CUSTOMER EQUITY DRIVERS AND ITS EFFECT ON CONSUMER LOYALTY

Abstract

Competition in the retail sector is very tight today, forcing companies to use the right strategy to maintain customers in the long run. The main purpose of this study is to discuss the importance of customer equity in affecting trust, consumer satisfaction, and loyalty. By using the theory of customer equity, this study tries to analyze the importance of companies to capture customer values, create consumer trust, and satisfy consumers in order to have long term customer loyalty. Data was collected through offline surveys with a structured questionnaire. A sample of 210 respondents was recruited using a purposive sampling method. To verify the hypotheses, the study employed SmartPLS. The study results found that only value equity effect on trust. Meanwhile, brand equity and relationship equity partially did not influence trust, but simultaneously customer equity driver impact on trust. Trust and satisfaction positively influence loyalty, meanwhile, trust does not affect satisfaction.