Factors Affecting Brand Loyalty on Smartphone In Nepal

A Project Report

Submitted To:
Office of People’s Campus
BBA Programme
Faculty of Management
Tribhuvan University

Submitted By:
Sec A Group A
Batch 13th
BBA Programme

In the partial fulfillment of the course on Business Research Methods

Bachelors of Business Administration

Kathmandu
July, 2016
 DECLARATION

We, the undersigned, to the best of our knowledge, declare that this research report
entitled ‘Factors affecting brand loyalty on smartphone in Nepal’ is submitted in
partial fulfillment of the requirements for the course Bachelors of Business
Administration and is our original work. It contains neither material previously
published by other person nor material which has been accepted for the award of any
other degree of the University, except where due acknowledgment has been made in
the text.

Zenith Singh Rajbanshi

Umit Siddhi Tuladhar

Satish Maharjan

Sabin Maharjan

Nikesh Dangol

Anoj Adhikari

Prateek Bhuju

Anuj Shrestha

Binayak Das

Bishal Aryal

Rabin Osti

ii
 ACKNOWLEDGEMENT

This study has been prepared for partial fulfillment of Bachelors of Business
Administration (BBA). It is our privilege to complete this study entitled “Factors
affecting brand loyalty on Smart phones in Nepal.”

It is our pleasure to express our sincere gratitude to Mr. Bikash Shrestha Sir for his
support throughout the research process. He had devoted his valuable time and efforts
in patiently guiding us to complete this project. His wide knowledge and logical way of
thinking have created a great value to us. Besides, his understanding, encouraging and
personal guidance has provided the good basis for this present form of project report.
Therefore, we would like to convey our special thanks to him for his valuable inputs.

We would like to express our profound gratitude to co-coordinator Rameshwor

Karmacharya sir and Mr.Keshav Paudel sir for their guidance and encouragement
throughout the completion of this project work. Similarly we would like to express
special thanks to Mr Netra Bahadur Swar sir and Mr. Pradip Kharel sir for providing
the guidance while developing the questionnaire for the study.

Furthermore, we would like to express special thanks to Mr.Laxmi sir for his
continuous effort and help from the time of doing the project work till its completion.
Also, would like to thanks all respondents, who spent their valuable time in filling out
the questionnaire. With the help and support by respondents, we have successfully
completed the part of questionnaire.

Lastly, we thank almighty, all the group members for their constant encouragement and
effort without which this assignment would not have been possible.

Group A, Sec A

BBA Programme

People’s Campus

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 TABLE OF CONTENTS

Pages

Declaration...................................................................................................................... ii

Acknowledgement ......................................................................................................... iii

Table of Contents .......................................................................................................... iv

List of Tables ................................................................................................................ vii

List of Figures ..............................................................................................................viii

Acronyms ...................................................................................................................... ix

CHAPTER I: INTRODUCTION .............................................................................. 1-8

1.1 Background of Study ........................................................................................... 1

1.2 Statement of Problem ........................................................................................... 6

1.3 Objective of the Study ......................................................................................... 7

1.4 Organization of the Study .................................................................................... 8

CHAPTER II: REVIEW OF LITERATURE ........................................................ 9-26

2.1 Review of Theories .............................................................................................. 9

2.1.1 Multidimensional Theory of Brand Loyalty .......................................... 10

2.1.2 Aaker's Brand Equity Theory ........................................................................... 16

2.2 Review of Empirical Studies ............................................................................. 19

2.3 Theoretical Framework ...................................................................................... 24

2.4 Hypotheses of the Study .................................................................................... 25

CHAPTER III: RESEARCH METHODOLOGY ............................................... 27-35

3.1 Research Design................................................................................................. 27

3.2 Population and Sample of the Study ................................................................. 28

3.3 Nature and Sources of Data ............................................................................... 29

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 3.3.1 Primary Data .......................................................................................... 29

3.4 Definition of Variables ..................................................................................... 30

3.5 Method of Analysis ............................................................................................ 32

3.5.1 Mean ....................................................................................................... 32

3.5.2 Media ...................................................................................................... 32

3.5.3 Mode....................................................................................................... 33

3.5.4 Standard deviation .................................................................................. 33

3.5.5 Variance ................................................................................................. 34

3.5.6 Correlation .............................................................................................. 34

3.5.7 Regression Analysis ............................................................................... 35

CHAPTER IV: PRESENTATION AND ANALYSIS OF DATA ......................36-53

4.1 Analysis of Primary Data ................................................................................... 36

4.1.1 Respondent's Profile ............................................................................... 37

4.1.2 Multiple Choice Questions ..................................................................... 38

4.1.3. Information on the Currently Using Samrtphone Brand ........................ 38

4.1.4 Duration of the Smartphone ................................................................... 39

4.1.5 Reason Behind Using the Same Brand .................................................. 40

4.1.6 Level of Satisfaction............................................................................... 41

4.1.7 Opinion on Factor Affecting Brand Loyalty .......................................... 41

4.1.8 Perception of People on Different Factors of Brand Loyalty................. 43

4.1.9 Correlation Analysis ............................................................................... 46

4.1.10 Correlation Analysis across Moderating Variables................................ 47

4.1.11 Regression Analysis ............................................................................... 49

4.1.12 Independent Sample t-test ...................................................................... 51

4.1.13 Acceptance or Rejection of Hypotheses................................................. 53

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CHAPTER V: SUMMARY, CONCLUSION AND DISCUSSION ...................54-58

5.1 Summary ............................................................................................................ 54

5.2 Conclusion ......................................................................................................... 57

5.3 Discussion .......................................................................................................... 57

References

Appendix 1

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 LIST OF TABLES

Table No. Name of Table Pages

4.1 Respondents’ Profile ................................................................................... 37

4.2 Multiple Choice Question on Factors of Brand Loyalty ............................. 38

4.3 Different Brand Used by the Customers ..................................................... 39

4.4 Change of Smartphone by the Customers ................................................... 39

4.5 Reason behind Using the Same Brand ........................................................ 40

4.6 Levels of Satisfaction .................................................................................. 41

4.7 Opinion on Factor Affecting Brand Loyalty ............................................... 42

4.8 Perception of the People on Different Factors of Brand Loyalty ............... 44

4.9 Correlation Analysis ................................................................................... 46

4.10 Correlation Analysis for Moderating Variables .......................................... 48

4.11 Regression Analysis for the Variables ........................................................ 50

4.12 Independent Sample t- test .......................................................................... 51

4.13 Acceptance or Rejection of Hypothesis ...................................................... 53

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 LIST OF FIGURES

Figure No. Name of Figure Pages

2.1 A Schematic diagram of the conceptual framework ................................... 24

viii
 ACRONYMS

BL : Brand Loyalty

BN : Brand Name

TV : Television

Md : Median

SD : Standard Deviation

R : Correlation Coefficient

Var : Variance

CONSUMER_BB : Consumer Buying Behavior

ADV : Advertisement

CONSUMER_A : Consumer Awareness

i.e. : That is

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 CHAPTER I

INTRODUCTION

1.1 General Background

A revolutionary and magical product that is literally five years ahead of any other

mobile phone, the guardian (2012). Smartphone is not just a simple mobile phone;

rather it has an extensive data storage capacity and processing power (Leyland, et al.,

2010). The Smartphone has moved the data processing power to in the hands of mobile

users, who can use the mobile device irrespective of time and space (Leyland, et al.,

2010). According to Euromonitor 2010, Smartphone contains functions such as instant

messaging, downloading applications, and the use of information services such as WiFi

and global positioning system (GPS) and entertainment. The market demand for

Smartphone in worldwide is high. The percentage shipment has been growing in the

last three years remarkably, according to Euromonitor (2012) & Canalys.com (2012).

Vendors shipped 488 million Smartphone’s in 2011, compare to 415 clients PCs

Canalys.com (2012). A 62.7 % increase its sales volume 2010/2011 according to

Canalys.com (2012). However, today’s, organizations aim is not only sell their

products or services, but also make relationship to customers that lead to customer

loyalty in happen during the process that consist introduce products to customer,

knowing it, and then selecting it. Loyalty is a degree of commitment that a customer

buys a special brand of product or services.

Understanding loyalty is essential for marketing practitioners as loyal customers are

less likely to switch and make more purchases than similar non loyal customers

(Reichheld, 1996; Reichheld and Sasser, 1990), thus if the company can retain just 5%

more of its loyal customers, profits will increase by 25% - 125% (Reichheldand Sasser,

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1990). Reichheld’s (1996) is further supported by Strauss and Frost (1999), who

suggest that relationship marketing is cost effective; it is less expensive to retain one

customer than to acquire one; it is easier to sell more products to one loyal customer

than to sell the same amount to two new customers. This means that, it is easier to

persuade loyal customer than to persuade new customers. In addition, brand loyalty

also contributes in reducing the costs of doing business, thus improving brand as well

as company’s profitability (Tiele and Mackay, 2001). In this instance, the profit gain is

the result of loyal customers whom would possibly provide ‘free-advertisement’

through positive word of mouth. A research study reported that each satisfied customer

tells nine or ten people about the happy experiences and 13% of dissatisfied customers

tell more than twenty people about how bad the company/product were (Sonnenberg,

1993). This is the reason why many companies are trying to understand the

contributing factors of brand loyalty. Theoretically, brand loyalty could be enhanced by

maintaining the long term relationship with the customers in that it could help in

creating the competitive advantages for any particular company. It would be more cost

effective and profitable to increase the market share that could be sustained over time

though effectively strategizing the brand loyalty rather than using the common short-

term strategies.

The marketing environment has turn out to be a very multifaceted and competitive one

and day by day marketing environment is shifting and developing gradually. Thus, it

has become essential for business to look for ways of gaining and maintaining brand

loyalty by building consumer believes and to give an individual identity to brand

loyalty. Product quality and brand loyalty has become the objective of all

organizations. Organizations have realized with the intention of, when customers are

loyal to their brand, it provides the organization to develop increasingly without any

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disturbance and create a form of revenue in return of increases in profits. A very great

saying “Companies that successfully develop loyal customers also develop brand

ambassadors”. True brand loyalty exists when customers have a high comparative

approach towards a specific brand which can be exhibited through repurchase behavior.

This kind of loyalty can be a huge asset to the firm: “because customers are ready to

pay higher prices and may charge less to the serve and carry new customers to the

firm” (Reicheld & Sasser, 1990). “Customer satisfaction is a determinant of how

products and services supplied by a company to meet or exceed customer expectation”

(Farris et al 2012). According to Lau et al; (2006) he mentioned in his editorial that

there are numerous factors which influenced consumers brand loyalty towards a

particular brands. The factors are; brand name, product quality, price, promotion and

service-quality. These studies will significantly look at product quality as a feature that

influences brand loyalty and the degree to which the quality of a product make

customers loyal to that product or superficial quality refers to the consumer’s value

judgments or perceptions of quality. This could include idea of loveliness and the

perceived quality of the brand image.

