Relationship between Brand Loyalty and Impulse Buying - Essay Example

Relationship between Brand Loyalty and Impulse Buying and Introduction For an organization toachieve its set goals and objectives, and to achieve sustainability and growth, it must strive to acquire customer and brand loyalty. Customer loyalty is largely determined by the quality of goods services rendered by a business. A business that has customer loyalty has a competitive edge over other businesses that do not have the same. This loyalty translates into increased revenue and net profit which makes the business even more competitive. As such, employers have done everything possible to ensure that the needs of the customers are met, and that consumers are made to feel valued by the business. Policies and programs are generated and enrolled to make sure that the customers remain loyal to the business. There are various reasons why customers remain loyal to an organization, but chief among them is consumer satisfaction. With satisfaction, consumers establish a working business relationship with the corporation. Sometimes, due to this loyalty, they find themselves doing impulse buying. This paper seeks to discuss whether loyalty affects consumer purchases. Discussion Customer loyalty At a time when business are competing for the available customers, customer loyalty becomes a must have for visionary businesses. Establishing loyal customers and increasing profitability results into a sustainable business. Many inventors strive to achieve this. However, customer loyalty is earned by the business from the way it treats its customers. Customer loyalty is mainly a product of continued consumer satisfaction. Customer satisfaction, according to Yunlai (2008), is the appraisal done by the customer of performance regarding the quality of goods and services rendered. Customer satisfaction is prompted by varied items including pricing of products, employee attitude and service efficiency. A satisfied customer feels valued and respected by the corporation through its employees. As such, the corporation should motivate and train the employees on how to handle the customers in a manner that they feel appreciated and valued. The employees should establish a positive emotional relationship with the clients, and earn their confidence and trust. This is best done not by discounts but by consistency in the offering of quality products and services. The quality should always match or supersede the expectation of the clients and the corporation should be accountable to the experiences of the client. The perceived customer value results into customer contentment, and thereafter customer loyalty. Customer loyalty, as Yunlai (2008) further argues, entails the probability that in the future, customers will continue consuming a particular product or service and will not change the brand. There are two types of customer loyalty, namely short-term and long-term (Brandi, 2001). According to Brandi (2001), Long-term customer loyalty entails an actual customer who will not readily opt for another service provider. On the flipside, Brandi states that short-term customer loyalty entails a customer who is inclined to move on to another service provide for varied reasons. A competitive business is therefore the one that have its customers continuing purchasing products from the same business. At this stage, the customer may tolerate anything, including higher prices, due to the attachment to the corporation. Below is a consumer loyalty model. Consumer loyalty model image@Google.com How Customer Loyalty Establishes Friendship Connection The quality of service leaves the customer forming perceptions from his/her experiences. When a customer is satisfied, they become more loyal to the business. According to Yunlai (2008), customer loyalty evolves into a form of a friendship between the customer and the business. This further suggests that such a customer is more likely to continue purchasing items from the same business in the future. In fact, Yunlai (2008) has established that customer satisfaction always have a favorable impact on customer loyalty. At this level, there is established a customer-seller relationship where both feel responsible to the other. The customer feels his/her needs are satisfied while the seller gains satisfaction from the profit earned and the trust accorded by the customer in allowing the seller to continually serve him/her. At this level, the customer is less likely to switch sellers due to perceived switching costs while the seller strives to offer quality products and services to maintain the customer and influence his/her buying patterns. The focus of any serious business should be to develop such a healthy and profitable relationship with the customers so as to make the business sustainable. This is best achieved by delivering more responsive and tailored services to the customers. When their needs are met, they feel