The role of brand preference and loyalty on performance of service providers in the Malaysian mobile telecommunications industry

Author: Iloka Benneth Chiemelie
Published: 30th August 2015

0.1 ABSTRACT

Purpose: there have been numerous reports that link brand loyalty and preference to overall performance of organization as it creates increased repurchase intention and recommendation from customers. The purpose of this research is to understand the role played by brand preference and brand loyalty on the performance of service providers in the Malaysian mobile industry.

Design / methodology / approach: this research is primary based; with data for prove of hypotheses gathered via online survey. The choice of online survey is to offer responders from all over the world to participate in contributing to the overall quality of the research. The gathered data were analyzed with SPSS – factor analysis and multivariate regressions were conducted to prove the hypotheses.

Findings – the analyzed data revealed that brand preference and loyalty increases repurchase intention, increases the possibility of customers to recommend the products to other people, reduces price sensitivity, increases passion towards the product and increases higher perception of value from the product. As such, these findings are in line with the theories in this paper that links brand preference and loyalty to increased profitability in the Malaysian mobile telecommunications industry.

Originality / value: the findings offer important implications for the support of theories on brand preference, brand loyalty, and customers’ perception of value in the mobile telecommunications industry.

Keywords: brand loyalty, brand preference, Malaysian mobile telecommunications industry

Paper type: Dissertation for the award of BA (Hons) in Business Administration

CHAPTER 1

INTRODUCTION

1.1  BACKGROUND

It has been reported that the Malaysian mobile telecommunications industry has witnessed high growth since 2004 as a result of fierce competition between major players in the industry to enhance their individual market shares (Mohd and Khairul, 2010). The intense competition between the brands have resulted in price ways and adopting of numerous marketing and pricing strategies geared towards improving the rate of mobile phone adoption in the country (Mohd and Khairul, 2010). The high growth in the industry has also been linked to high penetration of prepaid services which was introduced into the country in the late 1990s.

The prepaid services are highly affordable and convenient, and these qualities have increased the penetration of mobile phones in the less affluent and teenage segment of the Malaysian markets (Khairul Akmaliah et al., 2008). The Malaysians less willingness to adopt wired (PC-based) internet communication systems like e-mail have also been regarded as another reason why wireless communication is advancing in the Malaysian market. Khairul Akmaliah et al. (2009) also attributed Malaysians desires and value for an opportunity to be socially connected with friends and family as another reason why devices (such as mobile phones) that offer such opportunity will be highly welcomed in the market.

Although it has been acknowledged by numerous literatures that the Malaysian mobile telecommunication industry is witnessing tremendous growth, none of these literatures have tried to study the antecedents of brand preference and loyalty in this growth. As such, the purpose of this paper is to analyse how after effects of brand preference and loyalty influence financial performance and overall business growth in the Malaysian mobile telecommunication industry.

1.2 IMPORTANCE OF STUDY

It has already been indicated in the background analysis that the Malaysian mobile telecommunications industry has witnessed tremendous growth since inception, and numerous researchers have been enacted to address the after effects of customer loyalty and brand preferences in the mobile industry. As such, this paper is significant for a number of reasons in line with the above statement.

1.3 RESEARCH PURPOSE

As stated earlier, the purpose of this research is to evaluate the antecedents of brand loyalty and preferences in the Malaysian mobile industry. In order to achieve the research purpose, this paper will address the questions contained in the research question as a way of meeting the research objectives. Based on the purpose of this study, the objective can be stated as:

1.3.1 Research objectives

1.      To understand whether brand image is an important determinant of customer loyalty in the Malaysian mobile industry.

2.      To understand the antecedents of brand preferences

3.      To understand the antecedents of brand loyalty

4.      To understand how the antecedents of brand preference and loyalty can help increase profits for services providers in the Malaysian mobile industry

1.3.2 Research questions

1.      Is brand value an important determinant of customers’ loyalty in the Malaysian mobile industry?

2.      What are the antecedents of brand preferences and loyalty in the Malaysian mobile industry?

3.      How do these antecedents improve financial performance and overall business growth in the Malaysian mobile industry?

1.4 LIMITATIONS

There are few limitations to this paper, and all are related to the scope of study. Although this paper can be stated to be significant in its attempt to understand how the antecedents of brand loyalty and preferences influences profit maximization in the Malaysian mobile industry, the scope is too small and doesn’t offer high in-depth. While there are numerous factors that might contribute to profit maximization in businesses, this paper only focuses on the antecedent of brand preference and loyalty. Additionally, the focus is only on the Malaysian mobile industry. Thus, the scope is limited and this is a limitation to the study because it doesn’t create room for applicability in order industries or considering other factors that can influence profit maximization.

1.5 ORGANISATION OF STUDY

Figure (1): How the research will be undertaken

As illustrated in the figure (1) above, the research will follow the four steps above. Firstly, a literature review will be conducted to highlight theories related to the topic in order to aid understanding of the whole research. Secondary, primary data will be gathered from people across Malaysia and analysed in relation to the topic. The third step will involve proofing hypothesis which will be stated in the literatures. Finally, the fourth approach will involve discussing the findings as it’s related to the literatures review, and evaluating the proven hypotheses. As such, this paper will involve both primary research and desktop research. 

CHAPTER 2

LITERATURE REVIEW

2.1 CHAPTER INTRODUCTION

This chapter will present a review of literature on all the topics to be discussed. In this chapter, the Malaysian mobile telecommunication service industry will be review in relation to how they develop preference and loyalty towards their brands, the concept of branding and customers relationship management, and the effects of these concepts on financial productivity and business growth of a company.

2.2 FRAMEWORK FOR REVIEW

Figure (2): Framework for literature review

The framework for the literature review will follow the pattern of: 1) presenting an overview of the Malaysian telecommunications industry, the business strategies adopted in the industry, market size and trends, and competitiveness. 2) How customers choose a particular brand over others will also be review in relation to factors that encourage brand preference, branding and marketing strategies adopted in the industry, and the antecedents of brand preference in the Malaysian mobile telecommunications industry. 3) The final section of the literature review will involve addressing the context of brand loyalty in the Malaysian mobile telecommunications industry, in relation to strategies adopted by companies in the industry, brand assets management, competitive strategies, and antecedents of brand loyalty in the industry.

