The effect of perceived value, perceived equity and perceived quality on loyalty and repurchase intention

(Dissertation for Master of Business Administration (International Marketing)

Abstract

In the crowded market where we see the activity of many mobile phone brands, on the one hand, we are facing a decrease in the purchase of such phones due to the economic recession and the decrease in people's purchasing power, and on the other hand, we are witnessing the great efforts of these companies in order to differentiate their brand from their competitors in the minds of consumers, we can understand the necessity of this point that Professional marketers need to understand how to change the variables affecting brand loyalty. At the same time, it is necessary to mention that loyalty at a high level will have advantages such as: the ability to use higher pricing policies, lower sales costs for new competitors, etc. Also, marketing communication costs for customers who are confident about their purchase will be reduced, while reducing the need for sales promotion activities and advertising compared to a brand that has less loyalty. Therefore, in this research, an attempt has been made to investigate the factors affecting loyalty and repurchase intention. Based on previous research and literature study, perceived value, perceived special value, perceived quality, brand satisfaction, brand trust, continuous commitment and emotional commitment were selected as influencing factors and indicators related to each of them were presented, based on which a 49-question questionnaire with a five-point Likert scale was designed. The overall reliability coefficient of the questionnaire was calculated using Cronbach's alpha method equal to 0.899. Due to the unlimited statistical population of this research, which includes the visitors to Tehran's mobile market, the minimum sample size was determined based on the Cochran formula of 384 people. In this research, data was collected and analyzed from 389 people, and finally the results of the structural equation test confirmed all the hypotheses of the research.

Key words: brand loyalty, repurchase intention, perceived value, perceived special value, perceived quality, brand satisfaction, brand trust, commitment Continuous, emotional commitment

Introduction

Today, brand has become a strategic requirement for organizations because it helps them to create more value for customers. Creating a powerful brand in the market is the main goal of many organizations. Because a powerful brand can increase the trust of customers when buying goods and services and help them to better understand intangible factors. (Chen & Chang, 2008) From an economic and strategic point of view, brands are among the most valuable assets of companies, and even without exaggeration, they are considered to be their most valuable assets. (Dohdashti Shahrokh, Jafarzadeh Kanari and Bakshizadeh, 2013) It should also be considered that the brand is an important tool to help create a positive and different image on the consumer in front of competing products. (Kotler & Armstrong, 2004) In this way, it will significantly help companies to create a group of loyal customers and maintain their market share. Brand loyalty [1] refers to the consumer's willingness to pay more for a particular brand and also to recommend that particular brand to others, when there are other similar products. (Giddens, 2002) In addition, this brand will make the customer have a simple selection process, be assured in terms of quality, reduce his risk (Keller & Donald, 2006) and at the same time, it will motivate him to repeat the purchase. (Aaker, 1996) However, due to the large number of brands that serve the same purpose, customers become more aware and easily switch brands when faced with alternatives that offer more benefits. (Wood, 2004) One of the most important goals of brand owners for brand development is to create loyalty in customers towards their brand. Loyal customers are considered as a reliable source of profitability for companies, and due to the uncertainty of the environment, it brings them a suitable margin of safety. Companies want their customers to belong to their brand with strong feelings, for such loyalty it is first necessary to create customer satisfaction[2]. When customers are satisfied, they show their commitment by continuously buying the same brand and become a loyal customer.(Ballantyne & Warren, 2006) Of course, it should be kept in mind that satisfaction alone is not enough to create loyalty and it should be examined with a broader and comprehensive view.

1-2 statement and formulation of the problem

The review of the subject literature shows that a distinction should be made between customer retention, which is often expressed with the words of loyalty, the intention to repurchase the product [3] and behavioral loyalty [4]. (Jalali, Khairi and Khadim, 2018) Therefore, despite the great emphasis on customer retention in marketing texts, achieving such a goal for companies that manufacture and sell mobile phones is changing rapidly. In the mobile phone market, we see billions of Tomans spent annually by the companies that produce these phones on the promotion of their brand. But despite such costs, research shows that consumers are only able to distinguish between a few of these brands. The main point here is that brand promotion alone cannot be a guarantee for brand success, therefore, marketing professionals need a clear and clear strategy based on a complete understanding of the reasons that motivate consumers to repurchase a brand.  (Clarke, 2003)

Loyal customers are often willing to pay a higher amount for their preferred brand, it is easy to convince them to accept new usage situations, in addition, by encouraging them to increase their spending in connection with the brand at a wide level, the profit margin also increases.  (Davis, 2002) Also, marketing communication costs are reduced for loyal customers who are confident about their purchase and process the necessary information quickly, while reducing the need for sales promotion activities [5] and advertising compared to a brand that has less loyalty. It should also be noted that brand fans play an essential role in the decision making of potential customers, so when they see that the brand in question has a base of loyal customers, as a result, they will have a more positive evaluation of that brand.  (Bianchi & Drennan, 2013) Loyal customers will not need persuasion to continue buying, and it is unlikely that they will show a desire to the competing brand for its promotion. (Bohrer, 2007)

Fierce competition and rapid technological developments in various sectors have forced companies to set goals to increase their market share by customers who protect their market share, and the way to achieve this goal is to create customer loyalty. Companies that have loyal customer assets protect their inventory for a long time by creating repeat purchase intentions in their customers.  (Erics, Candan Burcu, & Yildirim., 2012) It is important to consider that customer loyalty actually creates a competitive advantage for the company because loyal customers save the company's marketing costs, because according to experts, the cost of attracting a new customer is about 6 times that of keeping an existing customer, in addition, loyal customers are willing to pay more for their favorite product and brand and are less sensitive to price, and also brand loyalty creates a commercial leverage for the company It will be in competitive moves. (Hosseini and Rezaei, 2013)

The study of the research conducted in this field shows that researchers have often investigated a limited number of variables affecting loyalty, on this basis, in this research, with comprehensive investigations, the variables of brand value[6], brand specific value[7], brand quality[8], brand satisfaction[9], trust in the brand[10], emotional commitment[11] and continuous commitment[12] as form factors. The determinants of brand loyalty are identified and used to determine their effects on loyalty and repurchase intention.  

1-3 research objectives

1-3-1 main objective

The main objective of the research is to examine the factors affecting loyalty and repurchase intention.

1-3-2 sub-objectives

- To examine the effect of perceived value [13] on brand satisfaction and brand trust.

- To examine the effect of perceived quality [14] on brand satisfaction and brand trust.

- Examining the effect of perceived special value[15] on brand satisfaction and brand trust.

- Examining the effect of brand satisfaction on brand trust.

- Examining the effect of brand trust on emotional commitment and continuous commitment.