Contribuyamos con el medio ambiente Segn el Panel Intergubernamental para el Cambio Climtico (IPCC), seis millones de hectreas de bosques

primarios son deforestados cada ao. Esto equivale a la superficie de un estadio de ftbol cada segundo. El cambio climtico es un problema que nos afecta a todos, por lo que todos somos responsables de actuar al respecto. ESAN, escuela de negocios lder en el Per, asume un compromiso con el medio ambiente a travs de acciones concretas que contribuyan a preservar nuestro medio ambiente. Parte de este compromiso es la distribucin de materiales de la semana internacional en formato digital. Con su apoyo, reducimos el consumo de ms de 160 millares de papel, adems de tinta contaminante y folders plsticos. Cada accin cuenta en el cuidado de nuestro medio ambiente. Es el nico que tenemos y por eso agradecemos su colaboracin. Ahora piense en cuntos estadios de ftbol fueron deforestados en el tiempo que le tom leer esta declaracin.

----------------------------------Este material de lectura se reproduce para uso exclusivo de los alumnos de la Escuela de Administracin de Negocios para Graduados ESAN y en concordancia con lo dispuesto por la legislacin sobre derechos de autor: LEY 13714 Art. 69: Pueden ser reproducidos y difundidos breves fragmentos de obras literarias, cientficas y artsticas, y aun la obra entera, si su breve extensin y naturaleza lo justifican; siempre que la reproduccin se haga con fines culturales y no comerciales, y que ella no entrae competencia desleal para el autor en cuanto al aprovisionamiento pecuniario de la obra, debiendo indicarse, en todo caso, el nombre del autor, el ttulo de la obra y fuente de donde se hubiere tomado.

Torres-Moraga, E., Vsquez-Parraga, A.Z. y Zamora-Gonzlez, J. (2008). Customer satisfaction and loyalty : start with the product, culminate with the brand . Journal of Consumer Marketing, 25 (5) pp. 302-313.

Customer satisfaction and loyalty: start with the product, culminate with the brand
Eduardo Torres-Moraga
a y Negocios, University of Chile, Santiago de Chile, Chile Facultad de Econom

squez-Parraga Arturo Z. Va
College of Business Administration, The University of Texas-Pan American, Edinburg, Texas, USA, and

lez Jorge Zamora-Gonza

Facultad de Ciencias Empresariales, University of Talca, Talca, Chile
Abstract Purpose Studies on customer satisfaction and loyalty have focused on brand rather than product. It is not that brand is not important, but the process of loving a brand starts with a product. Customers appreciate products by themselves, independent of the brand, as shown in their pursuit of satisfaction and development of loyalty. Such appreciation seems to be prominent regarding innovative products when compared to traditional products. This paper aims to investigate this issue and provide a product-brand typology. Design/methodology/approach The paper takes the form of empirical research on a partial application of the typology. Findings Results show that the relationship satisfaction-loyalty is signicantly present when evaluating products alone albeit a weaker presence than when evaluating brand alone. Such unequal presence is corroborated in both traditional (bottled wine) and innovative (electronic) products even though it is much stronger in innovative products. The relationship satisfaction-loyalty is also present when evaluating product and brand combined, indicating that there is an intermediate position between product and brand. In contrast, the literature treats brand and product-brand as being in the same category thereby diminishing the importance of a useful difference between brand and product-brand. Practical implications There are practical consequences of applying the typology and examining the ndings. The relationship satisfaction-loyalty starts with the product, includes the product-brand, and culminates with the brand. This process is signicantly more important regarding innovative products, such as electronics, as compared to traditional products such as wine. Originality/value This study introduces a typology underscoring the pursuit of satisfaction and development of loyalty in three conditions of product presence versus brand presence, that is, product alone, brand alone, and product and brand combined. Keywords Customer satisfaction, Customer loyalty, Brands, Electronic commerce, Wines Paper type Research paper

An executive summary for managers and executive readers can be found at the end of this article.

Introduction
This study aims at: . developing a comprehensive product-brand typology; . examining the relationship satisfaction-loyalty when evaluating the product alone; . comparing the strength of the relationship in either product alone or brand alone situations; . exploring the strength of the relationship in a productbrand combined situation; and . comparing the strength of the relationship in either traditional product or innovative product. The rst section reviews the literature on the key concepts of this research: product, brand, customer satisfaction, and
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customer loyalty, and introduces the product-brand typology. The next section reports on the methodology used to partially test the relationships emerging from the typology as formulated in the propositions. The section on results gives an account on the validity of the measures used and the hypothesis tests performed. The remaining sections offer conclusions, practical implications, and suggestions for future research.

