Building loyalty in consumer markets: The role of customer satisfaction

Abstract

Traditional marketing in the past had focused on attracting new customers rather than retaining existing ones as marketers aimed at selling rather than building relationships. Today, companies are grappling with the realities of customer satisfaction, loyalty, and customer switching, trying out both strategic initiatives and operational methods to ensure customer loyalty. But marketers are realizing that the rewards of increased market share and higher profitability come to those who build a large base of brand loyal customers. Despite its significant management attention, however, brand loyalty and its determinants remain elusive. Causal links between loyalty, satisfaction, commitment, purchase volume and frequency, and positive word-of-mouth remain unproven. A model for building loyalty can help explain the process that a customer follows to pledge loyalty, sometimes even subconsciously, to a product. From the brand's perspective, this process enables a firm to have a superior marketing performance based on the consideration that a loyal customer always is going to repurchase the same brand. India is one of the fastest growing consumer markets with high degree of competition. Even small changes in the market share can have a significant financial impact on company sales. In the face of such competition having brand loyal customers not only ensures sales, but also reduces marketing costs. To create brand loyal customers and retain them, it is imperative to have knowledge of the major factors that influence brand loyalty amongst customers in the consumer market.