Download Exploring loyal qualities: assessing survey-based

Exploring loyal qualities: assessing
survey-based loyalty measures
Sharyn Rundle-Thiele
Graduate School of Management, Griffith University, Nathan, Australia
Abstract
Purpose – This paper sets out to provide a step towards simplifying and shortening loyalty surveys for marketers and to summarise and to categorise
more than 30 survey-based loyalty measures administered in previous academic surveys.
Design/methodology/approach – This research took a step back from theory to re-define the concept of loyalty. An exploratory perspective using
two service markets was taken to examine a broad range of survey-based loyalty measures.
Findings – The results of this research provide support for the more recent view that there are different ways in which customers can be loyal. The
results of this research suggest that attitudinal loyalty could be the most important dimension for marketers to monitor. The exploratory method
selected in this research suggests that dimensions of loyalty may include propensity to be loyal, behavioural intentions, complaining behaviour,
resistance to competing offers, attitudinal loyalty and behavioural loyalty.
Practical implications – There are important managerial implications arising from this research. First, loyalty should be considered as more than one
thing. Second, this research has provided a step towards consolidating a wide range of survey-based loyalty measures that exist in the academic
literature, helping to simplify loyalty measurement for marketers. This research paper provides a guide of the better survey-based measures by
identifying “pure” measures of loyalty for marketers. Marketers will be able to better understand what type of loyalty a measure captures.
Originality/value – Valuable for marketers who can be helped to simplify and shorten their surveys by better understanding what type of loyalty a
survey measure captures and which measures may be most appropriate for their needs.
Keywords Customer loyalty, Customer retention, Attitude surveys, Service industries, Australia
Paper type Research paper
aggregate or brand level (Rundle-Thiele and Maio Mackay,
2001). There has been no attempt to analyse survey-based
measures at the individual or customer level.
An important rationale for the present study is to deepen
our understanding of loyalty by exploring loyal qualities
across two different service contexts to enable generalisation
across service markets. Services and retailing are important
contexts because services are the largest sector of most
Western economies. For example, services now account for
more than 75 per cent of Gross Domestic Product (GDP) in
Australia according to the Australian Bureau of Statistics
(www.abs.gov.au). Australian service industries are part of the
world business community. The trend in Australia towards
successful accreditation from international bodies including
ISO9000
(www.iso.org/iso/en/ISOOnline.openerpage)
highlights the relevance and similarity of Australian services
to international standards thus the findings from this study
are globally applicable.
This paper focuses on exploring a broad range of loyalty
measures (detailed in Table I in the next section of this paper)
that have been used previously in the literature in two
contexts, both of which can be classified as services.
An executive summary for managers and executive
readers can be found at the end of this article.
Introduction
It is commonly accepted in the marketing discipline that it is
far cheaper to retain an existing customer than it is to attract a
new customer (Reichheld, 1993; 1996) and that loyalty can
be linked to company growth (Reichheld, 2003). Given the
importance of loyalty to marketers there is a large body of
literature concerned with loyalty, a concept, which has also
been referred to as retention (Rust and Zahorik, 1993;
Narayandas, 1999; Eriksson and Vaghult, 2000) and
commitment (Beatty and Kahle, 1988; Ulrich, 1989;
van Birgelen et al., 1997).
The marketing literature is concerned with both the
conceptual definition and measurement of loyalty. The
loyalty literature contains a multitude of measures. There
have been few attempts to consolidate the plethora of survey
based loyalty measures. In 2001, Rundle-Thiele and
Maio Mackay analysed nine loyalty measures at the
The Emerald Research Register for this journal is available at
www.emeraldinsight.com/researchregister
Literature review
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/0887-6045.htm
Since loyalty was first defined there has been a great deal of
debate about the construct. The crux of these discussions
largely centres on: identifying whether loyalty is a behavioural
or attitudinal phenomenon; defining attitudinal and
Journal of Services Marketing
19/7 (2005) 492– 500
q Emerald Group Publishing Limited [ISSN 0887-6045]
[DOI 10.1108/08876040510625990]
The constructive comments provided by the reviewers of earlier versions
of this manuscript are appreciated.