2.3 BRIEF HISTORY OF THE MALAYSIAN MOBILE TELECOMMUNICATIONS INDUSTRY

The Malaysian Post and Telegraph Department had the responsibility of providing all telecommunications services in Malaysia before 1946 (BursaMalaysia, 2002). With the creation of Telecommunications Department in the Country the same year, the postal services were separated from telecommunications services. In 1968, both the postal services department and telecommunications services department were combined together to form the Department of Telecommunication Malaysia (Telekomunikasi Malaysia (JTM)) (BursaMalaysia, 2002).

In 1987, the responsibility to provide telecommunications services were transferred from JTM to Syarikat Telemnkom Malaysia Berhad, and the company was publicly listed in 1990. The company assumed its current name (Telekom Malaysia Berhard) in 1991. As a means of ensuring that the company’s policies are in line with government policies, the Malaysian government retains majority of the company’s shares (BursaMalaysia, 2002).

Telekom Malaysia introduced mobile telecommunications service in Malaysia in 1985, and since the introduction, the government of Malaysia has gone ahead to license numerous other private sector telecommunications services providers in line with the government’s desire to develop the country’s telecommunications services and advance its infrastructure.

SIZE OF THE MOBILE TELECOMMUNICATIONS INDUSTRY IN MALAYSIA

The mobile telecommunication industry is one of the fastest growing industries in the country, and this is because mobile phones have become Malaysians most favourable way to communicate as is experienced in other parts of the world. The main driver of growth in the industry is the mobile phones segment with its high subscribers’ base, increased international calls, and increase in multimedia services and mobile phone data usage (AHK, 2011). The introduction of 3G phone is also playing a significant role in the industry as it provides computer application on mobile phones.

It has been projected that the revenue of the mobile phone segment will grow at the rate of 6% per annum from 2008 to 2013. There is also a boom in mobile data such as text messaging, and it is also expected to grow at the rate of 6% per annum. The SMS traffic clocked 57 billion as of 2007, and the figure further increased to 73 billion in 2008, before eventually exceeding the 100 billion bench mark in 2010. Additionally, high tech phones are now easily affordable and telecommunications service providers now offer quality data plans and internet services that give customers the best experience since inception (AHK, 2011).

Figure (3): The market shares of major mobile telecommunications providers in Malaysia

Source as re-adapted from: AHK (2011)

From the figure (3) above, it can be seen that Maxis is the market leader with a share value of 39.9%, followed by TM-Celcom with a share value of 34.4% and Digi with the third largest market share in the Malaysian mobile telecommunications industry. besides these three players, there are also other services providers such as Umobile, but the above analysis is only an illustration of the top three market leaders in the industry.

A recent survey by the Malaysian Communication and Multimedia Commission (MCMC, 2010) revealed that Malays make up 60.8% of the overall subscribers in Malaysia, followed by the Chinese at 235, the Bumiputra Sabah/Sarawak and Orang Asli at 8.3%, Indians at 6.3%, and others at 1.6%. The same survey also shows that 71.5% of the users have only one phone, while the remaining 28.5 person have more than one phone.

Figure (4): GDP contribution of the Malaysian communication and multimedia industry

Source as adapted from: SKMM (2011)

From the above figure it can be seen that the mobile telecommunications industry play a significant role in Malaysia’s GDP growth with its 6.3% contribution to the country’s economic growth. Thus, this industry is significant for both economic growth and business development in the country.

2.4 ANALYSIS OF THE ANTECEDENTS OF CUSTOMER LOYALTY IN THE MOBILE TELECOMMUNICATION INDUSTRY

Customer loyalty is a gained trust that exists between a producer and consumers, with which the consumer view the products to be superior to the competitors. Usually, the outcome of loyalty is continued and repetitive purchase. This is beneficial for the organization because it increases their revenue generation and profit maximization. However, the question still remains as to what are the factors that influence customer loyalty? What factors make customer trust a brand above its competitors? There have been possible answers to these questions, but the most reoccurring answers are those that will be discussed in this paper.

2.4.1 Service quality

Although there is no consensus on the measurement and conceptualization of service quality (Carman, 1990), there is an agreement on the concept of service quality being the judgment a customer expressed about the overall excellence of superiority of a service (Zeithaml, 1988). In order to better describe service quality, it is important to state the general characteristics of a service. These characteristic are:

1.      Services are intangible;

2.      Services are heterogeneous – which means that their performance always varies in accordance with the service provider and the customer seeking the service;

3.      Services cannot be placed in a time capsule, and as such cannot be tested or re-tested over time; and

4.      The production process in services is usually not separate from their consumption (Gronroos, 1990).

As a result of these features, the evaluation of service quality is not easy. Also, the evaluation can be linked with service delivery process and output (Cody and Hope, 1999).

On a general note, service quality is viewed as being very important for profitability, and the success of a firm. There are two views that explain why service quality is important and the first is that service quality is seen as one of the very few ways for service differentiation and gaining competitive advantage that attracts new customers and contributes to the overall increase in market share of a given corporation (Venetis and Ghauri, 2000, p. 215).

Secondly, service quality increases customer’s desire to repurchase the same products, to buy a different product from the same company, to become less price-sensitive with products offered by the company, and to recommend the product to other people based on favourable experience (Venetis and Ghauri, 2000, p. 215). For example, Bloemer et al. (1998) and Jones et al. (2002), stated that there is a positive relationship between service quality and repurchase intention, recommendation, and resistance to better alternatives. All these aspects of repurchase intention, recommendation and less price-sensitivity are attributes of customer behaviour towards a brand. Thus, it can be stated that the quality of services influences customer’s loyalty towards a brand.

2.4.2 Trust

Emphasis was made by Anderson and Narus (1990) that trust occurs when one party believes in the possibility of another party’s actions yielding positive results for itself. As such, in order for customers to trust a brand, they must perceive the brand as being of positive quality.