Literature review
Product and brand for customer relationships This review focuses on product and brand as two stages in the development of the benets destined to satisfy customers needs and preferences, and satisfaction and loyalty as two stages in the customers response to the company offerings. It is assumed that product is an initial stage in the product offering whereas brand is a mature stage. Similarly, satisfaction is an initial stage in the customer response to a company offering whereas loyalty is a mature stage in such a response. When studying customer satisfaction and/or loyalty, research has focused on satisfaction or loyalty towards the brand, not the product. The existence of the product has been subsumed into the brand, thus ignoring brand as a separate reality. In addition, when studying the product, such as in 302

Journal of Consumer Marketing 25/5 (2008) 302 313 q Emerald Group Publishing Limited [ISSN 0736-3761] [DOI 10.1108/07363760810890534]

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product development or product innovation, the customers response (e.g., satisfaction or loyalty) to it has been ignored. One of the consequences of such an approach is that marketers do not use the product as a base to gain customer satisfaction or to generate customer loyalty even if loyalty is reduced to customer retention or purchase repetition (spurious loyalty). The product can be a good starting point for providing satisfaction and generating loyalty, whereas the brand can be the mature stage of such processes. The intention is not to diminish the importance of the brand; instead, the intention is to recognize the importance of the product, separate from the brand. The advantages of getting an early start with providing satisfaction and generating loyalty towards the product include market pioneering, rst mover advantages, low-cost proactive innovation, and industry redenition. The disadvantages of ignoring the product as an initial stage to develop company policies for satisfaction and loyalty include loss of market opportunities, loss of market leadership, highcost reactive innovation, and high-cost brand development. However, the recognition of the product as an initial stage to develop satisfaction and loyalty policies may not be equal across different products. Some products, lets say traditional products, such as fresh food and drinks, may be in less need of such policies, whereas innovative products, such as automobiles and electronic equipment, may be highly dependent on such policies. A typology including the product and the brand in their various levels of recognition, such as single product, product mix, and no presence, is developed and presented below and the relationships emerging from it tested. Customer satisfaction as antecedent of loyalty Satisfaction is often used as a predictor of future consumer purchases (Newman and Werbel, 1973; Kasper, 1988). Satised customers have a higher likelihood of repeating purchases in time (Zeithaml et al., 1996), of recommending that others try the source of satisfaction (Reynolds and Arnold, 2000; Reynolds and Beatty, 1999), and of becoming less receptive to the competitors offerings (Fitzell, 1998). More specically, satisfaction is found to be a necessary precursor of customer loyalty (Fitzell, 1998; Fornell, 1992; Reynolds and Beatty, 1999; Sivadas and Baker-Prewitt, 2000; Zeithaml et al., 1996). Whereas satisfaction and loyalty are recognized as strongly related by most studies (Anderson and Sullivan, 1993; Fornell, 1992; Rust and Zahorik, 1993; Taylor and Baker, 1994), some consider the relationship to be interchangeable (Hallowell, 1996; Oliver, 1999), and some to be unidirectional, that is, progressing from satisfaction to loyalty only (Strauss and Neuhaus, 1997). Satised customers tend to be loyal customers with (Rowley, 2005) or without the mediation of other variables (Coyne, 1989; Fornell, 1992; Oliva et al., 1992). Customer loyalty as an outcome of marketing relationships A quick observation of customer loyalty is repeated purchase (Ball et al., 2004; Copeland, 1923; Newman and Werbel, 1973; Tellis and Chandy, 1998). In practical terms, rms want repeated purchases mainly because such behavior in consumers can: . apparently show the customer preference for a brand or product (Bowen and Shoemaker, 1998); 303

reect a customers purchase intention (Mellens et al., 1996); and presumably secure protability (Reichfeld and Sasser, 1990; Rust et al., 2004; Reinartz et al., 2005) by increasing market share (Chaudhuri and Holbrook 2001).