492
Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
Table I Summary of loyalty measures used in previous research
Origin in the literature
Complaining behaviour
Make negative comments about this wine retailer to friends and
family
Discourage friends or family from using this wine retailer for their
wine needs
Post your complaint on the internet if you are dissatisfied
Behavioural intention
I would buy wine from this wine retailer for a dinner with friends
I would buy wine from this wine retailer for a work dinner
If I urgently needed a bottle of wine I would buy it from this wine
retailer
In the future I intend to buy more wine from this retailer
(de Ruyter et al., 1997; Bloemer et al., 1999; Price and Arnould, 1999; Ganesh
et al., 2000)
(Bloemer et al., 1999)
(Bloemer et al., 1999)
(Dubois and Gilles, 1999)
(Dubois and Gilles, 1999)
(Dubois and Gilles, 1999)
Use this wine retailer for most of your future wine-purchasing needs
Use this wine retailer the next time you need to buy wine
Word of mouth
Recommend this wine retailer to friends and relatives
Resistance to competing offers items
If this wine retailer raised the price of my favourite wine I would still
continue to be a customer of this wine retailer
Buy wine from this wine retailer even if a magazine had a highly
critical review of them
Pay 5 per cent more for wine from this wine retailer
Stay with this wine retailer even if there was a small difference in price
Purchase wine from this wine retailer regardless of price
Buy wine from this wine retailer even if another retailer offered better
features
Attitudinal loyalty items
I am strongly committed to buying wine from this wine retailer
Purchasing wine from this retailer would be good versus bad
Purchasing wine from this retailer would be favourable versus
unfavourable
Purchasing wine from this retailer would be positive versus negative
Purchasing wine from this retailer would be likely versus unlikely
Behavioural loyalty items
What percentage of your total wine purchases are with this retailer?
Approximately, how long have you purchased wine from this wine
retailer?
I considered other wine retailers when I last bought wine
When I last bought wine this wine retailer was my first choice
(Bloemer and de Ruyter, 1999; Ganesh et al., 2000; Bowen and Chen, 2001;
Chaudhuri and Holbrook, 2001; Homburg and Giering, 2001; Huber and
Herrman, 2001)
(de Ruyter, 1997; Nijssen et al., 2003)
(Soderlund, 1998; Chaudhuri and Holbrook, 2001; Odin et al., 2001)
(Bloemer et al., 1999; Narayandas, 1999; Price and Arnould, 1999; Ganesh
et al., 2000; Bowen and Chen, 2001; Butcher et al., 2001; Delgado-Ballester
and Munuera-Aleman, 2001; Homburg and Giering, 2001; Huber and
Herrman, 2001; Yu and Dean, 2001; Bove and Johnson, 2002; Nijssen et al.,
2003)
(de Ruyter, 1997; Bloemer et al., 1999; Price and Arnould, 1999; Ganesh et al.,
2000; Odin et al., 2001)
(Narayandas, 1999; Odin et al., 2001)
(de Ruyter, 1997; Narayandas, 1999; Yu and Dean, 2001)
(de Ruyter, 1997; Chaudhuri and Holbrook, 2001; Yu and Dean, 2001)
(Narayandas, 1999)
(Narayandas, 1999)
(Bloemer and de Ruyter, 1999; Chaudhuri and Holbrook, 2001; Knox and
Walker, 2001)
(Macintosh and Lockshin, 1997; Bennett and Rundle-Thiele, 2000, 2002;
Bennett, 2001; Bove and Johnson, 2002)
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
(Mooradian and Oliver, 1997; Narayandas, 1999; Bennett and Rundle-Thiele,
2000, 2002; Jones and Suh, 2000; Bennett, 2001; Nijssen et al., 2003)
(Cunningham, 1956; Macintosh and Lockshin, 1997; Rundle-Thiele and
Bennett, 2001)
(Rundle-Thiele and Bennett, 2001)
(Soderlund, 1998)
(Lee and Cunningham, 2001)
Propensity to be loyal items
Rarely introduce new brands to my friends and family
Rarely take chances by buying unfamiliar brands even if it means
sacrificing variety
Would rather wait for others to try a new brand than trying it myself
Would rather stick to well-known wine retailers when purchasing wine
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
(Bennett and Rundle-Thiele, 2000, 2002; Bennett, 2001)
493
Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
behavioural representations of loyalty; and discriminating
between additional dimensions of loyalty and understanding
the interrelationships between them.
