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International Journal of Business and Social Science Vol. 2 No.10; June 2011 Comparisons of Competing Models between Attitudinal Loyalty and Behavioral Loyalty Cheng, Shih-I Assistant Professor Department of Business Administration, Shu-Te University, Taiwan E-mail: jane@stu.edu.tw Abstract A literature review identifies several classifications of customer loyalty; the most common are attitudinal and behavioral loyalties. Traditional studies, however, have not yet examined customer loyalty wit
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   International Journal of Business and Social Science Vol. 2 No.10; June 2011 149 Comparisons of Competing Models between Attitudinal Loyalty and Behavioral Loyalty Cheng, Shih-I Assistant ProfessorDepartment of Business Administration,Shu-Te University, Taiwan E-mail:  jane@stu.edu.tw   Abstract  A literature review identifies several classifications of customer loyalty; the most common are attitudinal and behavioral loyalties. Traditional studies, however, have not yet examined customer loyalty within a framework of these classifications. To address this deficit, this study uses linear structural modeling to explore thedifferences between attitudinal and behavioral loyalty models; 295 department store shoppers were used assubjects to determine how the influences of corporate image, switching costs and customer satisfaction found in an attitudinal loyalty model differ from those of a behavioral loyalty model. The results demonstrate that while these two competing models have goodness of fit, when comparing models with non-nested structures,behavioral loyalty exhibits better performance. In addition, no significant difference is observed between theinfluence of corporate image and that of customer satisfaction in attitudinal or behavioral loyalty model.Conversely, switching cost is shown to have a stronger influence on behavioral loyalty than it does onattitudinal loyalty. Keyword : attitudinal loyalty, behavioral loyalty, corporate image, switching cost, customer satisfaction  Introduction Oliver (1999) points out that since the 1970s, the number of studies focusing on customer satisfaction hasdeclined as a result of the belief that pursuing customer loyalty is a more central imperative for business.Reichheld (1996) and Reynolds and Arnold (2000) agree that customer loyalty has become essential tobusiness operation. According the research from Kumar and Shah (2006), Lam et al. (2004), Fullerton (2005),Bove et al. (2009), both attitudinal and behavioral dimensions of loyalty are considered to be equally critical. Attitudinal loyalty explains a consumer’s identification with a particular service provider and preference of a product or service over alternatives (Jones and Taylor, 2007), when a customer is behaviorally loyal, heintends to repurchase the same brand and by that, maintain a relationship with a particular service provider(Jones and Taylor, 2007; Andreasen and Lindestad, 1998).There are many articles separate loyalty into Attitudinal and behavioral loyalty. Most part of research treatAttitudinal loyalty as antecedent of behavioral loyalty (Bandyopadhyay, Martell, 2007; Jacoby, Kyner. 1973;Pritchard, Havitz, Howard, 1999; East, Gendall, Hammond, Lomax, 2005; Russell-Bennett, McColl-Kennedy,Coote, 2007; Reynolds and Arnold, 2000; Carpenter, 2008), but some are not, like Labeaga, Lado and Martos(2007) argue corporate image increase behavioral loyalty significantly. Reynolds and Beatty (1999) findsatisfaction effect behavioral loyalty directly. Day (1969) mention behavioral loyalty happen because chance,custom or other factors, not necessary cause by attitudinal loyalty. Chaudhuri and Holbrook (2001) useattitudinal and behavioral loyalty as causes impact on market share, the believed the relationship of attitudinaland behavioral loyalty to be interrelated not cause-effect.Sharp et al. (2002) further implicate attitudinal and behavioral loyalty has low relative. Based on the reasons  © Centre for Promoting Ideas, USAwww.ijbssnet.com  150describe above illustrate, the study try to use the same antecedent variables to predict attitudinal andbehavio ral loyalty at the same time to understand what’s the difference between attitudinal and behavioralloyalty. Most customer loyalty studies integrate multi-dimensional concepts into a single construct comprising: “repurchase intention”, “recommendation intention ”, “customer retention”, or “price tolerance”. Researchers tally these components, combining them into a single dependent variable to determine factors that affectloyalty. According to studies by Kumar and Shah (2006), Lam et al. (2004), and Fullerton (2005), there aretwo kinds of loyalty: behavioral loyalty and attitudinal loyalty. Behavioral loyalty ensures that customerloyalty can be converted into actual purchase behaviors. While attitudinal loyalty will not ensure thatcustomers will purchase merchandise themselves, they will, through word-of-mouth, help to create a positiveimage of a business to others. This may not directly bring profit, but will indirectly create a positive result. Wedetermined the most common to comprise: behavioral loyalty (a substantial element) and attitudinal loyalty (apsychological construct). Hence, this study attempts to