customer satisfaction and loyalty start with the product, culminate with the brand
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(Moraga, Parraga & Gonzalez 2008)TRANSCRIPT
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Customer satisfaction and loyalty: start withthe product, culminate with the brand
Eduardo Torres-Moraga
Facultad de Economa y Negocios, University of Chile, Santiago de Chile, Chile
Arturo Z. Vasquez-ParragaCollege of Business Administration, The University of Texas-Pan American, Edinburg, Texas, USA, and
Jorge Zamora-GonzalezFacultad de Ciencias Empresariales, University of Talca, Talca, Chile
AbstractPurpose Studies on customer satisfaction and loyalty have focused on brand rather than product. It is not that brand is not important, but theprocess of loving a brand starts with a product. Customers appreciate products by themselves, independent of the brand, as shown in their pursuit ofsatisfaction and development of loyalty. Such appreciation seems to be prominent regarding innovative products when compared to traditionalproducts. This paper aims to investigate this issue and provide a product-brand typology.Design/methodology/approach The paper takes the form of empirical research on a partial application of the typology.Findings Results show that the relationship satisfaction-loyalty is significantly present when evaluating products alone albeit a weaker presencethan when evaluating brand alone. Such unequal presence is corroborated in both traditional (bottled wine) and innovative (electronic) products eventhough it is much stronger in innovative products. The relationship satisfaction-loyalty is also present when evaluating product and brand combined,indicating that there is an intermediate position between product and brand. In contrast, the literature treats brand and product-brand as being in thesame category thereby diminishing the importance of a useful difference between brand and product-brand.Practical implications There are practical consequences of applying the typology and examining the findings. The relationship satisfaction-loyaltystarts with the product, includes the product-brand, and culminates with the brand. This process is significantly more important regarding innovativeproducts, such as electronics, as compared to traditional products such as wine.Originality/value This study introduces a typology underscoring the pursuit of satisfaction and development of loyalty in three conditions of productpresence versus brand presence, that is, product alone, brand alone, and product and brand combined.
Keywords Customer satisfaction, Customer loyalty, Brands, Electronic commerce, Wines
Paper type Research paper
An executive summary for managers and executive
readers can be found at the end of this article.
Introduction
This study aims at:. developing a comprehensive product-brand typology;. examining the relationship satisfaction-loyalty when
evaluating the product alone;. comparing the strength of the relationship in either
product alone or brand alone situations;. exploring the strength of the relationship in a product-
brand combined situation; and. comparing the strength of the relationship in either
traditional product or innovative product.
The first section reviews the literature on the key concepts of
this research: product, brand, customer satisfaction, and
customer loyalty, and introduces the product-brand typology.
The next section reports on the methodology used to partially
test the relationships emerging from the typology as
formulated in the propositions. The section on results gives
an account on the validity of the measures used and the
hypothesis tests performed. The remaining sections offer
conclusions, practical implications, and suggestions for future
research.
Literature review
Product and brand for customer relationships
This review focuses on product and brand as two stages in the
development of the benefits destined to satisfy customers
needs and preferences, and satisfaction and loyalty as two
stages in the customers response to the company offerings. It
is assumed that product is an initial stage in the product
offering whereas brand is a mature stage. Similarly,
satisfaction is an initial stage in the customer response to a
company offering whereas loyalty is a mature stage in such a
response.When studying customer satisfaction and/or loyalty,
research has focused on satisfaction or loyalty towards the
brand, not the product. The existence of the product has been
subsumed into the brand, thus ignoring brand as a separate
reality. In addition, when studying the product, such as in
The current issue and full text archive of this journal is available at
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Journal of Consumer Marketing
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q Emerald Group Publishing Limited [ISSN 0736-3761]
[DOI 10.1108/07363760810890534]
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product development or product innovation, the customers
response (e.g., satisfaction or loyalty) to it has been ignored.One of the consequences of such an approach is that
marketers do not use the product as a base to gain customersatisfaction or to generate customer loyalty even if loyalty is
reduced to customer retention or purchase repetition(spurious loyalty).The product can be a good starting point for providing
satisfaction and generating loyalty, whereas the brand can be
the mature stage of such processes. The intention is not todiminish the importance of the brand; instead, the intention is
to recognize the importance of the product, separate from thebrand. The advantages of getting an early start with providing
satisfaction and generating loyalty towards the productinclude market pioneering, first mover advantages, low-cost
proactive innovation, and industry redefinition. Thedisadvantages of ignoring the product as an initial stage to
develop company policies for satisfaction and loyalty includeloss of market opportunities, loss of market leadership, high-
cost reactive innovation, and high-cost brand development.However, the recognition of the product as an initial stage
to develop satisfaction and loyalty policies may not be equalacross different products. Some products, lets say traditional
products, such as fresh food and drinks, may be in less need ofsuch policies, whereas innovative products, such as
automobiles and electronic equipment, may be highlydependent on such policies.A typology including the product and the brand in their
various levels of recognition, such as single product, product
mix, and no presence, is developed and presented below andthe relationships emerging from it tested.
