How Loyal are You? Factors Influencing Consumer Brand Loyalty among Smartphone Users in Malaysia

How Loyal are You? Factors Influencing Consumer Brand Loyalty among Smartphone Users in Malaysia

*¹Siti Noor Aishah Mohd Sidik.,²Mohamad Zainol Abidin Adam.,³Kanesh Gopal.,¹Adilah Othman

¹Faculty Business and Management, Universiti Teknologi Mara 23000 Dungun, Terengganu, Malaysia

²School of Business Management, Universiti Utara Malaysia, 06010 Sintok, Kedah

³Faculty of Accountancy, Finance and Business Tunku Abdul Rahman University of Management and Technology, 53300, Kuala Lumpur, Malaysia

*Correspondence Author

DOI: https://dx.doi.org/10.47772/IJRISS.2024.809055

Received: 26 August 2024; Accepted: 03 September 2024; Published: 01 October 2024

ABSTRACT

Smartphones have become a vital aspect of people every day. The technology development enables people to contact with one another from anywhere at any time. In competitive market, the variety of smartphones cause companies are challenging to retain brand loyalty. This study wants to identify the factor that influence brand loyalty among smartphone users. Brand reputation, brand competence, price, advertising, brand image, and design are all under investigation. This study’s sample consisted of students from the Universiti of Utara Malaysia. 400 questionnaires were distributing to respondents, with 390 collected and usable. The entire dataset was analyzed using SPSS to assess the correlation and regression effect of each variable. The study discovered that brand reputation, brand competence, price, advertising, brand image, and design has strong correlation with brand loyalty. Regression analysis also indicate that brand competence is the most critical factor impacting brand loyalty. The findings serve as a reference for businesses to develop the best plan for maintaining brand loyalty.

Keywords: Brand Loyalty, Brand Reputation, Brand Competence, Price, Advertising

INTRODUCTION

Brand loyalty is the behavior of consumers to be loyal to a particular brand. The company invents a million dollars to do a marketing strategy and launch a new smartphone every year. However, in this competitive market, businesses are challenged to ensure brand loyalty. Consumers are more intelligent when choosing the right product. Consumers also easily switch mobile phone brands (Sarkar, 2011). In fact, consumers desire to the brand that can perform and satisfy their needs. In real life, consumers use mobile phones for games, blogging, sending emails, shopping, and mobile banking. In the latest trend, people also actively create videos for content on social media (e.g. TikTok, Facebook, and Instagram) and prefer to buy smartphones with high-resolution pictures and videos. This shows that mobile phone usage is important for managing people’s daily lives. Moreover, people born in the 20th century are more likely to use mobile phones for social reasons and to maintain relationships with society (Swann, 2012). In the market, smartphone companies actively involve in research and development to develop new product. Asus is innovator companies in this industry by introducing handphones for gamers to get competitive advantage. These companies also increase their revenue when launching new products rapidly. Hence, competition among firms indirectly gives the challenges to enforce the brand.

Nowadays, the variety of smartphones in the market allows customers to select the best product. Consumers use social media to evaluate the quality of a brand. They consider consumer comments and feedback before make a buying decision. In terms of consumer engagement, by 2024, 28.68 million, or 83.1 percent of the population in Malaysia was actively using in social media (BERNAMA, 2024). In fact, customer prefer to read comments from smartphone users and watch unboxing videos from the YouTube influencer. The information in social media indirectly build customer trust before they purchase a product. Consumers also trust peer opinions and recommendations compared to information provided by companies (Ghahtarani, Sheikhmohammady, & Rostami, 2020; Onofrei, Filieri, & Kennedy, 2022). Therefore, the brand with high quality and good reputation will always be the top. Hence, understanding how to maintain brand loyalty among customers is crucial due every companies always launch a new smartphone to compete with others. Therefore, to gain information about people’s behavior regarding mobile phone brands, this study will examine the factors influencing brand loyalty among student of Universiti Utara Malaysia.

