Satisfaction, image and loyalty : new versus experienced customers

Purpose - Customer satisfaction and image are important factors for service companies because of their impact on loyalty. Although much research has looked at the relationship of both of these factors individually, little is known about them when they are considered together. Furthermore, experience with the service or product has largely been neglected in this line of research. This paper aims to undertake a first step to fill this gap. Design/methodology/approach - This research, with data from one of Europe`s most modem night-train companies, employs structural equation modelling to test the proposed hypotheses. Findings - Differentiating new customers from experienced ones, the results show that for new customers satisfaction is crucial whereas image plays a much smaller role in terms of loyalty. For experienced customers, however, the importance of satisfaction decreases whereas the impact of image increases. Research limitations/implications - Satisfaction and image were both measured by a single item. Although they show high face validity, the findings should be replicated using a multiple-item approach. Future research should also consider distinguishing between transaction-specific satisfaction and cumulative satisfaction. Practical implications - This paper concludes that customers` experience plays a decisive role in predicting loyalty. Managers should therefore be aware of the level of their customers` experience and may even consider developing different retention programmes tailored to the level of customers` experience. Originality/value - This research proposes an integrative model of satisfaction, image, and loyalty, and analyses the impact of experience within this model. It is pioneering work that empirically investigates the relationships between these constructs.