An Investigation on The Mediating Effect of Brand Trust on the Relationship between Elements of Brand Management and Brand Loyalty: A Literature Review

Assalamu’alaikum and ohayou minna-san.

How are you guys? Today, I’ve posted my third paper which has been published last month (Jan 2018). This paper explored previous literature and designed a summary of previous studies that examined the influence of the brand management’s elements on brand loyalty.

Abstract:

Brand loyalty and brand trust are known to be the fundamental aspect of brand management. Brand loyalty is important to many companies as it increases their profit as well as market share. Customers tend to choose the brand which they had put their trust and continue using the similar brand rather than taking risks by purchasing a new and unfamiliar brand. Thus, brand trust also plays an important role in influencing the behavior of customers, especially during their decision making process. A summary of the literature review has been designed in this paper, which was retrieved from the previous studies (from the year 1998 to 2016). Even though several factors have been examined separately in the previous researches, too little attention is focusing on examining the combined effects of the brand management’s elements towards the brand loyalty, especially with the presence of the brand trust as the mediating variable. Thus, this paper has been written in attempting to understand the concept of brand management, which includes its significance, dimensions, and the factors that influence brand loyalty.

Introduction:

Brand loyalty plays an important role to the firms as the loyal customers tend to repeatedly spend more on the brand. They are not only buying the chosen product, but also different products within the similar brand [1]. Brand loyalty can be defined as the commitment of customers towards the brand with the action of repeating purchase in the future [2]. Due to the presence of numerous brand in the market, it is important for the marketers to build trust with their customers in order to retain them.

Brand trust plays an important role in the decision-making process as customers are willing to rely on the strength of the brand in order to understand the as-stated purpose of the brand [3]. Once the customers are satisfied with the services offered by the companies, their attitude toward the companies will change. They tend to stay loyal to the product brand that suits their preferences [4]. Therefore, it is a tough competitive battle to capture and retain such customers. This is because the relationship between the loyal customer and brand has been engaged for a long time [5]. This engagement will help in generating more profits to the companies as it costs six times more to gain new customers than it does to retain the existing customers. This will finally increase the market share of the companies [6].

Besides that, the fierce competition among companies in the business environment has urged them to build a strong and long-lasting relationship with their customers. Due to this phenomenon, companies are seeking many ways to maintain their relationship with the customers. However, retaining the existing customers is not easy. For example, customers do not satisfy with the late delivery despite the low quality of the product [7]. Currently, the presence of various choices of product brands in the market has increased the choice of customers’ selection. This phenomenon has forced companies to embed an excellent value on their products to make their products differ from their competitors [8]. Moreover, when customers get value for their money spent, they will experience the full satisfaction towards the product brands and there will be no reason for them to change from the existing brand to other brands [9]. This indicates the importance of brand value in understanding the behavior of customers. However, focusing mainly on the brand value alone will not assure that the customers will remain loyal to the companies as other factors also can influence the customer behaviour [6]. Customer perceptions toward the brand will also influence their purchase pattern as they will gather information and distinguish the brand first before deciding to choose and purchase the desired brand of the product [10]. This will create a positive feeling or good impression about the brand.

A study conducted by Kuikka and Laukkanen [2] recommended a mediating variable to be studied together in order to explain the direct and indirect effect of predictors towards the criterion through the mediator. Their research approach was supported by Malik, Naeem and Munawar [11] who claimed that the additional variable of the mediator will increase the extensive explanation of the relationship between the independent variables and dependent variable. In addition, Nsairi and Khadraoui [12] explained about the extension of the theoretical framework on the brand loyalty relationships by integrating the brand trust as an additional variable that mediates the brand loyalty relationships, which was supported by Hsu  [13] who acknowledged the mediating effect of brand trust between the quality and customer intention. To detail up the matter, previous researchers has pointed out that the brand trust has shown the significant relationship with the brand loyalty [10, 14].

On the other hand, in the previous studies, the brand trust is acknowledged to be a mediator between the product quality and brand loyalty [15, 16]; service quality and brand loyalty [17]; brand value and brand loyalty [18]; brand image and brand loyalty [19], which have been conducted in different studies. Yet, the integrating effect of brand trust on the relationship between the product quality, brand service quality, brand value, brand image and brand loyalty is still anecdotal. Therefore, this paper tend to connect the theoretical gap by further investigating the existence of brand trust in explaining the brand loyalty relationships as suggested by Malik et al. [11] and agreed by MacKinnon [20] to investigate how the trust that is built on a brand will interfere and change the relationship between the predictor and criterion.

