Determining predictors of brand loyalty in the South African wine industry

Abstract

The South African wine industry is becoming more competitive, as there is a significant variety of wines and wine brands available to consumers. This makes it difficult to gain loyal consumers and build long-term relationships with them. Wine brands, therefore, need to determine those aspects that influence consumers' loyalty, in order to develop the appropriate marketing and branding strategies to build long-term relationships with consumers. Branding and brand strategies have been established as tactics to gain and retain loyal consumers and build long-term relationships with them. Branding and brand strategies assist in gaining an understanding regarding what influences consumers' loyalty towards a business. If a business implements a suitable branding strategy, it will be able to improve its brand, leading to consumers becoming satisfied with the brand, ultimately resulting in loyalty. The primary objective of this study was to investigate brand identity, brand value, perceived quality, and brand trust as predictors of satisfaction and ultimately brand loyalty within the South African wine industry. A quantitative descriptive research design was followed, implementing non-probability convenience and judgement sampling. The data was collected by means of self-administered questionnaires given to respondents in the Western Cape Province who were older than 18 years, and consume wine more than once a month. The sample size included 260 responses. Structural equation modelling was used to test the formulated hypotheses, indicating that brand identity, perceived brand value, perceived quality and brand trust statistically significantly predict satisfaction, and satisfaction statistically significantly predicts brand loyalty. A confirmatory factor analysis and Cronbach alpha test were conducted to confirm the constructs' validity and reliability respectively. Considering the results, a model is proposed that directs South African wine brands' brand identity, perceived brand value, perceived quality and brand trust that can be used to enhance consumers' satisfaction toward the brand, which should ultimately result in them becoming loyal towards the brand. Thus, for wine brands to be able to achieve loyalty among their consumers, they need to enhance consumers' satisfaction towards their brand, which can be done by improving their brand identity, perceived brand value, perceived quality and brand trust. In order for wine brands to improve their brand identity, they need to differentiate their brand. To improve perceived brand value, wine brands should have reasonable prices. To improve perceived quality, wine brands should ensure that they are the best brands in the market. To improve consumers' trust in the wine brand, the brand should be dependable. Lastly, to improve consumers' satisfaction towards the wine brand, they need to present consumers with what they are looking for. Recommendations for future research consist of working together with wineries and liquor stores to gain access to their consumers for primary data collection. Researchers should also consider making use of larger sample sizes, and include more provinces. Online surveys can be used, as they are more user friendly, cost effective and less time-consuming. Lastly, the model provided in this study can be used in other studies, economies or industries to test how reliable, relevant and applicable this model is.