Customer satisfaction as antecedent of loyalty
Satisfaction is often used as a predictor of future consumerpurchases (Newman and Werbel, 1973; Kasper, 1988).
Satisfied customers have a higher likelihood of repeatingpurchases in time (Zeithaml et al., 1996), of recommendingthat others try the source of satisfaction (Reynolds andArnold, 2000; Reynolds and Beatty, 1999), and of becoming
less receptive to the competitors offerings (Fitzell, 1998).More specifically, satisfaction is found to be a necessary
precursor of customer loyalty (Fitzell, 1998; Fornell, 1992;Reynolds and Beatty, 1999; Sivadas and Baker-Prewitt, 2000;
Zeithaml et al., 1996). Whereas satisfaction and loyalty arerecognized as strongly related by most studies (Anderson and
Sullivan, 1993; Fornell, 1992; Rust and Zahorik, 1993; Taylorand Baker, 1994), some consider the relationship to be
interchangeable (Hallowell, 1996; Oliver, 1999), and some tobe unidirectional, that is, progressing from satisfaction to
loyalty only (Strauss and Neuhaus, 1997). Satisfied customerstend to be loyal customers with (Rowley, 2005) or without the
mediation of other variables (Coyne, 1989; Fornell, 1992;Oliva et al., 1992).
Customer loyalty as an outcome of marketing
relationships
A quick observation of customer loyalty is repeated purchase(Ball et al., 2004; Copeland, 1923; Newman and Werbel,1973; Tellis and Chandy, 1998). In practical terms, firmswant repeated purchases mainly because such behavior in
consumers can:. apparently show the customer preference for a brand or
product (Bowen and Shoemaker, 1998);
. reflect a customers purchase intention (Mellens et al.,1996); and
. presumably secure profitability (Reichfeld and Sasser,1990; Rust et al., 2004; Reinartz et al., 2005) by increasingmarket share (Chaudhuri and Holbrook 2001).
Yet, the literature has categorized this type of loyalty asspurious loyalty (Dick and Basu, 1994) or loyalty by inertia(Solomon, 1992; Bloemer and Kasper, 1994) because it onlysignals behavioral customer response. The consideration ofattitudes in addition to the behavioral representation makesloyalty not just richer conceptually (loyalty is a process, notjust an act) but also more useful for practical purposes, suchas influencing customers both attitudinally and behaviorally(Dick and Basu, 1994; Jacoby and Chestnut, 1978; Jacobyand Kyner, 1973; Oliver, 1999; Olson and Jacoby, 1971).Attitudinal loyalty reflects customers cognitive, affective, andconative predispositions to continue relating to the brand orcompany (Oliver, 1999) often involving customercommitment (Bloemer and Kasper, 1994; Morgan andHunt, 1994; Solomon, 1992) or, better yet, involving trustand commitment, in this order, after an initial experience ofcustomer satisfaction (Bravo et al. 2005; Vasquez-Parraga andAlonso, 2000; Zamora et al., 2004).Consequently, true loyalty (behavioral and attitudinal)
would be more powerful to not only influence the bottom linebut also the mediating processes towards the bottom line suchas:. customers intention to favorably recommend the brand or
company to others (Getty and Thompson, 1994);. horizontal communication (customer to customer),
mouth-to-mouth communication in particular (Gremlerand Brown, 1999; Reynolds and Arnold, 2000; Srinivasanet al., 2002);
. customers resistance to competitors offerings (Gundlachet al., 1995) and persuasive tactics to attract newcustomers (Dick and Basu, 1994); and
. buzz marketing (Grifiin, 1995).
