Satisfaction and Repurchase Intention

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1 Startseite Satisfaction and Repurchase Intention Seminar Information, Organisation und Management, Thematic block Organizational Buying Behavior Michael Krause, Maximilian Nagel, Barbara Solchenberger

2 Role Startseite play: Repurchase Decision? 2

3 Connection between Satisfaction and Repurchase Intention? Satisfaction? direct indirect linear non-linear mediators moderators Repurchaseintention Repurchasebehaviour 3

4 Agenda 1. Customer repurchase intention A general structural equation model + A Two-Dimensional Approach 2. What Influences the Relationship Between Customer Satisfaction and Repurchase Intention? Investigating the Effects of Adjusted Expectations and Customer Loyalty 3. Repurchase Loyalty: The Role of Involvement and Satisfaction 4. Summary and Outlook 4

5 1. Customer repurchase intention A general structural equation model 5

6 Model 1 Initial Consideration Definition Satisfaction: The degree of overall pleasure or contentment felt by the customer, resulting from the ability of the service to fulfil the customer s desires, expectations and needs in relation to the service. Repurchase Intention: The individual s judgement about buying again a designated service from the same company, taking into account his or her current situation and likely circumstances. Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

7 Model 1 Initial Consideration Definition Satisfaction Attitude Repurchase Intention Attitude is here a post purchase construct Attitude: positive, neutral or negative learned dispostion Satisfaction Brand Preference Repurchase Intention Brand Preference: separate distinct evaluation of alternatives Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

8 Kapitel 3 Model 1 Taxonomy Perceived Quality Perceived Value Brand Preference Customer Loyalty Perceived Equity Customer Satisfaction Expected Switching Costs Repurchase Intention Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

9 Kapitel 3 Model 1 Item Definitions Expected switching cost: personal loss or sacrifice in time, effort and money associated with the customer changing to another service provider. Customer Loyalty: The degree to which the customer has exhibited, over recent years, repeat purchase behaviour of a particular company service and. Perceived Value: The customer s overall appraisal of the net worth of the service, based on the customer s assessment of what is received (benefits provided by the service). Perceived Equity: The customer s overall assessment of the standard of fairness and justice of the company s service transaction. Perceived Quality: The customer s overall assessment of the standard of the service delivery process. Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

10 Kapitel 3 Model 1 Item Corelations The strength of brand preference has a positive direct effect on repurchase intention. Expected switching cost has a direct positive effect on brand preference. Customer loyalty has a direct positive effect on brand preference. Customer satisfaction has a direct positive effect on brand preference. Customer satisfaction has a direct positive effect on customer loyalty. Customer satisfaction has a direct positive effect on customer expected switch. cost. Customer satisfaction has a direct positive effect on repurchase intention. Perceived value of service has a direct positive effect on customer satisfaction. Perceived value of service has a direct positive effect on brand preference. Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

11 Kapitel 3 Model 1 Taxonomy Perceived Quality Perceived Value Brand Preference Customer Loyalty Perceived Equity Customer Satisfaction Expected Switching Costs Repurchase Intention Source: Hellier, Geursen, Carr, Rickard, Customer repurchase intention, Australia,

12 Kapitel 3 Focus on Customer Loyalty: 2 Dimensional Approach Causal-model of direct factors of influence on active and passive loyalty + Aktiv Loyalty - Satisfaction Purchase Uncertainty + Perceived Switching Costs + Passiv Loyalty + Source: Bayon, Wangenheim, Ein zweidimensionales Kundenbindungsmodell mit direkten und moderierenden Variablen, Deutschland,

13 Kapitel 3 Focus on Customer Loyalty: 2 Dimensional Approach Causal-model of moderating factors of influence on the relations between active and passive loyalty. + Aktiv Loyalty Satisfaction Perceived Switching Costs Duration of C. Relationship Passiv Loyalty Purchase Importance Purchase Uncertainty Source: Bayon, Wangenheim, Ein zweidimensionales Kundenbindungsmodell mit direkten und moderierenden Variablen, Deutschland,

