Measuring customer loyalty with multi‐item scales: A case for caution

Abstract

Purpose: The contemporary interest in customer loyalty has resulted in a proliferation of multi‐item scales containing an aggregated mix of items that appears to reflect different aspects of loyalty. The most common application of this aggregation approach is to include two specific loyalty facets, repatronage intentions and word‐of‐mouth intentions, in the same loyalty measure and to proceed as if they reflect the same underlying construct. The purpose of this paper is to examine – and question – this practice in conceptual, methodological, and empirical terms. Design/methodology/approach: Two empirical studies in service settings were conducted and multi‐item measures were used to collect data on repatronage intentions, word‐of‐mouth intentions, and satisfaction. A structural equation model approach was used to compare an aggregated measurement approach with an approach which models the two loyalty constructs as two separate factors. Findings: The results indicate that repatronage intentions and word‐of‐mouth intentions can indeed be seen as two discrete constructs. Practical implications: The results indicate that caution is called for when the investigator is measuring customer loyalty with multi‐item measures. Indeed, the lumping together of such facets as repatronage intentions and word‐of‐mouth intentions is likely to conceal significant aspects of loyalty per se and its relation to other variables in the nomological net. Originality/value: Only a very limited number of existing studies measure customer loyalty with multi‐item scales and with an explicit assumption that several discrete facets of loyalty exist.