How customer value affects customer loyalty in milk tea market in China?

Abstract

In a competitive setting of the Chinese milk tea market, to increase customer loyalty is quite essential. Factors affecting customer loyalty varies, such as customer value and customer satisfaction. To address this issue, this study examines the relationship between customer value, customer satisfaction and customer loyalty. Switching cost, as an important factor, is also tested in this research as the moderator on the relationship between customer satisfaction and customer loyalty. The results of this research are derived from the customers of Yidiandian, a powerful milk tea brand in China. The results indicate that milk tea companies that strive for customer loyalty should focus primarily on customer value and customer satisfaction. In the Chinese milk tea market, functional value, emotional value, and social value are especially essential. The moderating effects of switching costs on the relationship between customer satisfaction and customer loyalty are significant when the level of customer satisfaction is above average. In light of those major findings, this study provides managerial implications for customer loyalty in the setting of the Chinese milk tea market.