In addition, the goal of this paper is to develop a more rigorous understanding of the mediating role of brand trust in the relationship between the brand management’s elements and brand loyalty. Henceforth, the outcomes of this paper will help many companies to understand the combined effects of these elements with the influence of brand trust on the brand loyalty in a single model. In light of this, this paper intends to fill the empirical gap by examining the combined effect of these four brand management’s elements towards the brand loyalty with the presence of brand trust as the mediator. Thus, the mediator role of brand trust in the previous studies [19, 21] that is used to control the relationships in the customer brand loyalty will be further discussed in the next section.

Literature review:

Many researchers have studied on the brand loyalty to get a better understanding of the customer behavior. It can help companies in increasing their profits and market share coverage [6]. Historically, the study of brand trust on the topic of customer behavior has been conducted since the 1990s [22]. Many researchers are examining the influence of brand trust towards the customer behaviour such as customer brand loyalty as the antecedent factors [10, 23, 24]. However, there are a limited number of studies focus on mediating role of brand trust in the relationship between the brand management’s elements and customer brand loyalty [19].

Although the studies on brand trust have existed a long time ago as stated in the literature, researchers fail to point out the other roles of brand trust other than being an antecedent of brand loyalty [23, 25]. Brand trust is believed to have a role of mediator between the brand management’s elements (product quality, brand service quality, brand value and brand image) and customer brand loyalty [26]. This study differs from the previous research in three ways. Firstly, researchers only examine the combined effect of product quality, brand value and brand image [27, 28] and the combined effect of brand service quality, brand value and brand image [29]. However, there is still a lack of study being done in measuring the combined effect of product quality, brand service quality, brand value and brand image. Therefore, this paper will provides further insight into the combined effect of these elements in brand management toward customer brand loyalty in a single model.

Secondly, in the previous studies, many researchers have examined the brand trust as the independent variable of customer brand loyalty [10, 14, 23]. In regard to this, limited studies examined the other roles of brand trust [11] that can help marketers and practitioners to better understand the behaviour of their customers. For that reason, this paper will examine the mediating role of brand trust in the relationship between the brand management’s elements and customer brand loyalty. Thirdly, most of the previous studies explored and measured the influence of the combined effects of these brand management’s elements and brand trust towards customer brand loyalty separately [24, 28, 30]. There is no study has been conducted to examine both of these relationships in a single model. Therefore, to close the loop, this study intends to understand the concept of brand management’s elements and its influence on brand loyalty with the presence of brand trust which is shown in... [cont.]

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Dr SAA

Investigating Critical Success Factors of Brand Loyalty: A Meta-Data Analysis Approach

Bismillahirrahmanirrahim (In the name of Allah, the beneficent the merciful)

Alhamdulillah for everything that happens to me, happy or sad. Let’s be ever grateful to Allah for everything that we possess, including our health, wealth, status, intellectual abilities and life. Maybe Allah didn’t give us everything we want, but He certainly gave us everything we need.

Today, I would like to share with you my second published paper about meta-data analysis of brand loyalty. In this paper, I’ve reviewed previous literature related to brand management and brand loyalty, specifically from the years 1998 to 2016.

Abstract:

Brand loyalty is a critical issue faced by organisations. It increases an organisation’s profits and market share. Overlooking brand loyalty among customers raises problems in retaining customers. Besides, retaining the existing customers is more cost efficient rather than gaining and attracting new customers. Thus, this paper explores the elements of brand management (i.e. product quality, brand service quality, brand value and brand image) that influence customer brand loyalty. Customers satisfied with the quality of a product and service and the value of the brand will remain loyal to the brand as it exceeds their expectations. The brand image also plays an important role in influencing customers to stay loyal. This paper conducts a meta-data analysis addressing this lacuna in the literature and helps researchers to understand the concepts and elements used to measure customer brand loyalty.

