Assignment On Brand Loyalty

ASSESSMENT 1

---------- Truong Bich Nga Nguyen (Nina) - 4556584 ----------

What do we know about brand loyalty?

Brand loyalty are agreed to be beneficial to brand owners in many different ways. It sustains the future demand and future income for the organization. Brand loyalty is also economic to an organization, as maintaining current customers is more cost effective than trying to win new ones (Fontana, 2018). An example is Coca-Cola spent about four billion U.S. dollars on advertising alone in 2016 while its global revenue was about 41.86 billion U.S. dollars in that year.

Brand loyalty keeps businesses stable, helps protect against competitive approaches from rivals and the effect of negative information on brand. It increases

It may leads to antitrust actions against monopoly or easy switching when a new product/service is introduced.

Attitudinal loyalty

Loyalty in attitudinal form, is seen as attitudinal commitment. This commitment is shown as consumer response with psychological attachment to the brand. Loyal consumers are described as consumers that behave in a consistently favourable manner to a certain product or service (based on the definition of “attitude” by Fishbein and Ajzen,1975). The example of this positive behaviour is positive word-of-mouth, thinking highly of a brand or willingness to pay more for a certain product/service (Dick & Basu, 1994).

Attitude based loyalty does not necessarily translate to purchase, as consumer may prefer a product/service but do not buy them immediately. However, it strongly links to future loyal behaviours. For instance, luxury product or service are desirable and fond of by the potential consumers, may be purchased when their finance is ready.

Therefore, it is very rewarding to invest into true brand loyal consumers that demonstrate both behavioral and attitudinal

Brand Trust

Brand trust has a significant connection with brand loyalty, in which positive attitudes are developed (Garbarino & Johnson, 1999). It is a result of Perception and Attitude & Beliefs influences. Brand trust is the central piece in any long-term relationship with the consumer that leads to long-term loyalty.

Eg.: Marketing campaigns use certified documents, qualified practitioners, celebrity endorsement or brand ambassadors to generate and fortify the sense of trust when referring a product/service to consumers.

3. Customer Satisfaction

Some researchers suggested that higher satisfaction implies high levels of loyalty (Heilman, Bowman & Wright, 2000). However, satisfaction can truly converts into loyalty when a low level of uncertainty (or high level of brand trust) also exists (Chandrashekaran et al., 2007). Basically, buyers have to trust the brand at a certain level and they feel happy with the customer service

There are many ways to create and enhance a satisfaction effect, Loyalty program is one of them. It allows consumers to indulge in guilt-free luxuries (Kivetz & Simonson, 2002). Loyalty programs are defined as programs that allow consumers to accumulate rewards (price discount, free gifts, special recognition) when they repeatedly purchase from the same company. Its goal is to sustain consumer loyalty even after the Loyalty program is discontinued. The examples are reward cards used by supermarkets such as Coles and