The development of consumer-brand relationship has been focus of branding theory in

recent years. Consumers should be more likely to buy a brand again and recommend it

to others and less likely to buy an alternate brand. The increase and retention of loyal

customers has become a key factor for long-term success of the businesses. Thus,

brand loyalty, is an important aspect and marketers have to create marketing strategies

that will appeal to the consumers at an individual level. The main emphasis in

marketing has shifted from winning new customers to the retention of existing ones

(Aaker, 1991). Customer loyalty determines how much of the product is bought, how

often and the repeat purchases made based in its features. The features that a customer

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is keen on when making a purchase are multiple and are blended in the product. From

the customer's perspective, a brand provides a visual representation of the differences

between several products in a particular category. Brands allow consumers to shop

with confidence and have some expectations (Hu, Chuang, Hsieh, Chang & Chang,

n.d). Customer loyalty in the apparel industry presents a paradox and brand loyalty is a

key issue. There are several studies that have looked at the impact of satisfaction on

loyalty. It was revealed that there exists a direct connection between satisfaction and

loyalty. The argument brought forward is that satisfied customers become loyal and

dissatisfied customers keep on moving from one vendor to another. This is because

when a customer’s satisfaction is low, they have the option to quit, seeking an

alternative brand or going to a competitor (Thomas, n.d).

The present world is the world of information technology. The blessing of information

technology has touched almost all of the countries of the world. As a developing

country Nepal is also blessed with the contribution of information and communication

technology. Smartphone is one of the revolutionary inventions of modern science and

technology that has enriched our communication network. In essence, basic phones are

mainly used for the purpose of communication voice and messaging short text services

(i.e., SMS) along with controlled browsing (Subramanian, 2009). Rice and Katz (2008)

indicated that the smartphone might be recognized as the digitally social platform that

has the capability of acquiring, providing and sharing private and group information.

The main aim of the present study was to test a general framework for building a

consumer- brand relationship from an experiential view. This paper commences with a

discussion of the conceptual framework including literature on brand loyalty, brand

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experience, satisfaction, trust and the role of previous experience leading to hypotheses

development.

1.2 Statement of Problem

Brand loyalty has been described as behavioral response and as a function of

psychological processes (Jacoby and Kyner, 1973), which means that brand loyalty is a

function of both behavior and attitudes. Most studies in brand loyalty have been

concentrated on the behavioral aspect of brand loyalty (e.g. repeat purchases) without

considering the cognitive aspects of brand loyalty (Choong, 1998). Repurchase action

is not sufficient evidence of brand loyalty since the purchasing practice should be

intentional (Tepeci, 1999). In order to be considered as brand loyalist, consumer should

have the intention to buy the same product or services at all the time. In addition, brand

loyalist would also include some degree of commitment toward the quality of a brand

that is a function of both positive attitudes and repetitive purchase.

Brand loyalty is important as it builds in the consumer’s mind the idea that their

product has the required quality and thus become the base for future purchase behavior.

In addition, the loyal customer guide themselves by quotes like, “I feel a bond with this

brand”. “I am willing to pay the higher price for this brand”, I will recommend this

brand to others,” So that from the company’s point of view, one brand loyal customer

is more beneficial than the ten other brand switchers customers.

The marketing field first took an interest in brand loyalty on an academic level through

Copeland’s work in 1923 (cited in Kabiraj and Shanmugan, 2011, p. 288), with the

understanding that brand loyalty existed only at the behavioural level.

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To our best understanding, very few researchers have investigated the impact of

quality, advertising and brand name on the brand loyalty of the customers. As such,

this study aims to bridge this gap in our knowledge. This paper is set out in the

following manner; we first review brand loyalty and its determinants (such as: quality,

advertising, brand name) from literature. This literature aids us in hypothesis

formulation. We then discussed about our methodology which is followed by the

results of our findings. We raise the implications of this study and possibilities for

future research.

However, some other past research shows that the determinants of the brand loyalty

(i.e. quality, advertising and brand name) directly affected the loyalty towards the

brand. We have seen that the good quality and good advertisement slogan attract the

customers towards the product (smart phone). Therefore the purposes of the study are

to explore the following points.

1) What is the relationship between quality of the smart phone and brand loyalty?

2) What is the effect of advertising on the brand loyalty?

3) What is the significant impact of the brand name of the product towards its

brand loyalty?

4) How does customer satisfaction affect brand loyalty?

5) What are the various factors that affect the brand loyalty of smart phone?

6) What is the state of the variables across the gender?

1.3 Objectives of the Study

The main objective of the study is to explore the determinant of the brand loyalty. The

main specific objectives of the study are:

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 1) To find out the relationship between the quality of the product and brand

loyalty;

2) To analyze the effects of advertisement on the brand loyalty;

3) To determine the effect of brand name in brand loyalty;

4) To examine and explore the relationship between price and brand loyalty;

5) To explore the relationship between quality and advertisement with brand

loyalty of the product;

6) To describe the relationship between quality and brand name with the brand

loyalty of the product;

7) To examine the effect of brand name and quality in the brand loyalty of the

product;

8) To find out the relationship of the price, quality, brand name and

advertisement with the brand loyalty.

1.4 Organization of the Study

This study has been organized into five chapters. The first chapter is the introduction

chapter and provides general background, statement of the problem, objectives of the

study, and organization of the study. The second chapter is the review of literature and

includes theoretical framework and review of empirical studies. The third chapter is

related to the research methodology employed in this study. This chapter includes brief

information of research design, nature and sources of data, methods of data analysis

and limitations of the study. The fourth chapter is data presentation and analysis.

Finally, the fifth chapter presents summary, conclusion and discussion and future

direction of the study.

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 CHAPTER II

REVIEW OF LITERATURE

2.1 Review of Theories

Brand loyalty has been the center of attention among academicians and practitioners

for many decades Jan Møller&Torben Hansen (2006). In their attempt to conceptualize

brand loyalty, most academicians and practitioners focused on the behavioral aspect,

less emphasis on the attitudinal brand loyalty. The attitudinal aspect has gotten more

attention when they notice behavioral brand loyalty couldn’t give them a

comprehensive picture of loyalty. Behavioral loyalty considers proportional purchase,

purchase sequence and probability of purchase Dick and Basu (1994). Behavioral

brand loyalty cannot explain why customers who made a repetitive purchase, sometime

switch away and buy other competitive brands Allan & Joel Bubinson (1996). Dick and

Basu (1994, p. 100) also state that “the behavioral definition is, consequently,

insufficient to explain how and why brand loyalty developed and modified up."

In contemporary researches brand loyalty has been explained in terms of behavioral

and attitudinal perspective Sekan&Gökhan (2005). (Son K, et al., 2010, p. 131) argue

that brand loyalty is “a deeply held commitment to re-buy or re-patronize a preferred

product/service consistently in the future, causing a repetitive same brand or same

brand-set purchasing, despite situational influences and marketing efforts having the

potential to cause switching behavior.” Antouridis&Trivellas (2010, p.333) claim that

brand loyalty “....... Loyalty has both attitudinal and behavioral elements, and it is

determined by the strength of the relationship between relative attitude and repeat

patronage”

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2.1.1 Multidimensional Theory of Brand Loyalty

Brand loyalty defined as a positively biased tendency contains three distinct

dimensions. The first dimension is the emotive tendency toward the brand. It refers to

the affective (like-dislike), fear, respect or compliance tendency which is

systematically manifested more in favor of a brand than other brands in the market

place. The value-expressive or ego-defensive attitudes as suggested by Katz (1960) will

be part of the emotive brand loyalty. We believe that the emotive tendencies are

learned by the consumer either from prior experiences with the brand or from non

experiential or informational services. The examples of emotive tendencies include the

strong emotional stereotypes or brand imageries which researchers talk about as

commonly prevalent among consumers.

The second dimension of brand loyalty is the evaluative tendency toward the brand. It

refers to the positively biased evaluation of the brand on a set of criteria which are

relevant to define the brand's utility to the consumer. For example, we may positively

evaluate Lincoln Continental as a brand of automobile on durability, performance,

prestige, and the like. It is not our intention in this paper to operationally define how

this evaluative tendency is generated in the consumer. However, we can safely state

that the evaluative tendency includes the instrumental, utilitarian attitudes suggested by

Katz (1960) as well as the perceived instrumentality component of the Rosenberg

(1956) model. Of course, it comes closest in measurement to the model of attitude

structure proposed in Howard and Sheth (1969) and Sheth (1973). The evaluative

tendency dimension of brand loyalty is also learned by the consumer either from prior

experiences with the brand or from non experiential or informational sources.

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The third dimension of brand loyalty is the behavioral tendency towards the brand. It

refers to the positively biased responses toward the brand with respect to its

procurement, purchase and consumption activities. We include in the behavioral

dimension all the physical activities of shopping, search, picking up the brand

physically from the shelf, paying for it and ultimately consuming or using it in a

systematic, biased way. In short, it represents the time and motion study of the

consumer as he behaves toward the brand in a positively biased way. The behavioral

tendency is learned primarily from the experiences of buying and consuming the brand

or from generalization of similar tendencies toward other brands.

We theorize that not all the three dimensions are present in every situation where brand

loyalty prevails. Depending upon the product class and upon the consumer, the

dimensionality of brand loyalty may be as simple as any one of the above three

dimensions or as complex as all the three dimensions. Logically, we can hypothesize a

total of seven different types of brand loyalty based upon the combinations. Each type

of brand loyalty is briefly described below:

Behavioral brand loyalty. This type of brand loyalty has only the behavioral tendency

dimension. It is analogous to what Day (1969) has defined as "spurious" brand loyalty

although we do not fully agree with his adjective. The behavioral brand loyalty has no

evaluative or emotive components &nd it represents the simple R-R relationship

presumed in the contiguity conditioning. In terms of Osgood's analysis of the learning

theory (1956), it represents the evocative or the predictive integration (Howard and

Sheth, 1969). The strength of behavioral brand loyalty is, therefore, directly a function

of the repetitive occurrence of purchase or consumption behavior. The consumer

establishes a systematic biased response or h&bit simply due to frequency of

11
encounters. It is, therefore, analogous to what Krugman (1965) has called learning

without involvement. Finally, most of the stochastic learning models (Bush and

Mosteller 1955) are operational measures of behavioral brand loyalty.