satisfied and happy. They start viewing the company as a trusted partner. They always want to be associated with the company. Impulse buying The concept of ‘impulse buying’ has evolved over time, and there have been several shifts on its definition over time. Initially, according to Lee (2008) focused on the time when the decision of purchase was made and the item purchased and the consumer was left out in the definition. Lee (2008) further argues that impulse buying was taken to be synonymous with unplanned buying. However, the two dimensions in the definition of impulse buying were later differentiated into two distinct concepts. Some researchers saw impulse buying as occurring as a reaction to stimuli, in this case the attractiveness of a commodity in a store (Lee, 2008). He further argues that impulse buying is of different types depending on the prompting factor. Other researchers take impulse buying as a form of ‘immediate response’ decision. Generally, these researchers understood impulse buying to mean the unplanned purchasing of a commodity due to an encounter with a stimulus, mainly the commodity (Yunlai, 2008). Later studies shifted the concept of impulse buying and viewed it as an ‘emotional’ process. Some researchers observed that impulse buying occurs when a consumer is confronted by a sudden crave to buy something at that very moment (Jansson-Boyd, 2009). Generally, impulse buying is a sudden irresistible crave to purchase an item devoid of any consideration and regard to the consequences. According to Ying-Hueih and Shu-Hua (2013), compulsive buying is qualified by an extreme dysfunctional purchasing behavior and occurs in a situation when a customer enters the store without having made a conscious intention to do so. The commodity that is purchased was not in the shopping list. Basing on this definition, impulse buying is divided into four categories according to Lee (2008): a. Pure Impulsive Buying: In this category, impulsiveness is very high, and is triggered by a strong emotional urge, not the commodity. Low prices are mainly to blame for this urge. b. Suggestion Impulse Buying: This is where a sudden urge to purchase a product is prompted by the sight of a new product in the market. The urge is only satisfied by the purchasing of the product. Though the purchase may be justified, the purchase was not planned for and the buyer had no previous knowledge of the product. This constitutes impulse buying (Lee, 2008). c. Reminder Impulse Buying: In this case, Lee (2008) argues that the buyer has a previous knowledge of the product in the unconscious mind. When the consumer enters a store and sees the product, he/she suddenly remembers that they need it because they are out it at home. Also, the commodity may remind them of an advertisement previously seen by the consumer, and he/she takes advantage and purchases it d. Planned impulsive buying: In this case, the consumer makes a decision to do some shopping. However, he/she has no pre-determined choice on what kind product to buy, the brand, price, size etc. A decision to buy a particular commodity is determined by such factors like pricing of commodities, in-store marketing, branding and influence from the salespersons (Lee, 2008). This category is different from the others in that there is no specific product in mind before a consumer enters a store, and the actual decision is made at the point of sale. For the other categories, the consumers have specific commodities in mind before entering the store (Lee, 2008). From the above discussion, as Lee (2008) explains, impulse buying should qualify as such if it fits the following criteria: a. The purchase of a commodity should be unplanned. The buyer should not have an already made decision on the choice of any particular product. b. The decision to purchase a particular product is spontaneously made once the consumer is in the store and when the customer sees the product, not any time before this. According to Hur and Kang (2012), there are three main categories of factors that influence impulse buying behavior. These include the buying conditions, store management, and individual characteristics of the shopper. a. Store management: As Hur and Kang (2012) explain, the general in-store display influences the purchasing decision of a buyer. A highly stimulating interior design like background music and fragrance may prompt impulse buying. Some of this stimuli trigger a direct purchase while some serve to first change the mood of the consumer into that which that makes him/her feel like shopping. b. Consumer individual characteristics: In this case, Hur and Kang (2012) argue that some people are more inclined to impulsivity than others. For instance, some people engage in impulse buying because they are able to due to financial freedom. Such purchases are made to show that the consumer is in full control of his/her life. Some people who suffer from low self-esteem and a sense of