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An empirical examination of brand loyalty

An empirical examination of brand loyalty

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An empirical examination of brand loyalty

Jan Møller Jensen
Department of Marketing, University of Southern Denmark, Odense, Denmark, and

Torben Hansen
Department of Marketing, Copenhagen Business School, Frederiksberg, Denmark
Abstract Purpose – This article aims to measure relative attitude as a latent two-dimensional second-order factor and to investigate the relationship between relative attitude and repeat purchasing. Design/methodology/approach – A conceptual model of attitude-behaviour consistency and brand loyalty is proposed and empirically tested in the context of frequently purchased consumer goods. Structural equation modelling was used on survey data from 395 households to test the model and corresponding hypotheses. Findings – The results support the conceptualization of relative attitude as a composite of purchase involvement and perceived brand differences and also support the hypotheses proposed in our research model. Theoretical and managerial implications are discussed at the end of the article. Originality/value – Survey data from 395 households was used to test the model and corresponding hypotheses. Keywords Brand loyalty, Consumer goods Paper type Research paper

An executive summary for managers and executive readers can be found at the end of this article.

Introduction
Representing one of the most important factors believed to explain consumer brand choices, it is no surprise that the concept of brand loyalty has aroused an enormous interest among academics as well as practitioners within the field of marketing and consumer behaviour. Firms with large groups of loyal customers have been shown to have large market shares, and market share, in turn, has been shown to be associated with higher rates of return on investment (Buzzell et al., 1975; Raj, 1985; Reichheld and Sasser, 1990). Dick and Basu (1994) suggest that brand loyalty favours positive worth of mouth and greater resistance among loyal customers to competitive strategies. Obviously such findings encourage marketers to build and maintain brand loyalty among customers. When striving for such goals, information on factors determining the creation of brand loyalty among customers becomes an important matter. This article investigates the importance of the relative attitude to the determination of brand loyalty. Our empirical investigation focuses on the market of frequently purchased consumer goods. In relation to this, we agree with the dictum put forward by Rundle-Thiele and Bennet (2001) that “variation between the characteristics of each market indicates that the measures used to capture brand loyalty should be very different, as will the antecedent variables” (p. 28). Furthermore, by examining the relative attitude as an antecedent of repeat purchasing we assume a determinist
The current issue and full text archive of this journal is available at www.emeraldinsight.com/1061-0421.htm

Journal of Product & Brand Management 15/7 (2006) 442– 449 q Emerald Group Publishing Limited [ISSN 1061-0421] [DOI 10.1108/10610420610712829]

approach to brand loyalty rather than the more behavioural oriented stochastic approach (Odin et al., 2001). From a purely stochastic approach, brand loyalty is considered tantamount to repeat purchasing and grounded on no manifest factors determining the behaviour. It is impossible to detect any antecedents of repeat purchases, and therefore companies gain no understanding of how to build brand loyalty. From a determinist approach brand loyalty is conceptualised more like an attitude or intention to purchase and it is believed that the researcher can investigate the factors producing brand loyalty. Marketers investigating these factors may therefore gain valuable insights into the creation and retaining of brand loyalty among customers. Although the stochastic approach seems very useful for explaining consumer purchase behaviour of fast-moving consumer goods (e.g. powder, detergent, toothpaste etc.), we do believe that even for frequently purchased consumer goods the purchase decisions are rarely made on a purely arbitrary basis. Therefore, we lean to the composite definition of brand loyalty which was originally suggested by Day (1969) and later supported by other researchers (e.g. Jacoby, 1971; Dick and Basu, 1994; Assael, 1998). Jacoby (1971) defines brand loyalty as repeat purchase but clearly points out that this behaviour is a function of psychological processes. In other words, repeat purchase is not just an arbitrary response but the result of some proceeding factors (for example psychological, emotional or situational factors). Likewise Dick and Basu (1994) point out that even a relatively important repeat purchase may not reflect true loyalty to a product but may merely result from situational conditions such as brands stocked by the retailer. In their framework, attitude is a requirement for true loyalty to occur. Consequently, they define repeat purchasing without a favourable attitude as spurious loyalty. Similar thoughts are found in Assael (1998) who conceptualizes brand loyalty as repeat purchase under high involvement and defines repeat purchase under low involvement as inertia. The relationship between attitude and behaviour is well accepted among consumer researchers although this relationship appears to be 442

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Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

most likely when applied to high involvement situations (Ajzen and Fishbein, 1980). Assuming that, even with regard to frequently purchased consumer goods, some consumers will exert more involvement to the purchase decision than others, this article investigates the relationship between relative attitude and repeat purchasing. Understanding the role of relative attitude to brand loyalty is important for brand managers in order to enhance and maintain consumers’ repeat purchasing of their brand. Only if an increase in relative attitude results in an increase in repeat purchase it is meaningful for marketers seeking to influence repeat purchasing through attitude building marketing strategies.

