| Abstract |
Purpose - In a fiercely competitive industry, credit card issuers need to develop a loyal customer base and motivate their card holders to use their cards at a sufficient level to assure profitability. The purpose of this article is to propose a consumer model of customer loyalty in the credit card industry. Design/methodology/approach - A model of customer loyalty incorporating service quality, value and involvement is developed theoretically and validated empirically through SEM using data collected from a global sample of 114 credit card holders. Findings - The loyalty model proposed was validated, showing that the independent variable, i.e. customer involvement, had path loadings of 0.32 and 0.26 on quality and value, respectively, while both service quality and value had direct effects on loyalty, with path loadings of 0.30 and 0.51, respectively. Research limitations/implications - Customer involvement has been shown to directly influence both service quality and value, and it should be further investigated for its effect on sustaining relationships, as well as a variable for segmenting customers. Practical implications - In order to develop sustainable relationships, marketers of credit cards should leverage involvement in their customers by employing strategies such as branding, positioning, and attractive and flexible frequent use benefits. Further, credit card customers desire high service quality, but at an affordable cost, therefore making value a prime consideration for achieving loyalty. Originality/value - This study has identified "involvement" as an independent variable that provides stability and sustainability to the firm-customer relationship. Despite its pertinence, this customer characteristic that may be also used to segment customers has not been investigated in prior quantitative studies. |