Prom the marketing viewpoint, it is relatively easy to generate behavioral brand loyalty

by primarily ensuring that the time and place stimuli are made conducive to repetitive

occurrence of purchase behavior, for example, making sure that the brand is available

at all times, is easy to reach on the shelf, or that the display is strategically placed. In

this respect, behavioral brand loyalty is analogous to the "interia" or "marketer's

strategies" classifications suggested by Engel, Blackwell and Kollat (1973). However,

we also believe that once the behavioral brand loyalty is strongly manifested by the

consumer, it is very difficult to change the systematic bias away from the brand.

Behavioral-evaluative brand loyalty. This type of brand loyalty is two dimensional. It

represents not only a systematic biased response toward a brand but concomitantly the

consumer also has a consistent cognitive structure underlying his biased behavior. This

represents the classical manifestation of attitude-behavior theories in social psychology

in which attitudes are determined by the instrumental or utilitarian evaluation of the

brand (Katz 1960; McGuire 1969). It is also best represented by the representational

mediation model which Osgood (1956) has theorized based on instrumental learning.

Due to the cognitive consistency tendencies (dissonance, incongruity, balance, and

consistency), it is presumed that there is a congruent relationship between the

consumer's evaluative dimension and his behavioral dimension so that it should be

possible to predict one from the knowledge of the other.

The behavioral-evaluative brand loyalty is probably closest to the economist's dream of

the "rational" consumer. It is also the presumed world of the consumer for those mass

12
communication practitioners and researchers who believe in the persuasion strategy of

advertising (Sheth 1974). We believe that the behavioral-evaluative brand loyalty is

developed by the reinforcement (instrumental) conditioning process in which the

consequences following a purchase of the brand strengthen or weaken future

behavioral tendencies and evaluations. In addition, the informational sources such as

the commercial, social, or the neutral sources (Howard and Sheth 1969) also strengthen

or weaken the behavioral-evaluative brand loyalty.

Behavioral-emotive brand loyalty. This type of brand loyalty is also two dimension. It

represents the systematic and biased response tendencies toward the brand and

concomitantly the consumer has emotive tendencies toward the brand. It is probably

most common among children who are primarily the consumers of the brand and

manifest affective, compliance or fear responses. However, we believe that it is not

inconceivable to find behavioral-emotive brand loyalty even among adults, especially

when they are not the buyers of the brand. For example, the husband being loyal to a

brand of dessert either due to the simple affective tendency or due to the compliance

tendency. In general, we should expect the manifestation of the behavioral-emotive

brand loyalty in situations where the consumer and the buyer are distinct individuals.

For example, the housewife buys the brand regularly and likes it because he-r husband

likes it as a consumer. We also think that this type of brand loyalty is often manifested

when the brand has some distinctive feature such as color, size, design or has a distinct

image developed by advertising which are not essential to the utility of the brand, for

example, the distinctive styling of an automobile or the package of a brand of perfume.

We theorize that the behavioral-emotive brand loyalty arises from the contiguous

conditioning and possibly also from the informational sources which communicate to

13
the consumer directly. As contiguous learning, it is representative of the evocative and

predictive integrations suggested by Osgood (1956).

Behavioral-evaluative-emotive brand loyalty. This is the most complex type of brand

loyalty consisting of all the three dimensions. It is analogous to what Day (1969) calls

"intentional" brand loyalty. Also, it meets all the six necessary and collectively

sufficient conditions which Jacoby (1971) has specified as part of his definition of

brand loyalty.

The behavioral-evaluative-emotive brand loyalty is perhaps the most common type of

brand loyalty which has been often suggested in consumer psychology and marketing

by the proponents of the hierarchy-of-effects models (Howard and Sheth 1969, Lavidge

and Steiner 1962, Sheth 1970, Colley 1961). It probably also represents closest to the

Rosenberg (1956) and Fishbein (1967) theories of attitude-behavior relationship.

Finally, it is this type of brand loyalty which can represent all the four functional

aspects of attitude (utilitarian, knowledge, ego-defensive and value-expressive)

suggested by Katz (1960). It is presumed that a strong consistency relationship exists

among the three dimensions so that it is possible to predict one from the knowledge of

the other two dimensions. While there have been several proponents of this type of

brand loyalty, the empirical evidence is as yet not conclusive. Especially, there seems

to be a relatively small correlation between the behavioral and the nonbehavioral

components. See Sheth (1973) for some of the explanations in the context of prediction

of purchase behavior.

The behavioral-evaluative-emotive brand loyalty largely arise from the reinforcement

learning of repetitive buying or consuming experiences. It is also likely to arise from

the informational sources.

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Evaluative brand loyalty. This type of brand loyalty is based on one dimension only. It

is lacking in both the emotive and the behavioral tendencies. It refers to the individual's

positively biased evaluation of a brand strictly based on the perceived utility function

of that brand. There are a number of situations in which this type of brand loyalty

exists. First, it is appropriate in all situations where the consumer is neither the buyer

nor the user of the product but at the same time possesses the cognitive evaluative

knowledge about the brand. For example, the husband has positive evaluative bias

toward a brand which his wife is both the buyer and the consumer such as lipstick or

pantyhose. Second, there are several situations in the broader context of consumer

behavior in which the consumer is expected to have evaluative biases for or against

choice alternatives but is never likely to manifest choice behavior. For example,

evaluative tendencies toward religions, subcultures, political parties, and the like.

Since there is no behavioral tendency in this type of brand loyalty, experience is not the

relevant source of learning. It is, therefore, likely to be either generalization or

informational.

Evaluative-emotive brand loyalty. This type of loyalty is probably more common than

either simply the evaluative or the emotive brand loyalty. If consistency theories are of

any usefulness, they have proposed a strong relationship between the evaluative and

the emotive tendencies (Rosenberg 1956, Fishbein 1967, Sheth 1970).

The evaluative-emotive brand loyalty is often prevalent in consumer behavior for those

products and services which are typically beyond the reach of the consumer, although

he may strongly aspire for them. For example, Rolls Royce automobile is likely to have

evaluative-emotive brand loyalty in the minds of most of us even though we may have

15
never experienced the automobile either as consumers or buyers. Of course, this type of

brand loyalty can only arise from informational sources or from generalizations.

Emotive brand loyalty. This type of brand loyalty consists of the emotive dimensions

only. There seems to be a number of areas of consumer behavior in which the

individual has strong emotive tendencies toward a brand without any experience or

evaluation. We believe that most of the stereotypes among nonusers of a product or

service fall into this category. For example, a strong emotive brand loyalty towards a

brand of beer on the part of a nondrinker or toward a brand of cigarette on the part of a

nonsmoker is probably based on the stereotype or imagery of the brand. Similarly, one

member of the family may like a brand without any cognitive evaluation or experience

simply because some other member in the family likes it. The only sources of learning

for this type of brand loyalty are information or generalization.

In summary, we propose a vector of seven different types of brand loyalty in consumer

psychology based on combinations of three dimensions of emotive, evaluative and

behavioral tendencies toward a brand. We hypothesize that the distribution of products

and consumers with respect to this vector of seven types of brand loyalty is neither

random nor equal, but skewed toward some elements more than toward others. Since it

is a function of the product differences and consumer differences, we turn our attention

to them in the next section.

2.1.2 Aaker’s Brand Equity Theory

In his Brand Equity Theory, David A. Aaker identifies five brand equity components:

(1) brand loyalty, (2) brand awareness, (3) perceived quality, (4) brand associations and

(5) other proprietary assets. Aaker defines brand equity as the set of brand assets and

liabilities linked to the brand – its name and symbols – that add value to, or subtract
16
value firm, a product or service. These assets include brand loyalty, name awareness,

perceived quality and associations. This definition stresses ‘brand-added value’;

however, his model does not make a strict distinction between added value for the

customer/consumer and added value for the brand owner/company.

This model can be used to get to grips with a brand’s equity and gain insight into the

relation between the different brand equity components and (future) performance of the

brand. Apart from the five components, the model also reflects indicators (and/or

consequences) of the pursued branding policy. It goes without saying that brand equity

will rise as brand loyalty increases, brand name awareness increases, perceived quality

increases, brand associations become stronger (and more positive ), and the number of

brand-related proprietary assets increase. The model also provides insight into the

criteria that indicate to what degree actual value is created with both consumer and

company due the pursued branding policy.

David Aaker’s Brand Equity Model defines the five following brand equity

components:

Brand loyalty: The extent to which people are loyal to a brand is expressed in reduced

marketing costs (hanging on to loyal customers is cheaper than charming potential new

customers), trade leverage (loyal customers represent a stable source of revenue for the

distributive trade), attracting new customers (current customers can help boost name

awareness and hence bring in new customers) and time to respond to competitive

threats(loyal customers that are not quick to switch brands give a company more time

to respond to competitive threats).

Brand awareness: The extent to which a brand is known among the public, which can

be measured using the anchor to which associations can be attached (depending on the
17
strength of the brand name, more or fewer associations can be attached to it, which

will, in turn, eventually influence brand awareness), familiarity and liking (consumers

with a positive attitude towards a brand, will talk about it more and spread brand

awareness), signal of substance/ commitment to a brand and brand to be considered

during the purchasing process (to what extent does the brand form part of the evoked

set of brands in a consumer’s mind).

Perceived quality: The extent to which a brand is considered to provide good quality

products can be measured on the basis of the quality offered by the product/ brand is a

reason to buy it, level of differentiation/ position in relation to competing brands, price

(as the product becomes more complex to assess, and status is at play, consumers tend

to take price as a quality indicator), availability in different sales channels (Consumers

have a higher quality perception of brands that are widely available) and the number of

line/ brand extensions (this can tell the consumer the brand stands for a certain quality

guarantee that is applicable on a wide scale).

Brand associations: associations triggered by a brand can be assessed on the basis of

the extent to which a brand name is able to ‘retrieve’ associations from the consumer’s

brain (such information from TV advertising), the extent to which association

contribute to brand differentiation in a relation to the competition (these can be abstract

associations, such as ’vitality’, or associations with concrete product benefits, such

‘will leave your washing cleaner’), the extent to which brand associations play a role in

the buying process (the greater this extent, the higher the total brand equity), the extent

to which brand associations create positive attitude/ feelings (the greater this extent, the

higher the total brand equity) and the number of brand extensions in the market (the

greater this number, the greater the opportunity to add brand associations).

18
Other proprietary assets: examples are patents and intellectual property rights, relations

with trade partners, and airlines’ landing slots(the more proprietary rights a brand has

accumulated, the greater the brand’s competitive edge in those fields)

2.2 Review of Empirical Studies

Brand loyalty is important as it builds in the consumer’s mind the idea that their

product has the required quality and thus become the base for future purchase behavior.

