Factors affecting brand loyalty in online versus offline stores

By Priya Chetty on April 9, 2020

Brand loyalty highlights the extent to which customers are devoted to the products or services of a company and also explains their tendency of selecting a brand over others (East, et al., 2005). Brand loyalty is an important aspect for all businesses as it influences the majority of the metric which are considered important. With brand loyalty, businesses ensure that consumers keep coming back which is critical for the success of the business.

Strong consumer loyalty facilitates the business to grow bigger with a higher profit margin (Griffin & Herres, 2002). If the company enjoys strong brand loyalty then it also explains its strong consumer retention approach. The cost of retaining a consumer is lower than the cost of acquiring a new consumer.

The factors that influence brand loyalty in online stores are customer satisfaction level, website design, customer risk perception, transaction security and customer support (Naputupulu & Aditomo, 2015). And the factors that influence brand loyalty in offline or brick and mortar stores are service or product quality, convenience, availability of the product, and price (Rajaguru & Matanda, 2006).

The convenience of online stores influence brand loyalty

Consumers generally select online stores for their shopping because of the convenience and ease of use factors associated with it. The elements which enhance the convenience level of the consumer while shopping online are:

  • information availability of the products,
  • time-saving, 24 * 7 shopping facility,
  • convenient product navigation,
  • less expensive due to heavy discounts and,
  • less shopping stress (Al Karim, 2013).

The ease of use factor explains the comfort level consumers have while browsing different products and services from any place (Shafiee & Bazargan, 2018). Therefore, website design is an important factor in sustaining brand loyalty among consumers (Chuang, et al., 2016). A growing number of studies find that website design should take into consideration emotional, functional, and symbolic dimensions in order to give the shopper a holistic experience. Various attributes of a website are linked to a positive shopping experience and service quality, which translates to brand loyalty (Tsai, 2017).

If the website design is not up to the expectations of the consumers and creates hindrance while they browse through products or services then it shapes up a bad experience. This eventually pushes them away to competitors and affects brand loyalty (Jeon & Jeong, 2017).

Customer risk perception promotes brand loyalty

Customer risk perception is a key factor that impacts the brand loyalty of online stores (Behravan, et al., 2012). Four types of perceived risks can be associated with online shopping:

  1. financial risk,
  2. product risk,
  3. no delivery risk and,
  4. convenience risk (Ariff, et al., 2014).

The risk perception of the consumers related to online shopping impacts the attitude of the consumers and thus, it influences the buying behavior of the consumers towards online shopping.

The ease with which payments can be made in online stores have changed the perception of consumers. Transaction security or financial risk remains a major concern for online businesses. Effective e-transaction boosts trust among the consumer and positively impacts consumer loyalty (Yang & Yuan, 2018).

Customer support plays a major role in enhancing brand loyalty by helping customers with their grievances such as product returns. In case when consumers are not satisfied with their purchase the positive role of customer support minimizes the product and delivery risks (Ding, et al., 2011). Customer support ensures that the queries and issues of the consumers are sorted out as soon as possible so that the customer satisfaction level remains intact and thus influencing the brand loyalty of the online stores (Naputupulu & Aditomo, 2015).

Product attributes influences brand loyalty in offline stores

Product attributes like physical appearance remain the top priority among many consumers. If the physical appearance of the product is not up to the standards of the consumer then they will move on to the next store (Yuen & Chan, 2010). Normally consumers like to rebuy a product that meets their required standards and expectations. When an offline store continues to provide its consumers with same product attributes, then the consumers are more likely to return to the same store for their purchases. There are five dimensions to attract shoppers to offline stores and they are:

  1. easy return and exchange policy,
  2. problem-solving salesmen,
  3. personal interaction with the salesmen and,
  4. reliability of a physical product (Nguyen, et al., 2016).

These dimensions of service quality are the influential factor to enhance consumer loyalty towards offline stores (Yuen & Chan, 2010).

Immediate availability of a product is a convenience

Shopping experience facilitated by the offline stores is one of the key determinants of brand loyalty and it depends on the immediate availability of the products (Rintamäki, et al., 2006). Availability of wider range of products is another factor that increases brand loyalty towards offline stores. 

Consumer loyalty towards a brand has been categorized under four different segments and they are convenience-seeker, contented, committed and captive (Rowley, 2005).  The fact that the consumers are not inclined towards a particular store but they prioritize their convenience level and that’s the reason behind their repetitive shopping from a nearby store. Convenient store location influences the repurchasing behavior of the consumers (Carpenter & Moore, 2006).

Product price promotes brand loyalty

One of the important factors that impact brand loyalty of the consumer towards offline stores is the price (Bridson, et al., 2008). The price of the product is often seen as the imperative indicator that influences the consumer’s decision related to store choices (Moore & Carpenter, 2006). Even the selection of the product is done by the consumers based on its prices (Romaniuk & Dawes, 2005).

The rising popularity of online shopping

The surge of online stores and their implications have resulted in the development of strong connection with the new-age consumers. Easy payment options, higher convenience level, easy delivery options, heavy discounts, a wide product range has given a more competitive advantage to online stores over offline stores.

Through facilitating quality shopping experience to their consumers, offline stores are competing with online stores and ensure long-lasting loyalty. On the other hand, a strategy such as focussing on the satisfaction level of the consumers is prioritized by the online store to ensure long-lasting loyalty from the consumers.


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Priya is the co-founder and Managing Partner of Project Guru, a research and analytics firm based in Gurgaon. She is responsible for the human resource planning and operations functions. Her expertise in analytics has been used in a number of service-based industries like education and financial services.

Her foundational educational is from St. Xaviers High School (Mumbai). She also holds MBA degree in Marketing and Finance from the Indian Institute of Planning and Management, Delhi (2008).

Some of the notable projects she has worked on include:

  • Using systems thinking to improve sustainability in operations: A study carried out in Malaysia in partnership with Universiti Kuala Lumpur.
  • Assessing customer satisfaction with in-house doctors of Jiva Ayurveda (a project executed for the company)
  • Predicting the potential impact of green hydrogen microgirds (A project executed for the Government of South Africa)

She is a key contributor to the in-house research platform Knowledge Tank.

She currently holds over 300 citations from her contributions to the platform.

She has also been a guest speaker at various institutes such as JIMS (Delhi), BPIT (Delhi), and SVU (Tirupati).