Model development and research hypotheses
Figure 1 presents our conceptual model of loyalty formation focusing on the relationship between relative attitude and repeat purchasing. We adopt the composite perspective of brand loyalty first suggested by Day (1969) and later supported by other researchers (e.g. Jacoby, 1971; Dick and Basu, 1994). The composite approach to loyalty claims that to be truly loyal the consumer must hold a favourable attitude toward the brand in addition to repeat purchasing it. Accordingly, we suggest that relative attitude positively influence repeat purchasing. However, in our research model we do not expect a direct influence from relative attitude on repeat purchases but rather hypothesise relative attitude to have an indirect influence on repeat purchase through variety-seeking and enhancing resistance to situational factors. More precisely we expect higher relative attitude to have a negative effect on the consumer’s tendency towards variety-seeking and a positive effect on the consumers resistance to situational factors triggering brand switching (e.g. “out-of stock” situations). The concept of relative attitude as well as the hypothesised relationships is further discussed in the following sections. Relative attitude as a two-dimensional construct As explained in the Methods section, we conceptualise relative attitude as a latent second order factor composed of two dimensions; purchase involvement and perceived brand Figure 1 Conceptual model and research hypotheses

differences. The rationale for the inclusion of these two dimensions as components of relative attitude is found in Dick and Basu (1994). According to Dick and Basu (1994) attitudinal differentiation is a prerequisite for a high relative attitude. If the consumer is unable to differentiate among alternatives and/or sees no or very few differences among alternatives, relative attitude will be low with absence of true loyalty as a consequence. This view is supported by Muncy (1996) who emphasizes that in the absence of perceived differences between brand alternatives it will be difficult to build brand loyalty. Dick and Basu (1994) further argue that relative attitude is at its highest on condition of high attitudinal strength. In our model we suggest attitudinal strength to be represented by the concept of purchase involvement. The role of involvement as an important factor in loyalty formation has been investigated and to some degree supported by consumer researchers (Quester and Lim, 2003). An experimental study focusing on the relationship between product involvement and brand loyalty (LeClerc and Little, 1997) concludes that repeat purchasing of high involvement products reflects true loyalty, whereas repeat purchasing of low involvement products is simple habitual purchase behaviour. Yet, other researchers (e.g. Traylor, 1983) have questioned the definition of high and low involvement products suggesting that it is up to the consumer and not to the product to decide the involvement degree of a purchase decision. For example, a person with great interest and experience in wine may be highly involved in the product category wine without necessarily feeling highly involved when purchasing a bottle of wine. Conversely, an individual purchasing a detergent to be used for washing an expensive blouse may experience high risk and feel highly involved in choosing the right brand of detergent. Thus, in order to investigate the influence of involvement on brand loyalty a purchasing-related conceptualization of consumer involvement seems more appropriate. Additionally, as argued by Quester and Lim (2003), involvement should not be investigated in a dichotomous form (e.g. high or low involvement) but rather as a continuum. Thus, in our model we view involvement as a purchase-related concept representing a consumer’s subjective perception of how important (involving) the outcome of a