Finally, loyalty is often considered to be a predictor of thefirms financial performance. The relationship, however, isoften established as part of a trio: customer satisfaction-customer loyalty-firms performance (Reichfeld and Sasser,1990; Zeithaml et al., 1990; Anderson et al., 1994; Storbackaet al., 1994; Rust et al., 1995; Hallowell, 1996; Fornell, 1992)
Customer satisfaction-loyalty relationships bylevels of product-brand presence
Product and brand are not synonymous (Schiffman et al.,1997). Yet, some authors have used them interchangeably,particularly when they have addressed repeated purchases(e.g., Dick and Basu, 1994; Oliver, 1997). As defined above,product and brand are significantly different bothconceptually and practically. Similarly, customer satisfactionand loyalty are significantly different even though they arestrongly and unidirectionally related.The following typology reflects a customer evolution in
adopting a product or brand and in becoming loyal besidesachieving satisfaction. A customer usually starts judging aproduct in order to find the benefits it brings and thesatisfaction it promises (Reynolds and Beatty, 1999). Thegeneric or unbranded product would be enough to start sucha selection process. Inexperienced consumers with a line of
Customer satisfaction and loyalty
Eduardo Torres-Moraga, Arturo Z. Vasquez-Parraga and Jorge Zamora-Gonzalez
Journal of Consumer Marketing
Volume 25 Number 5 2008 302313
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products start with the product benefits and preferences
whereas experienced consumers go directly to the brands. As
the customer becomes more experienced with the product, he
or she may focus on a brand.Similarly, products follow life cycles in combination with
their brands: new products are first recognized as products
and later, after the products have satisfied many customers
and reached a more developed stage, as brands. In adopting
cellular phones, for instance, recent customers adopt the
product that best fits their needs or best appeals to them
emotionally, symbolically, and/or cognitively (Park et al.,1986). More experienced but not highly experienced
customers adopt a range of brands on the basis of both
value and price, whereas highly experienced customers
become loyal to a brand.The typology is an effort to represent the evolution of
product to brand in customer choice and the sequential
achievement of customer satisfaction and customer loyalty.
Consequently, three levels of product presence (no presence,
presence of a product, and presence of a set of products) are
compared to three levels of brand presence (no presence,
presence of a brand, and presence of a set of brands). Each
cell generated in the comparison (nine cells in total eight
cells are useful because cell 1 is mute) serves to characterize
the type of customer satisfaction-loyalty relationship (see
Figure 1) as described in the following analyses.
Satisfaction-loyalty to the product alone (cell 2)
Customers that evaluate products for the first time focus on
the product benefits, not the brand. The emphasis is in the
tangible attributes of the product, which are visible and
accountable to the buyer (Keller, 1993). For instance,
consumers adopting a cellular phone for the first time may
look at its functions and properties and postpone any
particular interest in a brand. Similarly, low-price car buyers
may focus on the characteristics of the car regardless of brand.
Satisfaction-loyalty to a bundle of products (cell 3)
In addition to focusing on product benefits, some first-time
customers extend such evaluation to bundles of products. For
example, first-time customers who adopt hi-tech products or
innovative products such as electronics or fashion clothing
usually focus on the product functions or attributes,
respectively.
Satisfaction-loyalty to a brand alone (cell 4)
Some customers choose a brand regardless of the product.
For instance, customers who like the Sony brand in any
product Sony may offer, televisions, disc players, photo
cameras, etc. may demonstrate brand loyalty by making
subsequent purchases of Sony products without regard to
other brands. Some brands are linked to products in similar
lines, such as Sony or General Electric, whereas other brands
relate to products in different product lines such as Nestle or
the new Apple. Still some customers identify themselves with
a brand or adopt a brand because it reflects their personality
(Aaker, 1997). Most studies have focused on brand alone
emphasizing its intangible attributes or associations in various
forms: a) company advertising, public relations, and word-of-
mouth communications (Biel, 1992; Krishnan, 1996) media
reports on consumption (Biel, 1992), consumers direct
experience with the product (Biel, 1992; Burnkrant and
Unnava, 1995; Haynes et al., 1999; Hoch and Deighton,1989), brand-owning companys reputation (Nguyen and
LeBlanc, 2001), country of origin (Erickson et al., 1984;Hong and Wyer, 1990), and product distributors (Pettijohn
et al., 1992). Some studies have also emphasized thecombination of tangible and intangible attributes in the
product portrayals (Keller, 1993) or market equilibrium
(Wernerfelt, 1991).
Satisfaction-loyalty to product-brand combinations
(cell 5)
Customers choose the same product line in a range of brands,
for instance, television sets in three brands only, Sony, Philips
and Samsung. Some customers choose clothes or cars within
a range of two or three brands only. Some studies on
customer loyalty seem to have taken into account this type of
combination (Dick and Basu, 1994; Oliver, 1999).