Yet, the literature has categorized this type of loyalty as spurious loyalty (Dick and Basu, 1994) or loyalty by inertia (Solomon, 1992; Bloemer and Kasper, 1994) because it only signals behavioral customer response. The consideration of attitudes in addition to the behavioral representation makes loyalty not just richer conceptually (loyalty is a process, not just an act) but also more useful for practical purposes, such as inuencing customers both attitudinally and behaviorally (Dick and Basu, 1994; Jacoby and Chestnut, 1978; Jacoby and Kyner, 1973; Oliver, 1999; Olson and Jacoby, 1971). Attitudinal loyalty reects customers cognitive, affective, and conative predispositions to continue relating to the brand or company (Oliver, 1999) often involving customer commitment (Bloemer and Kasper, 1994; Morgan and Hunt, 1994; Solomon, 1992) or, better yet, involving trust and commitment, in this order, after an initial experience of customer satisfaction (Bravo et al. 2005; Vasquez-Parraga and Alonso, 2000; Zamora et al., 2004). Consequently, true loyalty (behavioral and attitudinal) would be more powerful to not only inuence the bottom line but also the mediating processes towards the bottom line such as: . customers intention to favorably recommend the brand or company to others (Getty and Thompson, 1994); . horizontal communication (customer to customer), mouth-to-mouth communication in particular (Gremler and Brown, 1999; Reynolds and Arnold, 2000; Srinivasan et al., 2002); . customers resistance to competitors offerings (Gundlach et al., 1995) and persuasive tactics to attract new customers (Dick and Basu, 1994); and . buzz marketing (Griin, 1995). Finally, loyalty is often considered to be a predictor of the rms nancial performance. The relationship, however, is often established as part of a trio: customer satisfactioncustomer loyalty-rms performance (Reichfeld and Sasser, 1990; Zeithaml et al., 1990; Anderson et al., 1994; Storbacka et al., 1994; Rust et al., 1995; Hallowell, 1996; Fornell, 1992)

Customer satisfaction-loyalty relationships by levels of product-brand presence

Product and brand are not synonymous (Schiffman et al., 1997). Yet, some authors have used them interchangeably, particularly when they have addressed repeated purchases (e.g., Dick and Basu, 1994; Oliver, 1997). As dened above, product and brand are signicantly different both conceptually and practically. Similarly, customer satisfaction and loyalty are signicantly different even though they are strongly and unidirectionally related. The following typology reects a customer evolution in adopting a product or brand and in becoming loyal besides achieving satisfaction. A customer usually starts judging a product in order to nd the benets it brings and the satisfaction it promises (Reynolds and Beatty, 1999). The generic or unbranded product would be enough to start such a selection process. Inexperienced consumers with a line of

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products start with the product benets and preferences whereas experienced consumers go directly to the brands. As the customer becomes more experienced with the product, he or she may focus on a brand. Similarly, products follow life cycles in combination with their brands: new products are rst recognized as products and later, after the products have satised many customers and reached a more developed stage, as brands. In adopting cellular phones, for instance, recent customers adopt the product that best ts their needs or best appeals to them emotionally, symbolically, and/or cognitively (Park et al., 1986). More experienced but not highly experienced customers adopt a range of brands on the basis of both value and price, whereas highly experienced customers become loyal to a brand. The typology is an effort to represent the evolution of product to brand in customer choice and the sequential achievement of customer satisfaction and customer loyalty. Consequently, three levels of product presence (no presence, presence of a product, and presence of a set of products) are compared to three levels of brand presence (no presence, presence of a brand, and presence of a set of brands). Each cell generated in the comparison (nine cells in total eight cells are useful because cell 1 is mute) serves to characterize the type of customer satisfaction-loyalty relationship (see Figure 1) as described in the following analyses. Satisfaction-loyalty to the product alone (cell 2) Customers that evaluate products for the rst time focus on the product benets, not the brand. The emphasis is in the tangible attributes of the product, which are visible and accountable to the buyer (Keller, 1993). For instance, consumers adopting a cellular phone for the rst time may look at its functions and properties and postpone any particular interest in a brand. Similarly, low-price car buyers may focus on the characteristics of the car regardless of brand. Satisfaction-loyalty to a bundle of products (cell 3) In addition to focusing on product benets, some rst-time customers extend such evaluation to bundles of products. For example, rst-time customers who adopt hi-tech products or innovative products such as electronics or fashion clothing usually focus on the product functions or attributes, respectively.