Trust has been recognizes as an essential element for establishing relationship between commitment (Morgan and Hunt, 1994) and then customer loyalty (Gundlach and Murphy, 1993). It is obvious that when a party trust the other, that party will likely develop positive attitudes towards the trusted party. Therefore, when a customer trusts a brand, it implies that the customer is likely to form positive attitude (in the form of purchase intention) towards that brand (Lau and Lee, 1999).

In view of the above statement, trust is important for establishing investment by working together for business exchange between partners, resisting attractive short-term alternative in favour of expected long-term benefits with staying with a partners, and seeing potentially high risk actions as being worthwhile because of the level of trust gained from previous experience (Morgan and Hunt, 1994). As such, it has been stated that positive relationship exists between trust in a firm and customer’s loyalty towards products offered by the firm (Chaudhuri and Holbrook, 2001; Lau and Lee, 1999).

Doney and Cannon (1997) made the suggestion that the establishment of trust is done through a calculative process that involves the ability of a party to continually meet the expectations of another party in a comparison between the reward gained and the cost of staying with that particular party. As such, trusting a brand should not be associated with only perceived positive outcomes, but it should be believed that these positive outcomes will continue to be obtained in the future. Thus, the quality of service will influence the trust towards that service

2.4.3 Corporate image

This is described as the overall impression a customer used to match a firm in his or her mindset. (Barich and Kotler, 1991). Nguyen and Leblanc (2001, p. 228) made the claim that corporate image is related to the physical and behavioural aspect of a firm, such as business name, architecture, products and services offered, and the impression of quality communicated by the staffs of the company.

Corporate image is the outcome of a process (MacInnis and Price, 1987). The process comes from ideas, feelings and consumption experiences with a firm that are gotten from the memory and worked into a mental image (Yuille and Catchpole, 1977). In that case, corporate image is the outcome of evaluation processes. Even though customers might not know the firm, information gotten from advertisement and word-of-mouth will be used to form the corporate image.

Fishbein and Ajzen (1975) argued that attitudes are functional in relation to behavioural intentions that are used to predict behaviour. Therefore, corporate image as an attitude influences behavioural intentions like customer loyalty (Johnson et al., 2001, p. 224). Nguyen and Leblanc (2001) also demonstrated that corporate image positively influences customer loyalty in three sections telecommunication, retailing and education). The same relationship is demonstrated by Kristensen et al. (2000) for Danish postal services and by Juhl et al. (2002) for the Danish food retailing sector.

From the above statements, it can be seen that corporate image is produces from customer’s consumption experiences, and the quality of services that is used to function the consumption experience. Therefore, how a customer perceived the quality of services offered by a firm will directly influence how he sees the corporate image.

2.4.4 Switching costs

Porter (1998, p. 10) presented the definition of switching costs as the cost the buyer will have to face for switching from one service provider to another.  As an addition to objective measureable monetary costs, switching cost can also be linked to time and psychological efforts involves in facing the uncertainty of dealing with a new service provider (Bloemer et al., 1998, Klemperer, 1987). Therefore, switching cost is somewhat customer-focused (Shy, 2002). In that hand, switching cost can be defined as the cost that discourages customers from purchasing from a rival brand.

Jackson (1985) described switching cost as the total of economic, psychological and physical costs. The economic or financial cost is a kind of sunk cost that seems to appear when the customer changes his or her brand (Klemperer, 1987).  Procedural switching costs are from the process of customers’ purchase decision making and their implementation of the decision. Thus, it can be stated that the cost of switching from one brand influence customers’ loyalty because customers will be less willing to switch to another brand if the associated cost of doing so is more expensive than the cost of staying with the brand

2.4.5 WHAT ARE THE ANTECEDENTS OF BRAND LOYALTY IN MOBILE TELECOMMUNICATION INDUSTRY?

From the above analysis, brand loyalty has been identified as being vital for increased profit maximization through increased revenue generation. This is because, when customers are loyalty to a brand, they are less willing to switch to another brand irrespective of associated benefits that might emanate from such switch.

Therefore, the antecedents of customer loyalty in the mobile industry will be increased repurchase intention, increased trust and reduced possibility of switch intention. When customer associates brands in the mobile industry as offering high quality services that meet their requirement in a service, the customers will gain high trust towards the brand. This gained high trust means that the customer will develop passion and loyalty towards the brand, and in essence, the customer will continue to use the brand in expectation of continued benefits. Definitely when customers are purchasing the same particular brand, it becomes very obvious that the brand will continue to maximize its profits because of increased and sustainable sales.

2.5 ANALYSIS OF THE ANTECEDENTS OF BRAND PREFERENCES IN THE MOBILE TELECOMMUNICATION INDUSTRY

Judging from contextual review, there seem to be a lack of consensus on the definition of brand preference and limited empirical research on the antecedents to, or the factors that influence, brand preferences. In that case, the research presented in this paper has been informed by different contributions on branding and brand strategy, and also previous works in relation to factors that influence brand preference.

In order to understand the antecedents, firstly, the definition of brand preferences needs to be established. A number of authors have viewed brand preferences in different ways, and establish different relationship between brand preferences and other branding variables. For example, Keller (2003) stated that preference is an antecedent of brand loyalty and brand equity, while Chang and Ming (2009) defined brand preference as a consequence of brand loyalty and brand equity. Other authors (e.g. Rundle-Thiele and Mackay, 2001) use brand preference and brand loyalty interchangeably. For this study, brand preference will be defined as an antecedent to brand loyalty. Many authors (e.g. Keller, 2003; Jamal and Good, 2001) do not offer a definition of brand preference. Hellier et al. (2003) offered a definition of brand preference and operationalize its measurement. Hellier et al. (2003)’s definition will be adopted for this study, and they defined brand preference as the extent to which the customer desires a specific services provides by the company currently used, in relative comparison to the services provided by other companies being considered.

