Shopper marketing moderators of the brand equity – behavioral loyalty relationship

Abstract

The branding literature assumes that the higher a brand's equity, the greater is its behavioral loyalty. In this research, we develop a conceptual framework that explains the off-diagonal relationship between brand equity and behavioral loyalty (i.e., high equity but poor loyalty and vice versa) by identifying five shopper marketing related factors that potentially moderate this relationship. We adopt a multi-method approach by mailing surveys to collect shoppers' attitudinal data on brand equity and the moderators for ten brands in two product categories, and then merging it with each household's corresponding purchase data from a frequent shopper scanner panel to empirically test our framework. Findings reveal that approximately 40% of consumers exhibit high brand equity but low behavioral loyalty or vice versa. The relationship between brand equity and behavioral loyalty is accentuated by perceived in-store presence and importance of brand choice decision, and attenuated by the brand equity of competitors. Our findings provide several implications for retailers and brand manufacturers.