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2. Essays
3. Marketing
4. The Impact Of Branding On Customer Loyalty Marketing
Essay
Background of Research
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The world has evolved so much that both men and women are equally
competing in all fields. This is due to the development of technology and
globalisation. This does not just apply to technology but also the food
industry. Everything is fast moving and demand has populated almost
every industry to have products instantly. The food industry is also a
victim of such demand that 'Fast Food' has taken over the world by
storm back in early 90s in Singapore and has been a ever growing
industry in Singapore. Such fast food is sought after in a country where
78% is working population. (Ministry of Manpower, Singapore Workforce,
2011)The younger generation of Singapore has also fallen prey to the
fast food culture in Singapore. There are over 376 household fast food
franchises operating successfully in Singapore (Economies Survey
Series, 2011). This also brings about the fierce competition between the
fast food giants in gaining market shares. Brands of such fast food
outlets have become popular and competing against each other to be
the No. 1 brand for fast food in Singapore. Fast food industry is
dominated by foreign brands (Local Fast Food in Singapore, 2012)
It requires the fast food giants to look for strategies to better compete
with their competitors and attract customers on a consistent basis.
Maintaining and upholding their brand image to retain customers are the
main challenges the industry is facing. One of the only ways to
differentiate one another is to brand themselves uniquely to attract and
retain customers. Branding has influence and have a perceived value
towards customers. Timeline has also created such Branding image on
products. (Tanja, 2008) Authenticity and tradition of a Brand is also
considered when timeline comes in. If a fast food brand is able to survive
the period with new brands popping day in, day out; then the brand is
looked upon as sustainable on its own as it has already built upon its
original grounds and managed to communicate it to the customers.
(Michael, 2009)
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Research Objectives
The first objective is to explore how marketing elements influence
Branding and further stamp out the importance of marketing which has a
vital role on Branding. A look at the marketing mix against Branding will
give us a clearer picture on how the image of branding is built through
time. Not all marketing approaches turns out to be positive for a Brand
and to emphasize on the direction of marketing which will eventually built
a positive image instead of a negative one as marketing done without
any research will lead to disastrous results. Examining the marketing
elements lets us learn the direct impact it has on Branding.
Another objective of this research is to realise the factors of customers'
expectations which affect Branding. A study of the factors which
influences customers' expectation will allow us to extract these factors
and study its perks which have direct impact on the way a customer
perceives a Brand. This factors comes in any form which will be further
siphoned as in which factors are the major stakeholders of customers'
expectations. From the factors identified, emphasis can be placed on
ratings as most important and less important factors which contribute to
customers' expectations.
The last objective of this research is to examine the relationship between
Branding and loyalty. The study should give us a macro level and micro
level image of the relationship between Branding and customer loyalty.
By looking at the Branding image which creates loyalty towards a Brand
will let us discover if loyalty towards a Brand is of perception or due to
pure Branding effects which creates loyalty. On the other hand if it is the
taste of the food made which creates the loyalty towards a fast food
brand. This also indirectly reads out if loyalty is imposed by Branding
statements or level of satisfaction gained by customers.
Research Question
The following research questions were raised to guide the research;
Q1: Is service quality important than Branding to customers of fast food
outlets in Singapore?
Q2: What are the benefits to fast food chains applying Branding in
Singapore?
Q3: Do Branding strategies influence the loyalty of customers towards
their favourite fast food name?
Q4: Do customers support all the branding tactics of fast food outlets in
Singapore?
Q5: How effective are fast food branding methods in retaining their
customers?
Research Structure
The study attempts to gather specific information on Fast Food outlets in
Singapore and their Branding policies. The collection of data will be
carried out through a quantitative methodology approach. From the
research questions we crack down on the facts that give importance
leading to the objective. Once the objectives are recognised, it creates a
flow of deep literature review. The hypothesis will be derived after an indepth study of the literature materials. Specific tools for analysis will be
utilised during the course of the study. Various calculable variables
should be identified by utilising the quantitative method. A survey form
consisting of multiple questions will be created after a look at literature
review. The survey will be in the form of a web-questionnaire. The
internet will be used as the basic form of data collection once the
questionnaire is tabulated. A review of the data collected will be
undertaken with the SPSS software package.