In addition, the loyal customer guide themselves by quotes like, “I feel a bond with this

brand”. “I am willing to pay the higher price for this brand”, I will recommend this

brand to others,” So that from the company’s point of view, one brand loyal customer

is more beneficial than the ten other brand switchers customers.

The marketing field first took an interest in brand loyalty on an academic level through

Copeland’s work in 1923 (cited in Kabiraj and Shanmugan, 2011, p. 288), with the

understanding that brand loyalty existed only at the behavioral level. At this time,

brand loyalty is measured using factors such as purchase sequence, percentage of total

purchase, and purchase probability (Kumar and Advani, 2005). This notion led to a

focus on price, functionality and quality when marketing product and services, with the

expectation that consumer would develop a repeated purchase pattern if these factors

met the customer’s criteria. However, another level of loyalty was revealed during the

1950’s, as brand loyalty became an increasingly popular research area. Several

researcher, such as Cunningham (1967), Day (1969)and jacoby (1971), began to

recognize that the attitudinal aspect of brand loyalty were just as important as the

behavioural aspects. As it became apparent that brand often held an emotional

component as well as the functional one, marketing strategies shifted to focus on

relationship and value creation (Iglesias et al, 2011). Wel et al (2011) explained two

component of the phenomenon that is brand loyalty, by stating that in addition to

19
having the intention to repurchase a brand, brand loyalists also have to hold some

degree of emotional connection and/or commitment towards the brand.

However, some other past research shows that the determinants of the brand loyalty

(i.e. quality, advertising and brand name) directly affected the loyalty towards the

brand. We have seen that the good quality and good advertisement slogan attract the

customers towards the product (smart phone).

The summary of major literature on this regard is summarized in table 2.1.

Table 2.1

Review of major literature

Study Major Findings

Zeithaml,
Quality of the product is the consumer subjective judgment towards the product. So it had
V. A.
made psychological impact on brand loyalty of customers.
(1988)
Cadogan Customers with elevated brand loyalty are ready to pay a heavy amount for their preferred
& Foster brand, because they think that brands with intense price are more valuable and much thrush
(2000) then the products with low price.
Swinker
If the perceived quality of the product does not match with the actual quality of the product,
& Hines
the chances of rejection of the product will be higher.
(2007)
Yee
Price is probably the most important consideration for the average consumer. Consumers with
&Sidek
high brand loyalty are willing to pay a premium price for their favoured brand.
(2008)
Sprott&
The attractiveness of the brand personality indirectly affects brand loyalty and people use
Czellar
products to enhance self image.
(2010)
Lau et al Price, product quality and brand name of the product are the major determinants of the brand
(2006) loyalty.
Park and Advertisement is directly related with the brand loyalty of the product. i.e positively
Jang(201 correlated. A person who heard the advertisement of the particular product repetitively, he
1) will be brand loyal of that product.
CheWel Higher the advertisement as well as word of mouth of the product, higher number of the
& Syed customer is brand loyal towards the product.
(2012)

20
Zeithaml, V. A. (1988) described in his research article that the quality of the product is

the consumer subjective judgment towards the product. So it had made psychological

impact on brand loyalty of customers. He was done his research by conducting the

focused group interview and in depth interviews between the participants. A total of 30

women were participating in interviews. All participants were women between the ages

25 and 49 and all had at least one child younger than the age of 10 years. On the basis

of 30 women he drawn the conclusion regarding the quality of the product and it’s

affect in brand loyalty.

Similarly,Cadogan& Foster (2000) also described that the Customers with elevated

brand loyalty are ready to pay a heavy amount for their preferred brand, because they

think that brands with intense price are more valuable and much thrush then the

products with low price. The data for this study were collected through a mail survey of

business customers of a large New Zealand office products firm. A list of 250

customers who had been approached by the company’s sales personnel during the

month prior to the survey was randomly generated and each contact was mailed a

questionnaire. Of these, 101 questionnaires were returned to the university in a postage

paid envelope, corresponding to a response rate of 40%. This response rate is

comparable to other studies of business purchasers (e.g., Boles, Barksdale and Johnson,

1997; Kumar, Scheer and Steenkamp, 1995; Siguaw, Simpson and Baker, 1998). In

order to assess whether non-response bias was a problem, a comparison of early

respondents and late respondents was made on all variables of interest (Armstrong and

Overton, 1977); no evidence of non-response bias was found since no significant

difference were uncovered. Respondents consisted of 87 women and 14 men. Fifty

three percent of the respondents had a polytechnic or university education. On average,

each respondent had purchased office products for five years, and had done business

21
with the supplier firm for three years. Also, the average respondents’ firm employed 30

people.

Swinker& Hines (2007) perceived that if the perceived quality of the product does not

match with the actual quality of the product, the chances of rejection of the product will

be higher. The purpose of this study was to evaluate consumers' selection patterns of

textile products made from recycled fibres. A quasi-experimental design was used. The

125 undergraduate students who participated in the study evaluated six identical

sweatshirts and six identical carpet samples that were labelled with two manipulated

information cues, price and fibre content. Chi-square tests of independence were

calculated to determine if there was a significant relationship between wearing apparel

choice and home textile product choice when both price and fibre content were

manipulated and when price was controlled and fibre content manipulated. The data

indicated that when both price and fibre content were manipulated, over half of the

subjects selected the lower priced sweatshirt and lower priced carpet regardless of fibre

content. If a consumer selected a lower priced wearing apparel product s/he also

selected a lower priced home textile product. When the price and fibre content were

controlled, 66% of the respondents selected the sweatshirt labelled recycled polyester

and 62% selected the recycled carpet. In addition, a consumer who selected a recycled

wearing apparel product also selected a recycled home textile product.

Likewise, Yee &Sidek explained that the Price is probably the most important

consideration for the average consumer. Consumers with high brand loyalty are willing

to pay a premium price for their favoured brand. For that research he took the

respondents of multiple ethnicity, namely Malay, Chinese, Indian and other races, were

selected from Bandar BaruBangi and Serdang. In Bandar BaruBangi, the locations

22
selected were at shopping malls such as Pasaraya Warta and Pasaraya Billion while in

Serdang, the locations selected are at shopping malls such as The Mines and South City

Plaza. These malls were selected because they represent the largest malls in the city.

No attempt was made to cover other malls as they were small and additional costs

would be involved. Conducted during the weekends over a time frame of two months,

the researcher went personally to the targeted locations and distributed questionnaires

to the respondents. A total of 100 sets of questionnaires were distributed to respondents

at the Bandar BaruBangi and Serdang areas.

Sprott&Czellar (2010) examined between 126 participants (N = 126) included students

who had not been involved in other research regarding BESC receiving course credit

for their participation. The BESC scale (α = .93; M = 3.63, SD = 1.25) was

administered to participants before the experiment via an unrelated survey. Participants

were randomly assigned to one of three experimental conditions related to the length of

waiting time for their favorite brand: One month vs. three months vs. six 18 months.

The manipulation was contained in a scenario depicting the decision to purchase a new

product. at last he described that the attractiveness of the brand personality indirectly

affects brand loyalty and people use products to enhance self image.

CheWel& Syed (2012) do the research in the students of universities of Malaysia. At

that time he observed that the higher the advertisement as well as word of mouth of the

product, higher number of the customer is brand loyal towards the product. In this

research he developed the close ended questionnaire for the purpose of data collection.

The undergraduate students were chosen as the target population of the study in order

to reflect the actual user of branded product. A total of 300 respondents from one

23
private university were selected as a sample of the study. The respondents were

selected from the various faculties of the universities.

2.3 Theoretical Framework

The conceptual model tested in this paper contains constructs that have demonstrated

theoretical support, based on a number of research done in this area in different

countries, particularly brand loyalty on end-user perspective. The model examines the

factors that would possibly affect the brand loyalty. The conceptual model is shown in

Figure 1 below.

Fig.1: A Schematic diagram of the conceptual framework

Price of the product

Quality of the product

Brand loyalty

Advertisement

Brand name
Sex

The schematic diagram of the theoretical framework above is use to show the

relationship between the dependent variable and independent variables. Essentially, the

theoretical framework shown above is the foundation on which the entire research is

based upon.

Brand loyalty is treated as dependent variables in this research. The dependent variable

is analyzed in order to find out the answer or solutions to the problems i.e. what are the

factors affecting the brand loyalty? In this situation, the study will test four independent

24
variables i.e. price, quality, advertisement and brand name of the product. These

variables are believed to have some influence towards the dependent variable (brand

loyalty) either in positive or negative way.

2.4 Hypotheses of the Study

A hypothesis is a statement or proposition that can be tested by referring to a collection

of empirical studies. Hypotheses are usually stated in a form that predicts either the

differences or associations between two variables under study. Development of a

hypothesis involving casual ordering where possible and measureable would be useful

in guiding the analysis strategy. Often such hypothesis can be made if the meaning of

an item is carefully analyzed within a chronological context.

A null hypothesis predicts there is no differences between the tested groups in relation

to some variable, or that there is no relationship between two variables. Null hypothesis

in this research is noted as H0.

The following hypotheses are derived from the relationships found from the previous

literatures.

H01: There is no negative relationship between brand name and brand loyalty of the

product.

H02: There is no negative relationship between the quality of the product and brand

loyalty.

H03: There is no positive relationship between the price of the product and brand

loyalty.

H04: There is no negative relationship between advertisement and the brand loyalty.

H05: There is no negative impact of brand name on the brand loyalty of the product.

25
H06: There is no positive impact of the product quality on the brand loyalty of the

product.

H07: There is no negative impact of the price on the brand loyalty of the product.

H08: There is no positive impact of the advertisement on the brand loyalty of the

product.

H09: There is no significant difference in brand name across the moderating

variables male and female.

H010: There is no significant difference in product quality across the moderating

variables male and female.

H011: There is no significant difference in price across the moderating variables male

and female.

H012: There is no significant difference in advertisement across the moderating

variables male and female.

H013: There is no significant difference in brand loyalty across the moderating

variables male and female.

26
 CHAPTER III

RESEARCH METHODOLOGY

This chapter has been divided into five sections. First section deals with the brief

description of research design, while second section describes selection of sample and

their size. Section three explains the nature and sources of the data that are taken during

the study. Subsequently, fourth section has been devoted to the definitions of the

variables that are used in the research and finally fifth section deals with the method of

analysis employed in interpretation of data.

3.1 Research Design

The research design adopted in this study consists of descriptive and causal

comparative research designs to deal with the various issues raised in this study.