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purchase within a particular product category is to the consumer. Purchase involvement is believed to range within a scale continuum and to be one of two dimensions comprising the concept of relative attitude. Relative attitude and variety-seeking When studying consumers’ variety-seeking behaviour, it is important to distinguish “true” variety- seeking behaviour from extrinsically motivated brand switching (Van Trijp et al., 1996). Van Trijp et al. (1996) argue that brand switching behaviour should only be attributed to true variety-seeking when variation is aimed at for its own intrinsic value and for the stimulation it brings to the situation. Consumers’ need for something to reduce boredom or a need for sensory stimulation by exploring new product variants (e.g. a differently flavoured coffee) are examples of true varietyseeking. Van Trijp et al. (1996) provide empirical evidence for variety-seeking to be more likely when involvement is lower, when smaller brand differences are perceived among choice alternatives and when consumers brand preferences are lower. On the basis of these considerations, we hypothesize H1. Relative attitude influences variety-seeking negatively. Relative attitude and resistance to situational factors In addition to the above mentioned intrinsical motivation for brand switching Van Trijp et al. (1996) call attention to the extrinsically motivated or derived brand switching behaviour caused by situational factors (e.g. friends recommending alternative brand, usual brand sold out or not stored by the retailer, competitors’ brand on sale). The authors further hypothesise that brand switches caused by external factors are more likely to happen in circumstances of low involvement purchasing and in situations where perceived differences among brands are small. Emmelheinz et al. (1991) found that perceived risk of purchasing another brand than the preferred one (e.g. high relative attitude) reduced the likelihood of switching brand. In a similar way, Dick and Basu (1994) propose that a consumer with a strong relative attitude will be more likely to overcome countervailing social norms and/or situational influences. Therefore we expect a consumer with high relative attitude to be less alert to competitors’ price offers and more likely to postpone purchases or to patronise another store if the usual brand is sold out. We therefore propose the following hypothesis: H2. Relative attitude influences resistance to situational factors positively. Variety-seeking and resistance to situational factors Intuitive consumers intrinsically motivated for brand switching will more actively be in search for alternative brands and therefore pay more attention to offers from the competition. Further they will be more likely to give up their usual brand in case of out of stock situations. Van Trijp et al. (1996) find that variety-seeking tendency seems to influence consumers’ response to out of stock situations. We therefore propose consumers with a higher level of true variety-seeking will be less resistant to situational factors and we forward the following hypothesis: H3. Variety-seeking influences resistance to situational factors negatively. Variety-seeking and repeat purchasing As mentioned above brand switches may result from consumers’ need to reduce boredom or a need for sensory 444

stimulation by exploring new product variants. Thus, suggest the following hyphothesis: H4. Variety-seeking influence repeat purchasing negatively. Resistance to situational factors and repeat purchasing In today’s market environment, particularly on the frequently purchased consumer goods market, many marketers are switching promotional spending from advertising to sales promotion, including in-store displays, shelf-space and price reductions. The axiom behind this is that although advertising creates brand loyalty, sales promotion creates brand switching. This axiom stems from a common belief that when consumers experience fewer differences between alternatives, they become more price sensitive and thus more vulnerable to competitive brands on sale. Yet, in our conceptual model we suggest that enhancing consumers’ resistance to situational factors (through building higher relative attitudes) is a possible and perhaps more sustainable way to increasing or maintaining repeat purchasing. Hence, we propose this hypothesis: H5. Resistance to situational factors influence repeat purchasing positively.

Data collection
The data used in this paper were obtained as part of a large survey of brand loyalty. Data were collected in Odense, the third largest city in Denmark, situated on the island of Funen. Random sampling using the Odense telephone directory drew 600 phone numbers. Households were first contacted by phone in order to get their acceptance of participation and to set up an appointment for distribution of questionnaires. Questionnaires were distributed to the respondents by use of the “drop-off-call-back” method (e.g. Hair et al., 1998). The following six non-durables were investigated: shampoo, toilet paper, coffee, chocolate, tooth pasta and washing powder. In order to improve response rate it was decided to split the product sample into two identical questionnaires including only three non-durables each. For each product category the respondents were asked various questions concerning their attitudes to and actual purchase of the products. Additionally there were a number of questions concerning household demographics and general purchase patterns. 348 questionnaires were returned leaving us with a potential of 1,046 product cases to be analysed. However, for each of the investigated products we decided only to include answers from persons indicating that they had at least sharing influence on brand decision and that they usually bought this product for the household. Furthermore, cases with “don’t know” responses to any items to be included in the measurement model were excluded. The application of these procedures resulted in a total of 395 cases, distributed across product types in a satisfactory way (all products were represented by 46 to 78 cases).