brand. To put this in context think about a consumable
product that you commonly purchase such as baked beans or
a newspaper. Do you feel attached to a can of baked beans or
a newspaper? There would be few who would agree that they
are attached to a can of baked beans or a newspaper. Yet,
when asked if you repeatedly purchase a brand of baked beans
or a newspaper you may answer yes. This loyal behaviour is
also of interest for marketers. We can now acknowledge that
loyalty may be one or a combination of attitudinal and
behavioural loyalty. Yet this may still provide a limited view of
loyalty.
Therefore, this paper suggests that loyalty should be
defined as:
Traditional views
The evolution of the loyalty concept is illustrated in Figure 1.
The concept of loyalty first appeared in the 1940s. In its
earliest days loyalty was proposed as a uni-dimensional
construct, which was related to the measurement perspective
taken by the researcher. Two separate loyalty concepts
evolved. Namely, “brand preference” (Guest, 1944, 1955)
which was later referred to as attitudinal loyalty and “share of
market” (Cunningham, 1956), which was later referred to as
behavioural loyalty.
Nearly 30 years after loyalty first appeared in the academic
literature researchers (e.g. Day, 1969) proposed that loyalty
may be more complex and that it may comprise both
attitudinal and behavioural loyalty. This bi-dimensional
concept has since been combined and referred to as
composite loyalty (e.g. Jacoby, 1971). The composite
definition of loyalty has become the basis for much loyalty
research that has since been undertaken (for examples see
Jacoby and Kyner, 1973; Bloemer and Kasper, 1995; Bennett,
2001). The composite definition of loyalty considers that
loyalty should always comprise favourable attitudes,
intentions and repeat-purchase (see Jacoby and Chestnut,
1978). Some researchers (see Oliver, 1999) suggest that
loyalty evolves and that there are stages of loyalty.
This paper suggests that loyalty is not necessarily a series of
hierarchical stages, and should not be considered to always
comprise favourable attitudes, intentions and repeatpurchase. This paper suggests that marketers should not
think of loyalty as a series of stages performed in sequence, as
proposed by Jacoby and Chestnut (1978) and subsequently
by Oliver (1999). Customers may exhibit or possess different
degrees of loyalty across the loyalty different types of loyalty.
The state or quality of being loyal, where loyal is defined as a customer’s
allegiance or adherence towards an object.
Loyalty is the key to the longevity of any brand and one type
of loyalty, namely word of mouth has recently been correlated
with company growth (Reichheld, 2003). A useful starting
point to examine what constitutes loyalty is to summarise the
range of survey-based loyalty measures that have been used in
previous studies. Table I uses logical partitioning (see Hunt,
1991 for a discussion on classification approaches) to
categorise measures used in previous research into loyal
qualities or states.
It is possible that each and every customer has loyalty
qualities or states in varying degrees, and that customer’s have
a different mix of loyalty qualities or states. Marketers can
activate different loyal states or qualities in different ways. For
example, word of mouth behaviours may be encouraged
through reward programs while attitudinal loyalty may be
encouraged through emotive advertising. This research
suggests that the dominant views on loyalty remain too
narrow. Old views of loyalty need to be expanded to
encompass a far broader range of loyal states and qualities
to benefit both customers and marketing managers.
Table I illustrates that a wide range of loyalty measures have
been inconsistently applied across many different loyalty
studies. Word of mouth is the most commonly used measure
of loyalty and Reichheld (2003) has demonstrated that word
of mouth measures correlate to company profits and growth.
According to Reichheld (2003), word of mouth is a strong
indicator of loyalty and growth because when customers
recommend your service they are putting their reputation on
the line. Table I illustrates that intention to purchase and
likelihood of purchase are the second most commonly used
measures of loyalty in the academic literature. The loyalty
concept needs some consensus and clarity. The purpose of
this paper is to explore the dimensions of loyalty using existing
measures of loyalty to deepen our understanding of loyalty.
The analysis undertaken in this paper will be largely
concerned with exploring the factorial structure of the
loyalty concept and the “purity” of survey measures of loyalty.
