16 Dec Customer Satisfaction and Customer Loyalty
Customer Satisfaction and Customer Loyalty
Satisfying customers is the ultimate goal of every business, due to its potential impact on repeat purchasing behaviour and profits (Kim, Li, & Brymer, 2016; Ryu et al., 2012). The definition and conceptualization of customer satisfaction varies throughout marketing literature. For example, Oliver (1997, p. 13) defined customer satisfaction as ‘a judgment that a product, or service feature, or the product or service itself, provides a pleasurable level of consumption–related fulfilment, including levels of under or over fulfilment’. Satisfaction has been deﬁned as the feeling of pleasure or disappointment when a customer compares a product’s perceived performance with his or her prior expectations (Oliver, 1981; Tse and Wilton, 1988). Clearly customer satisfaction is a post-decision experience. Service quality and customer satisfaction are closely related but not interchangeable, although both concepts involve a comparison of expectations of quality and the actual service received.
Customer loyalty is an integral part of the literature related to service marketing and it has been studied across different industries. There is a general consensus that customer loyalty develops once a person believes he or she is getting the best possible service from service providers (Ryu et al., 2012). Loyal customers bring many other benefits, such as occupying a higher portion of a customer’s budget, increased frequency of visits and positive word of mouth (Russell-Bennett, McColl-Kennedy, & Coote, 2007). Every service provider should therefore strive to develop marketing strategies to achieve the ultimate objective of maintaining customer loyalty. Various studies have resulted in many conceptualizations and definitions of customer loyalty. For instance, Jones and Sasser (1995, p. 94) defined customer loyalty as ‘the feeling of attachment to or affection for a company’s people, products or services’. Customer loyalty thus refers to the commitment and intentions of the consumer to continue to repurchase and consume preferred services over time (Han & Ryu, 2009). Oliver (1997) discussed four distinct stages of customer loyalty, comprising cognitive, affective, conative and action loyalty. Some scholars have also classified these four stages of customer loyalty into two dimensions: attitudinal and behavioral loyalty (Han & Ryu, 2009). While the behavioural dimension considers consistent repeat patronage or repeat purchase frequency, the attitudinal dimension considers a psychological (decision-making or evaluative) commitment toward the service provider (Han, Kwortnik, & Wang, 2008).
Nevertheless, many studies have treated the two as different variables. Although the vast majority the literature suggests a direct, positive relationship between customer satisfaction and customer loyalty (Wang, 2014; Hussain et al., 2015), a key ﬁnding in Dolnicar et al. (2011) is that an attempt to improve customers’ satisfaction has not proven to have a big impact on loyalty. Chen (2012) noted that past empirical evidence has shown the existence of difference in the strength of the relation between customer satisfaction and loyalty.
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- Han, H., & Ryu, K. (2009). The roles of the physical environment, price perception, and customer satisfaction in determining customer loyalty in the family res-taurant industry. Journal of Hospitality and Tourism Research, 33(4), 487–510.
- Han, X., Kwortnik, R., & Wang, C. (2008). Service loyalty: An integrated model and examination across service contexts. Journal of Service Research, 11(1), 22–42.
- Oliver, R.L., 1981. Measurement and evaluation of satisfaction processes in retail Settings. J. Retail. 57, 25e48.
- Jones, T. O., & Sasser, W. (1995). Why satisfied customers defect. Harvard Business Review, November/December (pp. 88–99), 88–99.
- Kim, W. G., Li, J. J., & Brymer, R. A. (2016). The impact of social media reviews on restaurant performance: The moderating role of excellence award. International Journal of Hospitality Management, 55(5), 41–51.
- Oliver, R. L. (1997). Satisfaction: A behavioral perspective on the consumer. New York: McGraw-Hill.
- Russell-Bennett, R., McColl-Kennedy, J. R., & Coote, L. V. (2007). Involvement, sa-tisfaction, and brand loyalty in a small business services setting. Journal of Business Research, 60(12), 1253–1260.
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- Wang, S.W., 2014. Do global airline alliances inﬂuence the passenger’s purchase decision? J. Air Transp. Manag. 37, 53e59.