Investigating a comparative evaluationapproach in explaining loyalty

Abstract

Purpose–The purpose of this paper is to examine the superiority of comparative evaluation or relativeattitudinal measurement approach in which the respondent evaluates one object with direct comparison withother objects. The study uses comparative and non-comparative approaches to examine the effects of servicequality, value, and customer satisfaction on attitudinal loyalty in a service setting.Design/methodology/approach–The study uses the data collected from the survey of 300 customers oftwo large Indian banks.Findings–The results provide partial support to the superiority of the comparative evaluation overnon-comparative evaluation. Additionally, results indicate that service quality positively affects customervalue, and both service quality and customer value have a direct positive effect on customer satisfaction.Customer satisfaction drives attitudinal loyalty which in turn leads to customers’willingness to pay more.Research limitations/implications–In the study, two banks were used for comparative evaluation.Since consumers’consideration set can consist of more than two alternatives, future studies can include morethan two objects.Practical implications–Non-comparative measurements do not always adequately explain customerloyalty and superior performance of firms. This could potentially lead to misinterpretations of effects ofservice quality improvement programs and thus sub-optimal management decisions. Managers should usecomparative evaluation approach for measuring marketing variables wherever possible.Originality/value–Although the use of comparative evaluation is suggested in the literature (Dick andBasu, 1994), extant research has not systematically examined its superiority over non-comparativeevaluation. This study empirically tests the comparative evaluation approach against the non-comparativeapproach by examining a comprehensive model involving the interrelationships among service quality, value,customer satisfaction, and their impact on attitudinal loyalty and willingness to pay more.