Conditional satisfaction-loyalty to a brand (cell 6) or
conditional satisfaction-loyalty to a product (cell 8)
Customers attempt to link a product with a brand and set
their preferences in product-brand combinations. A customer
may choose the product or the brand first and then follow
with the brand or the product, respectively (Jacoby and
Kyner, 1973; Brucks, 1985; Dawar and Parker, 1994). For
instance, a customer may choose Sony TV, JVC disc players,
and Cannon photo cameras. Similarly, consumers may choose
Figure 1 Types of satisfaction-loyalty relationships by levels of product-brand presence
Customer satisfaction and loyalty
Eduardo Torres-Moraga, Arturo Z. Vasquez-Parraga and Jorge Zamora-Gonzalez
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Levis blue jeans, Arrow shirts, and Dockers socks. The
selection is conditional because when deciding on television
sets, the customer will only favor a Sony brand, or whenadopting disc players, the buyer will only embrace a JVC
brand, and so on.
Satisfaction-loyalty to a set of brands (cell 7)
Some customers, particularly when associating their decisionsto cultural, social or economic peculiarities, buy within a
short span of brands regardless of product. For instance, rich
customers are found to fit this profile in brand choice bybuying luxury or upscale brands only such as Porsche and
Lexus in cars, Gucci and Hartmann in bags and luggage,Celine and Vuitton in clothes, and Burberry and La Vallee in
clothing stores. Similarly, customers that distinguishthemselves by generation, place of origin, or group beliefs
limit their brand choices to particular sets of brands, the ones
that distinguish them in terms of generation, place of origin orgroup beliefs, respectively (Boush et al., 1987; Park et al.,1991; Dacin and Smith, 1994; Herr et al., 1996; Klink andSmith, 2001).
Satisfaction-loyalty to a basket of product-brand
combinations (cell 9)
Many customers choose sets of products within ranges ofbrands, one set per range of brand. For example, in choosing
women cosmetics, some women prefer a set of brands (e.g.,Lancome, Ahrens, and Helena Rubinstein) for face cosmetics,
and another set, for body cosmetics, and so on. The
expressions if I buy moisture lotion it has to be Olay orChanel or if I buy wet shaving products they have to be
Gillette or Colgate Palmolive are common in this cell ofconsumer choices.Cells 2 (product alone), 4 (brand alone) and 5 (product-
brand) will be subject to test using a survey research. From
the above considerations regarding these three cells, we can
formulate the following proposition and hypotheses:
P1. The relationship satisfaction-loyalty is present in bothconsumer products and brand choices, includingproduct-brand combinations. Yet, this relationship is
stronger when customers adopt brands than when theyadopt products. It is stronger when they adopt
innovative products than when they choose
traditional products.H1. The relationship satisfaction-loyalty is significant in
both consumer products and brand choices, includingproduct-brand combinations.
H2. The more the brand is used in adopting the product,the greater the impact of satisfaction on loyalty.
H3. The impact of satisfaction on loyalty is greater inadoptions of product-brand combinations than in
product adoptions alone, but weaker than in brand
adoptions alone.H4. In product adoptions alone, the impact of satisfaction
on loyalty is greater when adopting innovate productsthan it is when adopting traditional products.
Methodology
Research design
A 3 2 research design was applied in order to secure threegroups of consumers (in terms of their choices of brand,
product, or product-brand) and two groups of consumers
adopting either innovative products or traditional products.The strength of the relationship between satisfaction and
loyalty is measured for each type of adoption: product alone,
product-brand, and brand alone. Six off-the-shelf scalesmeasuring each construct, satisfaction or loyalty, were
adapted from the literature as a starting point. The
satisfaction measures were adapted from Sharma andPatterson (1999); Brockman (1998); Smith and Barclay
(1997); Nguyen and LeBlanc (1998); and Veloutsou et al.(2004). The loyalty measures were adapted from Rowley and
Dawes (2000); Yoon and Kim (2000); Nguyen and LeBlanc
(1998); and Veloutsou et al. (2004).Because some of the scales were originally developed in
different contexts of consumers, a pilot study with focusgroups and a group of industrial and retail executives
preceded the actual study. This resulted in four depurated
scaled items per construct. A pre-test of the questionnairefollowed with 105 respondents and resulted in the elimination
of an additional item per construct after evaluating factoranalysis results in light of conceptual contents presented
above. Thus, three scaled items of a Likert type of seven
points (1 completely disagree through 7 completelyagree) for each construct were applied in the final survey.
Samples
Two types of products were adopted, electronic products to
represent innovative products and wine, to representtraditional products. A quota sample was comprised of
customers who buy electronic products or wine for a total of
1,223 respondents (830 buyers of electronic products and 393buyers of wine). The first sample is more than two times the
second sample due to the greater variety of products andbrands in that segment and because the group of product-
brand adopters was absent in the sample of wine buyers.The resulting sample of electronic-product buyers is
distributed as follows: 43 percent adopted product-brands,
40 percent adopted products alone, and 17 percent adoptedbrands alone. Among wine buyers, 55 percent adopted
products alone and 45 percent adopted brands alone.
