RELATIONSHIP BETWEEN BRAND LOYALTY AND COMPANY’S GROWTH
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RELATIONSHIP BETWEEN BRAND LOYALTY AND COMPANY’S GROWTH
Chapter one
INTRODUCTION
Background of the study
According to Anyanwa (2011), brand loyalty is a consumer preference for purchasing a specific brand in a product category. It occurs when buyers believe a brand provides the correct product characteristics, image, or degree of quality at the right price. This view forms the basis for new purchasing behaviours.
Essentially, consumers will make a trial purchase of the brand and, once satisfied, will establish a habit and continue purchasing the same brand since the product is safe and familiar. As a result, the company’s growth will progress from the typical stage to a higher level of product.
According to Mavis (2008), brand loyalty has a very important relationship with corporate growth, in the sense that increased sales volume leads to business growth.
It results in steady and even higher sales because the same brand is purchased frequently. Premium pricing ability demonstrates that as brand loyalty rises, customers become less sensitive to price changes.
In general, individuals are willing to pay more for their favoured brand because they believe it provides a distinct value that other alternatives do not. It serves as the foundation for the company’s growth. Furthermore, brand loyalists buy less frequently during cents-off bargains; these promotions only subsidised scheduled purchases.
When customers desire to acquire a product or service, a brand’s reputation (whether strong or poor) is likely to influence their decision.
Klass (2011) defines a brand as a name, symbol, design, or logo that adds value to a product outside of its utilitarian purpose. Brand loyalty is crucial and widely regarded in terms of driving company and sustaining growth.
According to Nwachukwu (2000), having a strong brand not only allows a firm to identify itself from its competitors, but it also fosters positive communication in order to please and convince customers.
When a firm wishes to create a new product or service, brand loyalty must play an important role in the decision-making process.
Brand loyalty serves not only to increase the value of a product beyond its practical purpose, but it also has an impact on trust, perceived quality, and company growth. White Head (2010).
STATEMENT OF PROBLEM
Many businesses face hurdles while attempting to grow in competitive situations. To achieve even 1% yearly growth, sales to both existing and new clients must increase by 14%.
Reducing client numbers can significantly boost business growth and even increase sales because the same brand is purchased frequently. However, many companies fail to recognise this fact, instead focusing on huge profits without regard for product quality.
Most businesses fail to create an unbeatable product; if they want to retain clients, they must ensure that they can receive what they want from the product.
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