Summary
Most of the studies on Branding strategies are created and in place with
western nations generally. Thus this study has focused on a Asian region
which is Singapore. The study relates widely on Branding in the Fast
Food industry in Singapore and its impact on customer loyalty. The study
looks at the current trends being practiced in the industry and at the
same time pointing out the increase of such knowledge in the industry.
This also shows the importance being given by the stakeholders to the
concept. Branding has become essential to fast food brands.
In this study the main objective was to find the relationship between
Branding and customer loyalty and how Branding has an impact on
customer's loyalty in the fast food industry in Singapore. Through the use
of the 4 Ps, the study attempts to identify the best way to retain a
customer in the fast food industry. Apart from contributing to Branding
and customer loyalty from a theoretical point of view the paper also
highlights the dimensions of Branding, which becomes a criterion for
customers to evaluate how efficient a fast food name is with its Branding
outcome.
Chapter Two:
Literature Review
2.1 Introduction
The functions describe what the Brand is and what does it carry along
with it in terms of the product.
The Personality/Image describes the form of imagery people have upon
the Brand and affective deposition to the Brand
The Source represents what the company is about and their objectives.
Lastly the Differences portion explains how different the brand is from
the rest and what makes it different from the rest of the competitors.
2.4.1 Product
Rustler (2012) has mentioned that creativity is product. Product is more
than just developing ideas. Dogra (2012) had defined that product
means anything that is capable or can be provided to achieve a need or
a want. It can be either tangible or intangible. She also has mentioned
that being a product it must deliver minimum level of performance. If it
fails, the other aspects of the marketing mix will not be of any good
.Hong, Kotler and Nancy, (2007) have stated that a core product
includes the benefits that the target audience will reap. Harsch (2012)
had classified product of more to a physical item that a service rendered
by firms as Product does not gain any currency in service business. It
can be considered as functionality, quality, appearance, packaging,
brand, service, support and warranty.
2.4.2 Price
Peter and Kerzner (1997) have argued that price is the easiest aspect a
competitor can battle on during competition. However they also clarified
that business with a significant cost advantage and reserves can never
be easily matched. Don and Beth (2009) have also argued that Price has
become increasingly irrelevant as markets are becoming very
aggressive and in turn makes pricing attractive but no longer a profit
statement. This is also aided by consumers who have more choice and
resistant to prices. Shay and Cynthia (2009) mentioned that price can be
defined as the value on audience member pays for to experience the
brand. Price can be considered as an investment on the certain item or
product a customer is willing to pay. Price can be considered as list
price, discounts, financing, leasing options and allowances.
2.4.3 Promotion
Allan (2009) has indicated that promotion is talking about the different
ways a product can be marketed. He further mentioned that promotion is
the communicating tool to reach audience other than pricing. Promotion
adds value to product being marketed. One of the primary goals of
promotion is to escalate the perception of the product, firm or brand.
Michael, Fredile and Terry (2010) defined promotion as a key pillar to the
4Ps which is referred to terms such as promotions and promotion
activities which can be confusing. Both are different but relates to getting
to the general targeted audience. And in turn gain audience trust which
builds loyalty between the products to customer. Promotion can be also
considered as advertising, public relations, message, direct sales, sales
media and budget
2.4.4 Place
Place refers to products being available where ever and when ever
customers need them. Place also refers to the physical distribution of the
product concerned including storing and transportation. (Charles, Hair
and Carl, 2011)Place is at times referred to as Distribution which is also
carries the same terms as Place. Distribution decides the quantity to be
produced for the place according to geographic location. (Gitman and
Carl, 2008)The product needs to define its needs in order to fulfil as a
product which a place or person requires. Once this is established, the
Place can be determined. (Phil Stone, 2001)Distribution is essential in
Place marketing. Distribution activities should be programmed within the
choice of marketing channel. The distribution activities are programmed
primarily consisting of activities aimed at development and maintenance
of the relationship with retailing organizations and physical distribution.