Descriptive research includes surveys and fact-finding enquiries of different kinds. The

major purpose of descriptive research is description of the state of affairs as it exists at

present. It is undertaken in order to ascertain and be able to describe the characteristics

of the variables of interest. The descriptive research design is selected for the study to

learn the profile of the respondents, presentation and description of the data collection,

and to describe the factor that affect the brand loyalty.

The causal comparative research design is selected for the study to examine the

relationship between the dependent variable and the independent variables under this

study. The causal-comparative research investigates the possible causes affecting a

particular situation by observing existing consequences and searching for the possible

factors leading to the results. This research is also known as “ex post facto” or “after

the fact” research (i.e. data are collected after all the events of interest occurred). This

27
is because both the effect and alleged causes have already occurred. In other words,

causal-comparative research is that research in which the independent variable or

variables have already occurred and in which researcher starts with the observation of

the dependent variable or variables. Then, analyze the independent variables in

retrospect for their possible relations to, and effect on the dependent variable or

variables. This research design is selected for the study to examine the relationship

between the dependent variable and the independent variables.

3.2 Population and Sample of the Study

The population is the collection of whole units that researcher are interested in

knowing about them. Definition of population is differs from nature and subject matter

of the study. In our study all the college students are the population of the study

because our study focused on the Nepalese youngsters who have used Smartphone. For

the purpose of study, consideration of all the population is not possible. So for our

convenience, we took sample students from five different colleges on the basis of

judgmental sampling. The study does not cover the perception of the aged people

because our focused is in the Nepalese youngsters who have using the Smartphone.

The method of judgmental sampling as well as convenience sampling has been

employed while choosing the sample students from the different colleges to collect the

primary data. We chose student of People’s campus, Shanker dev campus, Nepal

Commerce Campus, Public Youth Campus and Modern Nepal College for our sample

of the study. Through the help of the judgmental sampling, we chose different colleges

as our sample on the basis of our judgment regarding these colleges. In this method of

sampling, psychological perception of the researcher play the important role while

deciding the sample of the research. In our study, convenience sampling is also used. It

28
is used for the purpose of easy as well as making the research cheap. Through applying

this sampling method, we took the sample of the colleges which are located around us.

3.3 Nature and Sources of Data

This research is based upon the primary data. The primary source of the data has been

used to determine the perception of the individuals regarding to the factors that affect

brand loyalty on Smartphone in Nepal in the various BBA colleges of the Kathmandu.

3.3.1 Primary data

This study is based on primary sources of data. The survey questionnaire is designed to

generate the primary data. A structured questionnaire was administered to 157

participants in the various colleges. The average age of the participants was 21 years.

The study believes possesses the relevant for this study and those participants were

only included for the questionnaire survey who have sufficient time and are willing to

participate (Morse, 1998). The survey has been basically designed to understand the

opinions of respondent to explore the perception on the factor that affect the brand

loyalty on Smartphone in the context of Nepal.

The questionnaire was developed based on the findings from the literature review. A

pre-test of a survey questionnaire is necessary to assess its reliability and validity

(Cooper & Schindler (2006). A pre-test was conducted from a random sample of

twelve respondents from different sampled firms. The respondents were encouraged to

make comments on any questions that they thought were ambiguous or unclear. A final

version of the questionnaire is in Appendix 1 of this study.

29
3.4 Definitions of Variables

There are various variables that are used in the study. The definition of each variables

that are used in our study is given below.

Brand Name: According to (Kohli & Thakor,1997) a product brand name is the

conception of a picture or the expansion of a brand character and is a luxurious and

time intense process. The expansion of brand name is very important and absolutely

necessary significant elements of the process while the name is the foundation of a

brand’s image. Brand name is essential for the firm to magnetize clients to acquire the

product and manipulate replicate purchasing behavior.

Price: Price is the something is the sum of money that you have to give in order to buy

it. Price is the most important interest of needs and wishes of the standard to buy

anything for consumers.(Cadogan & Foster 2000). Customers with elevated brand

loyalty are ready to pay a heavy amount for their preferred brand, because they think

that brands with intense prices are more valuable and much thrush then the products

with a low price. So, consumer purchase significance is not easily affected by

price.(Keller,2003)

Product Quality: The features and characteristics of product or service that convince

customer to buy express the idea of product quality. Quality expresses that how

tremendous and bad the things are greatly valued (Shahzad khan 2011). Product quality

is explained as “fitness for use” or “capability to obligation” (Russell & Taylor, 2006).

Customers may replicate the buying of a particular brands or shift to different brands

due to the quality of the sold product. The factor which affects the texture, hand feel

and other performance aspects is the material that’s why material is an important facet

in quality of the product. More probably, customers narrate individually to color, and
30
can choose or refuse a product because of color. If the consumer does not like the color

or the color does not attract them, they will not buy the particular product.

Advertisement: Advertisement or promotion is a marketing mix factor, which is a type

of sharing or exchanging information with customers. Advertisement includes the use

of publicity, sales promotions and personal selling. Non-personal appearance of

information in mass media is advertising about which a product, brand, business or

store is promoted. “It deeply affects consumers‟ images, attitudes and attributes

towards products and brands, and in span, influences their buying behaviors”

(Lovelock, 2010). This indicates that advertisement particularly during publicity can

help institute ideas or awareness in the consumers‟ minds help differentiate products

besides other brands.

Clow (2010) defined and concluded that advertisement plays a vital role and is a

significant element of a firm’s marketing strategy. Advertisement is used to converse

with customers with reverence to product contributions, and it is a technique to

promote purchase or sales of a product or service”.

Brand Loyalty: According to Howard and Sheth's(1996) theory of buyer behavior.

They are the pioneers of the idea of brand consideration into marketing. Brand loyalty

is also distinct as “keeping desirable to a particular product or service” (BNET

Business Dictionary 2011).Loyalty is greatly linked with different variables; one of the

core fact is the practice of use (Aaker & Keller, 1990). Consumers may be loyal to high

switching barriers to, nominal, scientific, cost-effected or psychological facts, which

make it costly or difficult for the consumers to transform. Consumers also may be loyal

due to their satisfaction with the particular brand due to which they continue long term

relation with that brand. (Fornell, 1992).

31
3.5 Method of Analysis

The major focus of the methodology is to find out the relation between different

variables. The main purpose of data analysis in this study is to determine the factor

affecting in brand loyalty of the smart phones in Nepal. Therefore, this section deals

with statistical model used for the purpose of analysis of the primary data that are used

in the study. It includes mean, median, mode, standard deviation, variance, correlation

and finally regression analysis.

3.5.1 Mean

The mean is the average of all numbers and is sometimes called the arithmetic mean.

To calculate mean of a given set of observations, we add all the observations and

divide their sum by the number of observations. For example, the mean that is denoted

by x of 2,5,7,6 and 10 is 2  5  7  6  10 / 5 =30/5=6. Write some more.

∑
x =

3.5.2 Media

Median of a set of numbers is the number in the middle. For example, in the set of

numbers {4, 6, 25}, the median is 6. However the numbers must be in order for the

median to be in the middle. If there is an even number of numbers, then the median is

the average of the last 2 middle numbers. There are 2 ways to find the median of a set

of numbers. One is by rewriting the numbers in order, and then find the one in the

middle. The second way is cross of the highest number and then the lowest number,

then the highest and then the lowest and so on until only one number is left. That

32
number will be the median. The second method works the best when you have a large

number of numbers. The formula for median is as follows:

Median (Md)= Value of (N+1)/2th item

3.5.3 Mode

The mode is the value that appears most often in a set of data. The mode of a discrete

probability distribution is the value x at which its probability mass function takes its

maximum value. In other words, it is the value that is most likely to be sampled. The

mode of a continuous probability distribution is the value x at which its probability

density function has its maximum value, so the mode is at the peak.

3.5.4 Standard deviation

In statistics, the standard deviation (SD, also represented by the Greek letter sigma σ or

the Latin letters) is a measure that is used to quantify the amount of variation

or dispersion of a set of data values. A low standard deviation indicates that the data

points tend to be close to the mean (also called the expected value) of the set, while a

high standard deviation indicates that the data points are spread out over a wider range

of values.

The standard deviation of a random variable, statistical population, data set,

or probability distribution is the square root of its variance. It is algebraically simpler,

though in practice less robust, than the average absolute deviation. A useful property of

the standard deviation is that, unlike the variance, it is expressed in the same units as

the data. There are also other measures of deviation from the norm, including mean

absolute deviation, which provide different mathematical properties from standard

deviation.

33
 ( ͞)
σ=

3.5.5 Variance

In probability theory and statistics, variance is the expectation of the squared deviation

of a random variable from its mean, and it informally measures how far a set of

(random) numbers are spread out from their mean. The variance has a central role in

statistics. It is used in descriptive statistics, Statistical inference, hypothesis testing,

goodness of fit, Monte Carlo sampling, amongst many others. The variance is the

square of the standard deviation. It is often represented by σ² or Var(X).

Variance = σ²

3.5.6 Correlation

Correlation is a term that refers to the strength of a relationship between two variables.

A strong, or high, correlation means that two or more variables have a strong

relationship with each other, while a weak, or low, correlation means that the variables

are hardly related. Correlation analysis is the process of studying the strength of that

relationship with available statistical data. The most widely used type of correlation

coefficient is the Pearson r. This analysis assumes that the two variables being analyzed

are measured on at least interval scalesmeaning they are measured on a range of

increasing value. The coefficient is calculated by taking the covariance of the two

variables and dividing it by the product of their standard deviations.

Correlation coefficients can range from -1.00 to +1.00. The value of -1.00 represents a

perfect negative correlation, which means that as the value of one variable increases,

the other decreases. While a value of +1.00 represents a perfect positive relationship,
34
meaning that as one variable increases in value, so does the other. Values like these--of

+ or - 1.00--signal a perfectly linear relationship between the two variables, so that if

you plot the results on a graph it would make a straight line. A value of 0.00 means that

there is no relationship between the variables being tested.

It can be calculated by using the formula shown below:

(∑ ) (∑ )(∑ )
=
( ∑ (∑ ) )( ∑ (∑ ) )

3.5.7 Regression Analysis

Regression is a statistical measure that attempts to determine the strength of the

relationship between one dependent variable (usually denoted by Y) and a series of

other changing variables (known as independent variables). It includes many

techniques for modeling and analyzing several variables, when the focus is on the

relationship between a dependent variable and one or more independent variables (or

'predictors'). Regression is often used to determine how many specific factors such as

the price of a commodity, interest rates, particular industries or sectors influence the

price movement of an asset. The general form of the regression is:

Σ Σ Σ
=
Σ (Σ )

35
 CHAPTER IV

PRESENTATION AND ANALYSIS OF DATA

The main purpose of the study is to explain the factors that affecting in the brand

loyalty on Smartphone in Nepalese context and to determine the level of brand loyalty

of the respondents towards a particular product which they have purchased. It employs

the various statistical tools and techniques in order to determine the factors that affect

in the brand loyalty on the Smartphone in Nepalese perspective. For this purpose,

required primary data was collected and analyzed in systematic way so as to derive the

empirical findings and compare the hypothesis.