Satisfaction-loyalty to a brand alone (cell 4) Some customers choose a brand regardless of the product. For instance, customers who like the Sony brand in any product Sony may offer, televisions, disc players, photo cameras, etc. may demonstrate brand loyalty by making subsequent purchases of Sony products without regard to other brands. Some brands are linked to products in similar lines, such as Sony or General Electric, whereas other brands relate to products in different product lines such as Nestle or the new Apple. Still some customers identify themselves with a brand or adopt a brand because it reects their personality (Aaker, 1997). Most studies have focused on brand alone emphasizing its intangible attributes or associations in various forms: a) company advertising, public relations, and word-ofmouth communications (Biel, 1992; Krishnan, 1996) media reports on consumption (Biel, 1992), consumers direct experience with the product (Biel, 1992; Burnkrant and Unnava, 1995; Haynes et al., 1999; Hoch and Deighton, 1989), brand-owning companys reputation (Nguyen and LeBlanc, 2001), country of origin (Erickson et al., 1984; Hong and Wyer, 1990), and product distributors (Pettijohn et al., 1992). Some studies have also emphasized the combination of tangible and intangible attributes in the product portrayals (Keller, 1993) or market equilibrium (Wernerfelt, 1991). Satisfaction-loyalty to product-brand combinations (cell 5) Customers choose the same product line in a range of brands, for instance, television sets in three brands only, Sony, Philips and Samsung. Some customers choose clothes or cars within a range of two or three brands only. Some studies on customer loyalty seem to have taken into account this type of combination (Dick and Basu, 1994; Oliver, 1999). Conditional satisfaction-loyalty to a brand (cell 6) or conditional satisfaction-loyalty to a product (cell 8) Customers attempt to link a product with a brand and set their preferences in product-brand combinations. A customer may choose the product or the brand rst and then follow with the brand or the product, respectively (Jacoby and Kyner, 1973; Brucks, 1985; Dawar and Parker, 1994). For instance, a customer may choose Sony TV, JVC disc players, and Cannon photo cameras. Similarly, consumers may choose

Figure 1 Types of satisfaction-loyalty relationships by levels of product-brand presence

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Levis blue jeans, Arrow shirts, and Dockers socks. The selection is conditional because when deciding on television sets, the customer will only favor a Sony brand, or when adopting disc players, the buyer will only embrace a JVC brand, and so on. Satisfaction-loyalty to a set of brands (cell 7) Some customers, particularly when associating their decisions to cultural, social or economic peculiarities, buy within a short span of brands regardless of product. For instance, rich customers are found to t this prole in brand choice by buying luxury or upscale brands only such as Porsche and Lexus in cars, Gucci and Hartmann in bags and luggage, e in Celine and Vuitton in clothes, and Burberry and La Valle clothing stores. Similarly, customers that distinguish themselves by generation, place of origin, or group beliefs limit their brand choices to particular sets of brands, the ones that distinguish them in terms of generation, place of origin or group beliefs, respectively (Boush et al., 1987; Park et al., 1991; Dacin and Smith, 1994; Herr et al., 1996; Klink and Smith, 2001). Satisfaction-loyalty to a basket of product-brand combinations (cell 9) Many customers choose sets of products within ranges of brands, one set per range of brand. For example, in choosing women cosmetics, some women prefer a set of brands (e.g., me, Ahrens, and Helena Rubinstein) for face cosmetics, Lanco and another set, for body cosmetics, and so on. The expressions if I buy moisture lotion it has to be Olay or Chanel or if I buy wet shaving products they have to be Gillette or Colgate Palmolive are common in this cell of consumer choices. Cells 2 (product alone), 4 (brand alone) and 5 (productbrand) will be subject to test using a survey research. From the above considerations regarding these three cells, we can formulate the following proposition and hypotheses: P1. The relationship satisfaction-loyalty is present in both consumer products and brand choices, including product-brand combinations. Yet, this relationship is stronger when customers adopt brands than when they adopt products. It is stronger when they adopt innovative products than when they choose traditional products. The relationship satisfaction-loyalty is signicant in both consumer products and brand choices, including product-brand combinations. The more the brand is used in adopting the product, the greater the impact of satisfaction on loyalty. The impact of satisfaction on loyalty is greater in adoptions of product-brand combinations than in product adoptions alone, but weaker than in brand adoptions alone. In product adoptions alone, the impact of satisfaction on loyalty is greater when adopting innovate products than it is when adopting traditional products.