14 2. What Influences the Relationship Between Customer Satisfaction and Repurchase Intention? Investigating the Effects of Adjusted Expectations and Customer Loyalty 14

15 II: Object of investigation itel 3 Loyalty Behavioral repeat purchase frequency ¹ Attitudinal Cognitive, affective, conative and action phases² Adjusted expectations: expectations updated after consumption experience³ 1: Tellis, : Oliver, : Yi and La,

16 II: General Model Chronic Route Repurchase Intention Disconfirmation Customer Satisfaction Transient Route Adjusted Expectations Yi and La,

17 Kapitel 3 II: Transient Route Chronic Route Repurchase Intention Disconfirmation Customer Satisfaction Transient Route Adjusted Expectations Yi and La,

18 Kapitel 3 II: Chronic Route Chronic Route Repurchase Intention Disconfirmation Customer Satisfaction Transient Route Adjusted Expectations Yi and La,

19 3. Repurchase Loyalty: The Role of Involvement and Satisfaction 19

20 Repurchase Loyalty: The Role of Involvement and Satisfaction Svein Ottar Olsen, Psychology & Marketing, Vol.24(4): (April 2007) Main purpose: Investigate the role of satisfaction and involvement in the formation of repurchase loyalty at the product category level. Is involvement a motivational mediator or a moderator variable? Second purpose: Investigation of the relative importance of satisfaction compared with social norms and perceived control in explaining involvement and repurchase loyalty 20

21 Sample product category: Seafood 1000 parents of Norwegian school pupils (middle and high school), The person most responsible for buying and preparing home meals was to answer the questions. 52% of the surveys have been returned and 437 could be used in this study. typical respondent: - female (81%) - married (91%) - two children - 43 years (30-58) Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

22 Four models Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

23 Definitions I Satisfaction: Individual satisfaction is defined as a consumer s personal overall evaluation of satisfaction and pleasure with a given product category and as a cumulative rather than a transaction-specific construct. Repurchase Loyalty: This study restricts the definition of loyalty to the core concept of repeated consumption (action loyalty or repurchase loyalty) over time by a decision-making unit of a given product category with respect to one or more alternative product categories. Involvement: Involvement is defined as an unobservable state of motivation, arousal, or interest toward consumption (activity) of a product category (object) Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

24 Definitions II Social Norms: Social Norms are defined as approval of others expectations. Perceived Control: Perceived Control is defined as an integrated measure of internal and external resources and contextual factors that make it difficult to act upon the motivation to consume and engage in repurchase loyalty toward a product category. Moderator: A moderator might influence the degree or direction of the relationship between two variables, but is not responsible for causing the observed relationship. Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

25 Results strong and positive relationship between involvement and repurchase loyalty toward a product category confirmation of a positive relationship between satisfaction and loyalty involvement is a complete mediator between satisfaction and repurchase loyalty in this study (or an antecedent variable) social norms explained almost as much of the variance of involvement as satisfaction significant direct relationship between perceived control and repurchase loyalty relationship between perceived control and involvement was not significant, but close to being significant Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

26 Results Satisfaction Social Norms Involvement Repurchase Loyalty Perceived Control 26

27 Limitations of this study - sampling frame - sample size - definitions used - true causality cannot be tested in a crosssectional field survey Repurchase Loyalty: The Role of Involvement and Satisfaction S. O. Olsen, Psychology & Marketing, Vol.24(4):

28 4. Summary and Outlook 28

29 Satifsfaction and Repurchase Intention how are they connected? Satisfaction? direct indirect linear non-linear mediators moderators Repurchaseintention Repurchasebehaviour 29

30 Vielen Dank Thanks for your attention. 30

31 Vielen Dank Questions: Relation in different businesses? - B2C-Service, Long-Term-Contracts - New Markets? e.g. Organic Markets 31

CHAPTER II THEORETICAL FOUNDATION

CHAPTER II THEORETICAL FOUNDATION Theoretical foundation consists of the theoretical base such as opinion and understanding from several experts, which are gathered as secondary data from various sources