Introduction:

In the 21^st century, loyalty towards products and brands has declined, leaving marketers agitated. Marketers strive to differentiate their brand given the saturation of existing markets (Mise et al., 2013). Customers are prone to swing from one brand to another and/or to decide on the different brands equally thereby making it hard to establish loyalty to a brand. This creates a need to study the influence of several elements of brand management on brand loyalty. Brand loyalty is a customer preference when purchasing a specific brand in a product category (Giddens & Hofmann, 2010). Marketing academicians and practitioners accept that retaining the existing customers is more cost efficient as it costs five times more to attract new customers as compared to retaining the existing ones (Oladele & Akeke, 2012).

By establishing and maintaining high levels of brand loyalty among customers, companies can apply their best pricing and reduce their marketing and advertising cost on their products due to the willingness of their customers to not only pay for the brand even though the price is expensive but also to promote it to their families and friends (Upamannyu et al., 2014). Thus, the price is not the only factor that influences people to purchase goods as the perception of product quality, brand service quality, brand value and brand image are essential elements in retaining customers and establishing brand loyalty (Senel, 2011; Mise et al., 2013).

Although both marketing scholars and practitioners have long taken an interest on the subject of customer behaviour (i.e. brand loyalty), it still needs to be explored in detail (Thaichon et al., 2013). Several problems face scholars and marketers in studying and establishing brand loyalty. A highly competitive business environment has urged companies to take action in establishing a long-term and close relationships with their customers. According to Koller, Floh and Zauner (2011), companies are being forced to embed excellent value in their products and service as individuals can switch brands easily due to numerous product brands available in the market.

Improving the value of the product brand is not the only means to establish brand loyalty as companies also need to ensure that their customers are completely satisfied with the products offered (Rad et al., 2014). Brand image is also necessary for companies as it creates satisfaction among customers (Malik et al., 2012). When the satisfaction level of a brand is low, customers tend to leave and choose another brand.

Meta-data analysis for marketing literature is a summary of past research constructed and contains several brand dimensions and elements used by previous researchers that have an influence on customer brand loyalty. This meta-data analysis is an 18-year timeframe in which the articles were analysed from the years 1998 to 2016. This analysis suggests several variables require further study and analysis. These variables were retrieved from different published journal articles, conference proceedings, reports and working papers. The variables are summarised in the meta-data analysis presented in... [cont].

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# Sometimes, you need to be alone. Not to be lonely, but to enjoy your free time being yourself.

Love,

Dr SAA

Does Fear of New Car Technologies Influence Brand Loyalty Relationship?

Assalamu'alaikum (^_^)

Hi guys. Today, I would love to share with you an article on brand loyalty. This is the first article that I've published when I'm pursuing my study in University Malaysia Perlis (UniMAP). However, as you noticed, I'm still lacking in the writing skills. Yup. I believed this is part of the learning process. Since this is my first paper produced, I'm aware that there's still room for improvement. This research combined two different fields of study; customer relationship management and customer psychology.

Abstract:

The increasing importance of technology in our daily lives has led companies to implement the latest technology on their products before marketing them to their customers. In this era of technology, fuel-efficient vehicles have attracted a great deal attention with a rapidly increasing customer base in the automotive industry. Automobile companies use this as a means of increasing customers’ level of loyalty, due to the anxiety about the system installed in their cars. The purpose of this study is to investigate the indirect effects of brand service quality and brand value towards brand loyalty moderated by technology anxiety. Since moderator variables are rarely tested in the context of PLS model, this investigation will analyze the data by utilizing Partial Least Square (PLS) in measuring the moderating effect of technology anxiety in brand loyalty relationships. The results illustrate that technology anxiety, one of the factors of Car Technology Acceptance Model (CTAM), moderates the relationship between brand service quality, brand value, and brand loyalty.

Introduction:

Nowadays, technology is part of daily life. People look forward to products that offer advanced technological systems which can improve their way of doing things (i.e. during driving). The rapid growth of technology systems adopted in the automotive industry has forced automakers to embed high technology systems into their manufactured cars in order to gain competitive advantages which could increase anxiety level among the automotive consumers (i.e. driver). In the context of this investigation, customers’ feeling (i.e. anxiety) toward the technology installed in their car shall be an important point to understand the intention of the customers to repeat their purchase when purchasing a car. However, Osswald et al. (2012) noted that there is high anxiety level in the public towards technologically advanced cars, which is considered as poor customer behaviour.

