Customer Loyalty and Customer Satisfaction Essay

Customer Loyalty can be difficult to define given the different views that be presented within the literature. Zithaml, Berry and Parasuraman (1996) get word that committedness includes a customers intention to placate with an organisation and that loyalty includes four elements repurchase intentions, recommending the helper provider to other customers, less complaints and perimeter of price increases. Oliver, (1999) provides a different definition and describes loyalty as a customers overall attachment to a product, help, brand or organisation.A better appreciation of the factors that influence the loyalty of customers, particularly their attitudes and changing needs can help companies to develop strategies to prevent customer defection (Coyles & Gokey, 2002). Customer loyalty is measurable as it can have a powerful impact on a firms performance and it is considered to be a origination of competitive advantage (Lam, et al., 2004). There is a strong level of agreement that c ustomer loyalty and ecstasy are linked however, there is an absence of consensus as to what constitutes customer satisfaction (Caruana, 2002) in addition, despite the fact that many loyal customers are agreeable, this does not always translate into customer loyalty (Kuo & Ye, 1999, Jones & Sasser, 1995) and studies have shown that satisfied customers may express a desire to switch to a challenger but it may prove to be difficult due to a leave out of suitable alternatives (Pantouvalkis & Lymperopoulos, 2008, citing Mittal & Lassar, 1998).In contrast however, Reicheld & Sasser, (1990), indicate that high customer satisfaction should provide increased loyalty, which chafes it less likely that a customer will resolve to switch to a competitor. In addition to customer satisfaction, it has been suggested by numerous Researchers that there are other key antecedents to customer loyalty including perceived set, service fibre, corporate characterization, reputation, trust and switc hing costs (Ishaqa, 2012, Lam et al, 2004, Bitner, 1995) however, although Researchers have posited that there is a connection, it can be argued that the connections is not fully understood, due to the number of probable antecedents (Wang & Wu, 2012) hence the relevance of this research.Perceived value- Perceived value can be defined in simple terms as the benefits received and the sacrifices made by the customer, although some studies have also figured that perceived value is multi dimensional (McDougall & Levesque, 2000). It is also important to consider how perceived value can be increased and this may be achieved by delivering a better service, providing customisation of services (Coelho & Henseler, 2012) or reducing the customers cost perceptions (Ravald & Gronroos 1996).A customers perception of value could motivate them to continue to utilise the services of a service provider (Wang, 2010) and customers may also stay loyal to a company if they feel they are receiving greate r value than they would from a competitor (Lam, et al, 2004, citing Bitner & Hubbert, 1994, Bolton & Drew, 1991 Sirdeshmukh et al, 2002). Another consideration of why a customer may stay loyal, rather than move to a competitor is the anticipated switching costs, including the cost involved in changing to an alternative, loss of loyalty benefits and developed routines and procedures (Lam, et al., 2004). In situations where switching costs are high, customers may stay with a service provider regardless of the perceived value (Wang, 2010)Service theatrical role- Some studies have examined service quality as an antecedent of customer satisfaction (Rust & Oliver 1994 Spreng & MacKoy 1996), which as indicated earlier, is posited by some studies to link to perceived value.Parasuraman et al, 1988, developed the SERVQUAL theoretical account which can be adapted to suit the needs of an organisation and defines service quality as comprising of five dimensions including reliability, responsiv eness, assurance, empathy and tangibles. As part of the model the customer will compare their expectations with the perceived performance of services, or according to Santos, (2003), where the customer will make an overall judgement of the service offered. Whilst the SERVQUAL model is said to provide a good indicator of overall service quality (Buttle, 1996), it has been questioned whether or not the model can be applied to a range of industries and if the five dimensions are sufficient (Hu, et al, 2009, citing Buttle, 1996, Carman, 1990, Cronin & Taylor, 1990).Some Researchers have also argued thatthe SERVQUAL model has shortcomings, as the model wholly measures the quality of interaction and tangibles such as dcor, etc., but not the actual quality of the service outcome (Sureschander, et, al, 2001). Brady & Cronin, (2001) proposed a model which includes the quality of interaction, corporeal environment and the outcome. Given the fact that for this study the outcome relates to th e quality of homes, or the end product, it will be important to determine how this influences service quality perceptions, in addition to considering the SERVQUAL model.Also, according to Barber & Goodman, (2011), since the SERVQUAL model was developed, the debate on how to define and measure customer expectations, perceptions and performance and to understand how to address the gap has not been addressed. It is important to understand where gaps exist with the services provided and customer expectations, as meeting customer expectations is a significant driver of customer satisfaction, which can increase loyalty intentions (McDougall & Levesque, 2000). The macrocosm is that different customers have different service needs and expectations (McKnight, 2009) and it is important that this research also provides an insight into how customer expectations can be met.Corporate image- Several authors propose that service quality is determined by an evaluation of the corporate image of the organisation (Martnez Garca & Martnez Caro, 2008) and the relationship between satisfaction and corporate image have been reported in a number of studies (Razavi et al, 2012, citing Lai et al, 2009, Leblanc, 2001 Kandamplully and Hu,2007) Gronroos, (1984), indicated that image, including corporate image is built mainly via the customers experience and the manner in which the service is delivered. Bitner, (1992), proposed that the physical environment is instrumental, yet in later years these views have been extended to include a wider definition, including the business name, architecture, products and services and general impression of quality (Nguyen & Leblanc, 2001).