The moderating effect of brand trust on the relationship between customer brand engagement and brand loyalty for local car brands in Malaysia / Nurul Aqmar Zaidun

Brand loyalty has become a primary goal for a company in today's business environment due to intense market competition. Globalisation and competitive market have directed the business to cope with several challenges and keeping customers happy and maintaining a long-term relationship with the customers have been two valuable business strategies. The advancement of Web 2.0 has given the customers the power to choose due to more choices to consider. Easy access to the information of any brands is not limited to product, also on the prices and services offered. Therefore, companies need to engage with customers, as this may result in brand loyalty. Thus far, it remains as challenging issues in this modern business era due to intense competition despite managers' effort emphasising customer loyalty. Brand loyalty is a customer's inclination to buy a specific brand over and over again. It has become an indicator of companies' marketing achievement in many industries for many years and a focal issue in academic marketing research. Hence, it is believed that brand loyalty is a solution to a substantial and long-term competitive advantage for the business and has proven to be significant in assisting the company's profitability in the long run. However, it is becoming increasingly difficult to ignore that the companies are having difficulties retaining their customer because attracting new customers may increase the marketing cost compared to retaining the existing ones. Although previous researchers have examined the relationship between customer engagement and brand loyalty, the area of customer brand engagement is still scarce and lacks the empirically-based studies appraising its essence. Also, brand trust is recommended to be re-tested to confirm the robustness of the significant moderation effects. This study survey is conducted using online. 279 usable cases for analyses and were collected from two local car brands in Malaysia; Proton and Perodua. The data were then analysed using SPSS and Smart PLS. Also, this study adopted two types of higher-order models; repeated indicator approach and the two-stage approach. The findings of this study have indicated that customer brand engagement positively and significantly influences brand loyalty. Meanwhile, brand trust negatively influences the relationship of customer brand engagement and brand loyalty. Therefore, it has made a significant contribution by examining the relationship between brand loyalty and customer brand engagement and tested the moderating effect of brand trust. Furthermore, the findings could assist the managers to formulate a thoughtful analysis of their current strategies and determine how effective they are in building brand loyalty, improving customer brand engagement as well as building trust relationship. For instance, the companies should work to understand which types of engagement have the most significant impact in growing customer value of engagers, as well as customer value of those engaged by other customers. This further implies that the companies should prioritise relevant engagement for their businesses. As a way of learning from the experiments, a prioritisation and categorisation will be possible to improve strategic decisions on how to ensure brand loyalty as well as the best engagement method to gain customer trust.