LITERATURE REVIEW

Brand Loyalty: Loyalty is the consumer’s intention to rebuy the same product in the market (Oliver, 1999). Experience with product usage, psychological factors, and price are the factor that influence consumers to be loyal to certain brands (Keller, 1993). In order to develop brand loyalty companies need to offer good quality product with reasonable price (Venkateswaran, 2011). In fact, the technology and capabilities of the mobile phone can lead to positive feelings among the consumer. The issue of brand loyalty is continuously getting special attention from the researcher. This is due brand loyalty is root for successful business and sustain in the market. The previous study argues that the predictors such as brand trust, brand experience, brand reputation, and advertising are influencing brand loyalty in emerging markets (Sohaib, & Han, 2023; Bae, & Kim, 2023; Lang, Behl, Guzmán, Pereira, & Del Giudice,2023; Rasoolimanesh, Tan, Nejati, & Shafaei, 2024; Rutsaert, Donovan, Murphy, & Hoffmann, 2024).

Consumers who are loyal to the brand are an asset to the company. The loyalty reaction from consumers indirectly is an opportunity for the company to obtain feedback from the consumer and get ideas for product innovation (Harsono, Widyantoro, Prawitowati, & Rachmat, 2023). Loyal consumers also willing to share product information and experience with relatives and friends (Horng, & Wu, 2020). Therefore, it clear that brand loyalty has an important effect on businesses performance. Companies must play their role to maintain loyalty to survive in the long-term period. The majority of the previous research on brand loyalty was carried out in various research contexts, such as fashion industry, automobile industry and banking industry (Zainudin, Haji Hasan, & Othman, 2020; Zaidun, Muda, & Hashim, 2021; Ab Hamid, Maulan, & Wan Jusoh, 2023). Numerous studies have also been done to identify relevant predictors that may affect brand loyalty in Malaysia. Among the predictors has been tested is brand engagement, brand awareness, brand experience, brand love, brand attributes, brand reputation and brand trust (ahmad, Menon, Mason, Shamsudin, & Sentosa, 2020; Khan, Mohammad & Muhammad, 2021; Hee, Gan, Kowang, Rizal, 2022; Ab Hamid et al.,2023; Rasoolimanesh, Nejati, & Shafaei, 2024). However, limited attention has been given to the factors that foster loyalty among handphone users. Therefore, this study intends to examine whether brand reputation, brand competence, price, brand images and design influence brand loyalty among handphone users in Malaysia.

Brand reputation: Brand reputation refers to the collective perceptions and evaluations of a brand by its stakeholders, including consumers, employees, and the broader public. It encompasses the brand’s history, quality, and ethical standing (Fombrun & Van Riel, 2003). The best way to develop a strong brand reputation is via advertising, public relations, increase product quality and performance (Papasolomou, Thrassou, Vrontis, & Sabova, 2014). In fact, consumers are concerned about brand reputation when buying the brand in the market (Ali, 2022). Due to the importance of a good reputation among consumers, companies have chosen social media influencers as spokesperson to the brand. Social media influencers are important to influence brand reputation and brand awareness among consumers (Singh, Crisafulli, & Xue, 2020; Matin, Khoshtaria, & Todua, 2022). This investment is important to create positive expectations and develop a mutual understanding of consumer and brand. Brand reputation also plays a vital role in building trust and brand loyalty (Esmaeilpour, Sayadi, & Mirzaei, 2017; Sari, & Ramdan, 2022). This is in line with a previous study that revealed that brand reputation plays a critical role in fostering brand loyalty. Consumers are more likely to remain loyal to brands with a reputable image that aligns with their values (Chen & Lee, 2021; Astono, 2021; Ali, 2022; Qian, & Amoozegar, 2023; Ahmadi, & Ataei, 2024). Therefore, it is clear that a positive reputation is an advantage to companies to retain existing consumers and attract more potential consumers. Based on the discussion above, the following hypothesis was proposed:

H1: There is a significant relationship between brand reputation and brand loyalty.

