How Store Attributes Impact Shoppers’ Loyalty: Do Different National Cultures Follow The Same Loyalty Building Process?

HOW STORE ATTRIBUTES IMPACT SHOPPERS’ LOYALTY:

DO DIFFERENT NATIONAL CULTURES FOLLOW THE SAME LOYALTY BUILDING PROCESS?

Monica Grosso Sandro CastaldoEMLYON Business School SDA Bocconi School of Management

EMLYON Business School

Background


EVIDENCES

Relevance of store loyalty is rooted in the marketing literature on loyalty

Loyal customers are (Reichheld and Sasser 1990):

less price sensitive more likely to purchase at a higher frequency rate more willing to try the company’s other product offerings & to bring new customers to the firm

Many examples of loyalty-based relationships with customers that have positive effects on firms’ performance can be found also in the

retail context.


STUDIES ON STORE LOYALTYStudies on Store Loyalty investigated many issues, such as:

the loyal shopper’s profile and the shopping style (e.g. Reynolds, Darden and Martin 1974-75; Goldman 1977-78)

the segmentation of customers based on their store loyalty (e.g. Enis and Gordon 1970; Samli 1975; Miller and Granzin 1979; Steenkamp, and Wedel 1991)

the main drivers of store loyalty, with a specific focus on the role of the store personality and image

(e.g. Martineau 1958; Berry 1969; Lindquist 1974-75; Hirschman, Greenberg, and Robertson 1978; Pessemier 1980; Mazursky and Jacoby 1986; Zimmer, and Golden 1988; Grewal et al. 1998).


There are fundamental gaps in the retail literature on store loyalty:

1. Research has only considered a narrow set of tools that retail managers can leverage in order to foster customer relationships.

2. Prior study’s results are sometimes contradictory Inconsistencies between the results are probably due to the studies focusing on different countries/cultures.

It therefore seems possible that building store loyalty depends on the specific cultural context.

GAPS IN THE LITERATURE


The hp models


The goal of the study is to test a store loyalty model in multiple contexts

The model is developed and analysed in two main steps:• Model 1 is focused on the key dimensions of loyalty (intentions

and behaviour) and their two main antecedents reported in the literature (satisfaction value for money).

• Model 2 enlarges the perspective presented in the literature and simultaneously takes different store-level levers into account to gain further theoretical and managerial insights.

Test of the moderating effect of culture using the individualism/collectivism dimension of Hosftede

THE HP MODELS


THE HP MODELS

SATISFACTION

VALUE FOR MONEY

LOYALTY INTENTIONS

SOW

PL SOW

H5

H 6

H8

H 2

H1

COMPETENCE

ENVIRONMENT

ASSORTMENT

PROMOTION

H 20H 19

H17

H21

Model 2: extended

Model 1: core

TRUSTWORTHINESSH18

SALESPEOPLE

H3

H4

H 7H 22

STORELOYALTY

NATIONAL CULTURE (individualist vs collectivist)

H9-H16


members of individualist cultures tend to hold an independent view of the self that emphasizes separateness, internal attributes, and the uniqueness of individuals

members of collectivist cultures tend to hold an interdependent view of the self that emphasizes connectedness, social context, and relationships

THE MODERATING ROLE OF CULTURE


Methodology


DATA COLLECTION Web survey in 7 languages

Data collection in 12

countries selected to have variance in Hosftede cultural dimensions

2 macro product categories• FMCG• Non-food

Collettivist Individualist

United States

UK

France Italy

Australia

Brasil

Colombia

Mexico

China

Chile

Canada

Japan


1 data collector, MarketTool, collecting at the same time in all countries to assure data collection equivalence.

The store was the unit of analysis.

The participants’ familiarity with each of the product categories was assessed at the beginning of the questionnaire. The respondents were then randomly assigned to one of the categories they ranked higher in familiarity.

The respondents were asked to focus their attention on a store where they had bought the products in the assigned category.

DATA COLLECTION


SAMPLE

Demografics in line with single countries’ population

13,808 valid cases

46.5%

54.5%

Average age 39.9

Age range from 13 to 91


The questionnaire was designed on the basis of a comprehensive literature review.

An expert panel of professors and top retail managers (with different cross-cultural backgrounds) refined it to maximize the constructs measurement equivalence across the countries (Hult et al. 2008).

Subsequent to this evaluation, all the scales were slightly adapted from existing scales with the exception of the one used to measure customers satisfaction and promotion.

MEASURES


The store behavioural intention was measured using two direct questions on the store’s share of wallet in the product category (SOW – De Wulf and Odekerken-Scroeder 2003) and the share of private label sales (PL SOW).

Professional translators translated the questionnaire into six languages, using the translation-independent back translation procedure (Brislin 1970) in order to successfully run the survey in the 15 selected countries (Chinese, English, French, Italian, Japanese, Portuguese and Spanish).

MEASURES


For both models:

EFA to check the latent constructs Multiple EFA to check language invariance CFA to assess the psychometric measurement

properties of our scales Multigroup CFA to check subsamples invariance:

individualistic vs collectivistic countries

MEASURES – SCALES CHECK


Results


OVERALL RESULTS

SATISFACTION

VALUE FOR MONEY

LOYALTY INTENTIONS

SOW

PL SOW

ns

.140

.071

.151

.063

SALESPEOPLE

ENVIRONMENT

ASSORTMENT

PROMOTION

.065

.117

.354

.643

.133

.680

.196

STORELOYALTY

.078

.378

.124

New path

COMPETENCE

TRUSTWORTHINESS

Model 2: extended

Model 1: core


MODEL 1: COUNTRY COMPARISON

SATISFACTION

VALUE FOR MONEY

LOYALTY INTENTIONS

SOW

PL SOW

.219

.107

.718

STORELOYALTY

.786

.118

> In INDIVIDUALISM > In COLLECTIVISM

ns

.193


MODEL 2: COUNTRY COMPARISON

SATISFACTION

VALUE FOR MONEY

LOYALTY INTENTIONS

SOW

PL SOW

ENVIRONMENT

ASSORTMENT

PROMOTION

.442

STORELOYALTY

.286

.253.4

79

.94

ns

SALESPEOPLE

COMPETENCE

TRUSTWORTHINESS

Model 2: extended

Model 1: core

> In INDIVIDUALISM > In COLLECTIVISM


Future analysis


FUTURE ANALYSIS Further analysis on the dataset for our model :

• refining the countries groupingo Other cultural dimensions of Hofstede: eg.

uncertainty avoidance o Retail sector development

• Differences in the generations of shoppers?• Differences in the product categories? • Differences withing retail formats?


LIMITATIONS The analysis was conducted on the preferred stores selected by

the respondents.

Even the model included several retail levers, it is not exhaustive. There could be some levers that are country specific (developing countries).

Absence of behavioural data from retailers. The model relied on self-declared behaviour Future research should merge the survey data with real behavioural data (i.e. sales data, better if from loyalty cards records) from retailers (considering a smaller set of countries).

Economy & Finance

How Store Attributes Impact Shoppers’ Loyalty: Do Different National Cultures Follow The Same Loyalty Building Process?