LITERATURE REVIEW

Literature Review

Literature Review

Customer Loyalty

Many researchers in relationship marketing subject are tying to find an agreement of brand loyalty model. As state in Uncles, Dowling and Hammond (2003) article, customer loyalty is normally conceptualised in 3 different ways. First, customer loyalty come from favourable attitude or beliefs towards brand, and manifested in an emotion attachment to brand, which allows us to gain supplemental understanding of loyal behavior. Second, it can be identified purely in term of customer behavior, the repeat buying of a brand which this concept later argue that focusing on only the behavioral aspect of loyalty would overestimate the share of true loyalty customer, because there are always customer who are force by some situation to continue purchase the same product or used same distribution channel. Lastly, Uncles et al. explain about contingency approach which contains the relationship between behavior, attitude and loyalty are influence by variables factors such as an individual particular situation or current circumstances or both of these.

In addition, some researcher belief that satisfaction is the first step in create customer loyalty. According to Little and Mardini, (2003) If the experience just fulfils expectation, they are satisfied, but in reality no one can guarantee that satisfaction customer will lead to customer loyalty. This support by a survey by British Airway, found that 13% of complete satisfied customers did not intent to fly British Airway again (Weiser, 1995) However, many researcher beliefs that when satisfied customers continue to purchase, trust and commitment will be create which will lead to loyalty.

On the other hand, while some researchers claim that loyalty has only one dimension, it is commonly argue that loyal is a two dimensional construct, which contain both behavior and attitude. This two dimension loyalty concept was first developed by Day (1969). After ward, many various modification of this concept have been suggested. Some of the best known is by Jacoby and Kyner (1973), and Mahony, et al. (2000). And the most popular model is the loyalty typology model writhed by Dick and Basu (1994).

In addition to Harvey Thomson, author of Who Stole My Customer?, says that ?the key of effectively competing for loyalty is ensuring the quality of the customer experience, not the quantity of customer rewards? (Compton, 2005, p. 14). Thomson claim that frequent flyer mile or points of hotel industry and credit card company are very easy to copy and it is not true loyalty, but it just another from off price based competition and the customers will change to the competitor if they find another card with more give more point to redeem or an easier way to get those free airplane tickets.

From the facts above we can now see the difference between repeat purchase behavior and loyalty. And we can conclude that emotional bone, attitude and behavior are characteristic of true loyalty. This support by Dick and Basu,(1994). His article state that customer loyalty model can be measure based on behavior to that brand or store and a customer's relative attitude to brand ...