Mitchell and Amioku (1985) explored the different factors that might result in brand preference, and they conceptualized brand preference to be a result of different attributes which makes a customer to favour one brand over others. These attributes have been classified into three sets as: customer attributes, product attributes and market attributes. A number of authors have also established reference to brand preferences as yielding positive outcomes in relation to certain branding variables, such as brand equity (Chang and Ming, 2009), reference group (Escalas and Bettman, 2003), advertising (Ayanwale et al., 2005), self-image congruence (Jamal and Good, 2001), and re-purchase intention (Hellier et al., 2003).

In view of that, it can be stated that brand preference yield a similar result to companies as brand loyalty. This is because, brand preference is an outcome of brand loyalty and it implies a customer choosing a particular brand over its competitors. When a customer prefers (choses0 a brand of the other, it is expected that the decision must have been made based on past positive experiences and expectation of the positive experience to continue. Thus, the antecedent is the same as brand loyalty in the sense that the company will be able to maximize profit through increased and sustainable sales. 

2.6 RESEARCH HYPOTHESES

From the above discussion, it can be hypothesized in this paper that:

HP1. Brand image, trust, and quality of services are important determinants of brand preference and loyalty.

HP2. There are other variables besides brand preference and loyalty (such as advertisement, cost of services, and post service experience) that can also influence profit maximization in the Malaysian mobile telecommunications industry.

2.7 KEY FINDINGS FROM LITERATURE REVIEW

The literature review above has been successful in describing the concepts of brand loyalty and preference. It was identified that both elements yield the same result. Brand loyalty on its own is customer desire to stick with a particular brand as a result of experienced positive results, while preference is customer decision to choose a particular brand over its competitors. From the overview presented, it can be seen that brand loyalty and preference are similar because the both address the idea of customers choosing a particular products over its competitors as a result of positive outcomes experienced from choosing that particular product. In the view of that, it was noted that the antecedent of both factors will be increased profit as a result of increased and sustainable sales. This is because, when customer are loyal to – or prefer a brand, they will continue purchasing that brand because they have associated positive influence experienced from previous consumption. Thus, in the end, the company will generate more profits because of sustainable sales. This is also applicable in the Malaysian mobile industry where it can be stated that increased brand loyalty and preference in the industry will result to increased profit maximization because the customer’s loyalty and preference towards a brand means that they purchase the brand frequently and increases the revenue generation by the company, as well as sustainable business growth.

CHAPTER 3

RESEARCH METHODOLOGY

3.0 INTRODUCTION OF THE CHAPTER

In this chapter, the method to be adopted for primary research will be discussed. This will include the data gathering format, data coding and analysis format as well as the format for prove of hypotheses. This section will contain an explanation of all necessary tools that will be adopted for the primary research.

3.1 RESEARCH FRAMEWORK

Figure (3): the framework for the research

The framework for this research is as shown above. Data will be gathered through online survey, and these data will be used to analyze how the antecedents of brand loyalty and preferences increases profit in the Malaysian mobile industry. The choice of online survey is because it offers in-depth in the sense that participants can come from all over the world.  

3.2 DATA COLLECTION

The questionnaire for this research was designed by following guidelines from other related researches previous conducted (the questionnaire is available in appendix 1). A pilot test was conducted by distributing the designed questionnaire to online users via FreeSurveyOnline.com. The pilot test was conducted in order to test whether the choice of online survey will be right for this research in terms of data quantity and quality. Survey was chosen as the preferred data gathering method because it can easily be read and generalized, and it incorporates studies that are based on present situations (Churchill and Iacobucci, 2005). Surveys also provide researchers with the opportunity to access high variables (Ma, 2007). Additionally, surveys are convenient, fast and a cost effective data gathering method (Zikmund, 1999). It also reduced the biases associated with other form of data gathering such as interview. In order to determine the right sample size for this research, Roscoe’s Rule of Thumb (Roscoe, 1975; cited in Sekaran (2003)) was utilized as the guiding criterion. The rule states that the sample size must be bigger than the sample components by a high margin. Therefore, a sample of 20 questions targeted to 120 responders is considered appropriate for the research, because 120 is greater than 20 by 6 times. Once the sample size has been determined, and the survey developed, the survey was hosted at www.FreeOnlineSurvey.com for data gathering. The reason for choosing online survey is because it offers participants from all over the world the opportunity of contributing to the studying by sharing their workplace experience as related to perception of organizational politics and its effects on job performance. Once the survey has been hosted for contribution, responders were made aware of the survey through Google advertisement and advertisement on FreeOnlineSurvey.com for its registered members to participate.

3.3 MEASUREMENT

A self-addressed questionnaire was adopted in the research, and responders were to answer the questionnaire by choosing between either totally agreeing or totally disagreeing with each question from a 3-point rating likert scale method. The adoption of likert scale method is because it is the most commonly used rating scale method in business research, and it offer responders the opportunity of being more precise with their responds.

Table (1): adopted likert scale rating method

Yes	Not sure	No
1	2	3

The table (1) above illustrates the rating scale adopted for the research. An introductory note was drafted for the responders to understand how the scale will be used for answering the question. The inclusion of an introductory demonstration was to ensure that responders did not answer out of ignorance; rather, they based their response from full consciousness of their contribution to the overall quality of the research.

3.4 RESPONDERS’ PROFILE

Basically, the criterion set for responder’s profile are that responders must be at least 13 years old; can be any gender or race; must understand what brand loyalty and preference is all about; and must be residing in Malaysia.

3.5 CODING AND ANALYTICAL INSTRUMENT

The data was electronically coded with IBM SPSS data analyzer. Since the study was conducted only, coding was easier because it can directed be pasted from the database to the SPSS system. The idea of copying and pasting the data from the database directly into the SPSS system ensured a higher level of efficiency and reduced the level of human error (e.g. typing) that might have impacted on the overall quality of the research. While 120 questionnaires were answered, only 100 was adopted for analysis because the outstanding 9 contained more than 1 unanswered questions and it was believed that inclusion of these questionnaires will impact on the quality of the overall research as they will create missing links with the answered questions.