product, or product-brand) and two groups of consumers adopting either innovative products or traditional products. The strength of the relationship between satisfaction and loyalty is measured for each type of adoption: product alone, product-brand, and brand alone. Six off-the-shelf scales measuring each construct, satisfaction or loyalty, were adapted from the literature as a starting point. The satisfaction measures were adapted from Sharma and Patterson (1999); Brockman (1998); Smith and Barclay (1997); Nguyen and LeBlanc (1998); and Veloutsou et al. (2004). The loyalty measures were adapted from Rowley and Dawes (2000); Yoon and Kim (2000); Nguyen and LeBlanc (1998); and Veloutsou et al. (2004). Because some of the scales were originally developed in different contexts of consumers, a pilot study with focus groups and a group of industrial and retail executives preceded the actual study. This resulted in four depurated scaled items per construct. A pre-test of the questionnaire followed with 105 respondents and resulted in the elimination of an additional item per construct after evaluating factor analysis results in light of conceptual contents presented above. Thus, three scaled items of a Likert type of seven points (1 completely disagree through 7 completely agree) for each construct were applied in the nal survey. Samples Two types of products were adopted, electronic products to represent innovative products and wine, to represent traditional products. A quota sample was comprised of customers who buy electronic products or wine for a total of 1,223 respondents (830 buyers of electronic products and 393 buyers of wine). The rst sample is more than two times the second sample due to the greater variety of products and brands in that segment and because the group of productbrand adopters was absent in the sample of wine buyers. The resulting sample of electronic-product buyers is distributed as follows: 43 percent adopted product-brands, 40 percent adopted products alone, and 17 percent adopted brands alone. Among wine buyers, 55 percent adopted products alone and 45 percent adopted brands alone.

Results
Reliability Conrmatory factor analysis with Varimax rotation results revealed that each construct, customer satisfaction and loyalty among buyers of electronic products, is one-dimensional as shown in Table I. All Cronbach alphas (Cronbach, 1951) are above the 0.70 threshold established by Nunnally (1978), and all item-total correlations are above the 0.30 limit (Nurosis, 1993). Table I shows similar results for wine buyers except for the Cronbach Alpha above 0.60 in the loyalty factor, still acceptable for exploratory factor analysis (Hair et al., 1998). Hypothesis tests Hypothesis tests were conducted using structural equation modeling (EQS version 6.1). A maximum likelihood method (Hu et al., 1992) is used in order to prevent potential problems derived from the lack of univariate normality in the data. Figures 2-6 show that the relationship between customer satisfaction and loyalty is positive and signicant (at 0.01 level) in the three situations of adoption: product alone, brand alone and product-brand combination. These results support 305

H1.

H2. H3.

H4.

Methodology
Research design A 3 2 research design was applied in order to secure three groups of consumers (in terms of their choices of brand,

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Table I Satisfaction and loyalty: factor analysis by type of product

Brand alone Indicator Loading Loyalty: electronic products LTM1 LTM2 LTM3 0.80 0.84 0.83 Product-brand Indicator Loading LMP1 LMP2 LMP3 0.78 0.84 0.79 Product alone Indicator LTP1 LTP2 LTP3 Loading 0.59 0.88 0.88

Satisfaction: electronic products

Loyalty: wine products

Satisfaction: wine products

CA* 0:76 EV* 67:63 percent STM1 0.88 STM2 0.86 STM3 0.92 CA 0:86 EV 78:53 percent LTM1 0.76 LTM2 0.75 LTM3 0.76 CA* 0:63 EV* 57:53 percent STM1 0.73 STM2 0.79 STM3 0.63 STM4 0.76 CA 0:70 EV 53:17 percent

CA 0:72 EV 64:66 percent SMP1 0.87 SMP2 0.86 SMP3 0.89 CA 0:85 EV 77:03 percent

CA 0:70 EV 63:29 percent STP1 0.89 STP2 0.92 STP3 0.90 CA 0:89 EVA 81:99 percent LTP1 0.85 LTP2 0.85 LTP3 0.56 CA 0:63 EV 58:39 percent STP1 0.67 STP2 0.67 STP3 0.80 STP4 0.79 CA 0:71 EV 53:93 percent

Notes: CA Cronbach alpha; EV Explained variance

Figure 2 Satisfaction-loyalty relationship for brand alone (electronic products)

Figure 3 Satisfaction-loyalty relationship for product-brand combinations (electronic products)

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Figure 4 Satisfaction-loyalty relationship for product alone (electronic products)

Figure 5 Satisfaction-loyalty relationship for brand alone (wine products)

Figure 6 Satisfaction-loyalty relationship for product alone (wine products)

