The influence of customer brand identification on hotel brand evaluation and loyalty development

TL;DR: In this paper, the role of customer brand identification in the formation of hotel brand loyalty is investigated, and it is shown that customer identification is an indirect predictor of hotel loyalty through its three known antecedents.

About: This article is published in International Journal of Hospitality Management.The article was published on 2013-09-01 and is currently open access. It has received 269 citations till now. The article focuses on the topics: Brand loyalty & Brand management.

Summary

1. Introduction

• Furthermore, the proliferation of new hotel brands (Kim et al., 2008; Olsen et al., 1998), as well as the extensive adoption of branding strategies in the hotel industry (Forgacs, 2003; Prasad and Dev, 2000; So and King, 2010), requires a greater understanding of the role CBI plays in creating a strong customer–brand relationship.
• While customer satisfaction is also a commonly used antecedent of loyalty, this study specifically includes service quality rather than customer satisfaction.
• The structure of this paper is as follows.
• The next section provides a theoretical foundation for this study by reviewing the relevant literature on brand loyalty and its commonly identified antecedents, as well as the literature on CBI.

2.1 Brand loyalty

• The concept of brand loyalty has been approached from three perspectives: behavioral, attitudinal, and composite loyalty.
• While consideration of the attitudinal aspects of loyalty allows the researcher to distinguish brand loyalty from repeat buying, it focuses on consumer declarations rather than on actual purchases and thus may not be an accurate representation of reality (Mellens et al., 1996; Odin et al., 2001).
• A positive attitude toward a brand may not lead to actual purchase behavior.
• In contrast, the composite approach considers loyalty to be a biased behavioral purchase practice that results from a psychological process (Jacoby, 1971).
• To gain insight into the development of brand loyalty, scholars have consistently documented the contribution of service quality, perceived value, and brand trust.

2.2 Customer brand identification

• The concept of identification originates from social identity theory, which maintains that the self-concept comprises a personal identity, consisting of idiosyncratic characteristics such as abilities and interests, and a social identity, encompassing salient group classifications (Ashforth and Mael, 1989; Tajfel and Turner, 1985).
• Identification is essentially a perceptual construct (Mael and Ashforth, 1992), implying identity fit and identity matching.
• Individuals tend to go beyond their self-identity to develop a social identity by classifying themselves and others into various social categories (e.g., organizational membership and sport clubs) (Mael and Ashforth, 1992).
• From a consumer perspective, identification is an individual’s “perceived oneness with or belongingness to an organization ” (Bhattacharya et al., 1995, p. 46).
• In an attempt to determine why and under what conditions consumers enter into strong, committed, and meaningful relationships with certain companies, investigators have proposed that strong consumer– company relationships are based on consumers’ identification with the companies that help them satisfy one or more important self-definitional needs (Bhattacharya and Sen, 2003).

2.3 The effect of customer brand identification on hotel brand loyalty

• Social identity may influence individuals’ perceptions, cognitions, and evaluations of issues and events, and consumers’ increased identification with a product offering or brand can lead to enhanced customer outcomes, such as stronger loyalty to the brand (Underwood et al., 2001).
• Similarly, customers who identify with a brand community are more likely to recommend the brand (Algesheimer et al., 2005).
• On this basis, the authors propose the following hypothesis: Hypothesis 1.
• Customer hotel brand identification has a positive association with hotel brand loyalty.
• This is because the intangible nature of service brands is associated with increases in consumers’ perceived risk of purchasing a service.