3.6 GOODNESS OF MEASURE

In order to validate the overall quality of data gathered, they will subject to factor analyses. A principle factor analyses was used to dismantle the huge associated variables and pin-point the main factors to the used for prediction purposes in the preceding multivariate and regression analysis. Additionally, a scree plot was used to highlight the main variables for consideration. The main components for consideration were determined through their Eigenvalues that are greater than 1, and only 7 of the analyzed components meet this specification. The significance point for this research is 0.60 but the Kaiser-Meyer-Olkin Measure of Sampling Adequacy was 0.624, and this demonstrates the high value of data gathered for analyses. The Bartlett’s Test of Sphericity was highlight significant at 0.00. As suggested by Hair et al, (1998), selected factors and components were grouped and discussed appropriately.

To further prove the goodness of data gathered, reliability test was conducted with Crombach’s Alpha. Sekaran (2003) stated that reliability over 0.80 is good; those within the range of 0.70 are acceptable and reliability below 0.60 is not good. The data gathered for this research were above 0.70, thus laying down a good base for further analysis and prove of hypotheses.

3.7 LOADING

The objective of this research paper is to evaluate how the antecedents of customer loyalty and brand preferences help service providers in the Malaysian mobile industry to maximize profit. As such, the variable: antecedents of customer loyalty, brand preference, and profit maximization in the Malaysian mobile telecommunications industry where loaded into the 10 questionnaires designed for this research.

3.8 ANALYSIS OF FINDINGS  

The findings from this study were also analyzed. The analysis involves presenting an outlook on what customers think about the antecedents of brand loyalty and preference, and how it influence profit maximization in the Malaysian mobile telecommunications industry. The analysis is also linked back to the theories discussed in the literature review, in order to reveal any finding that is similar to or contradicts with existing theories. Stated hypotheses were also proved in this section.

3.9 ETHICS OF DATA GATHERING AND ANALYSIS

Since the whole data gathering process was via online survey, little worry was raised in link to the ethics involved in data gathering. This is because, the online platform set standard guidelines for responders to follow and offered necessary help for solving all difficulties the responder might experience. There was no case of data gathering biasness as the responder was under full control of his or her self, and had the right and opportunity to respond exactly as he or she fells without any interruption from the interviewer.

On the analysis part, it became clear that ethics was essential for maintaining the quality of the research and either proving or disproving the stated hypotheses. Thus, as stated earlier on, the gathered data were directly copied from the database and imputed into the SPSS system for analysis. Thus, there was no change in the data gathered as related to the data analyses. Ethical principals were always put into full consideration during the whole data analysis section.

3.10 LIMITATIONS OF CHOSEN METHODOLOGY

The components of online survey is a common topic of discussion in numerous literatures (for example, Fricker and Schonlau, 2002; Furrer and Sudharshan, 2001; Ilieva et al., 2002; Malhotra, 2004; McDaniel and Gates, 2005; Tingling et al., 2003; Wilson and Laskey, 2003) and some of the weak-points of online survey can be considered as limitations to the overall quality of this research. These limitations are discussed below.

3.10.1 Skewed attributes of internet population – not until recently, the internet was considered as being true representatives of the overall population. However, studies that question the real representativeness of online survey to the general population has emerged, suggesting that the internet is not a real representative of the overall population (for example, Fricker and Schonlau, 2002; Grossnickle and Raskin, 2001; Miller, 2001; Ray and Tabor, 2003; Wilson and Laskey, 2003). This is a limitation especially for this research because the 120 responders in real sense cannot be considered to be a true representative of the global population and other factors such as differences in culture, lifestyle and management system can also influence the perception of organizational politics and its impact on job performance. Job performance on the other hand can be measured in different ways and be said to mean different things to difference people. Nevertheless, Fricker and Schonlau (2002) stated that this difference in terms of representativeness of the internet population to the overall population is closing in and can be considered as being insignificant in the near future.

3.10.2 Sample selection and implementation - research have frowned heavily on the choice of online survey as a data gathering option, because of the fact that samples cannot really be determined by the interviewers. For this research, the man limitation is representativeness of samples. This is because, unintended responders can pretend to be have meet set criterion and contribute, while in reality they don’t meet the set criterion. Qualified responders on the other hand can input wrong information due to social or psychological pressure. For instance, responders who have been victimized but suffered little negativities can input that he or she suffered high level of associated negativity due to the psychological pressure that the responder might still be facing. However, Kulp and Hunter (2001, p. 35) associated this limitation as with low significance level, by saying that it can also be possible with offline surveys.

3.10.3 Responders lack of online expertise – although the internet adoption is increasing growing, it has been noted that the majority of the internet population is made up of users who have not used the internet for several months (Greenspan, 2003). Thus, the responders’ skills might be lacking on understanding the current survey methodology and required skills. Therefore, this can become a limitation as incompetence responders can enter results based on lack of understand and might find it difficult to delete mistake based inputs.

3.10.4 Technological variations - both differences in the responders’ computer device and their internet connection can influence the quality of the research. This is because, the model of software used are different and the higher the model the quality of information presented to its users. Thus, questions that are properly arranged might appear disorganized in lower computer versions (Ray and Tabor, 2003) and this can affect the overall quality of research and responders might not clearly understand the question being asked. Other technological factors such as electricity and dialup speed can also determine whether the responder will be able to finish the question or forced to drop out of the survey as a result of inconveniences caused by these technological factors.

3.10.5 Interpersonal issues – as compared with offline interview, there is no direct contact between the responder and the interview and it can influence the in-depth of the research conducted to a great extent. This is because, lack of contact between the responders and interview limits the possibility of in-depth probing that is commonly used in offline survey to gather more information (Scholl et al., 2002). Brown et al. (2001) supports this argument by stating that telephone interview offer greater opportunities for responders to pause and reflect on the questions being asked before presenting sound answers. Thus, responder might be forced to drop out of the survey if they face any difficult and don’t seem to find the perfect solution to the difficulty faced.

Although numerous limitations have been highlighted as to how the quality of the research might be affect, it must be noted that different measures have been put into place to ensure that the expected negative effects does not occur. Such measures include a 24/7 support system, where responders can contact the interviewer via email or phone contact to verify any issue or difficult faced during the survey. An introductory page is also provided advising the responders on how to about with the study and urging them not to participate if they don’t meet any of the set criterions as it could impact the overall quality of data gathered.