4.1. Analysis of Primary Data

This section includes the empirical investigation which was conducted in the form of

Field Survey of respondents through structured questionnaire distributed to the samples

selected by using non probabilistic procedures. Questionnaire was developed and

distributed to 157 sample respondents to get their opinions with respect to major

factors influencing brand loyalty of Smart phones in Nepalese context. All the

respondents were inquired in advance about their interest in participating in the survey

at the time of collecting the data from respective colleges. However due to the busy

schedule, only 130 participants actively participated in the survey with the response

rate of 83 per cent. The responses received from these respondents have been arranged,

tabulated and analyzed in order to facilitate the descriptive analysis of the study. This

chapter is all about the empirical investigation during the study.

In the survey questionnaire, the respondents were requested to response in four ways:

Yes or No option, multiple choice options, expressing view option and likert scale

36
option. In order to collect the perceived importance of determinants, 5-point Likert

scale has been used, where 5 being the most important (strongly agree) and 1 being the

least important (strongly disagree). The choice with the The sample of questionnaire

schedule is presented in Annexure 1.

4.1.1. Respondents’ Profile

The Table- 4.1 shows the respondents profile from those participated in the

questionnaire survey on the strata of gender. Questionnaire was developed and

distributed to 157 sample respondents to get their opinions with respect to major

factors that affecting brand loyalty on Smartphone in Nepalese context. All the

respondents were inquired in advance about their interest in participating in the survey

at the time of collecting the data. Out of 158 questionnaires distributed to selected

samples, only 130 responses were received representing 83 per cent in total.

Individually, 45 per cent were male and 55 percent were female respondents. The

average ages of the respondents are 21 years.

Table 4.1

Respondent’s Profile

Gender of the respondents

Gender Frequency Percentage Cumulative Percentage
Male 59 45 45
Female 71 55 100
Total 130 100

As is evident from the table, the highest per cent of participants in terms of gender

were female representing 55 percent of respondents followed by male participants with

45 per cent.

In total 130 participants were there where 59 were male and 71 were female

participants.

37
4.1.2 Multiple Choice Questions

In this segment the respondents are free to choose the more than one option as per their

opinion on the subject matter. In this study we ask to the respondents what are the

major factors that you consider while purchasing the branded products? The

respondents are free to give their opinion on this question. The result of the multiple

choice questions is presented in Table 4.2.

Table 4.2

Multiple Choice Questions

Options Frequency Percentage Cumulative Percentage

price/quality 80 57.00 57
Brand Name 47 34.00 91
Promotion 3 2.00 93
Others 10 7.00 100
Total 140 100.00

As evident from the table, most of the respondents (57 per cent) are chose price is the

major considerations while purchasing the branded products in the context of Nepalese

market perspective. The result of price is followed by brand name which is chosen by

34 per cent of the total respondents. From the table we can conclude that the price is

the major factor while purchasing the branded products.

4.1.3 Information on the Currently Using Smartphone Brand

Different people have different perception regarding the brand of Smartphone. This

study aims to focus on which brand of the Smartphone is popular among the customers

in the existing market. Some Smartphone are attractive in the outlooks whereas some

are attractive in price, quality and other features. It’s all depending upon the perception

of the customers which factor should be considered while purchasing the Smartphone.

The result of the study is presented in table 4.3.

38
 Table 4.3

Different Brands Used by the Customers

Smartphone brands used by respondents

Smartphone Apple Samsung Nokia Sony Others Total
Frequency 14 83 4 5 24 130
Percentage 11 64 3 4 18 100
Cumulative Percentage 11 75 78 82 100 100

As evident from table among 130 participants 14 people chose Apple, 83 chose

Samsung, 4 chose Nokia, 5 chose Sony, 24 chose Others. 11% of the participants chose

apple, 64% chose Samsung, 3% chose Nokia, 4% chose Sony, 18% chose others.

4.1.4 Duration of the Smartphone

One of the nature of human kind is they are want to experiment different things in their

life time. By nature the people doesn’t want to stay in one type of Smartphone. They

want to experiments with the different brands of Smartphone. So they should change

their Smartphone within a certain time. The time period of the people carrying the

same Smartphone in Nepalese perspective is presented in Table 4.4

Table 4.4

Change of Smartphone

Duration Frequency Percentage Cumulative Percentage

< 1 year 5 4 4
1 year 12 9 13
2 year 29 22 35
> 2 year 84 65 100
Total 130 100

From the above table, we can conclude that the most of the respondents (65 per cent)

are using the same brand of Smartphone for more than 2 years which is followed by 22

per cent and 9 per cent who change their Smartphone in two year and one year

respectively. Similarly, remaining 4 per cent of the total respondents are changed their

Smartphone in less than one year.

39
4.1.5 Reason behind Using the Same Brand

There are different reasons of different people behind the using the same brand

repetitively. Some scholars defined that the price, popularity and quality of the product

are the major reason behind using the same brand again and again. The reason behind

using the same brand in Nepalese perspective is presented in Table 4.5.

Table 4.5

Reason behind the using of Brand

Factors Frequency Percentage Cumulative Percentage

Price 13 10% 10

Popularity 16 12% 22

Reflection of personality 10 8% 30

Quality 83 64% 94

Others 8 6% 100

Total 130 100%

As evident from the above table, the reason behind using the particular brand of Smart

phone is quality of that product. Majority of the respondents (64 per cent) chose quality

is the major considerable thing while purchasing the Smart phone. Similarly 12 per

cent of the respondents are consider, popularity is the major reason behind using such

brand which is to be consistent with the findings of Park and Jang (2011). Likewise 10

per cent and 8 per cent of the respondents chose price and reflection of personality

respectively as their major reason to choose the particular brand of Smart phone which

is similar to the findings of Sprott & Czeller (2010).

40
4.1.6 Levels of Satisfaction

Different products have the different level of satisfaction. Some people are strongly

satisfied with the Smartphone whereas some people are dissatisfied with the

Smartphone which they have used. The level of satisfaction of the currently using

Smartphone from our respondents is given in Table 4.6.

Table 4.6

Satisfaction with the Smartphone

Level Frequency Percentage

Very satisfied 18 14
Satisfied 86 66
Somewhat satisfied 24 18
Not at all 2 2
Total 130 100

As evident from the given table, we can say that most of the respondents (66 per cent)

are satisfied with the Smartphone which had they purchased whereas 14 per cent of the

respondents are very satisfied with the Smartphone. The satisfaction level is measured

in terms of the quality and durability of the product. Similarly 18 per cent of the

respondents are somewhat satisfied and very few respondents (2 per cent) are not

satisfied with the Smartphone which have they purchased.

4.1.7 Opinion on factor affecting brand loyalty on Smartphone

Sprott & Czellar (2010) defined that the attractiveness of the brand personality

indirectly affects brand loyalty and people use products to enhance self image.

Similarly Swinker& Hines (2007) describes that if the perceived quality of the product

does not match with the actual quality of the product, the chances of rejection of the

product will be higher. There are the various factors that affect in the level of brand

41
loyalty in the Nepalese market perspective. The opinion of the people regarding the

factors affecting brand loyalty on Smartphone is presented in Table 4.7.

Table 4.7

Opinion on factor affecting brand loyalty on Smartphone in Nepalese context

Questions No. %
Do you buy only branded products?
Yes 51 39
No 79 61
Total 130 100
Are you a loyal customer for the products you buy?
Yes 50 38
No 80 62
Total 130 100
Will you stick to the same products if their price is increased (and you are loyal customers to the product)?
Yes 42 32
No 88 68
Total 130 100
Do you think that the quality of the product affect the brand loyalty?
Yes 122 94
No 8 6
Total 130 100

From the above table we can see that the majority of the respondents (61 per cent) are

not purchase the branded products and 62 per cent of the respondents are not loyal to

the products that they purchased. From this figure we can conclude that the majority of

the people are not brand loyal to the product that they purchased. Similarly the majority

of the respondents respond “No” (68 per cent) stating that the price of the product does

not hamper in the brand loyalty of the particular product which is observed to be

supporting the findings by Lau et al (2006). Likewise, most of the respondents (94 per

cent) are believed on that the quality of the product is the major determinant to measure

brand loyalty towards the particular product and the result is found to be consistent

with the findings by Zeithaml V. A. (1998), Lau et al (2006), Swinker& Hine (2007).

42
4.1.8 Perception of People on Different Factor of Brand Loyalty

The different people have the different perception regarding the factors that affect in

the brand loyalty of the consumer. Some people give more priority to the brand name

whereas some other people give the priority to price and quality. So that it is determine

by the psychological factors of the individuals. In our study, we take four factors that

affect in the brand loyalty which is called the dependent variables of our study. The

dependent variables are brand name, product quality, price and advertisement of the

product. These four factors are positively or negatively affect in the brand loyalty of

the consumer towards a certain product. Some people are searched those products

which has reputed in the market. The brand name of the product greatly influence to

the consumer. Similarly some consumers are focused on those products which are more

durable and reliable in the market. These types of customers give the priority to the

product quality. Likewise, some high class level consumers are perceived that the high

price of the product is more durable and reliable. So, they would become a brand loyal

to these products. And finally some customers reach to the product through the means

of advertisement in the media as well as word of mouth and finally they became the

brand loyal to the product which have they purchased. The perception of the people on

different factors of brand loyalty is presented in following Table 4.8 through likert

scale table.