Measurements
Repeat purchasing is measured by a single item. In this study we asked respondents for each product category, to indicate how many times of the last five purchases they bought the same brand. Although we recognize that this is a measure of past behaviour, we believe that such a measure is a reasonable indicator for future repeat purchasing. An alternative way to measure behavioural loyalty could be the perceived probability

An empirical examination of brand loyalty Jan Møller Jensen and Torben Hansen

Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

of purchasing the same brand in the future (Jacoby and Chestnut, 1978). Considering the weak relationship between attitude and behaviour often found in studies of low involvement situations, such an indicator would neither be a very reliable measure of future repeat purchasing, particularly not with regard to frequently purchased goods markets. Except for repeat purchasing, all constructs in our conceptual model are latent unobservable variables. In order to obtain reasonable accurate measures of such constructs it is recommended to developed multi-item scales including two or more items. In our study we created scales with two or three items, mostly adapted from previous research. Each construct and its corresponding items is displayed in the Appendix. All items were measured on a seven-point Likert-like scale ranging from 1 ¼ “completely disagree” to 7 ¼ “completely agree”. Dick and Basu (1994) conceptualize relative attitude as a composite of attitudinal strength and attitudinal differentiation. In their GRID-model the two dimensions are treated as independent constructs. Dick and Basu (1994) do not question the assumption of independency, nor do they suggest how to measure the two constructs. In this study we suggest attitudinal strength and attitudinal differentiation to be represented by purchase involvement and perceived brand differentiation respectively and propose relative attitude to be a latent variable (or function) comprised of these two subdimensions. To accomplish this measurement we will specify a second-order factor model, which suggests that the second-order factor “relative attitude” is a composite (or function) of the first-order factors “purchase involvement” and “perceived brand differentiation”. Purchase involvement was assessed by Ratchford’s (1987) three-item involvement scale. The three items are shown as INV1 to INV3 in the Appendix. Considering perceived brand differences as the opposite to the concept of brand parity we adapted three items from Muncy’s (1996) five-item scale of perceived brand parity. The three items are named PBD1 to PBD3 in the Appendix. In order to measure consumers’ resistance to situational factors we use two items from Munchy (1996). The two items are named RSF1 and RSF2 in the Appendix. Variety-seeking is measured with two items framed with reference to Van Trijp et al. (1996) and is referred to as VS1 and VS2 in the Appendix.

Results
The model in Figure 1 was translated into a LISREL model consisting of a measurement part (confirmatory factor analysis) and a structural equation part (simultaneous linear regression). The relationship between variables was estimated by maximum likelihood estimation. A two-stage approach (see Anderson and Gerbing, 1988; Gerbing and Anderson, 1992) tested the proposed model. First, conducting confirmatory factor analysis on the applied multi-item scales developed the measurement model. Next, the measurement model and the structural equation paths were estimated simultaneously to test the proposed model (overall model). By applying this two-stage method we want to ensure that the measures of the constructs are reliable and valid before attempting to draw conclusions about relations between constructs. Measurement model An initial confirmatory factor analysis revealed an offending estimate as the loading of “purchase involvement” on “relative 445

