Service Quality and Brand Image on Customer Loyalty

Relationship Marketing is a form of marketing that evolved from direct response marketing; it places emphasis on building longer-term relationships with customers rather than on individual transactions. Relationship marketing involves an understanding of customers' needs and wants through their lifecycle and providing a range of products or services accordingly. The term relationship marketing was popularized in the 1980s when the focus of marketers started to switch from customer acquisition to customer retention (Gronroos, 2012).

The concept was strongly influenced by reengineering theory, which was gaining currency at the same time. Organizations undergoing reengineering became structured according to complete tasks and processes rather than functions. Thus, cross-functional teams should be responsible for a whole process, from beginning to end, rather than having the study go from one separate functional department to another. Traditional marketing is said to use the functional department approach, which is now deemed too limited to provide a usable framework for assessing and developing customer relationships (Chen, 2013).

Price is the monetary cost for a customer to buy products or services. It is the critical determinant that influences customer buying decision. Customers usually select their service providers strongly relying on perceived price. How much consumers are willing to pay differs due to their different needs and wants. Thus, the price perceptions to the same service or product may differ among individuals. Higher pricing perceived by consumers might negatively influence their purchase probabilities (Peterson, 2012).

A service is a process consisting of a series of more or less intangible activities that normally, but not necessarily always, takes place in interactions between the customer and service employees and/or physical resources or goods and/or systems of the service provider, which are provided as solutions to customer problems (Morgan, 2014).

Brand concept has been frequently discussed in marketing literatures. Brand building is not only an important driving force for marketing physical products, it is also a vital issue for service firms. Brand image was defined by Tseng (2014) as perceptions about a brand as reflected by the brand associations held in consumers memory.

Palmer, (2015) also argued that the customer loyalty is the main key towards the success and failure of every company which can be only achieved by providing the desired level of quality products and services to them that have an ability to efficiently satisfy their needs and wants. The author also argued that when once a company increase a number of their potential customers their cost continuously decreasing and they are able to gain sustainable competitive edge on their competitors and maximize their sales, revenue and profit margin.

Fontenot (2014) states that loyalty is a continuous process that starts from some cognitive beliefs and ends on the final purchase of a product or service. Increasing the satisfaction level of customers and making them loyal to specific brands is the main important objective of relationship marketing (Agarwal, 2012).

Initially in the literature the main focal point of marketing researchers were to understand customers to become able to efficiently satisfy their needs and wants to compete their competitors while in recent literature it has been observed that relationship marketing is the main key of increasing the customer loyalty and found as an important determinant of long term profitability (Akrofi, 2013).