Brand Competence: Brand competence is the consumer’s perception of a brand’s ability to meet its promises and deliver value consistently. Brand competence plays an important role in determining whether a consumer decides to trust and intends to purchase the brand (Afzal, Khan, Rehman, Ali, & Wajahat, 2010; Xue, Zhou, Zhang, & Majeed, 2020; Shafiq, Ziaullah, Siddique,Bilal, & Ramzan, 2023). In fact, consumers will compare the uniqueness of brand before making a buying decision. The best product is competent if it is able to solve consumer problems (Bjurklo, Edvardsson, & Gebauer, 2009). This means that the competence of a brand depends on the benefit after usage, and consumers are satisfied with the brand. Previous research revealed that brand reputation is important in influencing brand loyalty among customers (Loureiro, Sarmento, & Le Bellego, 2017; Khan, Ali, Mahmood, & Raza, 2020; Ahn, Shamim, & Park, 2021; Astono, 2021; Suwarno, Prassetyawan, & Abbas, 2023; Sharma, & Joshi, 2024). Therefore, understanding how brand competence influences brand loyalty is critical for companies seeking strong brands. Based on this issue, the following hypothesis was proposed: consumers

H2: There is a significant relationship between brand competence and brand loyalty.

Price: Price is the sum of money charged for a service or product, and is exchanged for values that will get after having or using the product or service (Kotler & Armstrong, 2010). In the new era, the consumer is particular about price before buying a new product (Yee & Sidek, 2008). Price also as motivation to customer to repurchase product in the future (Salim, Soliha, & Siswanto, 2020; Mahendrayanti, & Wardana, 2021; Sudirjo, Yani, Hernawan, Rukmana, & Nasution, 2023; Muthi, & Utama, 2023). In a competitive market, consumers are intelligent enough to choose a high-quality brand, while offering a good image and reasonable price (Giddens & Hoffman, 2010). Consumers are likely to stay loyal to a brand if they perceive its pricing as fair and provide good value for money (Puspitaweni, Rini, & Sembiring, 2021). Previous research also highlights the importance of consistent and targeted advertising in fostering brand loyalty (Gázquez-Abad & Martínez-López, 2022; Li & Yang, 2022; Suryatenggara, & Dahlan, 2022; Cahyamulia, 2022; Al-Hakim, 2023; Anwar, & Elmas, 2023). Therefore, the price strategy by the companies is crucial to developing consumer loyalty. Based on this issue, the following hypothesis was proposed:

H3: There is a significant relationship between price and brand loyalty

Advertising: Advertising is an important strategy of the company to shows how strong the brand in the marketplace (Moorthy & Zhao, 2000). Advertising is the best way to share information about the company and its products, explain the product’s new features, remind consumers how to use it, and reassure them about their purchase.  Nowadays, social media is the best tool since consumers use digital platforms to keep in touch with the brand. This platform indirectly helps companies to manage the advertising cost (Park & Jang, 2012). This social network has a positive impact by reaching new consumers with the lowest advertising price. To create loyal consumers towards a particular brand or firm, high investment must be spent on advertising which leads to brand loyalty (Ha, John, Janda, & Muthaly, 2011; Muangmee, 2021; Ibrahim;2022).