attitude” was greater than 1.0 (producing a corresponding negative variance to the construct). Since such an estimate is not theoretically appropriate, it was necessary to solve this problem before the results from the conducted confirmatory factor analysis could be examined. To solve the problem we decided to fix the variance of the concept “involvement” to a small positive figure (here 0.1), as recommended by several researchers (e.g. Hair et al., 1998). Table I shows the results of the confirmatory factor analysis (CFA). The aim of CFA is to verify the factor structure as proposed. Prior to examining results from elaborating on the figures in Table I we call attention to the fact that x2 (df ¼ 37) ¼ 122.82 is highly significant ( p , 0.001) indicating that the model fails to fit in an absolute sense. However, since the x2-test is very powerful for large sample sizes, even a good measurement model could be rejected. Thus, several writers (e.g. Hair et al., 1998) recommend that for sample sizes greater than 200 the x2-measure should be complemented with other goodness-of-fit measures as for example GFI and RMSEA. The GFI value (0,955) is well above the recommended 0.90 threshold level. RMSEA, which is less dependent on sample size, constitutes a measure of fit between the proposed model and the population covariance matrix. Brown and Cudeck (1993) suggest that RMSEA less than or equal to 0.05 indicates a good fit, RMSEA between 0.05 and 0.08 a fair fit, and values in the range of 0.08 and 0.10 indicate mediocre fit. RMSEA for our measurement model is 0.074, which is below the 0.08 threshold level and thus indicates an acceptable fit (Brown and Cudeck 1993; Hair et al. 1998). To conclude, the results indicate an acceptable overall fit between the model and the observed data. All other fit measures, including AGFI, CFI, NFI and TLI, also show acceptable (. 0.90) results. All factor loadings were highly significant (t-value . 2.64; p , 0.01), which demonstrate that the chosen generic questions for each latent variable reflect a single underlying construct. The reliabilities and variance extracted for each variable indicate that the model was reliable and valid. All composite reliabilities exceed 0.70 and all variance-extracted estimates were above 0.50, indicating an acceptable level of unidimensionality. The reliabilities and the estimates of extracted variance were computed, using indicator standardized loadings and measurement errors (Hair et al. 1998; Shim et al. 2001). These model considerations indicate that the constructs do exist and that they are tapped by the measures used. Discriminant validity of the applied constructs was tested applying the approach proposed by Fornell and Larcker (1981). In Table II, the diagonals represent for each construct the variance extracted as reported in Table I. The other entries represent the squares of correlations among constructs (i.e. the shared variance among constructs). An examination of the matrix displayed in Table II shows an acceptable level of discriminant validity of constructs. Extracted variance of each construct (displayed as diagonal entries) is higher or equal to the shared variance between constructs (displayed as non-diagonals) except for resistance to situational factors sharing a relative high amount of variance with relative attitude and variety-seeking as well (variance_resistance to situational factors ¼ 0.65 , squared correlation_ relative attitude – resistance to situational factors ¼ 0.73; variance_variety-seeking ¼ 0.56 , squared correlation_variety-seeking – resistance to situational factors ¼ 0.58). Yet, these correlations are below the suggested threshold of 0.85 (see Frambach et al.,

An empirical examination of brand loyalty Jan Møller Jensen and Torben Hansen

Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

Table I Confirmatory factor analyses results (n ¼ 395)
Construct/indicator Standardized factor loadinga 0.883 0.964 0.572 0.825 0.789 0.873 0.673 0.593 0.900 0.555 0.792 0.822
2

Standard error – 0.138 – 0.131 0.118 – 0.062 0.053 – 0.057 – 0.064

t-value

Construct reliabilityb 0.921

Extracted variancec 0.855

j1 Relative attitude h1 Involvement h2 Perceived brand differences h1 Involvement I1 I2 I3 h2 Perceived brand differences PBD1 PBD2 PBD3 h3 Variety-seeking VS1 VS2 h4 Resistance to situational factors RSF1 RSF2
2

10.427 0.777 11.567 11.345 0.761 13.707 11.848 0.706 9.416 0.789 16.264 0.651 0.559 0.522 0.543

x 5 122.82; p < 0.001 x /DF ¼ 3.149 RMSEA 5 0.074 GFI 5 0.947; AGFI 5 0.911; CFI 5 0.955; NFI 5 0.936; TLI 5 0.936 Notes: aThe first item for each construct was set to 1; bCalculated as S(Std. Loadings)2/S(Std. Loadings)2 + Sjj; cCalculated as SStd. Loadings2/SStd. Loadings2 + S jj

Table II Discriminant validity of constructs
Construct 1. Relative attitude 2. Variety-seeking 3. Resistance to situational factors 1 0.86 0.56 0.73 2 0.56 0.58 3

Table IV Results of the structural equation model (n ¼ 395) (Part 2)
Explained proportion of construct variance 0.65 Resistance to situational factors Variety-seeking Repeat purchasing Squared multiple correlations (R2) 0.76 0.55 0.21

Note: Diagonals represent average amount of extracted variance for each construct; non-diagonals represent the shared variance between constructs (calculated as the squares of correlations between constructs)

Notes: x2 (38) ¼ 117,21, p ¼ 0.000; x2/DF ¼ 3,08; CFI ¼ 0.957; NFI ¼ 0.939; GFI ¼ 0.948; TLI ¼ 0.938; RMSEA ¼ 0.073; HOELTER(0.05) ¼ 180; HOELTER(0.01) ¼ 206