use the same variables to make predictions of behavioral and attitudinal loyalties to identify the differences between the behavioral loyalty model andattitudinal loyalty model.With a rise in national income and the attendant swell in consumer spending, increasing numbers of Taiwanese consumers are shopping at department stores, giving this segment the largest share of the generalmerchandise retailing industry. According to 2010 data from the Department of Statistics at the Ministry of Economic Affairs, about 30% of business turnover from general merchandise retailing comes from departmentstores (including shopping malls). This makes department stores the leading segment within the generalmerchandise retailing industry (which also includes supermarkets, convenience stores and warehouses). Hence,this study used department store shoppers as research subjects to conduct an empirical study. The findings willbe provided to department stores in the hope that they will provide guidance as management devises andimplements different strategies for building behavioral and attitudinal loyalties among customers  Literature Review 1. Definition and Classification of Customer Loyalty(1) Definition of Customer Loyalty Customer loyalty is a customer’s sense of belonging or identificatio n with the employees, services or productsof a company; these feelings have a direct impact on customer behavior (Jones and Sasser, 1995). Dick andBasu (1994) argue that loyalty is multi-dimensional. It does not simply indicate whether a customer will makerepeat purchases; it also serves as a measure of customer support for a business. Zeithaml et al. (1996) andBloemer and Odekerken-Schroder (2002) describe customer loyalty as a multi-dimensional constructconsisting of purchase intention, recommendations, price tolerance, word of mouth, complaint behavior, and  propensity to leave. In summary, customer loyalty is a customer’s sense of identification with a business. This sense of identification affects repurchases intentions, spending amount, the possibility of recommendation,and even the willingness to become part of a business. (2) Classifications of Customer Loyalty Ganesh et al. (2000) empirically derive two distinct dimensions of the loyalty construct: active and passiveloyalty. Active loyalty behaviors are those that require a conscious and deliberate effort to undertake, and arereflected in both purchase behavior and purchase intentions. Passive loyalty can be identified when customerpurchase behaviors or intentions are affected by a change in price or switching cost.Kumar and Shah (2006) describe two alternate forms of loyalty: behavioral loyalty and attitudinal loyalty. For   International Journal of Business and Social Science Vol. 2 No.10; June 2011 151Lam et al. (2004) loyalty is manifested in two other ways: repeat patronage and recommendation. Fullerton(2005) uses repurchase intention and advocacy to evaluate consumer brand loyalty to a single retailer; “advocacy” here is understood to signify positive word -of-mouth, meaning that customers will recommend aretailer to others. More researcher focus loyalty on attitudinal loyalty and behavioral loyalty (Kumar and Shah,2006; Jones and Taylor, 2007; Kumar and Reinartz, 2006; Bove et al., 2009). Behavioral loyalty means consumers’ repurchase behavioral or intension of specific brand (Russell -Bennett et al. 2007). Attitudinal loyalty means consumers’ sense of specific products or service (Kumar and Reinartz, 2006). Bowen and Chen(2001) describe three approaches for the evaluation of customer loyalty: (1) behavioral measurement, (2)attitudinal measurement, and (3) composite measurement (a combination of behavioral and attitudinalmeasurements). From a review of the above literature, among the various classifications for customer loyalty,we determined the most common to comprise: attitudinal loyalty (a psychological construct) and behavioralloyalty (a substantial element). Generally speaking, studies on loyalty do not subdivide loyalty. This studyattempts to distinguish behavioral loyalty from attitudinal loyalty and examine their differences. Factors Influencing the Evaluation of Customer LoyaltyCustomer Satisfaction Customer satisfaction is determined by customer perception: following a service or purchase evaluation,customers form emotional perspectives toward a product (Churchill and Surprenant, 1982). Anderson et al.(1994) suggest that overall customer satisfaction is based primarily on the experience and satisfaction whilepurchasing merchandise or services: it is both an emotional evaluation and a process of comparison between a “pre - consumption expectation” and   the “post -consumption  perceived performance”. Customer satisfaction isthe most widely discussed independent variable in studies on customer loyalty (Ibanez, Hartman and Calvo,2006; Auh and Johnson, 2005; Host and Knie-Anderson, 2004; Hellier, Gaursen, Rondey and Rechard, 2003.)Bei and Chiao (2001) interviewed 495 customers across 15 service departments at Mitsubishi, Nissan andToyota dealers.The results suggested that the higher the customer satisfaction, the higher the loyalty to the company.Reichheld and Saser (1990) argue that improved customer satisfaction will affect the likelihood of repeatpurchases. Tailor and Baker (1994) based their studies on four