Howard (2010) suggested that television advertisement is the most powerful advertising medium. The advantage of this medium is that it can reach a wide market of consumers. Television advertisements can also demonstrate product attributes, explain products, promote organizations to the public, and directly impact the organizational performance and consumers’ opinion of the market (Kotler et al, 2013). In fact, consumers who frequently exposed to a brand’s advertisements are more likely to develop emotional bonds with the brand and leading to higher levels of loyalty (Vrtana, & Krizanova, 2023). Previous research also highlights the importance of consistent and targeted advertising in fostering brand loyalty (eg. Ha, John, Janda, & Muthaly, 2011; Hameed, 2013; Amoako, Anabila, Asare Effah, & Kumi, 2017; Puspaningrum, 2020; Wantini, & Yudiana, 2021; Lang et al, 2023; Kulawardena, & Kalpana, 2024). Therefore, it indicates that advertising is important to create brand loyalty. In the competitive market, the right advertising strategy can build brand awareness in consumers’ minds. Based on this issue, the following hypothesis was proposed:

H4: There is a significant relationship between advertising and brand loyalty

Brand Image: Brand image is the set of perceptions that consumers have about a brand. The positive brand image in customer mind is shaped by brand identity, experiences, and marketing communications. It is multidimensional, encompassing functional, emotional, and symbolic attributes (Keller, 1993). Brand image component includes attributes like product quality, reliability, and emotional connection, which contribute to forming a positive or negative perception of the brand (Faircloth, Capella, & Alford, 2001). In competitive market, a strong brand image can differentiate a brand from competitors. Therefore, create a favorable brand image can attract impression among smartphone users, and influence consumer behavior. Numerous studies have demonstrated a positive relationship between brand image and brand loyalty (Mabkhot, Shaari, & Md Salleh, 2017; Putra, Himawati, Suzana, & Oktavilantika, 2023; Ab Hamid, Maulan, & Wan Jusoh, 2023; Watson, Perrigot, & Dada, 2024). In fact, a favorable brand image enhances consumer trust and satisfaction (Hendrawan, & Agustini, 2021). Therefore, based on this statement the following hypothesis was proposed:

H5: There is a significant relationship between brand image and brand loyalty

Design: Design is a unique way to distinguish company products and services. Design is associate with the visual appearance and lead to consumer’s perception (Frings, 2005). Fokkinga, Desmet, and Hekkert (2020) argue that products with visually pleasing designs create positive emotional responses, leading to stronger emotional bonds with the brand. These emotional bonds often translate into loyalty as consumers are more likely to return to brands that evoke positive feelings. This is in line with previous study who found that product design affect brand loyalty (Murray, Elms, & Teller, 2017; Hsu, Chen, Yang, Lin, & Liu, 2018; Konjkav Monfared, Mansouri, & Jalilian, 2021). In competitive market, the unique design (e.g. logo, colour scheme) indirectly can reinforces brand identity, brand recognition and brand loyalty (Karjalainen & Snelders, 2010). Therefore, it’s clear that product design is important to influence overall perception of the customer to choose the best smartphone brand. Based on this issue, the following hypothesis was proposed:

H6: There is a significant relationship between design and brand loyalty

UNDERPINNING THEORY

Theory of Planned Behaviour (TPB).

The loyalty behavior can be explain based on Theory of Planned Behaviour (TPB). TPB is important roots to understanding behavioural intentions among the customers. Three key determinants in TPB are attitude towards the behaviour, subjective norm, and perceived behavioural control (Ajzen, 1991). Attitude Toward the Behavior refers to the individual’s positive or negative evaluation of performing a specific behavior. In smartphone industry, the good perception about brand reputation and brand image can influence customer to loyal with the same brand. Customer willing to buy the product form the same brand if they trust the company (Atulkar, 2020; Kwon, & Kim, 2021; Sohaib, & Han, 2023; Nuvriasari, 2024). In fact, company that serves unique brand, offer good price, aggressive advertising strategy and best design also will get competitive advantage in the market (Ab Hamid et al., 2023; Konjkav Monfared et al.,2021; Wantini, & Yudiana, 2021; Cahyamulia, 2022).

Based on the discussions above, a conceptual framework is developed, as shown in Figure 1.