H1. Similarly, Table II shows acceptable adjustment measures for all relationships in both types of products, innovative and traditional, providing additional support for H1. In support of H2, the relationship satisfaction-loyalty is stronger in brand adoptions as compared to product adoptions as observed in Table III and in Figures 2-6. The main reason brand adoptions produce more customer satisfaction, which in turn produces more customer loyalty, has to do with the addition of intangible characteristics to the product tangible features. Intangible components include psychological benets of symbolic and emotional value (Park et al., 1986) and a consumers preference for the personality 307

he or she sees reected in the brand (Aaker, 1997). Product adoptions alone generate customer satisfaction, which in turn generates customer loyalty on the basis of tangible product features such as useful functions and attractive appearance. Most often this is the initial stage of customer satisfaction and an important one. Yet, it takes the brand to raise the level of satisfaction with some intangible benets. In support of H3, Table III and Figures 2-6 show that the impact of satisfaction on loyalty is greater in adoptions of product-brand combinations than in product adoptions alone, but weaker than in brand adoptions alone. This is an intermediate stage of development in the relationship between

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Table II Satisfaction-loyalty relationship: goodness of t by type of product

Electronic products Brand alone Product-brand 30.354 8 # 0.001 0.975 0.966 0.975 0.974 3.79 Product alone 14.466 8 # 0.001 0.986 0.985 0.993 0.993 1.8 Wine products Brand alone 44.925 13 # 0.001 0.939 0.836 0.878 0.874 3.5 Product alone 45.265 13 c 0.001 0.934 0.831 0.873 0.869 3.48

Goodness of t indices x2 df p GFI Increases in goodness of t NFI IFI CFI Adjustments for parsimony x2/df

50.405 (8) 8 # 0.001 0.887 0.885 0.902 0.900 6.3

Table III Satisfaction-loytalty relationship: intensity of the differences

Differences Fishers Z-test 6.32 6.91 2.33 5.19 2.86 Signicance level 0.01 0.01 0.05 0.01 0.01

Electronic products versus wine products STP ! LTP (electronics) and STP ! LTP (wine) STM ! LTM (electronics) and STM ! LTM (wine) Electronic products STM ! LTM (electronics) and STP ! LTP (electronics) STP ! LTM (electronics) and STP ! LTP (electronics) STP ! LTP (electronics) and STP ! LTP (electronics)

sellers and buyers, providers and customers. A product-brand combination brings the advantages of both the tangible features of the product and the intangible benets of the brand in a period of development in which neither the product nor the brand is able to dominate. On the consumer side, this stage is represented by a medium-level of satisfaction-loyalty as compared to the one generated for the brand alone, assuming the dominance of the brand was able to generate greater levels of satisfaction by maximizing the virtues of both tangible and intangible, especially the later ones, benets of the product. Finally, in support of H4, Table III and Figures 2-6 show that the impact of satisfaction on loyalty is greater when adopting innovative (electronic) products than when adopting traditional (wine) products. Following a recommendation by Ailawadi et al. (2001) and using the Fishers Z-test and a procedure introduced by Cohen and Cohen (1983) to test the signicance of the difference, the results in Table III show that the relationship is signicantly stronger among adopters of innovative (electronic) products than it is among adopters of traditional (wine) products. This may happen because innovative products require more customer participation in the process of delivering the product to the customer. By the nature of innovative products, customers become more active in their search for the product at the same time they become more scrutinizing and more demanding of satisfaction. Thus, innovative-product manufacturers and providers work harder at satisfying the customer, whereas traditional-product manufacturers and providers may just rely on a customary base of customers to keep going. 308

Conclusions
Customer satisfaction and loyalty can be achieved by either emphasizing the product or the brand depending on the level of development of the product or product line in the markets. At the introduction stage of the product, emphasis is on the product and the tangible aspects of it. Satisfaction can be achieved at this stage if there is a t between the customer need and the product offering. The intensity of satisfaction attained at this stage, however, is not high mainly because of the absence or scarcity of the psychological benets included in the product offering. At a more mature stage of the product, there are given opportunities for the brand to excel if it is able to add enough intangible benets to the product. When successful, this new bundle of tangible and intangible benets can produce higher customer satisfaction, which in turn can generate higher customer loyalty in the long term. Yet, a more mature stage can combine a product-brand where both tangible and intangible benets are salient without any set (tangible or intangible) prevailing over the other. Alternatively, this stage can privilege the brand emphasizing the intangible benets. The consequences of either approach (product-brand or brand alone) on customer satisfaction, however, are distinctive: the brand alone is able to produce a stronger satisfaction-loyalty relationship than the productbrand combination. Nevertheless and despite the benets of achieving the stage of a brand alone, it seems that both customer and manufacturer/provider have to pull up the brand. The manufacturer/provider cannot reach the highest stage without the customers help. The customer would nally