This ensures that products are available at point of purchase. (Herbert
and MacFie, 1996). Place can be referred to as locations, logistics,
channel members, channel motivation, market coverage, service levels,
internet and mobile.
options to be used in order to stamp out the need to have the first
impression. The model is named as an engagement model. The aim of
the model is to provide quality service with or without a product at
optimum levels to customers. At the same time to fine tune the
commitment level and control. The level of investment required is also to
be controlled via the model which will look at capitalising on maximum
satisfaction fulfilled with cost savings initiatives. (Caresoft, 2012)
Chapter Three:
Research Methodology
3.1 Introduction
Branding is defined by Kotler and Armstrong as a combination of name,
term sign or design developed to identify a product or service provided
by a seller or a group of sellers. At the same time it helps to differentiate
them from each other to compete and excel in a market. There are
studies which have been conducted to learn and analyze the relationship
between Branding and its success. But there are also evidences that this
fact could be contradicting. Kapferer (2008) has mentioned that Branding
alone has no immediate effect as mentioned by Kotler and Armstrong.
Just Branding without emotions leads to lesser effect of Branding is their
argument. Thus we can determine that Branding has mixed reviews from
its users. And there is a need for certain elements to be present for
3.2 Hypotheses
Hereby, the research is going to hypothesize that there is positive effect
of Branding which does have impact on customer loyalty therefore
emphasizing for a fast food Brand to be more Branding conscious in
order to achieve customer loyalty. Such emphasis should lead to
Branding as their core business strategy.
Hypothesis - Branding positively affects the customer's loyalty in Fast
food names in Singapore
Parsa and Francis (2002) have underlined that quality service has been
undertaken by fast food outlets since the time it was introduced in
Singapore as entrepreneurs followed up on the success it gained in the
western countries. And in no time it was appreciated in Asian countries
such as Singapore. Quality service has not just been a differentiator but
also a aggressive tool to attract and retain customers.
correct tools and path for the ultimate results. Such plan or strategy
leads research proper.
Research Design
A structured approach to data collection that nearly and economically
addresses the research question, answering the hypothesis or resolving
the argument involved
Exploratory
Information-gathering
Critical Incident assembly
Descriptive
Market Research
Case Study
Systematic examination of mode of operations
Casual
Survey
Time-sampling
Before-after
Controlled Experiment
Choice of Method
A particular, systematic and orderly approach for the collection and
analysis of data, so that information can be derived
Approach to Generalization
Sampling
Replication
(Associated with Case Study Method)
Choice of Technique
Figure 1.5: Elements of the Research
Design Process
3.3.1 Qualitative Research
Qualitative research is beyond issues of subjective meaning and towards
issues of language, representation social organization. A method to build
links between social sciences traditions. (David,2004) Norman and
Yvonna (2011) have stated that 'the open ended nature of the qualitative
research leads to a perpetual resistance against attempts to impose a
single, umbrella like paradigm over the entire project' . Such methods
are used for theory building instead of theory testing. It's a collection of
data or information from observation, informal, unstructured and in-depth
interviewing, and participant observation. David (2009) has emphasized
that interest in subjectivity and the authenticity of human experience is a
exemplary of Qualitative research.
3.4.1 Services
When it comes to service, the fast food outlet should be able to provide
adequate information on their services provided. Satisfaction of
customer should be always met by the fast food outlet. Customers tend
to patronise other fast food brands when their regular fast food outlet
lacks in the service they require. Bad experience has never come across
when first choice fast food outlet is visited. Change of outlet for in the
name of convenience sake. Regular updates via mass media by the
outlet.