 Figure 1: Conceptual Framework Factor Influence Brand Loyalty

METHODOLOGY

This study involved 400 students from Universiti Utara Malaysia, and questionnaires were distributed using random sampling. The centres of students, such as a library, student residence hall, classroom at DKG 1, 2, and 3, and faculty economy are used as the location to conduct this study. The respondent samples were selected by picking any 3 students that reached the area at a particular time. This ensures that the questionnaire is randomly distributed to all the respondents. The time provided for respondents to complete the questionnaire was 15 minutes. After the period, the questionnaire was collected. However, only 390 questionnaires were used for data analysis. Statistical Package for the Social Sciences (SPSS) software was run to assess reliability, descriptive analysis, pearson correlation and multiple regression,

In terms of measurement, this study adapted a questionnaire from previous research. The item for Brand Loyalty was adapted from Keller (2001), brand reputation was adapted from Haliday and Kuenzel (2010), brand competence was adapted from Lau and Lee (1992), item for price was adapted from Taylor, Celuch, and Goodwin (2004), advertising adapted from Kirmani and Wright (2007) and design adapted from Khraim (2011). Respondents assessed their degree of agreement to questions using a 5-point Likert scale ranging from 1 (Disagree) to 5 (Extremely agree).

FINDINGS AND DISCUSSION

390 respondents participated in this study by answering the questionnaire via random sampling. Table 1 below lists the demographic profile of the respondents.

Table 1: Demographic Profile of the Respondents

Table 1 illustrates 54.6% of female and 45.5% male student involve in this study. The ethnic groups are as follows: Malay (65.4%), Chinese (20.5%), Indians (6.7%) and other ethnic groups (7.4%). Majority of respondent is from bachelor degree program (75.9%), follow by master (14.4%) and PhD (9.7%). The smartphone brand that student use is Samsung (50.3), Oppo (16.9%), Apple (13.8%), Redmi (5.5%), Realme (4.2%) and another brand is 13.8%.  Majority of the respondent use the smartphone for 1 until 2 years (52.6%).

Table 2: Descriptive Analysis for Research Variables

Table 2 illustrates descriptive analysis for research variables. The mean for brand loyalty is 3.97, design show the highest mean value (4.54), followed by brand image (4.49), brand reputation (4.46), brand competence (4.24), price (4.12), and advertising (4.21).

Table 3: Pearson Correlation Result

* Correlation is significant at the 0.05 level (2-tailed)

Correlation analysis was run to examine the relationship between the research variables. This study found that all the research variables positively correlated with brand loyalty. The R-value for Brand reputation is (r= 0.742), brand competence (r=0.775), Price (r=0.707), and brand image (r=0.705). This indicates that all these variables correlate highly with brand loyalty However, advertising and design shows a moderate relationship with brand loyalty (r=0.545) and (r=0.628).

Table 4: Regression Analysis Result

Based on table 4, the largest beta value is brand competence (β 0.376, ρ≤0.05). This indicate that brand competence is the most important factor that influence brand loyalty among smartphone users. This is followed by price (β 0.258, ρ≤0.05), brand reputation (β 0.255, ρ≤0.05), and advertising (β 0.00, ρ≤0.05). However. Brand image and design not influence brand loyalty with β 0.046, ρ≥0.005 and β -0,290, ρ≥0.05. The result also shows all the independent variables (brand reputation, brand competence, price, advertising, brand image and design) contribute 60.7% in brand loyalty. Which is highly significant and model is fit as the F statistic is 133.988 (F≥1) and the ρ- value is 0.000 and less than (ρ≤0.05).

DISCUSSION

As a guideline for smartphone companies, this study identifies the most important factors that can ensure brand loyalty. Based on the finding, brand competence is the key factor that can influence loyalty behavior among smartphone users. This result is consistent with earlier studies that revealed that brand competency is a key predictor of brand loyalty among smartphone users and students in Indonesia (Astono, 2021: Makatita, Amin, & Surijadi, 2022).The ability of the brand to meet customers need and offer unique specifications also will enhance positive word of mouth and purchase intention via an online review (Xue, Zhou, Zhang, & Majeed, 2020; Astono, 2021; Li, & Nan, 2023; Cuong, Nguyen-Le,Ngo, & Nguyen, 2024).Therefore, product with unique innovation can lead the business’s for long-term Success.  The brand also remains relevant and can attracts customers, even as market conditions change.