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accept the brand alone as the subject of his satisfaction and follow-up loyalty. The above tting process between product or brand adoption and customer satisfaction-loyalty is more intense in the world of innovative products, such as electronic products, as compared to traditional products, such as wine. Innovative product processes, such as the ones involved in electronic products, accelerate the interaction between adoption and relationships. The intensity in technological developments is usually matched by customers higher participation in such processes. By contrast, traditional products do not require either technological innovations or active customer participation or both in the usually slow-paced development of the product. As a consequence, traditional products do not reach high levels of satisfaction-loyalty, at least not as high as the ones achieved in innovative-product processes.

start with the product, particularly when developing new products or innovating existing ones; evaluate product and brand combined when product development has reached a state of maturity that is considered enough to maintain a brand; and culminate with the policy by focusing on the brand as the last stage in the learning process.

Limitations and future research

When studying the satisfaction-loyalty relationship as derived from the product adoption process, the literature has ignored both the product alone and the product-brand combinations. In this research, we have addressed this forgotten problem and claried that customer satisfaction and loyalty start early in the process, that is, in the development stage of the product alone. Despite this clarication, however, much remains to be done. We have tested only three quadrants in the proposed typology of satisfaction-loyalty relationships by levels of product-brand presence. The other quadrants, except the one where there is no brand and product, can also be and should be tested empirically in order to validate their corresponding formulations. In addition, further studies are needed regarding the two stages we have tested empirically, that is, the product alone and the product-brand combinations. Whereas previous studies have privileged the brand over the product in its effects on customer satisfaction and loyalty, this is a new study and validation of the ndings is called for in other product lines, other market conditions, or other measures.

Managerial implications
The practical implications of the results achieved in this research are three-fold. First, managers, particularly, product or brand managers, should pay attention to the development of the product by itself. The customer pays attention to such development when the product is new or innovated and shows satisfaction even when taking into account the product alone. Of course, the level of customer satisfaction achieved is not very high and does not generate strong customer loyalty but is present and can mark the initial point of a successful path in both product development and customer satisfaction-loyalty. Second, managers should use the product-brand stage, an intermediate level in product development, to enhance the brand and its intangible benets over the product and its tangible features. The combination is not always of equal parts or equal importance, but it signals the presence of both, without either prevailing over the other. To continue progress in product development, the company should attempt to make the brand salient by enhancing the intangible benets of the product if it nds that the customer is ready for that stage. The customer is ready for the brand stage when he or she can decide on the basis of the intangible benets of the product, ceteris paribus, the tangible features already in place. If moving to the higher stage of the brand alone is difcult, either the product-brand combination will have a longer life, delaying the stage of the brand alone, or the customer satisfaction is strongly linked to the tangible benets of the product, making more costly to the company the addition of the chosen intangible benets. Finally, the shifting process from product alone to productbrand to brand alone is faster in technologically innovative products. In this product category, managers can use such advantage to achieve the highest stage (brand alone) faster with probably short periods of product alone and productbrand combinations. Conversely, managers can have insurmountable problems in accelerating the process in traditional products. Correct policies linked to traditional products can emphasize the product or the product-brand in the long term even if the stage of the brand alone can develop at some point in the future. This is a healthy guidance for managers of traditional products, so that they should not waste time and resources in developing the brand in traditional products that require longer life in the previous stages of product alone and/or product-brand combinations. Consequently, company positioning policies should: 309

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Corresponding author
squez-Parraga can be contacted at: avasquez@ Arturo Z. Va utpa.edu

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Executive summary and implications for managers and executives