1998). Also, considering the hypothesized paths from both relative attitude and variety-seeking towards resistance to situational factors (see H2 and H3), these relatively high correlations are not surprising. Overall model fit Tables III and IV display the results of testing the proposed theoretical model. The results of the structural equation Table III Results of the structural equation model (n ¼ 395) (Part 1)
Hypotheses H1 H2 H3 H4 H5 Construct relationships Relative attitude ! Variety-seeking Relative attitude ! Resistance to situational factors Variety-seeking ! Resistance to situational factors Variety-seeking ! Repeat purchasing Resistance to situational factors ! Repeat purchasing

modelling reveal that the x2 for the estimated model was 122.82 (df 39; p , 0.001). This result indicates that the model fails to fit in an absolute sense. However, as mentioned above, the x2-measure should be complemented with other goodnessof-fit measures. The results of the full model (structural and measurement models) indicate a good fit (GFI: 0.95; AGFI:

Estimates of structural equation coefficients 2 0.743 0.621 2 0.303 2 0.104 0.370

Standard error 0.135 0.164 0.084 0.075 0.081

t-value
29.57 * 6.12 * 23.34 * 21.05 3.72 *

Test-results Accept Accept Accept Reject Accept

Notes: x2 (38) ¼ 117,21, p ¼ 0.000; x2/DF ¼ 3,08; CFI ¼ 0.957; NFI ¼ 0.939; GFI ¼ 0.948; TLI ¼ 0.938; RMSEA ¼ 0.073; HOELTER(0.05) ¼ 180; HOELTER(0.01) ¼ 206; *Significant at the 0.01 level

446

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Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

0.91; NFI ¼ 0.94; CFI ¼ 0.96 and RMSEA 0.07) providing acceptable support for the model as proposed. Hypotheses testing The structural equation results reveal that 21 per cent of the variance in repeat purchasing can be explained by the proposed model (refer to the R2 figure in Tables III and IV). Most of the explained variance in repeat purchasing is produced by consumers’ resistance to situational factors (H5: standardized coefficient ¼ 0.370; t ¼ 3.72; p , 0.01). Surprisingly, the path from variety-seeking to repeat purchasing is not significant. In other words we find no support for our hypothesis with respect to this association (H4: standardized coefficient ¼ 2 0.104; t ¼ 2 1.05; p . 0.05). However, variety-seeking has a significant negative effect on consumers’ resistance to situational factors (H1: standardized coefficient ¼ 20.303; t ¼ 2 3.34; p , 0.01). As hypothesised, relative attitude has a significant negative effect on variety-seeking (H1: standardized coefficient ¼ 2 0.743; t ¼ 2 9.57; p , 0.01) and a significant positive effect on resistance to situational factors (H2: standardized coefficient ¼ 0.621; t ¼ 6.12; p , 0.01). 55 per cent of the variance in variety-seeking is explained by relative attitude and 76 per cent of the variance in resistance to situational factors is explained by relative attitude and variety-seeking (refer to figures on R2 in the lower part of Table II). These results show that relative attitude plays an important role in explaining consumers’ need for variety-seeking and in enhancing consumers’ resistance to situational factors as well.

enhance relative attitudes towards their brand. First, marketers should try to increase consumers’ purchase involvement, for example trying to relate the consumption situation to consumers’ value system. Second, marketers should clearly differentiate their own brand from competing alternatives by telling the consumer why and how their brand is better than alternative brands. Within certain product categories (e.g. food products) consumers are more likely to seeking variations in their purchases. Since consumers’ tendencies to variety-seeking make them more alert to offers from competing brands, it is important for marketers competing on such markets to expand their product lines (e.g. tee products with many different flavours) making it possible for the consumer to vary their purchase experiences without having to switch brands.

Limitations and future research directions
Our study is focusing on the frequently purchased consumer goods market, and the results may therefore not necessarily be generalised to other market types. Other studies should test our model on other market types. Also, our results are limited by the nature of measuring repeat purchases. In this study we asked respondents for each product category to indicate how many times of the last five purchases they bought the same brand. Although we recognize that this is a measure of past behaviour we believe that such a measure is a reasonable indicator of future repeat purchasing. An alternative operationalisation of behavioural loyalty could be the perceived probability of purchasing the same brand in the future (Jacoby and Chestnut, 1978). Considering the weak relationship between attitude and behaviour often found in studies of low involvement situations, such an indicator would neither be a very reliable measure of future repeat purchasing, particularly not with regard to frequently purchased goods markets. Further research may wish to investigate brand loyalty through longitudinal studies.