                                                                       CHAPTER 4

DATA ANALYSIS

4.0 INTRODUCTION OF THE CHAPTER

In this chapter, all the data gathered will be analyzed and used to prove stated hypotheses. The data analysis will both factor analyses and descriptive analyses. The factor analyses will focus primary on testing as well as proving the reliability of gathered data, while the regression analysis will focus on proving stated hypotheses.

4.1 RELIABILITY TEST – CRONBACH’S ALPHA

Computing the reliability of gathered data is important in order to prove the overall importance of the research. Alpha was developed by Lee Cronbach in 1951 as a tool for measuring the internal consistence of a test (Mohsen and Reg 2011). Test of reliability brings all gathered data together and analyze them against their variables, providing response patterns and factors in order to determine if the data is significantly reliable. The score of 0.50 or 50% will be adopted as the measure of reliability for this paper. If the reliability test scores above 0.50, the whole data will be considered reliable, but if the score is below 0.50, the data will be considered unreliable.

Table (2): Test of reliability

Case Processing Summary
		N	%
Cases	Valid	103	92.8
	Excludeda	8	7.2
	Total	100	100.0
Listwise deletion based on all variables in the procedure.

This gathered data has been proven to be reliable from the table (2) above because it not only meet the stipulated 0.50 score mark, but it exceeded it by an additional 0.129 which makes the overall reliability score to be 62.9%. Eight questions were missing from the main analysis, and these questions are part of an incomplete survey. 8 responders had at least one unanswered questions in their questionnaire, but the outstanding 19 was still included for analysis because they were still considered valuable and capable of improving the overall quality of the research. The one unanswered question has been coded with number 9 for further analysis.

4.2 FREQUENCY ANALYSIS

This section will present a frequency analysis of some of the variables studied in this research. The idea is to understand how each other these variables weigh up in terms of responder’s thoughts about their influence in the organization.

Table (3): frequency of the effect of brand image on loyalty

I am more loyal to a company with quality brand image
		Frequency	Percent	Valid Percent	Cumulative Percent
Valid	Yes	71	63.9	63.9	144.8
	not sure	8	7.2	7.2	71.2
	No	32	28.8	28.8	160.4
					100.0
	Total	100	100.0	100.0

It was discussed in the literature review that brand image is important for enhancing customer loyalty. The reason is that companies with quality brand image are viewed as capable of offering quality services. Additionally, quality brand image is a product of positive past experience that a customer accustoms with a brand. This case have been proven in the above analysis, where it can be seen that the number of responders who agree to be more loyal to brand with quality image make 63.9% of the total responders. Thus, it can be stated in view of the analysis that quality brand image is essential for increasing and maintaining customer brand loyalty in the Malaysian mobile telecommunications industry.

Table (4): responders’ thought about repurchasing based on service quality

I will repurchase more frequently from a brand that offers me quality service
		Frequency	Percent	Valid Percent	Cumulative Percent
Valid	Yes	90	81	81	200
	not sure	16	14.4	14.4	95.5
	No	5	4.5	4.5	99.1
					100.0
	Total	100	100.0	100.0

The finding from table (4), serves as a support to existing theories that link quality service to positive repurchase intention. From the literature review, it was noted that the quality of services offered is an important determinant of a consumer’s intention to repurchase from a specific brand. In view of that, it was stated that if the quality of the service is high, then the potentials to repurchase will be positive, but if the quality of the service is low, then the potential to repurchase will be negative.

The finding from the above table shows that responders are generally loyal to companies that provide quality services. This claim is based on the number of responders (83%) that agree that they will repurchase more frequently from the brands that offer them quality services.

The idea of linking quality services to loyalty and increased repurchase intention is based on the perceived value theorem. The theory if of the notion that the higher value a customer obtains from using a brand, the more loyal the customer will be. Consumers want to experience the best values at the least cost because they have unlimited wants but limited resources to satisfy these wants. Thus, offering higher value than competing brand is a good way of creating competitive advantage and increasing customers’ repurchase intention.

Table (5): what responders think about recommendation

I will recommend brands to people if i experience quality services from them
		Frequency	Percent	Valid Percent	Cumulative Percent
Valid	Yes	28	25.2	25.2	544.9
	not sure	4	3.6	3.6	28.8
	No	76	71.1	71.1	114.4
					100.0
	Total	100	100.0	100.0

Still don’t see a reason why corporations should take organizational politics serious? Well the above table (5) might give you some insight on the reason because most of the responders (71.1%) are not able to control the outcome of experienced organizational politics. Thus, they are left at the mercy of such experience and in the long run have their commitment and performance reduced.

4.3 REGRESSION ANALYSIS

4.3.1 DESCRIPTIVE STATISTICS

The first thing in regression analysis will be to describe the mean of demographic data gathered in relation to their response part. As illustrated in the table (4) below, the average age of responders is between the rage of 20 to 39 (1.87). This is because, from the statistical analyses, 1 was denoted to represent age of 19 and below, 2 represents 20 to 39, 3 represents 40 to 59 while 4 represents 60 and above.

Figure (4): race of responders

From the above analysis, it is clear that Malay have the highest response followed by Chinese, Indian and then others. This is also in line with the population statistics of Malaysia, where the Malay make up the largest ethnic group, followed by the Chinese, Indians and other natives in the country.

Figure (5): employment status of responders

Additionally, it can be revealed that majority of the responders are currently employed. This is significant for this paper because it means that the response to be gathered will be viable because on the fact that the responders are judging from current trends and status of organizational politics in their various sectors of employment.

Table (6): gender of responders

Gender of Responders
		Frequency	Percent	Valid Percent	Cumulative Percent
Valid	male	30	30.0	30.0	30.0
	female	70	70.0	70.0	100.0
	Total	100	100.0	100.0

The final element to be highlighted in the descriptive statistics is that women made up 64% of the responders. There have been recent studies that conclude women as making up the biggest gender population in online environment. If this case is true, then this finding is in line with the studies on such issue.