service industries in their examination of therelationships between service quality, customer satisfaction, and customer purchase intention. Theydetermined that customer satisfaction is positively correlated to purchase intention. Fornell et al. (1996) alsomaintain that after a customer purchases a product or service, an attitude will be formed, which is satisfaction.If satisfaction is high, the likelihood of repeat patronage is great. This will create an attitudinal loyaltywhereby the customer will recommend the product or service through word of mouth. In other words,customer satisfaction has a positive impact on both behavioral and attitudinal loyalty. Service Quality S ervice quality is a customer’s evaluation of  overall superiority of a service encounter; it is a perceived, notobjective, quality. The PZB model is most commonly used for evaluating service quality. Parasuraman et al.(1988) refined the PZB model by subdividing it into five aspects: Tangibility, Reliability, Responsiveness,Assurance, and Empathy. They created the 22 question service quality scale for the evaluation of acu stomer’s expected service quality and his/her  perceived service quality.This SERVQUAL model has been widely used in various service industry studies. Cronin and Taylor (1992)  © Centre for Promoting Ideas, USAwww.ijbssnet.com  152proposed the SERVPERF (SERVice PERFormance) service quality scale, positing service quality can bemeasured by simple service results. This method evaluates service quality through a measurement of perceived service. Most studies maintain that customer satisfaction is based primarily on service quality.Bolton and Drew (1991) claim that service quality is the antecedent of customer satisfaction. Cronin andTaylor (1992) determined that higher service quality leads to improved customer satisfaction. Anderson andSullivan (1993) also agree that service quality affects satisfaction, emphasizing that customer satisfaction is anintegrated appraisal of the post-purchase experience. Ibanez et al. (2006) argue that the technical quality of acore service as well as the technical quality of peripheral and service process qualities also affect customersatisfaction, but that service quality does not directly affect loyalty: it affects loyalty only through satisfaction.A study by Host and Knie-Anderson (2004) contends that among the five constructs of service quality,reliability and assurance can best predict satisfaction. This study also classifies service quality as anantecedent variable of customer satisfaction. Corporate Image Corporate image is a consumer’s per  ception of a corporate entity. This image will remain in a consumer’s mind further affecting purchase behaviors or intentions. By means of the products, services and relatedinformation, consumers develop a subjective appraisal of a corporation, thus forming a corporate image.Robertson and Gatignon (1986) believe that a positive corporate image can decrease uncertainty in consumerdecision making and establish a high level of recognition among certain businesses. Josee and Gaby (2002)defined corporate image as a society’s overall impression, including the interaction between physic al andinvisible elements. In summary, corporate image is an integrated perception that represents the degree towhich consumers identify with a business.Nguyen and LeBlanc (1998) argued that corporate image has significant influence on customer loyalty andplays a key role in customer retention. Josee and Gaby (2002) used 357 European supermarket chaincustomers as subjects and determined that corporate image affects loyalty, they also proved that corporateimage influences purchase decisions; the better a corporate image, the greater both the purchase frequency anddollar amount spent. The majority of department stores in Taiwan enjoy high brand awareness; however,consumers hold varying perceptions toward each department store in terms of image and reputation. In this study, a “corporate image” variable is included in the customer loyalty model in order to determine if this psychological variable exhibits differences when it comes to affecting behavioral and attitudinal loyalty. Switching Costs Switching cost can make it difficult or expensive for customers to switch service providers. When customersare considering switching service providers, they evaluate both the benefits and the costs; when required costsare higher than gained benefits (meaning an excessively high switching cost) an exit barrier is created, thusdecreasing the possibility of switching (Jones et al., 2000). Hauser et al. (1994) point out that, when switchingcosts increase, sensitivity to satisfaction decreases. Therefore, switching costs play an important role when acustomer considers changing service providers. Many studies indicated that perceived switching cost is animportant factor when it comes to customer loyalty (Storbacka et al., 1994; Jones et al., 2000; Sharma andPatterson, 2000; Lewis, 2002; Whitehead, 2003). Many case studies reveal that an unsatisfied customer maycontinue with the same vendor only because he/she believes that extra time and effort spent on switching, willbe costly.In a study by Anderson and Sullivan (1993), it was found that in the airline and banking industries, customers
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