This summary has been provided to allow managers and executives a rapid appreciation of the content of the article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benet of the material present. Why product is important Research into customer satisfaction and loyalty has so far almost exclusively focused on brands. In contrast, products have largely been ignored and considered as part of the brand rather than a separate entity. That customer satisfaction and loyalty can in fact be directed at the product has therefore not been acknowledged. One consequence has been reluctance from marketers to use the product as a means of generating satisfaction and loyalty. Torres-Moraga et al. put forward the view that the product is the starting point for the satisfaction and loyalty process, whereas the brand represents the advanced stage. Gaining satisfaction and loyalty at this initial phase can result in several benets, including rst-mover advantage, low-cost proactive innovation and an opportunity to redene the market. In contrast, lost market opportunities, market leadership and the higher costs associated with reactive innovation are some consequences of ignoring the product stage for such purposes. However, the inuence of product on satisfaction and loyalty may depend on the product type. Indications suggest there will be less impact with traditional goods like food and drink but considerable signicance when the products are innovative. Automobiles and electronic equipment are two product areas noted in this respect. Satisfaction is essentially viewed as the antecedent to loyalty. Satised customers become loyal customers who express this loyalty through their purchase behavior and future purchase intention. But loyalty that merely exists at this behavioral level is dismissed as spurious by some observers. The argument here is that loyalty is more profound when it incorporates attitude as well as behavior since it reects cognitive, affective and conative attachment on the customers part. This level of loyalty is often expressed through such as positive word-of-mouth, recommendation to others and a refusal to consider rival offerings. A satisfaction-loyalty typology Based on the existence of a life cycle whereby products evolve into brands, the authors suggest a typology to elucidate the process. Eight different stages combining various levels of product and brand presence are suggested. The present study focuses on customer satisfaction-loyalty relating to three of these stages: 1 Product alone, when consumer evaluation occurs for the rst time. 2 Brand alone some consumers will opt for a specic brand for a range of different products. Take Sony, for instance. Those who support this brand may purchase television sets, disc players, cameras or various other electrical appliances or gadgets. 3 Product-brand past research has acknowledged this intermediate phase where customer selection of a 312

particular product will be limited to within a small range of brands. One example would be narrowing the choice of a new television to Samsung, Phillips or Sony. Research was designed to examine the extent of satisfactionloyalty within these different adoption phases in relation to either traditional or innovative products. Wine was chosen for the traditional product and electronic goods as its innovative counterpart. Of the 1,233 respondents, 830 purchased electronic products and 393 were wine buyers. Findings indicated that customer satisfaction and loyalty was: . Positive and signicant in all three situations. . Stronger for brand adoption compared to product adoption. Adoption of the product alone is enough to generate the satisfaction that in turn can lead to loyalty. This occurs on the basis of functional attributes and other tangible product features such as appearance. However, the brand is also able to boast additional components containing symbolic and emotional value. In additional to attachment with these intangible attributes, potential exists for the customer to engage with the personality perceived in the brand. Likewise, the impact of satisfaction on loyalty was greater for: . Product-brand adoption than for product adoption alone but weaker than for brand adoption alone. The productbrand stage combines both tangible product qualities and intangible brand benets during a development stage when neither product or brand can dominate. . Adoption of innovative products than for adoption of traditional products. The authors suggest that consumers are more involved with innovative products and may therefore be more demanding. This is likely to force manufacturers of such products into striving harder to deliver satisfaction. In contrast, consumer involvement with traditional products is invariably much lower. The study ndings show that satisfaction and loyalty do begin much earlier in the process than previously acknowledged. Satisfaction is possible at the initial stage providing the product meets customer needs. However, the scarcity or absence of intangible and psychological benets at this time means that the intensity of satisfaction is usually not high. But this does not lessen the signicance of this stage in helping to generate customer loyalty and satisfaction that can increase during the subsequent phases and over the longer term. Marketing ideas and future research Torres-Moraga et al. urge marketers to place more importance on the development of the product as customer interest in such developments is high when products are new or innovative. Any resulting satisfaction may be limited but it provides the foundation that can aid product development as well future increases in customer satisfaction and loyalty. In the product-brand stage, the emphasis should be on showcasing the intangible features more than the products salient qualities. When the customer is inuenced by intangible features alone, the time is right to move to the nal stage and make the brand more salient. If marketing the brand alone proves difcult, the product-brand stage may have to last longer. On occasions, it could be that satisfaction is inextricably linked to the tangible product benets. A focus

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on the intangible features becomes more difcult when that is the case. The transition from product alone to brand alone via product brand is much quicker for technologically innovative products. Managers should use this knowledge to accelerate to the mature stage as quickly as possible. Conversely, moving to this stage with traditional products can be extremely difcult and ultimately unproductive. Rather than wasting valuable time and resources, it is more advisable to invest the effort into developing effective strategies for the product alone and product-brand stages. Given the novel approach of this study, Torres-Moraga et al. suggest further exploration of customer satisfaction and loyalty within these initial phases. Likewise, the ndings

should also be examined in relation to different product types, market conditions or other measures. Further study could additionally concentrate on other stages of the authors typology. This research could, for example, investigate customer loyalty to a bundle of products or set of brands or to various product-brand combinations. Study could also focus on situations where satisfaction and loyalty is conditional because it depends on specic mixes of product type and brand such as, for example, Sony televisions or JVC disc players. cis of the article Customer satisfaction and loyalty: start (A pre with the product, culminate with the brand. Supplied by Marketing Consultants for Emerald.)

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