The effect of brand communication and service quality through brand trust in creating brand loyalty

Study letter for obtaining a master's degree, field: business management, major: insurance

Abstract

In this research, the general goal of the development and stability of the insurance industry is to achieve this goal, we must focus on attracting, retaining and loyalty of policyholders. With the increasing competition between insurance companies in the field of gaining more market share, the managers of these companies are inevitably looking for ways to gain the trust of their customers, which leads to their loyalty. Meanwhile, two factors of communication and service quality play a very important role in creating trust in the insurance brand. This research seeks to investigate the effect of brand communication and service quality through trust in the brand in creating brand loyalty in Iran Insurance Company agencies in Gilan province based on the model of Kamal Zohir et al. Also, the statistical population is all customers of Iranian insurance branches and agencies in Gilan province, the sample size of the study was considered to be 384 people using the Karjesi and Morgan table, and sampling was done by multi-stage cluster sampling method. The measurement tool in the present research is the standard questionnaire of Kamal Zahir et al. and Cronbach's alpha test was used for the final evaluation of the questionnaire. The impact of research hypotheses has been measured through structural equation modeling using PLS software, and then path analysis has been performed. These findings show that the perception of brand communication and service quality can be seen in the records of brand trust, which in turn is influenced by brand loyalty. Key words: brand communication, service quality, brand trust, brand loyalty. Insurance in different countries has reached such a position that it can play a key role in the social and economic development of the country by creating confidence in the set of economic factors. Today, insurance can be considered one of the important pillars of the economic and social life of human societies and a guarantee of the economic cycle. In order to provide proper services to policyholders[2], insurance companies must have close relations with insurance buyers, especially non-compulsory insurance buyers, so that they can know their needs and offer suitable insurances to meet them. In today's business world, where the competition is not only among companies of the same industry but also between different industries, knowing the company's customers and knowing their buying behavior creates a competitive advantage [3] for their respective companies (Mahdovinia and Kadratpour, 2014). In traditional marketing, success meant having a larger share of the market, but in modern marketing, the criterion is to have a larger share of the customer. Products and services come and go, but what creates value for organizations today is creating a continuous relationship with customers, and successful organizations are the only organizations that are able to create lifelong customers for themselves. So that the research shows that some very successful companies have a high rate of 90% retention of their customers. The effort of these organizations is not only to attract and create a customer, but more importantly, they want to keep him for his whole life (Peters [5], 2008). In the new era of marketing, the goal is to establish long-term and mutual relationships with interested groups and, most importantly, customers in such a way as to retain more customers and in this way, in the long term, benefits are obtained, which, as a result, increase the market share [6] and profitability [7] of companies (Osman et al. [8], 2009).

Brand names [9] as intangible assets are one of the most valuable assets of the company. In this context, brand loyalty[10] is at the heart of companies' marketing activities (Shees and Pauthier[11], 1995). The cost of attracting new customers is five times the cost of keeping existing customers, and losing a customer is not only the loss of a sales item, but beyond that, it means losing the entire flow of purchases that a customer could make during his life (Kotler [12], 2002). In addition, due to various emotional factors, loyal consumers may use the brand that they like to use or know its image more.The cost of attracting new customers is five times the cost of retaining existing customers, and losing a customer is not only the loss of a sales item, but beyond that, it means losing the entire flow of purchases that a customer could make during his life (Kotler [12], 2002). In addition, due to various emotional factors, loyal consumers may use the brand that they like to use or know its image more (App Shu [13], 1995). When a consumer looks for a specific brand in his daily life to fulfill his desires, he looks for a name that will satisfy him (Vyasu [14], 2009) and this is the relationship between the brand and customers that is presented as brand loyalty, which is one of the important research topics in brand management (Haber [15], 2009). The brand name is used as a sign of the product's status. The most important feature and characteristic of a brand name as a sign of the product's position is its reliability and validity (Erdem and Swait [16], 2004). Brand trustworthiness is a key component in the brand pyramid presented by Keller [17] (2001), which shows an aspect of the customer's response to the brand, and this aspect is our understanding of the brand's trustworthiness, as it shows the customer's relationship with that brand over time (Erdem and Swait, 2004). Customers stay loyal not because of sales and marketing promotion programs, but because of the value they receive. This value comes from the complete arrangement of effects such as product quality, after-sales service and its availability (Gamson [18], 1995). Loyal customers of the brand may be willing to pay more for the use of the brand (Richard, 1996).

In this research, the general goal is the development and stability of the insurance industry, and to achieve this goal, we must focus on attracting, retaining and loyalty of policyholders. And even though all government insurances except Iran insurance became private, for Iran insurance as the only government insurance and despite the market share more than other competitors, the issue of customer loyalty is very important. This uniqueness may be derived through brand communication [19], service quality [20], trust [21] and brand loyalty when customers interact and use the brand (Asayel [22], 1998). Increasing competition in the field of services, in industries such as hotel[23], banking[24], insurance, etc. It is quite evident and this factor makes it more and more difficult to maintain customers and increase their loyalty in this space (Allameh and Nitta Dan, 2019). Brand names are among the most valuable assets of a company that increase the final value of the product and are infiltrating people's personal lives and may influence values, beliefs, policies and even people, the importance of creating and maintaining customer loyalty has become a clearer focus in marketing (Fornell [25], 1992). The high level of customer loyalty to the brand creates a series of competitive advantages for companies and has a positive effect on the increase in brand income and the reduction of marketing costs. With the intensity of competition, today we see a focus on relationships rather than a focus on exchange (Smith and Van Pak [26], 1992). Customer loyalty is the key to business success today. With the increase of customer loyalty, the market share and the profitability of the economic enterprise increase by planning and adopting appropriate strategies to make customers loyal (Cronin and Taylor [27], 1992). Increasing their loyalty rate will bring long-term benefits for businesses. With the advancement of technology and more competitive market conditions in various production and service sectors, loyal customers are considered as the main capital of any company (Cronin and Taylor, 1992).

Brand trust leads to brand loyalty or commitment because trust creates exchange relationships that are very valuable (Morgan and Hunt [28], 1994). In a long-term relationship, the brand name makes the buyer and the seller commit to each other. Therefore, the brand name can be used as a defensive marketing tool to retain existing customers and also as an offensive marketing tool to acquire new customers. The importance of defensive marketing in the field of services has been determined through the knowledge that the cost of attracting new customers is much higher than retaining the same customers (Sweeney and Sweet [29], 2008). We define brand trust as the consumer's average willingness to rely on the brand's ability to perform its stated performance (Moorman et al., 1993).