Conceptal Theory Of Brand Loyalty

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CHAPTER – III CONCEPTUAL FRAMEWORK OF THE STUDY 3.1 Introduction Brand loyalty implies that consumer have a good attitude towards a particular brand over other competing brands. Brand loyal consumers may be willing to pay more for a brand because they perceive some unique value in the brand that no alternative can provide (Oliver1993) . Brand loyalty, long a central construct in marketing, is a measure of the attachment that a customer has to a brand. It reflects how likely a customer will be to switch to another brand, especially when that brand makes a changes, either in price or in product features. As brand loyalty increase, the vulnerability of the customer base to competitive action is reduced. It is one indicator of brand equity…show more content…
Brand loyal consumers reduce the marketing cost of the firm as the cost of attracting a new customer (Levins, 2009) . Brand loyal consumers are willing to pay higher prices and are less price sensitive (Reichheld and Sasser, 1990) .Brand loyal also provides the firm with trade leverage and valuable time to respond to competitive moves (Aaker,1991) . The following are the most common benefits from brand loyalty. 3.6.1 Higher sales Volume The average company loses half of its customers every five years, equating to a 13% annual loss of customers. This statistic illustrates the challenges companies face when trying to grow in competitive environments. Achieving even 1%annual growth requires increasing sales to customers, both existing and new, by 14%. Reducing customers’ loss can dramatically improve business and brand loyalty which leads to consistent and even greater sales since the same brand is purchased repeatedly (Giddens, 2010) . 3.6.2 Premium Pricing Ability Consumers are fewer prices sensitive when increasing the brand loyalty. Generally, they are willing to pay more for their preferred brand because they perceive some unique value in the brand that other alternatives do not provide. Additionally, brand loyalists buy less frequently on cents-off deals- these promotions only subsidies planned purchase (Aaker, 1996)…show more content…
A link between product class and brand is involved in brand awareness. Brand awareness involves a continuum ranging from an uncertain feeling that the brand recognized to a belief that it is the only one in the product category (Aaker, 1991) . Brand awareness makes it easier for consumers to identify products with the well- know brand names (Sullivan 1998) . Brand awareness is created by increasing the familiarity of the brand through repeated exposure for brand recognition and strong association with the appropriate product category or other relevant purchase or consumption cues for brand recall (Alba and Hutchinson 1987) .Brand awareness plays an important role on purchase intention because consumers tend to buy a familiar and well known product (Keller, 1993 ; Macdonald and Sharp, 2000) . Brand awareness can help consumers to recognize a brand from a product category and make purchase decision (Percy and Rossiter, 1992) . Brand awareness has a great influence on selections and can be a prior consideration base in a product category (Hoyer and Brown, 1990) . Brand awareness also acts as a critical factor in the consumer purchase intention, and certain brands will accumulate in consumers’ mind to influence consumer purchase decision. A product with a high level of brand awareness will receive higher consumer preferences because it has higher

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