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An executive summary for managers and executive readers can be found at the end of this article.
1. Introduction
Highly satisfied customers regularly defect to the competition ([42] Kapferer, 2005; [53] Mittal and Lasser, 1998), in part due to a world-wide declining trend in customer loyalty. The phenomenon of satisfied but disloyal customers has prompted trade journals for the banking ([56] Oechsli, 2002), pulp and paper ([66] Perkowski, 2003), and health care ([40] Huff, 2007) industries to emphasize the relatively greater importance of customer loyalty vis-à-vis satisfaction. Such sentiments echo assertions made by [60] Oliver (1999) that the only customers that matter are those who are loyal.
1.1 Four forms of loyalty
The implications of customer loyalty go far beyond customer retention ([54] Motley, 2002). Increasing market share means persuading competitors' customers with weak loyalty-based opinions and beliefs to defect, as well as enhancing the loyalty of one's own customers to retain them ([85] Tyler, 2002). Consistent with these efforts by practitioners is the notion that loyalty formation is an evolutionary process in which logical (cognitive loyalty) reasons for ongoing patronage give way to emotional (affective loyalty) associations between the customer and the product, followed by a commitment to re-buy a product (evidencing conative loyalty), and may eventually result in ongoing repurchase even when action (loyalty) is necessary to overcome obstacles ([59] Oliver, 1997).
Research has confirmed this notion of four ascending loyalty forms in a number of ways. The links between various combinations of portions of the four-phase loyalty framework have been explored. For instance, [51] Methlie and Nysveen (1999) studied the effects of satisfaction (and other exogenous constructs) on affective and conative loyalty. Another effort tested cognitive perceptions of service quality, affective aspects of satisfaction, and conative loyalty responses ([21] Chiou et al. , 2002). The effects of self-esteem on conative loyalty were tested by [83] Trail et al. (2005). Relationships between customer satisfaction and action loyalty, and action loyalty and profitability were explored by [37] Helgesen (2006). Studies of cognitive, affective, conative, and action loyalty have been conducted by [80] Sivadas and Baker-Prewitt (2000), [48] McMullan and Gilmore (2003), [36] Harris and Goode (2004), [74] Samong and Omar (2004), and [28] Evanschitzky and Wunderlich (2006). Very similar work was conducted by...