The specific research question to be addressed in this paper
is:
RQ1. What dimensions of loyalty exist in the literature?
The present view
In 1994, Dick and Basu subsequently identified the need to
define the different manifestations of composite loyalty as
separate dimensions. Following Dick and Basu’s (1994)
conceptual model multi-dimensional views of loyalty emerged
in the literature (for examples see Zeithaml et al., 1996;
Bloemer et al., 1999; Narayandas, 1999; Yu and Dean, 2001).
Future views
In a personal sense loyalty is a feeling or an attitude of devoted
attachment and affection. This feeling of loyalty tends to
imply that a person feels an obligation to persevere with a
personal relationship through good and bad times. A
commercial setting involves a subtle change for the term
“loyalty”. One of the main reasons for this change is
customers can persevere in a commercial relationship without
a feeling or an attitude of devoted attachment. These loyal
behaviours demonstrate that the customer has faith in the
Figure 1 The loyalty construct (1950-1990)
Methodology
Factor analysis methods generally attempt to determine which
sets of observed (measured) variables sharing common
variance-covariance characteristics define constructs
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Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
(Schumacker and Lomax, 1996). The technique of
exploratory factor analysis will be used in the present study
to explore the dimensions of loyalty. The most distinctive
feature of exploratory factor analysis is that a detailed model
relating loyalty to the measures is not specified in advance and
the number of loyalty dimensions is not determined before the
analysis (Bollen, 1989). When defining a new concept
exploratory factor analysis should be used to assess the
dimensionality of the construct and to assess the
appropriateness of the selected measures (Hair et al., 1998).
Such endeavours are not truly confirmatory and as a result
exploratory factor analysis is more relevant to this research.
Therefore, exploratory factor analysis will be used in this
research to explore the dimensionality of the loyalty construct
using existing loyalty measures.
Mailing lists for 2,500 members of wine clubs and 2,500
insurance customers were purchased. Funding constraints did
not permit data collection in other product categories nor did
it permit selection outside of the service markets analysed and
this provides an opportunity for future research. An additional
list comprising 1,000 names was provided for the wine retail
study by a sponsoring organisation. A total of 3,500 wine
retail questionnaires were mailed. Questionnaires were mailed
to 2,500 respondents in the insurance context. Questionnaires
were accompanied with a reply-paid envelope and mailed to
respondents in each context. The initial section sought to
determine whether respondents had purchased in the
category of interest in the past 12 months. Respondents
who had purchased from the category of interest in the past
12 months were asked to proceed with the questionnaire.
Following the initial section, respondents completed
questions relating to loyalty followed by demographic
questions.
The optimal response rate for a consumer mail survey is
between 20 per cent and 40 per cent (Green et al., 1988). Of
the surveys returned 726 wine retail customers met the prequalifying criteria, which represents an optimal effective
response rate of 21 per cent. In the insurance context 314
customers met the pre-qualifying criteria, which represented a
less than optimal effective response rate of 13 per cent[1].
The technique of comparing early and late respondents was
used to examine non-response bias for both the wine retail
and insurance samples. Comparing waves of early and late
respondents on a range of demographic characteristics (see
Armstrong and Overton, 1977 for a discussion of this
technique) revealed no significant differences ( p . 0.05) for
both the wine retail and insurance surveys, suggesting that
non-response bias may not be a problem. For the purposes of
data analysis any survey that did not have all items completed
were removed. A total of 670 cases were analysed.
dimensions of loyalty had an eigenvalue greater than 1 and
these six dimensions explained 59.37 per cent of the total
variance for the loyalty construct.
The results of the exploratory factor analysis will be
presented in two tables. The first table, Table II reports which
factors each loyalty measure has loaded on. The second table,
Table III summarises how much of the variance is explained
by each factor and the eigenvalues used to identify the
number of loyalty factors in the EFA. Definitions of the
dimensions are also reported in Table III because EFA is most
efficient when the factors can represent conceptually defined
definitions (Hair et al., 1998)
The EFA results support that there are six types of loyalty.