Results
Reliability
Confirmatory factor analysis with Varimax rotation resultsrevealed that each construct, customer satisfaction and loyalty
among buyers of electronic products, is one-dimensional as
shown in Table I. All Cronbach alphas (Cronbach, 1951) areabove the 0.70 threshold established by Nunnally (1978), and
all item-total correlations are above the 0.30 limit (Nurosis,1993). Table I shows similar results for wine buyers except for
the Cronbach Alpha above 0.60 in the loyalty factor, still
acceptable for exploratory factor analysis (Hair et al., 1998).
Hypothesis tests
Hypothesis tests were conducted using structural equationmodeling (EQS version 6.1). A maximum likelihood method
(Hu et al., 1992) is used in order to prevent potentialproblems derived from the lack of univariate normality in the
data. Figures 2-6 show that the relationship between customer
satisfaction and loyalty is positive and significant (at 0.01level) in the three situations of adoption: product alone, brand
alone and product-brand combination. These results support
Customer satisfaction and loyalty
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Table I Satisfaction and loyalty: factor analysis by type of product
Brand alone Product-brand Product alone
Indicator Loading Indicator Loading Indicator Loading
Loyalty: electronic products LTM1 0.80 LMP1 0.78 LTP1 0.59
LTM2 0.84 LMP2 0.84 LTP2 0.88
LTM3 0.83 LMP3 0.79 LTP3 0.88
CA* 0:76 CA 0:72 CA 0:70EV* 67:63 percent EV 64:66 percent EV 63:29 percent
Satisfaction: electronic products STM1 0.88 SMP1 0.87 STP1 0.89
STM2 0.86 SMP2 0.86 STP2 0.92
STM3 0.92 SMP3 0.89 STP3 0.90
CA 0:86 CA 0:85 CA 0:89EV 78:53 percent EV 77:03 percent EVA 81:99 percent
Loyalty: wine products LTM1 0.76 LTP1 0.85
LTM2 0.75 LTP2 0.85
LTM3 0.76 LTP3 0.56
CA* 0:63 CA 0:63EV* 57:53 percent EV 58:39 percent
Satisfaction: wine products STM1 0.73 STP1 0.67
STM2 0.79 STP2 0.67
STM3 0.63 STP3 0.80
STM4 0.76 STP4 0.79
CA 0:70 CA 0:71EV 53:17 percent EV 53:93 percent
Notes: CA Cronbach alpha; EV Explained variance
Figure 2 Satisfaction-loyalty relationship for brand alone (electronic products)
Figure 3 Satisfaction-loyalty relationship for product-brand combinations (electronic products)
Customer satisfaction and loyalty
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H1. Similarly, Table II shows acceptable adjustment measures
for all relationships in both types of products, innovative and
traditional, providing additional support for H1.In support of H2, the relationship satisfaction-loyalty is
stronger in brand adoptions as compared to product
adoptions as observed in Table III and in Figures 2-6. The
main reason brand adoptions produce more customer
satisfaction, which in turn produces more customer loyalty,
has to do with the addition of intangible characteristics to the
product tangible features. Intangible components include
psychological benefits of symbolic and emotional value (Park
et al., 1986) and a consumers preference for the personality
he or she sees reflected in the brand (Aaker, 1997). Product
adoptions alone generate customer satisfaction, which in turn
generates customer loyalty on the basis of tangible product
features such as useful functions and attractive appearance.