43
 Table 4.8

Perception of People on Different Factor of Brand Loyalty

Strongly Strongly
Disagree Disagree Unsure Agree Agree Total weighted weighted
Statement 1 2 3 4 5 value mean
Brand name
Brand name of the product attracts me to
purchase it 4 8 19 71 28 130 501 3.85
Product of this brand you purchase
satisfies you 0 4 19 90 17 130 510 3.92
Brand reflects my own personality 7 22 43 38 20 130 432 3.32
Grand Mean 3.7
Product Quality
The brand has superior functional quality 4 10 18 82 16 130 486 3.73
The brand stays longer than other brands 5 7 38 58 22 130 475 3.65
The brands meets my needs better than
other brands 2 14 25 66 23 130 484 3.72
Grand Mean 3.70
Price
Increase of price does not hamper me to
purchase 25 44 32 22 7 130 332 2.55
The brand we use , charge fair prices 4 25 33 59 9 130 434 3.33
Comparatively the brand we use charges
low prices 13 39 56 15 7 130 354 2.72
Grand Mean 2.87
Advertisement
Advertisement of the brand attracts me to
buy 9 18 12 71 20 130 465 3.57
Outlooks of the brand is attractive 5 10 14 79 22 130 493 3.79
Advertisement of the product are stylish
and fashionable 7 12 9 74 28 130 494 3.8
Grand Mean 3.72
Brand Loyalty
I will purchase product of this company
again 3 3 41 62 21 130 485 3.73
I will recommend products of this
company to my friends and family 3 5 19 77 26 130 508 3.90
I am brand loyal to the products 2 15 52 41 20 130 452 3.47
Grand Mean 3.70

As evident from the above table others factors that affect in the brand loyalty of the

product are the price, quality, advertisement and brand name of the product. From the

above table, most of the respondents are agreed upon that the brand name of the

product and satisfaction level of the products is strongly affected on the brand loyalty

towards these products with a average weighted mean of 3.85 and 3.92 respectively.

Likewise, with a average weighted mean of 3.32 the respondents are agreed upon the

44
statements that the product reflects the personality also affect on the brand loyal of the

product that you are going to purchase.

As evident from the table, most of the respondents also agreed upon that the product

which has higher quality and the more durability also affect in the brand loyalty of the

product with a weighted mean of 3.73 and 3.65 respectively which is followed the

findings of Zeithaml V. A. (1998), Lau et al (2006), Swinker& Hines (2007). Similarly,

numbers of the respondents are brand loyal towards that product which satisfied the

human needs and basic human expectation towards that product with an average

weighted mean of 3.72.

Another most important factor that determines the level of brand loyal towards the

product is its price. From the above table, we can conclude that the price of the product

affect the brand loyalty level which is correlated with the findings of Lau et al (2006).

Most of the respondents are agreed upon that increase in the price of the product

hamper to purchase a particular product. Similarly, numbers of the respondents are

believed upon that the product which they bought charges the low prices and the most

of the respondents are unsure about the price of the product in comparison with other

products with a weighted mean of 3.33 and 2.72. Likewise, advertisement is also one of

the factors of the brand loyalty. As evident from the table most of the respondents are

agreed upon that those products which have attractive advertisement, attractive

outlooks and fashionable & stylish advertisement directly affect on the brand loyalty

with an average weighted mean of 3.57, 3.79 and 3.8 respectively.

From the above collected data through the likert scale most of the respondents are

agreed upon that they are brand loyal towards the product which have they purchased

with a weighted mean of 3.48. Numbers of the respondents with an average mean of

45
3.90 are agreed upon that they will go to recommend the product to purchase to their

family and relatives. Similarly, with a weighted mean of 3.73 most of the respondents

are going to purchase the same product again.

4.1.9 Correlation Analysis

The table 4.9 depicts the correlation analysis of the major variables under study. The

correlation analysis is conducted for the whole sample. The correlation analysis helps

to find out the relationship between the variables under study. In our study, we measure

the correlation between the different factors and brand loyalty of the product. The

factors of the brand loyalty are the brand name, product quality, price and

advertisement respectively.

Table 4.9

Correlation Analysis for full Sample

The sample includes all 130 respondents among them 51 respondents are male and remaining 71 are female
respondents. All variables are defined as described in chapter III. The table presents correlation analysis of whole
sample. The values in parentheses are p-value. In the table BRAND_N indicates to the brand name of the product.
Similarly PRODUCT_Q and BRAND_L refer to the product quality and brand loyalty respectively, whereas ADV
denotes to the advertisement.
VARIABLES BRAND_N PRODUCT_Q PRICE ADV BRAND_L

BRAND_N 1

PRODUCT_Q .258** 1

(0.003) .

PRICE .231** 0.153 1

(0.008) (0.082) .

ADV 0.147 0.115 0.115 1

(0.094) (0.192) (0.193) .

BRAND_L .510** .425** .292** 0.004 1

(0) (0) (0.001) (0.96) .

*. Correlation is significant at the 0.05 level (2-tailed).

**. Correlation is significant at the 0.01 level (2-tailed).

46
Table 4.9 shows the positive and significant (at one per cent level of significance) relation

between brand name and brand loyalty of the product among the entire sample under study

with coefficient of 0.510 with p-value of 0 indicating that the brand name of the product and

the brand loyalty of the product are positively correlated. Since our hypothesis assumptions

between the brand name and brand loyalty is no negative relationship, our hypothesis will be

accepted.

Similarly, the table shows positive and significant relation between product quality and brand

loyalty of the product with a coefficient of 0.425, which indicate that if the quality of the

product is high, there will be the high brand loyalty regarding those products. Since our

hypothesis assumptions between product quality and brand loyalty is also no negative

relationship, so the hypothesis will be accepted.

Likewise, as evident from table there was positive and significant relation between product

price and brand loyalty of the product with a coefficient of 0.292 and p-value 0.001 but our

hypothesis between price and brand loyalty is no positive relationship. So, our hypothesis

would be rejected.

However, the table shows that there was positive relation between advertisement of the product

and brand loyalty of the product but it is insignificant with a coefficient of correlation 0.004

and p-value 0.96. Since our hypothesis assumption was no negative relation, our hypothesis

will be accepted.

4.1.10 Correlation Analysis across the Moderating Variables

The table 4.10 depicts the correlation analysis of the major variables under study across

the moderating variables (between male and female). The correlation analysis is

conducted for the male and female separately. The correlation analysis helps to find out

the relationship between the variables under study across the male and female. In our

study, we measure the correlation between the different independent factors and brand

47
loyalty of the product. The independent factors of the brand loyalty are the brand name,

product quality, price and advertisement respectively.

Table 4.10

Correlation Analysis across Male and Female

The sample includes all 130 respondents among them 51 respondents are male and remaining 71 are female
respondents. All variables are defined as described in chapter III. The table presents correlation analysis of whole
sample. The values in parentheses are p-value. In the table BRAND_N indicates to the brand name of the product.
Similarly PRODUCT_Q and BRAND_L refer to the product quality and brand loyalty respectively, whereas ADV
denotes to the advertisement. Here brand name, product quality, price and advertisement are the independent
variables whereas brand loyalty is the dependent variables for our study.
GENDER VARIABLES BRAND_N PRODUCT_Q PRICE ADV BRAND_L
Panel A :MALE BRAND_N 1
.
PRODUCT_Q .283* 1
(0.03) .
PRICE .341** 0.236 1
(0.008) (0.072) .
ADV 0.097 -0.091 0.028 1
(0.465) (0.491) (0.832) .
BRAND_L .606** .465** .426** -0.107 1
(0) (0) (0.001) (0.422) .
VARIABLES BRAND_N PRODUCT_Q PRICE ADV BRAND_L
Panel B: FEMALE BRAND_N 1
.
PRODUCT_Q .248* 1
(0.037) .
PRICE 0.105 0.051 1
(0.384) (0.674) .
ADV 0.181 .274* 0.202 1
(0.131) (0.021) (0.092) .
BRAND_L .447** .380** 0.143 0.071 1
(0) (0.001) (0.235) (0.557) .

As evident from Table 4.10, we can say that correlation coefficient between brand

name and brand loyalty is 0.606 which is significant at 0.01 level across a male

whereas same correlation coefficient across a female is 0.447. From this result, we can

conclude that the correlation between brand name and brand loyalty across a male is

higher and positive than across a female.

Similarly the result shows that the correlation coefficient is positive and significant

between product quality and brand loyalty across the both moderating variables (i.e.

48
male and female). The correlation is higher and positive across the male in comparison

with the female. Likewise the correlation coefficient between price and brand loyalty is

positive and significant across the male with a coefficient of 0.426 whereas it is

positive and insignificant across the female with a coefficient of 0.143.

Finally the table shows that the correlation coefficient is negative and insignificant

between advertisement and brand loyalty across the male whereas it is positive and

insignificant across the female. From this result we can conclude that female are more

aware about advertisement in comparison with the male.

4.1.11 Regression Analysis

In our study, regression analysis helps to find out the impact of independent variables

on the dependent variables. We find out the impact of each and every independent

variable on the dependent variables taking one at a time as well as taking all the

variables at a time when conducting the regression analysis. The regression analysis is

presented in Table 4.11.

49
 Table 4.11

Regression Analysis of the Variables

The sample includes all 130 respondents among them 51 respondents are male and remaining 71 are female
respondents. All variables are defined as described in chapter III. The table presents correlation analysis of whole
sample. The values in parentheses are p-value. In the table BRAND_N indicates to the brand name of the product.
Similarly PRODUCT_Q and BRAND_L refer to the product quality and brand loyalty respectively, whereas ADV
denotes to the advertisement.
Model Constant BRAND_N PRODUCT_Q PRICE ADV R SQUARE

1.572** 0.577**
1 0.249
(0) (0)

1.983** 0.465**
2 0.237
(0) (0)

2.687** 0.355**
3 0.112
(0) (0)

3.388** 0.085
4 0.009
(0) (0.27)

0.489 0.421** 0.331** 0.205** -0.042

5 0.411
(0.212) (0) (0) (0.008) (0.5)

*. Regression is significant at 0.05 levels (2- tailed)

**. Regression is significant at 0.01 levels (2- tailed)

In model 1 while introducing brand name as the independent variable and by

controlling, product quality, price and advertisement, the impact is observed to be

positive with a coefficient of 0.577 and significant at 1 per cent level of significance

with explaining power of 24.9 per cent.

Similarly in model 2, after controlling brand name, price and advertisement, the impact

of product quality on level of brand loyalty is observed to be positive and significant

with a coefficient of 0.465 and explaining power of 0.237.

Likewise in model 3, the impact of price on the level of brand loyalty is observed to be

0.355 which is positive and significant at 99 per cent of confidence interval with a

explaining power of 11.2 per cent. In model 4, after controlling brand name, quality

50
and price, the impact of advertisement on brand loyalty is observed 0.085 which is

positive but insignificant and explaining power of this variable is observed 0.9 per cent.

In model 5, while introducing all the variables under study together, the impact of

brand name on brand loyalty is 0.421 and significant. Similarly the impact of quality

and price are obtained to be positive and significant with the coefficient of 0.331 and

0.205 respectively. However the impact of advertisement on brand loyalty is observed

to be negative and insignificant with a coefficient value of -0.042. The explaining

power of the variables is observed 41.1 per cent.