Figure (6): Service provider used

From the above analysis, the highest number of network based on responders’ profile is Digi, followed by Maxis, then Celcom, with Umobile maintaining the last sport. Somehow, this is significant in relation to the market share analysis above, because Digi is the largest shareholder and Unmobile holds the smallest amount of share in the Malaysian mobile telecommunications industry.

Figure (8): Purpose of using network service provider

Another discovery from this study is as illustrated in the figure (8) above. This discovery is that the main purpose why responders use mobile telecommunications services is for personal use. As such, personal use can be said to include maintaining close relationship with friends, doing personal business or accessing online information. This can be illustrated by the significant number of people who agree to use their phone for all the purpose listed. Business is the third largest with family related usage being the smallest purpose.

4.4 ANOVA

Table (8): Model Summaryb
Model		R	R Square		Adjusted R Square		Std. Error of the Estimate
1		.474a	.225		.188		.346
a. Predictors: (Constant), Gender of Responders, Average Monthly Wages / Salary, Type of Employment
b. Dependent Variable: Ages of Responders
Table (9): ANOVAa
Model				Sum of Squares		Df		Mean Square		F	Sig.
1	Regression			3.655		5		.731		6.101	.000b
	Residual			12.580		105		.120
	Total			16.234		110
a. Dependent Variable: Ages of Responders
b. Predictors: (Constant), Gender of Responders, Average Monthly Wages / Salary, Type of Employment

Table (8) above demonstrates a regression of 0.474 between the dependent variable (age of responders) and the independent variables (constants). Table (9) on the other hand illustrated a frequency distribution of 6.101 which is significantly high in relation to the dependent variable and the constants. This illustration demonstrates a linear relationship between the age of responders and their type of employment, average monthly wages / salary, and gender.

The linear relationship that exists between the dependent variables and constants is as earlier discussed in the correlation above. It was earlier stated that the older an employee is, the likely he is to be employees on full-time, and the type of job is not a determinant of the amount of pay as some part-time jobs pay higher than some full-time jobs. For instance, a part-time medical consultant is expected to be receiving higher pay than a full-time security man if both of them where to be working in the same company. This prove of correlation supported by the ANOVA test pose a new point of research in the future as these new discoveries can aid the understanding of how age and type of employment influences the amount of wage / salary receivable.

CHAPTER 5

DISCUSSION

5.1. CHAPTER INTRODUCTION

With the data gathered and analysed in the previous chapters, this chapter aims to discuss findings from the data analysis. It was stated early that the findings will be linked to existing theories. Additionally, the stated hypothesis will be proved in this chapter as well.

5.2. FINDINGS FROM DATA ANALYSIS

From the data analysis presented above, numerous findings related to theories on the antecedents of brand loyalty and preference on profit maximization has been revealed. It was shown in the findings that customers are more loyal to brand with quality services and willing to be stay with the brands irrespective of price based on the fact that responders agree to be frequently purchasing from brands that offer them quality services. Also, it was found from the study that responders are likely to recommend brands that offer quality services to other people.

Thus, it can be seen from the above revelation that the quality of services offered is highly important and directly influences the performance of service providers in the Malaysian mobile telecommunication industry because: consumers will be loyal to the brand and recommend the brand to other people. However, there is a question of differentiating service by quality considering the fact that most if not all the services providers in the Malaysian mobile telecommunication industry offer similar services. For instance, the main purpose of mobile telecommunications service providers is to offer the customers the opportunity to be connected, and all the service providers in the country do that by offering calling services, SMS services, and internet services. So how can the quality of service be measured in this case considering the fact that is no relative differences between the companies in relation to the services offered.

Well, the literature review has been successful to pin-point certain factors that can be used to differentiate service qualities in the mobile industry. Such include wide area coverage (providing services in the most primitive and rural areas of the country to keep customers connected no matter where they are); fast upload and download internet services; extra features that supports customers life such as health tips and news updates; and affordable pricing. Thus, it can clearly be seen that service differentiation is highly possible in the Malaysian mobile industry, as is the case in order mobile industries of the world. So, corporations should not be reluctant with providing these service features as clients will use them in measuring the overall benefit of services received in terms of per value of money spent.

There is still a situation of low level switch intention. Considering that this is a telecommunication service where by individuals are offered services based on identifiable personal qualities, settings and requirements, there is still a question of whether customers will really switch even if they are not getting the appropriate services in terms of per value of money spent when compared with other services providers. For instance, if a customer decides to switch from one service providers to another, the customers must forego his or her registered number and this can result in loss of contacts as not all his contacts will be able to know or get notified about the switch. In cases where the contacts are mainly businesses contacts, it can also result to loss of potentially businesses. Thus, the associated alternative that must be foregone for the customer to successfully switch to another service provider discourages them from doing so because of potential loss of important contacts. Additionally, there seems to be little price differences in terms of per value costing of services provided in the Malaysian mobile industry as all service provider seems to offer similar costs. For example, it cost 5 to send SMS within same network and 10 per SMS to different networks in Celcom, Digi and Maxis. All these factors put together discourages the customer from switching service providers.

However, the importance of providing quality service and maintaining good customer relationship through value added products and services must not be overlooked as all these factors put together cannot serve as a discouragement if customers begin to view the services offered by a service provider as being below par in relation to other customers. No matter the factors that might have been highlighted above, it is still very important to ensure that customer get best value in the per price investment on services as it is the only way to really keep them loyal. Therefore, services providers in the Malaysian industry are advised to look into the antecedents of customer loyalty and preference as discussed about as it has a direct influence on their overall performance. Where customers are offered high value at lowest cost, they will be loyal to the brand and always prefer it amongst its competitors. Additionally, the paper discovered that they will also have a high tendency of recommending the service providers to other customers.

CHAPTER 6

CONCLUSIONS

6.1. CHAPTER INTRODUCTION

In this chapter, this paper will look back at all the contents provided above, and summarize it in a simple way that will be easier for the reader to understand, and reflect on the findings from this paper as well.