Price also is a key determinant in creating a successful business strategy. The price offered to the customers indirectly shapes customers’ perceptions of its value. If the price is aligned with what customers believe the product is worth, they are more likely to purchase loyal to the brand (Al Hakim, 2023; Arindaputri, & Santoso, 2023; Muthi, & Utama, 2023; Lucky, Aisjah, & Ningrum, 2023). Conversely, a mismatch between price and perceived value can lead to lost sales. Therefore, setting the right price is crucial for business success. Customer who satisfies with the price willing to recommend the brand to other relatives (Matzler, Teichmann, Strobl, & Partel, 2019; Hanaysha,2021: Liu, Lai, Wu, & Luo, 2022). In fact, previous study also reveals that price is important determinant to influence brand loyalty among grocery store and supermarket consumers (Albert, Leonardi, Juliana, & Djakasaputra, 2022; Dewi, Suryaputra, & Sondakh; Meilani, Rizki, Sono, & Fitri, 2023).

This study also revealed that companies with high brand reputations also will get competitive advantages and fosters loyalty among customers. This is consistent with previous study by Loureiro, Sarmento and Bellego (2017) Who found that brand reputation enhances brand loyalty among Tesla, Toyota, and Volvo users. When customers trust a brand, they are remaining to loyal with the brand, make repeat purchases, and recommend the brand to others (Atulkar, 2020; Kankam, & Charnor, 2023; Bae, Lee, & Luan, 2023; Sun, & Moon, 2024). In another cases, the good brand reputation also influences brand loyalty among student to choose same private higher education and choose the same bank for financial purpose (Oppong, & Caesar, 2023; Rasoolimanesh, Tan, Nejati, & Shafaei, 2024). Moreover, high brand reputation also is important for global expansion. A strong brand reputation give opportunity to companies enter new markets and gain more profit. In term of advertising, continues effort by the companies to advertise the product is important to create brand memory, brand awareness, and brand loyalty (Aisyah, 2023; Alanazi, 2023, Albarq, Kumar, Piaralal, Bhatti, & Abd Razak, 2023; Zeqiri, Koku, Dobre, Milovan, Hasani, & Paientko, 2024). The advertising will educate customers how to use the product and the show uniqueness about product compare with competitors. Therefore, the advance of social media can be an advantage for companies to advertise product, due customer is engaging in social media to get information about brand before make any making decision.

LIMITATION

This study only focusing loyalty behavior among student at Universiti Utara Malaysia.  Therefore, the result cannot be generalized to other customers. The sample selection such as working professionals and comparison between age range can enhance the generalizability of the findings in Malaysia context.

CONCLUSION

In summary, this study has improved understanding of the key determinants that influence brand loyalty among smartphone users in Malaysia. Brand reputation, brand competence, price and advertising are important factors that need to be considered by car companies to develop brand loyalty and maintain in competitive market. Customers not only party that will buy the brand, but they have power to influence others customer perception. Therefore, research and development (R&D) are important to launch new competence brand with affordable price. The high-quality product indirectly can enhance brand reputation and profit in long term period.  The companies also must follow latest trend by advertise the product in social media platform. Sosial media is a free tool that can enable viral effect, customer more trust information that share in social media compare with information that provide by the company. Hence, the brand ambassadors or influencer that appointed by the company can play their role to develop brand trust among the customer. The more customer trusts the brand and they will purchase the product. In summary, brand managers must always create a good marketing strategy or conduct the survey to know customer expectation or any product recommendation for product development.

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