Besides, as the population in industrialized countries like North America, Europe, and Japan grows slowly, customer loss can be disastrous to companies. This is due to a smaller number of available new customers to replace those who leave (Blackwell et al., 2012). In the context of this study, a slow growing population in a developing country like Malaysia, has caused automotive companies difficulties in gaining new customers (MIDA, 2012). Therefore, retaining their existing customers is the best way to increase their market share and profitability. In line with the above, Malaysia, a previously overlooked country due to its financial turmoil and political instability, started to gain more and more international attention. The previous Prime Minister Tun Dr Mahathir Mohamed pledged to gradually eliminate tariffs on finished vehicles as part of an agreement signed by Japan and Malaysia in order to gain economic benefits from the trade liberalization between the two countries (Ministry of Foreign Affairs [MOFA] of Japan, 2003).

Tight competition in the business environment has urged companies to take action in building close relationships with their customers and encourage a long-term relationship. Due to this phenomenon, establishing and maintaining brand loyalty is not be easily achieved by companies as the services offered to customers were unsatisfactory and the delivery slow, despite the product quality (Es, 2012). In addition, companies are being forced to embedded excellent value into their products and service as individuals today are able to switch brand easily due to the variety brands present in the market (Koller et al., 2011). Thus, companies need to understand the determinants of brand loyalty among existing and potential customers.

This topic is expected to become a priority in brand building, especially in fast-growing and emerging markets (Meyer, 2014). It is well accepted by scholars and practitioners in the marketing field that it is at least five times more cost efficient to retain the existing customers compared to attracting new customers (Oladele & Akeke, 2012). Brand loyalty is however, a much used and abused term. Although it is widely utilised, many scholars investigate different antecedents of brand loyalty, resulting in a lack of consistency in findings of the investigation (e.g. Thompson et al., 2010; Es, 2012; Sugiati et al., 2013; Kassim et al., 2014). The frequent assumption is that a satisfied customer is the reason for customer to repeat a purchase from the same supplier (Alex & Thomas, 2011; Chinomona & Sandada, 2013; Goel, 2014). However, many other factors could influence customers to repeat the purchase. Therefore, this investigation aims to bridge the research gap by exploring and examining key factors that influence brand loyalty, as well as the effect of technology anxiety on the relationship between brand service quality and brand value towards brand loyalty.

Literature Review:

Since 1950s, marketing researchers have conducted several research in the context of branding (Bastos & Levy, 2012) due to the importance of increasing sales (Li & Green, 2011). Historically, brand loyalty was explained only in terms of customer behavior (i.e. repeat purchase) and since 1969, Day launched a two dimensional concept which includes attitudinal and behavioural (Sivarajah & Sritharan, 2014). However, due to insufficient findings regarding the two dimensions of customer loyalty, researchers in the marketing field added another dimension known as composite (Kaur & Soch, 2013; Tabaku & Kushi, 2013). Therefore, the three dimensions (i.e. attitudinal, behavioral and composite) are necessary to understand and measure the level of brand loyalty (Chuah et al., 2014).

In an increasingly innovative and aggressive business environment, fierce competition exists between firms. One of the key factors of the success of firms is how the customers perceive the quality of service that is offered to them (Auka et al., 2013), as it determines their level of satisfaction (Ivanauskienė & Volungėnaitė, 2014). Therefore, it is important for firms to focus not only on improving the quality of their products to create an intention to purchase, but also to improve the quality of their services. In the past, little effort has been spent in maintaining a relationship with customers after they purchased goods in the retail business even though the brand service quality was found to encourage customers to do repeat purchase and remain loyal to the brand (Auka et al., 2013). Brand service quality is defined as the positive attitudes of customers towards a brand (Chinomona et al., 2013). Offering high quality service is not the only way to increase the level of brand loyalty among customers, as anxiety towards technological tools installed in cars also plays a vital role in influencing buyers’ brand loyalty.

In the business world of today, every company tries to grab the attention of their potential customers by embedding high value into their products. Brand value is an important element in gaining the competitive advantage (Sugiati et al., 2013). It could be defined as what customers think of the brand, including the gap between the price that the customers are willing to pay and the benefit gained from the products offered by the firms (Thaichon et al., 2013). Customers who view a product or service as having more value than their expectations will encourage them to do repeat purchase with the same company (Alex & Thomas, 2011; Goel, 2014) and it can be measured by examining whether this brand is offering a reasonable and fair price as well as giving a good value for the money spent in purchasing the product instead of the competitors (Auka et al., 2013). Focusing on brand value helps firms to maintain a longer relationship with customers as it builds trust towards the products’ brand (Hanzaee & Andervazh, 2012) that will finally lead to brand loyalty (Geçti & Zengin, 2013).