6.2. REFLECTION ON RESEARCH OBJECTIVES

Right from the first chapter of this paper, the objective of the study was stated as: “to understand the influence of the antecedents of brand loyalty and preference on the performance of service providers in the Malaysian industry”. This topic was chosen because it has been discovered that the Malaysian mobile telecommunications industry is highly competitive and customer are now focused on per value of money spent as the determinant of how they conceive a brand to be good and choose to stay with the brand.

The antecedents of brand loyalty and preference were found to be related because when a customer is loyal to a brand, he or she will prefer the brand to its competitors; and when a customer prefers a brand to its competitor, he or she will be loyal to that brand. So why the division in the module of understanding? The reason is that both variables are measured differently. Loyalty is a product of experience, but preference might occur by just listening to adverts and word-of-mouths from peoples who have used the products or services before. It antecedents of these variables were found to be increased in value conception, increase in possibility to recommend the service provider, increase in repurchase intention, and reduction in price sensitivity. When all these outcomes merge together, the output is increase in loyalty and preference, which will result in subsequent increase in profit maximization for the firm as a result of increased sales and revenue generation.

Therefore, it is highly significant to note that the research objective has been meet as the review of literature and findings from data analysis are in line with these stated outcomes. It the concluding sections, managers in the Malaysian mobile industry were reminded of the need not to forget the important of quality service offering as it can directly be linked to their sustainable business in their firms.

6.3. IMPLICATIONS FOR RESEARCH

This paper has been successful in contributing to exiting theories and research in the sense that the findings from the paper support theories that stated brand preference and loyalty as being an important determinant of business success because loyal customers will increase their repurchase intention and it will subsequently result in increase in profit for the company.

6.4. IMPLICATIONS FOR PRACTICE

On a practical ground, it has been suggested that increasing the quality of service will directly result in increased profit generation. Therefore, managers are advised to call to mind the need to always make sure that their services are of the highest value and highly affordable as it will result in increased customer loyalty and preferences towards their brand.

6.5. REVISITING THE LIMITATIONS

Earlier in the research, it was stated that since data for this study will be collected via online survey. This method of data gathering was linked to numerous limitations such as: questions on whether the online population can be considered as a true representative of the real population, and the issues of unintended audience answering the questions or intended audience attempting more than once.

However, these issues were taken care of in the data analysis. In the case of being a true representative of the overall population, it must be comprehended that online survey is far better than offline because it allowed the research to get response from all over Malaysia, which would have been difficult with offline survey. The second issue is about unintended audience participating in the study. This issue was curbed out by programing the survey to reject any IP that is not from Malaysia. As such, it can be stated that only Malaysians answered the questionnaire because all the IPs of the responders are based on Malaysia. As such, it can be seen that the highlighted limitations didn’t implant any negativity on the data gathered.

6.6. DIRECTIONS FOR FUTURE RESEARCH

There is still a great need of importance to expand this paper. This is because, it is important to understand other factors (besides brand loyalty and preference) that impact on the overall financial performance of corporations. As such, the direction for future research should be focused on studying about other variables besides those contained in this paper.

7 APPENDICES

APPENDIX ONE – PERSONAL REFLECTION ON THE RESEARCH PROCESS

This has been an interesting paper in the sense that it has helped the researcher to gain new grounds understandings about customers’ satisfaction, brand loyalty and its antecedents. However, it must boldly be stated with pity and gratitude that undertaking this work was never an easy tasks.

Right from the beginning, the researcher faced numerous difficulties in relation to designing the approach for the research, reading through tens of journals for development of the literature review, data gathering, and data analysis. At some point, the researcher almost gave up as a result of the high degree of difficulty experienced. Such period include when the researcher was gathering data and most of the people approached didn’t pick interest in undertaking in the research. The reason behind such could be that there were no benefit given to people for participating in the survey.

Although the paper is largely associated with numerous difficulties, at the end, the researcher is happy and joyous because the benefits overweigh these difficulties. For instance, the researcher have learned more about management of customer relationship, influence of customers satisfaction on revenue generation, and factors that can be used to increase customers’ satisfaction. As such, it is at the best of the researcher’s knowledge that this paper has been able to position him as a better and reliable leader and manager.

Thus, prospective researchers that might pick interest in expanding the natures and scope of this research or going into new research with the recommended topics in this paper are advised not to be discouraged by the enormous task involved in producing this kind of quality paper, but should be rather focused on the potential benefits they will gain from completing the task in the form of increased knowledge, experience, expertise and new skills. With such note, it is concluded that this paper was slightly difficult but widely enjoyable, educating, and inspiring. Thank you very much for reading.

APPENDIX TWO – QUESTIONNAIRE USED FOR THIS STUDY

PART 1

DEMOGRAPHIC DATA

Name (s)
Gender	Male		Female
Form of employment	Full-time		part-time
Age	18 to 39	40 to 59		50 and above
How many timed you eat in a Selangorian Mamak restaurant.	4-7 times per week	1-3 times per week		At least once per month	At least once per year	Never

PART 2

PLEASE ANSWER THESE 20 QUESTIONS                                                                       

QUESTIONNAIRE:

#		1 – totally disagree to totally agree – 7
1	Service price incurred is worth value received	1	2	3	4	5	6	7
2	Will change service for better value offer
3	Current service provider was chosen mainly on price
4	Monitor usage to control spending
5	Will upgrade to expensive package if price is reduced
6	Will stay with service provider irrespective of cost
7	Willing to pay to try new and innovative services
8	Always updated with promotions
9	Services are designed to suite my needs
10	Complains and feedbacks are well handled
11	Satisfied with overall service delivery in term of coverage, connection time, hang time, quality voice/video, speed and disruption?
12	Feel over-loaded with marketing information sent by service provider?
13	Would like to receive more marketing information from existing service provider
14	Will change service provider if their customer services is not satisfactory
15	Service is charged at a lower price compared with other networks
16	Offer numerous services compared with other networks
17	Proud of the service provider in terms of their brand  image
18	Service provider is generally better than their competitors
19	Will change service provider irrespective of cost
20	Unlikely to switch to other competitor no matter what change is experienced with their service

Appendix 2: Google analytics documentation of average daily visitors to the website

Appendix 3: Result of Facebook advertisement

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