4.1.12 Independent Sample t- test

For robustness, to check whether there is significant mean difference or not in each of

these variables under study across the moderating variables of the study (between male

and female) is tested using independent sample t-test as the statistical tool. The analysis

of independent sample t-test has been carried out to compare the mean differences of

the variables under study. The result of the sample t-test is presented in Table 4.12.

Table 4.12

Independent t-test of the Variables

Variable Groups N Mean Std. Deviation Std. Error Mean

MALE 59 3.6949 0.61053 0.07948
BRAND_N
FEMALE 71 3.7042 0.58972 0.06999
P Value=0.930
MALE 59 3.661 0.77926 0.10145
PRODUCT_Q
FEMALE 71 3.7418 0.67424 0.08002
P Value=0.533
MALE 59 2.887 0.75964 0.0989
PRICE
FEMALE 71 2.8592 0.55108 0.0654
P Value=0.815
MALE 59 3.6497 0.75156 0.09784
ADV
FEMALE 71 3.784 0.81863 0.09715
P Value=0.332
MALE 59 3.6215 0.73879 0.09618
BRAND_L
FEMALE 71 3.7746 0.64186 0.07617
P Value=0.214

51
Our hypothesis assumption about the brand name across the moderating variables is

that there is no significant difference in brand name across the moderating variables.

The table reveals that the mean value of brand name for male is 3.694 and for female it

is 3.704. Since the p-value is greater than 0.05, our null hypothesis should be accepted.

That means there is a no significant difference in the brand name across the male and

female.

Similarly our hypothesis assumption about the product quality is that there is no

significant difference in the product quality across the male and female. Since the p

value of 0.533 is greater than the 0.05, our null hypothesis about the product quality

should be accepted. That means there is a no significant difference in the product

quality across the male and female.

Likewise, our hypothesis assumption about the price across the moderating variables is

that there is no significant difference in price across the moderating variables. The table

reveals that the mean value of price for male is 2.88 and for female it is 2.85. Since the

p-value is greater than 0.05, our null hypothesis should be accepted. That means there

is a no significant difference in the price across the male and female.

As evident from the table, the p-value of the advertisement is 0.332 across the male and

female which is greater than the 0.05. Since it is greater than the 0.05 our null

hypothesis should be accepted. That means there is a no significant difference in

advertisement across the male and female.

At last our hypothesis assumption about the brand loyalty across the moderating

variables is that there is no significant difference in brand loyalty across the moderating

variables. The table reveals that the mean value of brand loyalty for male is 3.62 and

for female it is 3.77. Since the p-value is greater than 0.05, our null hypothesis should
52
be accepted. That means there is a no significant difference in the brand loyalty across

the male and female.

4.1.13 Acceptance or Rejection of Hypotheses

In chapter II we set the different set of assumptions about our study which is called the

hypothesis of the study. The above result and interpretation of the data helps to us find

out the acceptance or rejection of the hypothesis which is presented in Table 4.13.

Table 4.13

Acceptance or Rejection of Hypothesis

Hypothesis Rejected/Accepted
H01: There is no negative relationship between brand name and brand loyalty of the product. Accepted
H02: There is no negative relationship between the quality of the product and brand loyalty. Accepted
H03: There is no positive relationship between the price and brand loyalty of the product. Rejected
H04: There is no negative relationship between advertisement and brand loyalty of the product. Accepted
H05: There is no negative impact of brand name on brand loyalty of the product. Accepted
H06: There is no positive impact of product quality on the brand loyalty of the product. Rejected
H07: There is no negative impact of price on the brand loyalty of the product. Accepted
H08: There is no positive impact of advertisement on the brand loyalty of the product. Accepted
H09: There is no significant difference in brand name across the moderating variables male and female. Accepted
H10: There is no significant difference in product quality across the moderating variables male and female. Accepted
H11: There is no significant difference in price of the product across the moderating variables male and female. Accepted
H12: There is no significant difference in advertisement across the moderating variables male and female. Accepted
H13: There is no significant difference in brand loyalty across the moderating variables male and female. Accepted

As evident from the table, our only two (H03 and H06) hypotheses are rejected. In

hypothesis H03 we set the assumptions that there is no positive relationship between

price and brand loyalty but result shows that the there is positive relationship between

these two variables. Similarly in hypothesis H06 we set the assumptions that there is no

positive impact of product quality in the brand loyalty of the product. But in the result,

we found that there is positive impact of the product quality in the brand loyalty. So

our hypothesis was rejected.

53
 CHAPTER V

SUMMARY, CONCLUSION AND DISCUSSION

5.1 Summary

Brand loyalty has been described as behavioral response and as a function of

psychological processes (Jacoby and Kyner, 1973), which means that brand loyalty is a

function of both behavior and attitudes. Most studies in brand loyalty have been

concentrated on the behavioral aspect of brand loyalty (e.g. repeat purchases) without

considering the cognitive aspects of brand loyalty (Choong, 1998). Repurchase action

is not sufficient evidence of brand loyalty since the purchasing practice should be

intentional (Tepeci, 1999). In order to be considered as brand loyalist, consumer should

have the intention to buy the same product or services at all the time. In addition, brand

loyalist would also include some degree of commitment toward the quality of a brand

that is a function of both positive attitudes and repetitive purchase. In our study, we

focused on the cognitive aspect of the brand loyalty. That means we focused on what

are the various factors that affect the brand loyalty on Smartphone in Nepalese

perspective. The main factors that we consider in our research are brand name, product

quality, price and advertisement of the product.

The main objective of the study is to find out the various factors that affect in the brand

loyalty of the certain product. There is always negative, positive or no impact of the

independent variables on the dependent variables. The main focused of our study is to

find out the relationship between independent and dependent variables and how these

independent variables impact on the dependent variables. For that purpose, we chose

brand loyalty as a dependent variables and brand name, quality, price, advertisement as

independent variables.

54
The research design adopted in this study consists of descriptive and causal

comparative research designs to deal with the various issues raised in this study.

Descriptive research includes surveys and fact-finding enquiries of different kinds. The

major purpose of descriptive research is description of the state of affairs as it exists at

present. It is undertaken in order to ascertain and be able to describe the characteristics

of the variables of interest. The descriptive research design is selected for the study to

learn the profile of the respondents, presentation and description of the data collection,

and to describe the factor that affect the brand loyalty.

The main focus of our study is on the Nepalese youngsters. So we chose student of

different colleges and campuses as our population of the study. However, we took

students of five different colleges as our sample for the study. We took total 157

students from these colleges for our sample population. A structured questionnaire was

administered to 157 participants in the various colleges. Among them 8 students did

not give any responses while other 19 students wrongly filled up the questionnaire. So,

we interpret the data from the 130 respondents.

To interpret our findings, we use different statistical tools such as mean, median, mode,

standard deviation, variance, correlation analysis, regression analysis, t-test etc.

different statistical tools describe the different relationship of the variables. Correlation

analysis help to describe the degree of relationship whereas regression analysis help to

find out the impact of independent variables on the dependent variables.

The major findings of the study are summarized as follows:

1. There is positive and significant correlation between the brand name of

the product and the brand loyalty of the product. This result shows that

higher the reputed brand name, higher will be brand loyal of the

55
 customer towards the product. The higher reputed brand name can

attract the customers.

2. The positive and significant correlation (0.425) between the product

quality and brand loyalty revels that higher the quality of the product

higher will be brand loyalty towards that product. The most of the

customers are loyal to those products which has high quality.

3. The positive and significant correlation (0.292) between price of the

product and brand loyalty towards that product. The most of the

respondents are brand loyal to that product whose price is high.

4. The very low positive correlation (0.004) but insignificant relation

between advertisement and the brand loyalty of the product. It is

insignificant and low positive correlated because most of the unseen

expenses such as donation, charity are included in advertisement.

5. There is positive impact of brand name on the brand loyalty of the

product. Higher the reputed brand name leads to the brand loyalty of

that product.

6. There is also positive impact of product quality on the brand loyalty of

that product. Higher the quality, higher will be the brand loyalty. High

quality of the products leads to make the loyal customers.

7. Similarly, the result also shows that there is positive impact of the price

on the brand loyalty to the product. Higher the price also helps to make

the consumer loyal towards the product.

8. There is negative impact of the advertisement on the brand loyalty of the

product. Our study shows that there is no help from advertisement to

make customer loyal towards the product which have they purchased.

56
 9. From our study, we can conclude that there is no significant difference

between independent variables and dependent variables across the

moderating variables. i.e across the male and female.

5.2 Conclusion

From our research, we can conclude that high reputed brand name of the product

creates the high loyalty towards these product. It is because of high word of mouth.

Most of the people talks about the certain particular product, which helps to increase

level of understanding to the people towards these products which ultimately creates

the brand loyalty. Similarly from our findings we can say that advertisement doesn’t

help in increase in the brand loyalty of the product in the Nepalese perspective. It is

because of most of the people did not give attention to the advertisement of the

product. Likewise, our study concludes that there is high positive and significant

impact of the product quality in the brand loyalty of the product. In the Nepalese

perspective high quality of the product refers to the high durability, reliability and

functionality. Those products which are more durable and reliable helps to loyalty of

the consumer towards those products.

5.3 Discussion

In the review of literature of our study, we were discussed about the findings of the

various authors. The result of our study is also similar and connected with the previous

findings of different authors. The significance of findings of our study with the

previous findings of different authors is described below:

1. From our study, we can conclude that the product quality of the product

has significantly impact on the brand loyalty of the consumer towards

those products. To become the brand loyal, the product quality plays the
57
 psychological role in the consumer’s judgments towards these products

which is similar to the findings of the Zeithaml, V.A (1998) and

Swinker & Hines (2007).

2. Similarly from our result, we can say that price is one of the major

determinants of the brand loyalty of the consumer towards the certain

product. It has positive impact on the brand loyalty of the consumer.

Some consumer perceived that the high price of the product will be high

quality and more durable. So that they become loyal to these product,

which is connected with the findings of Lau et al (2006) , Yee & Sidek

(2008) and Cadogan & Foster (2000).

3. Likewise, advertisement of the product is also directly related with the

brand loyalty of the consumer. A person who heard the advertisement of

the particular product repetitively, he will be brand loyal of that product.

From our study, we also find out that there is positive relationship

between advertisement of the product and the brand loyalty which is

similar to the findings of Park and Jang (2011) and Che Wel & Syed

(2012).

4. Another major finding of our study is that the brand name of the product

is also one of the determinants of the brand loyalty of the consumer. The

reputed brand name of the product helps to increase the brand

personality of the consumers. So that brand name of the product band

the brand loyalty towards the product is positively correlated which is

the similar to the findings of Sprott & Czeller (2010).

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