Loyalty and Customer Engagement in Online Grocery Shopping in Indonesia

Abstract

COVID-19 pandemic has driven the growth of online grocery shopping in Indonesia. However, the increasing trend did not last long as the customers tended to return to a physical grocery store after entering the new normal. This study aims at understanding the role of customer engagement in predicting customer loyalty, i.e., repurchase intention and positive word-of-mouth. We use structural equation modeling to test the research model with customers of online grocery stores in Indonesia (n = 341). The results indicated that customer perception of risk (i.e., security and privacy concerns) and ease of use positively affect e-satisfaction and trust. There are also positive effects of e-satisfaction and trust on customer engagement which in turn positively affects repurchase intention and positive word-of-mouth. This study contributes to marketing literature in customer engagement, loyalty, and online grocery shopping behavior. Further, this study provides online grocery stores with actionable insights to increase customer engagement and loyalty.