emptiness will sometimes go for shopping as a way of defeating the depression, though this is only a short-term solution. Relationship between loyalty and impulse buying Brand loyalty can partly contribute to impulse buying. As observed earlier, loyalty is earned a result of perceived quality of goods and services (Brandi, 2001). As such, the consumer learns to associate quality with that particular business. In a situation where the consumer finds himself in the store with or without premeditated shopping list, he/she is most likely to buy an item. The consumer, on seeing a particular product in the store, remembers that he/she had run out of it at home. He/she will most likely pick it up without much consideration of its quality. This is because he/she has learnt to trust the organization in terms of offering quality goods and services. If the consumer is prompted by the marketing strategy, the interior design or is influenced by the salesperson, he/she may also purchase the product and assume that they are of superior quality. This assumption is not because the consumer has indeed experienced the product, but because he/she has learnt to associate the business with quality products and services. This assumption of quality is a product of consumer loyalty which is generated and enhanced by consumer satisfaction (Brandi, 2001). In this regard, consumers may find themselves purchasing products they had not planned for just because they feel ‘secure’ about the products being offered by the business. From this perspective, one can argue that brand loyalty may trigger impulse buying. Research done by Jansson-Boyd (2009) shows that over time, consumers generate a special connection with a certain product, especially that which satisfies their needs. Their minds are conditioned to feel like they possess the product. They almost cannot do without the product. This attachment can be, according to Janssson; physical, where the product is physically close; temporal connection, where we can acquire a product upon demand; and social connection in which case we compare ourselves with people using the product. When a consumer then finds himself/herself in a store, and holds the product on his/her hands, he/she imagines the pleasure that would accrue if he/she indeed buys the product, just like the person they saw using the product was happy. This attachment to a product may encourage impulse buying. Some businesses have also enrolled loyalty programs which may encourage impulse buying. They employ positive reinforcement, a principle of operant conditioning (Jansson-Boyd, 2009). Some reduce prices of particular products for loyal customers while others may offer discounts for products bought. Moreover, consumers are issued with loyalty cards with which they collect points after doing shopping. There is high probability that that consumer will be come back (Jansson-Boyd, 2009). These are initiatives aimed at maintaining the loyalty of the customer. Due to these incentives, some loyal consumers may find themselves buying products they had not planned for just to receive the rewards. As such, this sort of impulse buying is a resultant of customer loyalty to the business and brand. However, studies done on impulse buying suggest that there are more fundamental and measureable reasons as to why people engage in impulse buying (Wilkie, 1986). These findings far outweigh brand loyalty as a driving factor in impulse buying by the consumers. The following discussion examines the reasons for impulse buying by consumers and how this could not be caused by customer loyalty, but rather by other factors that override brand loyalty. To begin with, some people, as mentioned earlier, possess a natural inclination towards impulsivity in buying than others (Jansson-Boyd, 2009). Jansson further argues that these kinds of people are out-going, affable, status- conscious and are generally mindful of how they appear. As such, an impulsive buyer will purchase products, not because of brand loyalty, but because they want to look good in public eyes and to maintain their status quo. For instance, if a lady loves to be fashionable and follows fashion trends, she will always go out shopping for the latest fashion in the market, regardless of where it is, not the brand loyalty. Also, research by Ji and Wood (2007) shows that impulse buyers are more emotional and find it difficult to control those emotions. Since impulse buying is largely a sudden emotional reaction, these impulse buyers find it difficult to deal with this emotion and resist the urge and they most likely succumb and purchase the product. Considering this scenario, the consumer engages in impulse buying due to inability to deal with the emotion, as opposed to brand loyalty. Brand promotion and advertising also goes a long way into prompting impulse buying. Adverts placed in visual and print media, as Giles (2003) argues, are embedded in the unconscious mind of