Brand loyalty for domestic and global brands: A case of Thai fast-moving consumer goods

Abstract

The purpose of this research was to study potential differences in the formation of brand loyalty for domestic and global brands in Thai consumer groups through brand equity, consumer satisfaction, and country of origin effects. The study compared two well-known brands of a consumer product (shower gel), one of which presented as a local brand and the other of which had global branding. (Both brands are in fact manufactured by the same company and have similar functional and quality characteristics.) A convenience sample of Thai consumers (n = 400) was selected from shopping centers in and around Bangkok for a consumer survey about brand image and perceptions of the two brands. Factors in the formation of brand loyalty were then explored using structural equation modelling. The analysis showed that the effects of brand awareness and brand associations were similar for domestic and global brands. However, domestic brands had higher effects from customer satisfaction than perceived quality, while this relationship was reversed for global brands. The implication of this study is that domestic and global brands may be evaluated differently by consumers in some contexts, even if they are functional substitutes for each other. Consumers placed more emphasis on perceived quality than the brand experience for global brands. This could create problems for domestic brand marketers and those developing new domestic brands. However, this study only included a single product category. These results cannot be generalized across all consumer categories.