Image, brand relationships and customer value : Exploring the moderating role of advertising spending- and labour-intensity in customer loyalty

Purpose – While service brands are conceptualised as being both the company’s presented brand and the customer’s relationship experience, most research to date has supported the central role of the latter over the former in creating customer value and developing loyalty. Studies supporting the central role of relationship experience have relied on classification schemes that have been developed around the role of employees. In contrast, the purpose of this paper is to propose and test the effect of two new moderators, namely advertising spending- and labour-intensity (LI), in predicting the impact of company image and employee trust. Design/methodology/approach – Four contexts (banking, internet provider, insurance and hairdressing) were selected based on their advertising spending- and LI, and a multi-group structural equation modelling technique was employed to test for differences between contexts. Findings – Company image and employee trust were found to have a significant impact on customer value and loyalty perceptions, with considerable differences in patterns across the chosen contexts. This study has confirmed that differences in advertising spending intensity can explain discrepancies in the relative influence of customer value and loyalty drivers across multiple service industries. Originality/value – The findings of this study shed new light on the results of previous studies that relied solely on classification schemes and which supported the primary importance of employee-customer interactions for service brands. Ultimately, this research can help managers better understand the driving forces of their business.