2.4 The effect of customer brand identification on service quality

• Consumers’ increased identification with a product offering or brand can lead to a range of favorable customer outcomes, such as stronger perceptions of quality.
• When evaluating a hotel brand, customers are more likely to be satisfied with the brand when brand identification enhances their positive image within social groups or contributes to their sense of belonging to a social group (Nam et al., 2011).
• While the potential for service quality to enhance CBI cannot be discounted, as an antecedent, CBI for a service brand would seem to be more consistent in its influence on evaluative judgments given its initial formation occurring prior to consumption, rather than being influenced by those same customer evaluations.
• Perceived service quality, representing “the consumer’s judgment about a product’s overall excellence or superiority” (Zeithaml, 1988, p. 3), in turn directly determines the level of a customer’s loyalty to a product or brand (e.g., Aydin and Ozer, 2005; Zeithaml et al., 1996).
• On this basis, the following hypothesis is proposed: Hypothesis 3.

2.5 The effect of customer brand identification on perceived value

• In the organizational literature, where the concept of identification is rooted, scholars argue that an individual’s identification with an organization enhances his/her support for it (Ashforth and Mael, 1989).
• Analogously, from a consumer perspective, the greater the identification with an organization or a brand, the more likely the customer is to be content with the organization’s products (Papista and Dimitriadis, 2012).
• Customer hotel brand identification has a positive association with perceived value.
• Most conceptual definitions of perceived value are grounded on the description of value as “the consumer’s overall assessment of the utility of a product based on perceptions of what is received and what is given” (Zeithaml, 1988, p. 14).
• For this reason, the authors also propose that Hypothesis 5.

2.6 The effect of customer brand identification on brand trust

• In addition to having the ability to engender favorable perceived value, CBI is conceptually related to the concept of brand trust.
• Conversely, the attachment characterized by brand identification may provide a platform for brand trust development (Dunn and Schweitzer, 2005; Williams, 2001).
• While brand trust is enhanced by the hotel customer’s strong identification with the brand, trust also serves as a significant determinant of brand loyalty (Aydin et al., 2005; Flavián et al., 2006; Garbarino and Johnson, 1999).
• Theoretical reasoning for the relationship between trust and loyalty has identified three ways in which trust enhances an individual’s commitment to a relationship (Ganesan and Hess, 1997).
• On this basis the authors advance the following hypothesis: Hypothesis 7.

3. Method

• The quantitative method used to test the research hypotheses included the development of a survey questionnaire to measure customers’ perceptions of hotel brands.
• The survey instrument was compiled using measurement items generated from the literature.
• To measure the five constructs of interest, the sample of this study was drawn from a panel of consumers who had expressed interest in participating in research projects.
• The national database contains demographic, lifestyle, and purchasing data on consumers from Australia and is a comprehensive online membership portal with over 500,000 members.
• This study adopted a systematic random sampling method, whereby the market list firm was instructed to calculate a sample interval to result in a list of 2,500 potential respondents.

4. Results

• Female respondents accounted for 65% of the sample, while male respondents represented 32%, and the remaining 3% did not indicate their gender.
• The research data were analyzed through structural equation modeling (SEM) according to the two-step procedure recommended by Anderson and Gerbing (1988), with an initial examination of the measurement model followed by testing the hypothesized structural relationships among the five constructs.
• To assess nonresponse bias, the authors compared early respondents (top 5%) with late respondents (bottom 5%) on the demographic variables (e.g., age, gender, and income) and the measurement items (Armstrong and Overton, 1977).
• The chi-square tests indicate no significance differences (α = .05) between early and late respondents in terms of respondent characteristics.

4.1 Measurement model

• To evaluate the performance of the measurement model, the authors conducted a confirmatory factor analysis (CFA) with the five constructs measured in this study using AMOS 18.0 through maximum likelihood estimation.
• Using this threshold as a guide, an inspection of the kurtosis values produced by AMOS suggests that no item to be substantially kurtotic, therefore satisfying the assumption of maximum likelihood estimation of SEM.
• The t-values for all standardized factor loadings were greater than 2.57 (Netemeyer et al., 2003), suggesting that they are significant indicators of their respective constructs (p < .01) and providing support for convergent validity.
• As Table 3 indicates, the analysis shows that all combinations resulted in a significantly higher value (χ 2 > 3.84 at α = 5%) for the constrained model, providing evidence of discriminant validity (Jöreskog, 1971).
• Various techniques have been proposed to assess common method variance (e.g., Harman's single-factor test, CFA test, and the marker variable technique), each having its advantages and limitations (cf. Malhotra et al., 2006).