The loyal qualities identified in the EFA are attitudinal
loyalty, behavioural intentions, resistance to competing offers,
propensity to be loyal, complaining behaviour and
behavioural loyalty. Considering loyalty as more than one
thing is important for marketers.
Marketers seeking to maintain or improve customer loyalty
should use more than one loyalty measure to benchmark and
monitor the different types of loyalty. Considering loyalty as
more than one thing can provide guidance for marketers
seeking to develop marketing programs to build loyalty. For
example, a problem would exist if a marketer found that
propensity to be loyal was high but the remaining types of
loyalty were low. This would indicate that improvements in
marketing programs were required in order to build loyalty to
the service.
Pure measures
More than one half of the survey-based loyalty measures used
in this survey loaded on more than one loyalty factor.
Loadings greater than or equal to 0.3 on more than one factor
are termed cross loadings. Cross loading suggest statements
are not “pure” measures as they are measuring more than one
construct. The “impure” measures are represented in Table II
in italics. If marketers are prepared to consider that loyalty is
more than one thing it is important for marketers to use
“pure” measures of loyalty. “Pure” measures of loyalty are
known to represent one and only one thing.
Table III shows that the first factor, termed attitudinal
loyalty, explains 30 per cent of the total variance. This may
suggest that attitudinal loyalty could be the most important
dimension for marketers to monitor. The variance of the
second factor, termed resistance to competing offers, is 10 per
cent of the total variance; while the variance of the third factor
through to sixth loyalty factors was between 6 per cent and 4
per cent for each of the remaining four factors.
Conclusions and future directions
This research took a step back from loyalty theory to re-define
the concept of loyalty. An exploratory perspective using two
service markets was taken to examine a broad range of surveybased loyalty measures that had been used in the literature.
Exploratory results suggest there may be at least six types of
loyalty, many of which have been used previously in academic
research. The use of multiple dimensions in loyalty
assessment will improve the explanatory potential for both
marketing managers and academics. There is value in
considering the types of loyalty and in specifying these
types. In other words, loyalty is more than one or two
combined things.
Results and discussion
Exploratory factor analysis was performed on the combined
insurance and wine retail samples to obtain the highest
respondent per measure ratio to minimise the chances of overfitting the data. The number of respondents analysed was
670, which exceeds the acceptable 10 respondents to 1
measure (Hair et al., 1998).
According to Hair et al. (1998) using the latent root
criterion, which is commonly referred to as the eigenvalue, for
establishing the cut-off number of dimensions is most
appropriate when there are 20 to 50 measures. Six possible
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Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
Table II Exploratory factor analysis rotated factor matrix
Attitudinal
loyalty
Purchasing insurance from this company would be good
versus bad
Purchasing insurance from this company would be
favourable versus unfavourable
Purchasing insurance from this company would be positive
versus negative
Purchasing insurance from this company would be likely
versus unlikely
Consider new products that this company may offer in the
future?
Purchase insurance from this company regardless of price
Pay 5 per cent more for insurance from this company
Buy insurance from this company even if another insurer
offered better features
If this company raised the price of my policy I would still
continue to be a customer of this company
Recommend this company to friends and relatives
Stay with this insurance company even if there was a small
difference in price
I am strongly committed to buying insurance from this
insurance company
I would not obtain quotes from another insurance company
Buy insurance from this company even if a magazine had a
highly critical review of them
Use this company the next time you need to buy insurance?
I would buy insurance from this company for a new car
If I urgently needed insurance I would buy it from this
company
How likely are you to use this company for most of your
future insurance needs?
Renew your policy with this insurance company
How likely are you to use this company for other financial
services you may require?
Rarely take chances by buying unfamiliar brands even if it
means sacrificing variety
Would wait for others to try a new brand rather than trying
it myself
Rarely introduce new brands to my friends and family
I would rather stick to well-known companies when
purchasing insurance
Complain about this company to friends and family in
social situations?
How likely are you to discourage friends or family from
using this company for their insurance needs?
How likely are you to post your complaint on the internet if
you are not satisfied?
When I renewed insurance this brand was my first choice
I considered other insurance companies when I last bought
insurance
Approximately how long have you been a customer of this
company?
What percentage of your total wine purchases are with this
company?