Most often this is the initial stage of customer satisfaction and
an important one. Yet, it takes the brand to raise the level of
satisfaction with some intangible benefits.In support of H3, Table III and Figures 2-6 show that the
impact of satisfaction on loyalty is greater in adoptions of
product-brand combinations than in product adoptions alone,
but weaker than in brand adoptions alone. This is an
intermediate stage of development in the relationship between
Figure 4 Satisfaction-loyalty relationship for product alone (electronic products)
Figure 5 Satisfaction-loyalty relationship for brand alone (wine products)
Figure 6 Satisfaction-loyalty relationship for product alone (wine products)
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sellers and buyers, providers and customers. A product-brand
combination brings the advantages of both the tangible
features of the product and the intangible benefits of the
brand in a period of development in which neither the
product nor the brand is able to dominate. On the consumer
side, this stage is represented by a medium-level of
satisfaction-loyalty as compared to the one generated for the
brand alone, assuming the dominance of the brand was able
to generate greater levels of satisfaction by maximizing the
virtues of both tangible and intangible, especially the later
ones, benefits of the product.Finally, in support of H4, Table III and Figures 2-6 show
that the impact of satisfaction on loyalty is greater when
adopting innovative (electronic) products than when adopting
traditional (wine) products. Following a recommendation by
Ailawadi et al. (2001) and using the Fishers Z-test and aprocedure introduced by Cohen and Cohen (1983) to test the
significance of the difference, the results in Table III show that
the relationship is significantly stronger among adopters of
innovative (electronic) products than it is among adopters of
traditional (wine) products. This may happen because
innovative products require more customer participation in
the process of delivering the product to the customer. By the
nature of innovative products, customers become more active
in their search for the product at the same time they become
more scrutinizing and more demanding of satisfaction. Thus,
innovative-product manufacturers and providers work harder
at satisfying the customer, whereas traditional-product
manufacturers and providers may just rely on a customary
base of customers to keep going.
Conclusions
Customer satisfaction and loyalty can be achieved by either
emphasizing the product or the brand depending on the level
of development of the product or product line in the markets.
At the introduction stage of the product, emphasis is on the
product and the tangible aspects of it. Satisfaction can be
achieved at this stage if there is a fit between the customer
need and the product offering. The intensity of satisfaction
attained at this stage, however, is not high mainly because of
the absence or scarcity of the psychological benefits included
in the product offering. At a more mature stage of the
product, there are given opportunities for the brand to excel if
it is able to add enough intangible benefits to the product.
When successful, this new bundle of tangible and intangible
benefits can produce higher customer satisfaction, which in
turn can generate higher customer loyalty in the long term.Yet, a more mature stage can combine a product-brand
where both tangible and intangible benefits are salient without
any set (tangible or intangible) prevailing over the other.
Alternatively, this stage can privilege the brand emphasizing
the intangible benefits. The consequences of either approach
(product-brand or brand alone) on customer satisfaction,
however, are distinctive: the brand alone is able to produce a
stronger satisfaction-loyalty relationship than the product-
brand combination. Nevertheless and despite the benefits of
achieving the stage of a brand alone, it seems that both
customer and manufacturer/provider have to pull up the
brand. The manufacturer/provider cannot reach the highest
stage without the customers help. The customer would finally
Table II Satisfaction-loyalty relationship: goodness of fit by type of product
Electronic products Wine products
Brand alone Product-brand Product alone Brand alone Product alone
Goodness of fit indicesx2 50.405 (8) 30.354 14.466 44.925 45.265
df 8 8 8 13 13
p # 0.001 # 0.001 # 0.001 # 0.001 c 0.001GFI 0.887 0.975 0.986 0.939 0.934
Increases in goodness of fitNFI 0.885 0.966 0.985 0.836 0.831
IFI 0.902 0.975 0.993 0.878 0.873
CFI 0.900 0.974 0.993 0.874 0.869
Adjustments for parsimonyx2/df 6.3 3.79 1.8 3.5 3.48
Table III Satisfaction-loytalty relationship: intensity of the differences
Differences
Fishers
Z-testSignificance
level
Electronic products versus wine productsSTP! LTP (electronics) and STP! LTP (wine) 6.32 0.01STM! LTM (electronics) and STM! LTM (wine) 6.91 0.01Electronic productsSTM! LTM (electronics) and STP! LTP (electronics) 2.33 0.05STP! LTM (electronics) and STP! LTP (electronics) 5.19 0.01STP! LTP (electronics) and STP! LTP (electronics) 2.86 0.01
Customer satisfaction and loyalty
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accept the brand alone as the subject of his satisfaction and
follow-up loyalty.The above fitting process between product or brand
adoption and customer satisfaction-loyalty is more intense in
the world of innovative products, such as electronic products,
as compared to traditional products, such as wine. Innovativeproduct processes, such as the ones involved in electronic
products, accelerate the interaction between adoption andrelationships. The intensity in technological developments is
usually matched by customers higher participation in such
processes. By contrast, traditional products do not requireeither technological innovations or active customer
participation or both in the usually slow-paced development
of the product. As a consequence, traditional products do notreach high levels of satisfaction-loyalty, at least not as high as
the ones achieved in innovative-product processes.