the consumers. Once they are in the stores and when they see the advertised product, they remember the advertising. They then experience a sudden urge to purchase the product and experience whatever the advert seemed to say about the product. From Giles observation, it does not matter the level of consumer loyalty in whether or not the buyer will purchase the product. Rather, it is how compelling was the advert that will make the consumer to buy the product and have a taste of it. As Kellet & Bolton (2004) argues, impulse buyers are more likely to suffer from psychological problems like stress and low self-esteem. Such people always look for activities that will fill the void in them and uplift their souls. Some opt for shopping and, though this is a temporal solution to their problems, it serves to satisfy them by alleviating their misery and elevating their moods. These impulsive shoppers are motivated by their misery, not brand loyalty. Moreover, some people go shopping just for the fun of it. While at it, they experience pleasurable moments (Brandi, 2001). Since most people love to feel good, such people will engage in impulse buying to sustain their pleasurable moments. In this situation, brand loyalty does not play a role in propelling the indulgence. In business marketing, ‘seeing’ forms the main attraction to impulse buyers. Businesses like kiosks and cart operators will attract more impulse buyers since their products are well-displayed in the open and are visible from a distance. Impulse buyers are attracted by this and find it hard to resist once they see the products. They eventually purchase some products not because of any royalty, but because of they fell into the marketing strategy of visibility of the products. Conclusion As observed earlier, impulse buying is a sudden and immediate purchasing of products devoid of prior shopping intentions of the specific products. It may be occasioned by loyalty to a brand in that loyal customers are easily swayed by the marketing strategies employed by a corporation in the internal environment as well as in the external environment. This includes loyalty programs, pricing strategy, interior design and the general presentation of the business. Due to a perceived connection to the brand, such consumers are easy to trust products from the business and this makes them vulnerable to strategies that promote impulse buying. However, from the above discussion, brand loyalty does not necessarily result in impulse buying. Findings from the various researches cited indicate that other factors are largely responsible for impulse buying. Visibility of the products is the first step towards impulse buying. The pricing strategy employed by the business could see people buying goods impulsively. Also, personal characteristics like a craving to be fashionable and trendy, emotional status, and love for freedom enhances impulsive buying. Moreover, promotional and advertising activities influence the purchasing behavior of a consumer. Research also indicate that situational factors like the popularity of a brand, public recommendation and the demand of particular products during particular times like festive seasons, prompts and enhances impulse buying. In conclusion, I am of the view that there is an insignificant relationship between brand loyalty and impulse buying. Impulse buying is a psychological behavior that is prompted and perpetuated by more concrete factors. Being loyal to a brand does not affect impulse purchases exhibited by a consumer. A mere loyalty to a brand would constitute a lame rationale as to the reason for impulsive buying. References Brandi, J. (2001). Building Customer Loyalty. Dallas TX: Walk the Talk Co. Giles, D. (2003). Media Psychology (1st ed.). Mahwah, N.J.: Lawrence Erlbaum Associates Publishers. Hur, W., & Kang, S. (2012). Interaction Effects of the Three Commitment Components on Customer Loyalty Behaviors. Social Behavior and Personality: An International Journal, 40(9), 1537--1541. Ji, M. F., & Wood, W. (2007). Purchase and Consumption Habits: Not Necessarily What You Intend. Journal of Consumer Psychology (Lawrence Erlbaum Associates), 17(4), 261- 276. Jansson-Boyd, C. (2009). Consumer Psychology. Maidenhead, Berkshire: Open University Press. Lee, J. (2008). Relative and Interaction Effects of Situational and Personal Factors on Impulse Buying. Minnesota: UMI. Lewis, M. (2004). The Influence of Loyalty Programs and Short-term Promotions on Customer Retention. Journal of Marketing Research, 41(3), 281--292. Wilkie, W. (1986). Consumer Behavior. New York: Wiley. Yunlai, Z. (2008). The Relationship between Impulse Buying, Negative Evaluations and Customer Loyalty. Beijing: Beijing Technology and Business University. Ying-Hueih, C., & Shu-Hua, C. (2013). Impulse Purchases and Trust: The Mediating Effect of Stickiness and the Mental Budgeting Account. Cyberpsychology, Behavior & Social Networking, 16(5), 1-7. Read More