Resistance to
competing Behavioural Propensity to Complaining Behavioural
offers
intentions
be loyal
behaviour
loyalty
0.884
0.244
0.205
0.860
0.266
0.260
0.849
0.303
0.252
0.762
0.246
0.372
0.496
0.403
0.777
0.742
0.688
0.212
0.271
0.354
0.315
0.294
0.307
0.414
0.299
0.684
0.628
0.215
0.587
0.305
0.560
0.492
0.262
0.364
0.282
0.722
0.716
0.215
0.644
0.260
0.627
0.561
0.238
0.226
2 0.332
0.452
2 0.316
0.849
0.783
0.765
0.675
2 0.372
0.747
2 0.364
2 0.240
0.746
0.656
0.788
0.406
2 0.576
0.456
0.206
0.387
Note: All measures in italics cross load on more than one dimension and are considered to be impure measures
496
2 0.416
Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
Table III Summary of EFA loyalty factors
Eigenvalue
Variance
explained (%)
Attitudinal loyalty
9.267
30
A customer feeling or a customer attitude of devoted
attachment and affection towards the service brand or retailer
Yes
Resistance to competing offers
3.113
10
Customer immunity to or protection from competing offers
(Hozier and Stern, 1985; Zeithaml et al., 1996; Walker and Knox,
1997; Narayandas, 1999; Ganesh et al., 2000)
Yes
Behavioural intentions
1.950
6
Attitudes towards purchasing the brand (Sharp et al., 1997)
No
Propensity to be loyal
1.611
5
Propensity to be loyal relates to the characteristics of an
individual customer, and is defined as a characteristic of the
consumer (Raju, 1980). In other words, a tendency to be loyal
Yes
Complaining behaviour
1.335
4
Expressions of dissatisfaction or disapproval (Bennett et al.,
2003)
Yes
Behavioural loyalty
1.127
4
The consumer’s tendency to repurchase revealed through
behaviour which can be measured and which impacts directly
on brand sales (Hammond et al., 1996)
Yes
Factor
Definition
Pure
measures
measurement for marketers. Marketers will be able to better
understand what type of loyalty a measure captures and which
survey measures may be better measures.
Loyalty is more than attitudinal and behavioural loyalty
The results of this research do not support the commonly
accepted definitions of loyalty. The results of this research
provide support for the presently-held view in the loyalty
literature that customers can be loyal in different ways. This
may suggest that loyalty is not a sequence of stages. The
exploratory method selected in this research suggest that
dimensions of loyalty may include propensity to be loyal,
behavioural intentions, complaining behaviour, resistance to
competing offers, attitudinal loyalty and behavioural loyalty.
Future research is required to confirm the loyalty dimensions
identified in this research.
Simplifying loyalty measurement
This paper provides a starting point to simplify and shorten
surveys for marketers. This paper does not advocate the use of
complex multi-dimensional measures rather this paper
suggests that loyalty may be more than one thing. As a
result loyalty may need to be measured using one measure for
each loyalty factor[2]. This paper recommends that marketers
and academic researchers alike identify “pure” measures of
loyalty for use in surveys and that up to six loyalty measures
are used to assist marketers to benchmark and monitor the
different types of loyalty.
Impure measures
The exploratory factor analysis results indicate that 16 (out of
a total 31 analysed) statements are not pure measures of
loyalty. These statements measure more than one type of
loyalty. This is important because it is difficult to interpret
findings when we can’t clearly define what we are measuring.
Marketers can confidently use pure (plain text in Table II)
measures when measuring loyalty.
A framework to synthesise loyalty findings
This research provides a base for the synthesis of loyalty
findings by providing the ability to more clearly understand
what loyal quality or state is being captured by a given
measure. Pure measures offer the clearest guidance for
marketers concerned with marketing programs to maintain or
build loyalty. For example, a market survey has identified that
resistance to competing offers is high while attitudinal loyalty
is low. A pure measure of resistance to competing offers
indicates that customers are willing to purchase regardless of
price. Armed with this knowledge a marketer may increase
price to compensate for initiatives such as emotional
advertising to build attitudinal loyalty.
Is loyalty context-specific?