4.2 Structural model

• The overall structural model was then tested using AMOS 18.0 with maximum likelihood estimation, with the three service evaluation constructs assumed to be correlated because they summarize various interrelated aspects of hotel consumer evaluation of a service offering.
• The structural path coefficients suggest that of the seven hypothesized paths tested, only one path was not significant (i.e., H1: CBI→BL).
• Thus, with the exception of H1, the seven paths are supported.
• Table 4 presents results of hypotheses testing with beta weights of the hypothesized paths and model fit statistics.

4.3 Testing rival models

• While the literature review argues for the relationships hypothesized in this study, it also acknowledges alternative perspectives.
• Therefore, although the proposed structural model indicates a good model fit, the authors also examined rival models.
• Testing theoretically rival or competing models is recommended to rule out equivalent or even better fitting models (MacCallum and Austin, 2000; Thompson, 2000).
• As the literature suggests that identification may form as a result of prior consumer associations with the brand, such as service transactions (Underwood et al., 2001), service quality (He and Li, 2011), and trust (Keh and Xie, 2009), a theoretically logical possibility is that service quality, perceived value, and brand trust could be modeled as antecedents to CBI.
• The results show that service quality and perceived value are not significant in predicting CBI.

4.4 Testing for mediation

• To test the mediation effects of SQ, PV, and BT hypothesized as linking the independent variable (i.e., CBI) and dependent variable (i.e., BL), four alternative structural models were estimated following the test procedures outlined by James, Mulaik and Brett (2006) and subsequently adopted by Grace and Weaven (2010) and Baldauf et al. (2009).
• The results of Model 1 (Table 5) indicate that both conditions have been satisfied.
• Using the results presented in Table 5, a comparison of Model 2 and Model 4 indicates that, after the inclusion of the mediators (SQ, PV, and BT), the direct path from the independent variable (CBI) to the dependent variable (BL) became nonsignificant, thus satisfying the fourth condition.
• The final test for full mediation involves testing whether the full mediation model (Model 1, with paths from CBI going through SQ, PV, and BT to BL) produces a better fit than the nomediation model, where the paths from SQ, PV, and BT to BL were not included, thus eliminating any indirect effect (Model 3).
• Insert Table 5 about here Insert Figure 1 about here.

5. Discussion and implications

• This study contributes to the hospitality management literature by demonstrating that CBI has an indirect effect on hotel brand loyalty through customer judgments of service quality, perceived value, and brand trust.
• These findings suggest that when customers identify with a hotel brand, they tend to have a more favorable judgment of the brand’s overall service excellence or superiority (i.e., service quality) and overall assessment of the utility (i.e., perceived value), and to exhibit a greater level of willingness to rely on that brand (i.e., brand trust).
• Supporting a sports team is a more personal relationship that often starts at a very early age and is often associated with family, friends, the community within which one lives, and general daily life during the sporting season.
• While the results indicate that a strong CBI is insufficient to establish hotel brand loyalty in isolation, CBI does represent a significant factor that exerts an indirect influence on brand loyalty through customers’ brand evaluation, highlighting the significance of CBI in the enhancement of hotel brand evaluation and, subsequently, hotel brand loyalty development.
• Identity distinctiveness can attract customers to develop identification with the brand.

6. Limitations, future research, and conclusion

• This study contributes to the tourism and hospitality literature by demonstrating the direct effect of CBI in enhancing customer evaluation of the consumption experience with hotel brands, as well as its indirect effect on the development of hotel brand loyalty.
• Second, the relatively low response rate may affect the validity of the study’s findings.
• First, qualitative research methods can also be used to investigate CBI with hotel brands and explore customers’ experiences with hotel brands that they identify with.
• Results could expand brand managers’ comprehension of the conditions under which CBI is more likely to occur.
• From a theoretical perspective, this study has addressed a relatively unexplored area in the brand management literature and has provided empirical evidence of CBI’s influence on customer evaluation of hotel brands, which contributes to brand loyalty.