3.4.2 Branding
Branding strategies by the outlet is satisfactory. Ideas by patrons with
regards to Branding should be taken into consideration. Fast food outlet
should show responsibility by making its health facts public. Choice of
outlet has good branding strategies. Choice of fast food outlet
accessibility concerns. Price of product is competitive. The promotion
efforts are attractive. The end product has met its needs.
presented. The SPSS method will be used to compile all data and
information which will be presented and analyzed.
Variables
Frequency
Percentage
Mode
Gender
Female
31
47%
Male
Male
39
53%
Total
70
100%
Variables
Frequency
Percentage
Mode
Age
>60
4
6%
18-30 Years
18-30
41
58%
31-60
25
38%
Total
70
100%
Variables
Frequency
Percentage
Mode
Nationality
Foreign National
7
10%
Singaporean
Permanent Resident
13
20%
Singaporean
50
70%
Total
70
100%
Variables
Frequency
Percentage
Mode
Status
Student
20
29%
Corporate
Self Employed
4
6%
Government
5
7%
Corporate
27
39%
Other
13
19%
Total
70
100%
Variables
Frequency
Percentage
Mode
Education
Post Graduate
5
7%
Diploma
Undergraduate
13
19%
Diploma
44
64%
Secondary
7
9%
Primary and Below
1
1%
Total
70
100%
Variables
Frequency
Percentage
Mode
Annual Income
(SGD)
>80k
6
8%
50K - 70K
11
16%
30K-50K
24
29%
>30K
18
26%
Others
11
20%
Total
70
100%
Variables
Frequency
Percentage
Mode
Fast Food Names
MacDonald's
13
17%
MacDonald's
KFC
11
15%
Long John Silver's
10
13%
Burger King
9
14%
MOS Burger
2
4%
Texas Chicken
6
9%
Subway
8
11%
Popeye's
7
10%
Wendy's
4
7%
Total
70
100%
Source: Result Summary of SPSS used for the purpose study
Figure 1.7
Statement: You feel your Fast Food Brand takes health of customers' as
priority
food names for convenience sake or taste. Indirectly this percentage had
aided Branding in a way as they revisit the same fast food name for
'taste' and visit the same name in the name of convenience. Branding
has still prevailed.
Variables
N
Minimum
Maximum
Mean
Std.
Deviation
Services
70
1
5
3.35
0.95
1) All Services
provided with
70
1
5
3.64
1.014
respondents brand
2) Happy with Brand
70
1
5
3.61
.752
services
3) Another brand
70
1
5
3.16
1.080
services are used
4) Problem with
services of first choice brand
70
1
4
3.04
1.006
5) Brands are
responsible towards
70
1
5
3.51
.816
society and
environment
6) Change the brand
70
1
5
2.96
1.049
if it was convenient
7)You receive regular
70
1
5
3.55
.963
updates/newsletters
from your bank
Branding
70
1
5
3.19
0.85
1) Your brand
undertakes branding
70
2
5
3.74
.634
activities
2) You support your
70
2
5
3.38
.688
Brands' activities
3) You would like to
be more involved in
70
2
5
3.41
.773
the brands' activities
4) You have
aided in your
70
1
5
3.04
1.077
brands branding activities
5) You have
70
1
5
3.20
.994
Customer
70
1
5
3.82
0.73
Retention
1) Branding is an
important criteria
70
2
5
3.36
.785
2)
Prices are an
important criteria
70
1
5
4.23
.710
when choosing a
brand
3) Quality of service
is an important
70
1
5
4.17
.663
criteria
4) Image of brand is
70
1
5
3.52
.779
an important criteria
Customer Loyalty
70
1
5
3.79
0.65
1) You would
continue with your
brands as they
70
2
5
3.58
.651
Enhance Branding
activities
2)
You would
publicise your brand
70
1
5
3.86
.670
for their Branding
3) You are proud of
your brand for
70
3
5
3.96
.527
Performing Branding
Activities
4) You would
recommend your
70
2
5
3.77
.789
brands to others due
its Branding success
Source: Summarised from results of the SPSS test for the purpose of
this study