Sharp et al. (2003) distinguished between three different types
of service markets, namely free choice, renewal markets –
where one and only one service can be used and finally,
tenure – where the service continues until actively
terminated. The insurance and wine retail contexts offer
contexts that can be sufficiently contrasted as insurance is a
renewal service and wine retail is a free choice context which
presents an avenue for future research. Researchers need to
compare and contrast loyalty in different service marketers.
Notes
1 It is possible the pre-qualifying criteria of purchase in the
last 12 months may have been too strict and that renewals
in the past 12 months may have been more appropriate as
not all customers purchase insurance from new insurers
each year.
2 This is similar to Reichheld (2003) who indicates there is
a managerial need for simple and short instruments to
measure important marketing concepts such as loyalty.
Managerial implications
There are important managerial implications arising from this
research and each implication will be discussed in turn for the
reader. First, loyalty should be considered as more than one
thing. Second, this research has provided a step towards
consolidating a wide range of survey-based loyalty measures
that exist in the academic literature, helping to simplify loyalty
497
Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
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Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
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Journal of Business Research, Vol. 16 No. 2, pp. 149-67.
Executive summary and implications for
managers and executives
This summary has been provided to allow managers and executives
a rapid appreciation of the content of this article. Those with a
particular interest in the topic covered may then read the article in
toto to take advantage of the more comprehensive description of the
research undertaken and its results to get the full benefits of the
material present.
Marketers commonly accept that it is cheaper to retain an
existing customer than to attract a new one. Customer loyalty
is key to the longevity of a brand and can be linked to
company growth.
Loyalty, also known as customer retention and
commitment, first appeared as a marketing concept in the
1940s. Two loyalty concepts evolved: “brand preference”, or
attitudinal loyalty; and “share of the market”, or behavioural
loyalty. Subsequently, these two concepts were merged into
“composite” loyalty, which considered that loyalty should
always comprise favourable attitudes, intentions and repeat
purchase. Some researchers later came to the view that loyalty
evolves and that there are stages of loyalty.
“Pure” and “impure” measures of loyalty
In the context of two services – wine clubs and insurance –
Rundle-Thiele analysed 31 types of loyalty that had been used
in previous studies. The author discovered that 16 of these
measured more than one type of loyalty and therefore were
not “pure”. “Pure” measures offer the greatest guidance for
marketers concerned with marketing programmes to maintain
or build loyalty. The author suggests that there may be six
“pure” types of loyalty:
1 attitudinal loyalty – a customer feeling or attitude of
devoted attachment and affection towards the service
brand or retailer;
2 resistance to competing offers – customer immunity to, or
protection from, the offers of competing firms;
499
Exploring loyal qualities: assessing survey-based loyalty measures
Journal of Services Marketing
Sharyn Rundle-Thiele
Volume 19 · Number 7 · 2005 · 492 –500
Because customers can be loyal in different ways, the author
concludes that loyalty is not necessarily a series of stages
performed in sequence, and that it should not be considered
always to comprise favourable attitudes, intentions and repeat
purchase. Customers may exhibit or possess different degrees
of loyalty across different types of loyalty.
monitor the different types of loyalty. Considering loyalty as
more than one thing can provide guidance for marketers
seeking to develop marketing programmes to build loyalty.
For example, a problem would exist if a marketer found that
propensity to be loyal was high but the remaining types of
loyalty were low. This would indicate that improvements in
marketing programmes were needed in order to build loyalty
to the service.
Marketing managers should consider the types of loyalty
that exist and specify these types. In this way, marketers will
be better able to understand what type of loyalty a survey
measure captures and which measures may be most
appropriate for their needs. This can help them to simplify
and shorten their surveys.
Benchmark and monitor the different types of loyalty
Marketers seeking to maintain or improve customer loyalty
should use more than one loyalty measure to benchmark and
(A précis of the article “Exploring loyal qualities: assessing surveybased loyalty measures”, supplied by Marketing Consultants for
Emerald.)
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behavioural intentions – attitudes towards purchasing the
brand;
propensity to be loyal – the individual customer’s
tendency to remain loyal to the brand;
complaining behaviour – expressions of dissatisfaction or
disapproval; and
behavioural loyalty – the customer’s tendency to
repurchase, revealed through behaviour that can be
measured and that directly affects brand sales.
500