Summary and implications
The results of our study confirm to a large extend the proposed hypotheses and suggest a number of important managerial implications for consumer researchers and brand managers. First, to the best of our knowledge, this is the first study that attempts to measure relative attitude as a second factor composite of perceived brand differences and purchase involvement. Considering the high reliability (alpha ¼ 0.92) and predictive validity (see the acceptance of H1 and H2) found in our conceptualisation and measurement of relative attitude, the results lend some support to Dick and Basu’s (1994) two dimensional conceptualisation of relative attitude. Second, as hypothesised relative attitude has a significant influence on variety-seeking as well as resistance to situational factors, providing support for some of the propositions forwarded by Dick and Basu (1994). Third, although resistance to situational factors turns out to be the most important factor in predicting repeat purchasing, separating intrinsically motivated variety-seeking from extrinsically imposed brand switching, reveals that consumers’ varietyseeking tendencies may play a mediating role inhibiting resistance to situational factors. The results have implications for brand managers, especially with respect to marketing frequently purchased consumer goods. The results show that consumers with a high relative attitude are less prone of variety-seeking, more resistant to out of stock situations and competitors offers, and consequently more likely to keep loyal to their usual brand. Thus, it is still possible for marketers to create loyal consumers by building positive attitudes towards their products. Our conceptualisation and measurement of relative attitude as a composite of purchase involvement and perceived brand differences suggest two ways for marketers to 447

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An empirical examination of brand loyalty Jan Møller Jensen and Torben Hansen

Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

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Appendix. Scale items used in the study
INV1 Our choice of ________ is a very important decision INV2 Buying ________ requires a lot of thoughts INV3 It’s not a big deal if a wrong brand of ______ is chosena PBD1 I can’t think of many differences between the major brands of _______a PBD2 To me, there are big differences between the various brands of _______ PBD3 _____ is _____, most brands are basically the samea RSF1 If a brand of ______ other than the one I usually purchase was on sale, I would probably buy ita RSF2 I the store were out of my favourite brand of ______, I would rather postpone my purchase than trying another brand VS1 Buying ______, I would rather stick with a brand I usually buy than try something elsea VS2 I enjoy buying another brand of _______ just to get some variation in my purchases Notes: All items were measured on a five-point Likert scale from 1 ¼ totally disagree to 5 ¼ totally agree; aReversed score

About the authors
Jan Møller Jensen is an Associate Professor at the Department of Marketing, University of Southern Denmark, Odense. He received his PhD at the University of Southern Denmark, Odense, in 1990. Jan Møller Jensen has taught “Theory of Consumer Behaviour” and “Quantitative Market Analysis” for several years and his research up to now also reflects his interest in those two disciplines. His research focuses on a wide range of topics in consumer behaviour, including family decision making, consumer purchasing on the Internet, brand loyalty, and consumer behaviour in Tourism. He has worked as a consultant for Ad agencies and Marketing Research firms. Jan Møller Jensen is the corresponding author and can be contacted at: jmj@sam.sdu.dk Torben Hansen is a Professor at the Department of Marketing, Copenhagen Business School. His main fields of research are consumer behaviour and marketing research methods. He has published a number of books within these areas and his papers have appeared in various academic journals, including Journal of Consumer Behaviour, Journal of International Consumer Marketing, Journal of Euromarketing, International Journal of Information Management, International Journal of Retail & Distribution Management, British Food Journal, The International Review of Retail Distribution and Consumer Research, Journal of Retailing and Consumer Services, Journal of Food Products Marketing, The Marketing Review, and the European Management Journal. In 1998 Torben Hansen 448

Further reading
Baldinger, A.L. and Rubinson, J. (1996), “Brand loyalty: the link between attitude and behaviour”, Journal of Advertising Research, Vol. 36, pp. 22-34. Cunningham, R.M. (1956), “Brand loyalty – what, where, how much?”, Harvard Business Review, Vol. 34, pp. 116-28.

An empirical examination of brand loyalty Jan Møller Jensen and Torben Hansen

Journal of Product & Brand Management Volume 15 · Number 7 · 2006 · 442 –449

received the Copenhagen Business School Gold Medal. Torben Hansen has worked as a consultant for various organisations dealing with consumer behaviour and/or with marketing research methods.

