discount store customers found the following patterns:

Less than 75 percent had a preferred brand of consumer electronics, only 28 per cent strongly believed they would find their preferred brand at their local discounter, only about 40 percent would consider another brand if their preferred brand was out of stock or not carried (thus, 60 per cent would go somewhere else).

Fifty eight percent of shoppers had a preferred brand of house wares only 35 per cent felt certain they would find it at their discount store; and roughly half would decide not to make a purchase rather than switch to another brand.

Although the results of OOS conditions appear to be significant little research has been done on its effect on brand loyalty. Clearly customer reactions to OOS situations may be either short or long run in nature, including switching brands, substituting product class, shopping at other stores, postponing purchase or altering choice behavior for later decisions.

Several marketing implications flow from our discussion of brand loyalty. The first question, of course, for the marketer attempting to attract more brand loyal customers is the feasibility of segmenting this group that is are these consumers identifiable? As we have just seen from the correlates of brand loyalty those customers generally do not appear to differ significantly from other customer on most segmentation bases. The marketers may be more successful however, in discerning unique characteristics of customer loyalty to his particular brand or product. The result of such an analysis may provide him with useful insights for developing attractive marketing strategies.

Excerpts from New Era of Management