Managerial implications
The practical implications of the results achieved in this
research are three-fold. First, managers, particularly, product
or brand managers, should pay attention to the developmentof the product by itself. The customer pays attention to such
development when the product is new or innovated and shows
satisfaction even when taking into account the product alone.Of course, the level of customer satisfaction achieved is not
very high and does not generate strong customer loyalty but is
present and can mark the initial point of a successful path inboth product development and customer satisfaction-loyalty.Second, managers should use the product-brand stage, an
intermediate level in product development, to enhance the
brand and its intangible benefits over the product and its
tangible features. The combination is not always of equalparts or equal importance, but it signals the presence of both,
without either prevailing over the other. To continue progress
in product development, the company should attempt tomake the brand salient by enhancing the intangible benefits of
the product if it finds that the customer is ready for that stage.
The customer is ready for the brand stage when he or she candecide on the basis of the intangible benefits of the product,
ceteris paribus, the tangible features already in place. If movingto the higher stage of the brand alone is difficult, either theproduct-brand combination will have a longer life, delaying
the stage of the brand alone, or the customer satisfaction is
strongly linked to the tangible benefits of the product, makingmore costly to the company the addition of the chosen
intangible benefits.Finally, the shifting process from product alone to product-
brand to brand alone is faster in technologically innovative
products. In this product category, managers can use suchadvantage to achieve the highest stage (brand alone) faster
with probably short periods of product alone and product-
brand combinations. Conversely, managers can haveinsurmountable problems in accelerating the process in
traditional products. Correct policies linked to traditional
products can emphasize the product or the product-brand inthe long term even if the stage of the brand alone can develop
at some point in the future. This is a healthy guidance for
managers of traditional products, so that they should notwaste time and resources in developing the brand in
traditional products that require longer life in the previousstages of product alone and/or product-brand combinations.Consequently, company positioning policies should:
. start with the product, particularly when developing new
products or innovating existing ones;. evaluate product and brand combined when product
development has reached a state of maturity that is
considered enough to maintain a brand; and. culminate with the policy by focusing on the brand as the
last stage in the learning process.
Limitations and future research
When studying the satisfaction-loyalty relationship as derived
from the product adoption process, the literature has ignored
both the product alone and the product-brand combinations.
In this research, we have addressed this forgotten problem
and clarified that customer satisfaction and loyalty start early
in the process, that is, in the development stage of the product
alone. Despite this clarification, however, much remains to be
done. We have tested only three quadrants in the proposed
typology of satisfaction-loyalty relationships by levels of
product-brand presence. The other quadrants, except the
one where there is no brand and product, can also be and
should be tested empirically in order to validate their
corresponding formulations. In addition, further studies are
needed regarding the two stages we have tested empirically,
that is, the product alone and the product-brand
combinations. Whereas previous studies have privileged the
brand over the product in its effects on customer satisfaction
and loyalty, this is a new study and validation of the findings is
called for in other product lines, other market conditions, or
other measures.
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Corresponding author
Arturo Z. Vasquez-Parraga can be contacted at: avasquez@
utpa.edu
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Eduardo Torres-Moraga, Arturo Z. Vasquez-Parraga and Jorge Zamora-Gonzalez
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Executive summary and implications formanagers and executives
This summary has been provided to allow managers and executivesa rapid appreciation of the content of the article. Those with aparticular interest in the topic covered may then read the article intoto to take advantage of the more comprehensive description of theresearch undertaken and its results to get the full benefit of thematerial present.
Why product is important
Research into customer satisfaction and loyalty has so far
almost exclusively focused on brands. In contrast, products
have largely been ignored and considered as part of the brandrather than a separate entity. That customer satisfaction and
loyalty can in fact be directed at the product has therefore not
been acknowledged. One consequence has been reluctance
from marketers to use the product as a means of generating
satisfaction and loyalty. Torres-Moraga et al. put forward theview that the product is the starting point for the satisfaction
and loyalty process, whereas the brand represents the
advanced stage.Gaining satisfaction and loyalty at this initial phase can
result in several benefits, including first-mover advantage,
low-cost proactive innovation and an opportunity to redefine
the market. In contrast, lost market opportunities, marketleadership and the higher costs associated with reactive
innovation are some consequences of ignoring the product
stage for such purposes.However, the influence of product on satisfaction and
loyalty may depend on the product type. Indications suggest
there will be less impact with traditional goods like food and
drink but considerable significance when the products are
innovative. Automobiles and electronic equipment are two
product areas noted in this respect.Satisfaction is essentially viewed as the antecedent to
loyalty. Satisfied customers become loyal customers who
express this loyalty through their purchase behavior and
future purchase intention. But loyalty that merely exists at this
behavioral level is dismissed as spurious by some observers.
The argument here is that loyalty is more profound when it
incorporates attitude as well as behavior since it reflects
cognitive, affective and conative attachment on the
customers part. This level of loyalty is often expressed
through such as positive word-of-mouth, recommendation to
others and a refusal to consider rival offerings.