Executive summary
This executive summary has been provided to allow managers and executives a rapid appreciation of the content of this article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benefit of the material present. A missing ingredient deep within your mix Not all of your customers are the same. Intuitively this is not a difficult point to understand. It probably feels like a statement of the blindingly obvious. As marketers generations of thinking about market segmentation has surely defined and redefined over many years how we have come to view and relate to our customers. Brand loyalty is essential for businesses to grow over the medium to long term. This is also not the most controversial statement ever, although some might still dispute it. Firms with large groups of loyal customers have been seen to grow into having large market share and been able to provide good returns to their investors. Again, it has been a rich source of inquiry for academics and practitioners alike. Loyal customers are likely to be resistant to the machinations of competitors. They are likely to tell family, friends and colleagues of the wonders the products perform. When they need what is on offer they are very likely to come back and buy it again. Combining the need to understand our customers, with the need to understand what makes them loyal customers is not too much of a stretch. After all, at its most basic marketing is about understanding customer needs and supplying them with goods and services that fill the void. Yet there has been something missing. Decisions to make purchases are not arbitrary ones that people make, even when, as in the case of toothpaste, they are making the same decision time after time. A Danish study focusing on frequently purchased consumer goods by Jensen and Hansen of the University of Southern Denmark and Copenhagen Business School respectively points to a key, under-researched ingredient at work, that of consumers’ relative attitude towards a given brand. Increasing consumers’ repeat purchasing patterns Researchers have long considered the correlation between attitude and behaviour, most frequently explored in high involvement situations. Buying frequently purchased consumer goods is not exactly a classic high involvement scenario. For many consumers a trip to the supermarket can be a case of putting the mind into neutral while filling the trolley with all of the usual products. Not everyone wants to rethink thirty or forty different purchasing decisions. Yet some will exert more involvement in the purchasing decision than others, so repeat purchases don’t just happen. A customer who knows a lot about wine may take time and trouble over that purchase because it is seen as an important one. A customer who knows nothing about detergent may

take similar time and trouble. This time it is in order not to make a gaffe. This is where relative attitude to brand loyalty becomes the issue to consider. Increasing customers’ relative attitude towards your brand increases their repeat purchasing behaviour. Marketers can influence this by focusing on attitude building marketing strategies. For relative attitude to be high, customers must be able to differentiate among alternative products and brands. Where such differences are not distinguishable it is hard to build brand loyalty. For Jensen and Hansen, the issue is not just one of understanding, but of relating this to consumer purchasing decisions. This they were able to do by exploring five dimensions. 1 Relative attitude and variety-seeking – which falls into two major areas, brand switching behaviour and customers seeking more product variety to alleviate boredom with the status quo (more likely when involvement is lower). 2 Relative attitude to situational factors – such as friends recommending an alternative or the usual brand being sold out and an alternative being all that is available. Consumers with high relative attitude are likely to be less alert to price offers from competitors and more likely to put off a purchase if their preferred brand is sold out. 3 Variety-seeking and resistance to situational factors – customers who have a high propensity towards variety seeking are more likely to buy alternative products during stock-out situations and be more alert to offers from other suppliers. 4 Variety-seeking and repeat purchasing – which can result from customers needing to reduce boredom with current products or in some way be stimulated. 5 Resistance to situational factors and repeat purchasing – marketers spend on advertising (which tends to build brand loyalty) but also on store promotions (which tend to encourage switching behaviour). Reducing customer’s resistance to situational factors that cause switching may be a more sustainable way to grow. The survey reveals that it is indeed possible for marketers to build success by creating positive attitudes to their brands among target consumer groups. In predicting success, situational factors are the most important ones in determining repeat purchasing behaviour. However, in examining these, the effects of the competition should be differentiated from consumers’ own desires to have a change. While companies can craft strategies that encourage customers not to be tempted by the offers being made by the competition, the need for variety that consumers exhibit is a mitigating factor to consider. That said, customers with a high relative attitude are much more likely to stick with your brand, even when it is not available. So working on building high relative attitude among the largest number of customers is an area for brand managers to focus on, and from that base see improvements in repeat purchases and customer loyalty. If customers want variety, make it possible for them to have it by providing it, and not by switching brands. ´ (A precis of the article “An empirical examination of brand loyalty”. Supplied by Marketing Consultants for Emerald.)

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