This study aims to add to this scant body of knowledge by including the variable technology anxiety when testing the level of brand loyalty among automotive consumers. Similar to other industries, the use of electronic components in the automotive industry has rapidly increased as multiple aspects of driving a modern automobile is controlled by advanced technological electronics such as acceleration, braking, security, and navigation (Osswald et al., 2012). Additionally, with the latest technology, auto manufacturers currently produce numerous fuel-efficient cars believed to be able to protect the environment, in response to reports that transportation is responsible for about 20 percent of the global greenhouse gas emissions released into the air (Benthem & Reynaert, 2015). Furthermore, technology can be used as one of the preventive tools in providing greater safety and avoiding theft (Laguador et al., 2013). Therefore, consumers prefer to purchase a safer car which includes additional safety features such as airbags, antilock brake systems, and anti-theft alarm systems.

More recently, researchers demonstrated the benefits of technology in the automotive industry, especially in providing safety in terms of information, safety environment and driving tasks assistance (Osswald et al., 2012). The message here is clear: A lower anxiety of technology increases trust towards a brand, while high anxiety reduces trust towards the brand. Once the customers place their trust in a brand, they intend to remain loyal to the brand. In relation to customer behaviour in technology-related industries, it is recognized that the relationship between the infrastructure of technology and customer intention is moderated by technology anxiety (Yang & Forney, 2013). Therefore, technology anxiety is believed to play a role in strengthening brand loyalty relationships.

In previous studies, researchers employed Technology Acceptance Model (TAM) and Car Technology Acceptance Model (CTAM) in order to measure the level of anxiety among users towards technology (e.g. Osswald et al., 2012; Gelbrich & Sattler, 2014). CTAM is an extension of Unified Theory of Acceptance and Use of Technology (UTAUT). The theory of UTAUT was primarily developed to explain and predict users’ acceptance towards technology from the context of the organization. Since the UTAUT model has only been used to measure anxiety in context of computers (Yang & Forney, 2013) and not from the context of other technological system such as technology usage in car (Osswald et al., 2012), CTAM has been introduced by Venkatesh et al. (2012) to further improve the explanatory power of the  model. Hence, to predict technology anxiety in the context of customers regarding the technology system installed in the cars, this investigation intends to revisit the predicting factors postulated by CTAM by introducing brand service quality and brand value to measure and analyze the technology anxiety among drivers.

Conceptual Framework and Hypothesis Development:

In line with the literature review and the purpose of this investigation, a proposed framework was constructed to investigate the indirect effect of brand service quality and brand value towards brand loyalty, with the moderating role of technology anxiety. The proposed model is depicted in... [cont.]

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# Success has nothing to do with what you gain in life or accomplish for yourself. It's what you do for others. -Danny Thomas

Love,

Dr SAA

Motivation to Study

Assalamu'alaikum wbt.. (^_^)

Alhamdulillah, by the grace of Almighty Allah (Azza wa Jalla), I've been blessed by a succesfull viva session with major correction last year (7 Sept 2017). Even I've got major correction, I'm really grateful to Allah for this rizq.

How are you guys? I hope you are in the pink of health. I leave you guys in the care of Allah, as nothing is lost that is in His care. This blog is actually an academic blog designed to channel some of the useful information to people who are researching on the behaviour of customers.

My research interests include customer relationship marketing, marketing management, and customer behaviour. If you have doubt in the area of customer behaviour, In sha Allah, I'll be gladful to help you guys since brand loyalty is my cup of tea. Sharing is caring, right? (^_^)

Success will come to people who are looking for it. So, learning process should be filled with trust. Even if you face a long and difficult journey, you should be patient to overcome it. Just enjoy the journey! Avoid cheating along the ways. This is because, cheating can automatically lower your self-respect and confidence. So, if someone caught you red-handed, you will lose their respect and trust.

Since there's no doubt that Allah Almighty is with those who are righteous and with those who acccompany righteous people, let's follow the right ways of life as it could bring you happiness. We as a Muslim need to differentiate between right and wrong and stand for the right and forbid the wrong so that we can achieve success in the true sense.

# Successful people take a chance; unsuccessful people are afraid of failure


Love,
Dr SAA