Figures

Table 5 Mediation analysis results

Table 2 Discriminant validity analysis from CFA

Table 1 Results of the measurement model

Table 4 Structural model results – Overall model

Figure 1. Results for Final Structural Model

Table 3 Discriminant validity analysis from chi-square difference tests

Frequently asked questions

Q1. What contributions have the authors mentioned in the paper "The influence of customer brand identification on hotel brand evaluation and loyalty development author" ?

To extend current understanding of hotel brand management, this study investigates the role of customer brand identification in the formation of hotel brand loyalty. This study contributes to the literature by establishing that customer brand identification is an indirect predictor of hotel brand loyalty through its three known antecedents. Results suggest that while the customer may identify with a particular hotel brand, hotel loyalty still depends on the customer ’ s positive evaluation of factors relating to service experiences. 

Q2. What have the authors stated for future works in "The influence of customer brand identification on hotel brand evaluation and loyalty development author" ?

The study suggests a number of possible areas for future research. The authors have provided a possible explanation—that products with high symbolic value are more likely to generate CBI—but qualitative evidence is needed for verification. Second, future research could test the conceptual model across business and leisure travelers, as well as investigate the effect of frequency of stay on CBI levels. Third, because the current study considers brand loyalty as a unidimensional construct comprising both attitudinal and behavioral aspects, future research might investigate the effects of CBI and hotel evaluations on different aspects of brand loyalty ( i. e., cognitive, affective, conative, and action-oriented ), thereby offering additional insight into the impacts of CBI on different facets of the loyalty construct. 

Q3. What can be done to investigate CBI with hotel brands?

qualitativeresearch methods can also be used to investigate CBI with hotel brands and explore customers’ experiences with hotel brands that they identify with. 

Q4. What are the three main factors that have been considered as evaluative judgment variables?

Service quality and perceived value have been considered as evaluative judgment variables (Butcher et al., 2001) or service evaluation (Lai et al., 2009), depending on the customer’s actual service experience. 

Q5. what is the effect of brand identification on brand loyalty?

While brand trust is enhanced by the hotel customer’s strong identification with the brand,trust also serves as a significant determinant of brand loyalty (Aydin et al., 2005; Flavián et al., 2006; Garbarino and Johnson, 1999). 

Q6. What is the role of service quality in establishing strong CBI?

within the hotel industry, where products have been described as a commodity (Mattila, 2006), superior service quality is considered as necessary but insufficient to establish strong CBI. 

Q7. What is the significance of the standardized factor loadings?

The t-values for all standardized factor loadings were greater than 2.57 (Netemeyer et al., 2003), suggesting that they are significant indicators of their respective constructs (p < .01) and providing support for convergent validity. 

Q8. How was the analysis of the data analyzed?

The research data were analyzed through structural equation modeling (SEM) according to the two-step procedure recommended by Anderson and Gerbing (1988), with an initial examination of the measurement model followed by testing the hypothesized structural relationships among the five constructs. 

Q9. what is the implication of brand cues?

As extrinsic cues such as advertising and personal referrals have been shown to be significant influences in hotel purchase decisions (Brady et al., 2005), it is reasonable to suggest that a level of identification with the brand is the result of such brand cues. 

Q10. how does brand performance affect customer self-esteem?

When brand performance expectation is confirmed or exceeded, identified customers are reassured of their psychological attachment with the brand, which in turn helps the customers to preserve their self-esteem. 

Q11. What are the main factors that influence the development of brand loyalty?

To gain insight into the development of brand loyalty, scholars have consistentlydocumented the contribution of service quality, perceived value, and brand trust.