A satisfaction-loyalty typology
Based on the existence of a life cycle whereby products evolve
into brands, the authors suggest a typology to elucidate the
process. Eight different stages combining various levels of
product and brand presence are suggested. The present study
focuses on customer satisfaction-loyalty relating to three of
these stages:1 Product alone, when consumer evaluation occurs for the
first time.2 Brand alone some consumers will opt for a specific
brand for a range of different products. Take Sony, for
instance. Those who support this brand may purchase
television sets, disc players, cameras or various otherelectrical appliances or gadgets.
3 Product-brand past research has acknowledged this
intermediate phase where customer selection of a
particular product will be limited to within a small range
of brands. One example would be narrowing the choice of
a new television to Samsung, Phillips or Sony.
Research was designed to examine the extent of satisfaction-
loyalty within these different adoption phases in relation to
either traditional or innovative products. Wine was chosen for
the traditional product and electronic goods as its innovative
counterpart. Of the 1,233 respondents, 830 purchased
electronic products and 393 were wine buyers.Findings indicated that customer satisfaction and loyalty
was:. Positive and significant in all three situations.. Stronger for brand adoption compared to product
adoption. Adoption of the product alone is enough to
generate the satisfaction that in turn can lead to loyalty.
This occurs on the basis of functional attributes and other
tangible product features such as appearance. However,
the brand is also able to boast additional components
containing symbolic and emotional value. In additional to
attachment with these intangible attributes, potential
exists for the customer to engage with the personality
perceived in the brand.
Likewise, the impact of satisfaction on loyalty was greater for:. Product-brand adoption than for product adoption alone
but weaker than for brand adoption alone. The product-
brand stage combines both tangible product qualities and
intangible brand benefits during a development stage
when neither product or brand can dominate.. Adoption of innovative products than for adoption of
traditional products. The authors suggest that consumers
are more involved with innovative products and may
therefore be more demanding. This is likely to force
manufacturers of such products into striving harder to
deliver satisfaction. In contrast, consumer involvement
with traditional products is invariably much lower.
The study findings show that satisfaction and loyalty do begin
much earlier in the process than previously acknowledged.
Satisfaction is possible at the initial stage providing the
product meets customer needs. However, the scarcity or
absence of intangible and psychological benefits at this time
means that the intensity of satisfaction is usually not high. But
this does not lessen the significance of this stage in helping to
generate customer loyalty and satisfaction that can increase
during the subsequent phases and over the longer term.
Marketing ideas and future research
Torres-Moraga et al. urge marketers to place more importance
on the development of the product as customer interest in
such developments is high when products are new or
innovative. Any resulting satisfaction may be limited but it
provides the foundation that can aid product development as
well future increases in customer satisfaction and loyalty.In the product-brand stage, the emphasis should be on
showcasing the intangible features more than the products
salient qualities. When the customer is influenced by
intangible features alone, the time is right to move to the
final stage and make the brand more salient. If marketing the
brand alone proves difficult, the product-brand stage may
have to last longer. On occasions, it could be that satisfaction
is inextricably linked to the tangible product benefits. A focus
Customer satisfaction and loyalty
Eduardo Torres-Moraga, Arturo Z. Vasquez-Parraga and Jorge Zamora-Gonzalez
Journal of Consumer Marketing
Volume 25 Number 5 2008 302313
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on the intangible features becomes more difficult when that isthe case.The transition from product alone to brand alone via
product brand is much quicker for technologically innovativeproducts. Managers should use this knowledge to accelerateto the mature stage as quickly as possible. Conversely, movingto this stage with traditional products can be extremelydifficult and ultimately unproductive. Rather than wastingvaluable time and resources, it is more advisable to invest theeffort into developing effective strategies for the product aloneand product-brand stages.Given the novel approach of this study, Torres-Moraga et al.
suggest further exploration of customer satisfaction andloyalty within these initial phases. Likewise, the findings
should also be examined in relation to different product types,market conditions or other measures.Further study could additionally concentrate on other
stages of the authors typology. This research could, forexample, investigate customer loyalty to a bundle of productsor set of brands or to various product-brand combinations.Study could also focus on situations where satisfaction andloyalty is conditional because it depends on specific mixes ofproduct type and brand such as, for example, Sony televisionsor JVC disc players.
(A precis of the article Customer satisfaction and loyalty: startwith the product, culminate with the brand. Supplied byMarketing Consultants for Emerald.)
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Customer satisfaction and loyalty
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Journal of Consumer Marketing
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